In the Republic of Moldova, even if the legislation enables the local public authorities of all levels to issue municipal bonds, none of these entities took such a step. The causes are multiple, being both legislative and investment in character or even reflated to financial infrastructure. On the one hand, the interaction with the capital market necessitates special financial and economic forecast capacities in the LPA. On the other hand, the current legal framework does not favor the issuing of and investment in municipal bonds, shows a study carried out by the Independent Think Tank “Expert-Grup” that is quoted by IPN.

The study notes that the municipal bonds play their role in the mixture of financial instruments and the most appropriate one is to finance investment projects with direct or indirect incomes or to co-finance grant projects and obtain positive financial levier. Despite particular flexibilities of bonds, the LPAs must treat their obligations in the same way as those to a commercial bank.

The simple procedures for issuing and selling municipal bonds and the reasonable costs are a basic criterion for the success of this instrument. The central authorities should be receptive to the proposals coming as a result of testing and piloting in the issuing process so as to ensure simplifications and eliminate the barriers for transforming this instrument into a comfortable one for the LPAs and investors.

Given that the good international practices suggest securing the support of the central authorities by national support programs, the implementation of a national program for purchasing municipal bonds in particular amounts is welcome. Such a program would entail minimum costs for the national budget and would provide the LPAs with financial resources at costs that can be covered by the Government of Moldova.