Myths and truths about Association Agreement in evolution: salaries and pensions

In July 2014, IPN News Agency carried out an awareness raising campaign entitled “Myths and truths about the Association Agreement”, which tackled the main fears related to the process of signing and ratifying this accord. In almost three years, we decided to return to the same sources and the same subjects in order to see how things changed in evolution and if the expectations that existed before the signing of the Association Agreement with the EU were met.
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If the Association Agreement is signed, the authorities will have to cut jobs and decrease wages, and people will lose their pensions”

The creation of jobs depends a lot on the economic growth in the country, while the economic growth depends on investment projects as not the state, but business entities create jobs, said Viorica Antonov, expert in social policies and development at the Institute for Development and Social Initiative “Viitorul”. “The Association Agreement with the European Union can help us attract investments and this is the most important thing that can help us overcome the economic impasse as Moldova is in an economic crisis. Owing to the ratification of the Association Agreement, all the EU member states found out the economic profile of the Republic of Moldova and this helped the foreign business entities that are less initiated in the national economy to come and know more. As a result, we have a considerable number of Italian, German, Chinese investors,” stated the expert.

Viorica Antonov noted that besides the assistance provided by the EU, national strategies for economic development and social safety need to be worked out. “In a way, I presume that this strategy that was thought up for the future, concerning the workplaces, will strengthen security on the labor force market. I refer first of all to the social insurance as the low salaries are the main cause why the people do not work. The second reason is the social security, which does not satisfy everyone. I refer here to the pension system. For these reasons, many people choose to do undeclared work, with salaries in ‘envelope’,” said Viorica Antonov.

She added that the national legislation should be in accordance with the provisions valid in the EU, while the Association Agreement helps the Republic of Moldova implement the EU norms on equal work and equal pay, based on principles of equality and equal options. There are such norms defined in the Labor Code, but they are not always respected by employers. In this regard, the employers should be educated on equal pay for equal work and eliminate the gender pay gap. This is a condition for intergrading into the EU from the perspective of the observance of human rights.

The “Viitorul” expert said the Association Agreement facilitates the creation of jobs by bringing foreign investors. At the same time, a lot depends on the homework. “It is very important that the homework on economic and social aspects should be ensured by national policies so that an investor that comes here and creates jobs is sure that he will not be caught in the trap of fiscal misunderstandings, etc. The Association Agreement facilitates the coming of investors, but a lot depends on the improvement of the situation by political instruments, strategies and national policies,” stated Viorica Antonov.

The Association Agreement made the Moldovan labor force known from a positive angle. Daily, about 100 persons leave the country with or without a contract, in search for a better life. For the European values to be implemented in the country and the people to stay home, small, but safe steps should be taken to clarify the national legislation and adjust the fiscal policies as swiftly as possible so that the business entities and workforce feel the changes and understand that things improved owing to the Association Agreement and the foreign investors that come to Moldova owing to this accord. Any association agreement is a very good positive advertising instrument of a state that wants to become a fully-fledged member of the EU,” stated the expert.

In conclusion, Viorica Antonov said they speculate a lot on Europeanism and there is a lot of populism in politics, but the European integration is first of all an economic process and a process of economic and cultural integration that brings benefits to any nation that has connection with the EU and wants to join this cultural-economic and then political union.

Alina Marin, IPN

The article on the same issue published in July 2014 is available here.

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