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Chisinau should require compliance with Free Trade Agreement from Tiraspol, IDIS expert


https://www.ipn.md/en/chisinau-should-require-compliance-with-free-trade-agreement-from-tiraspol-7966_1039046.html

The companies on the left bank of the Nistru river export 40% of their products to European Union states, and the Tiraspol alleged authorities are ready to extend the Free Trade Agreement for the coming year, but Chisinau ought to insist on them respecting the responsibilities they have assumed, suggests IDIS Viitorul expert Ion Tăbârță, quoted by IPN.

During the IDIS-hosted “15 Minutes of Economic Realism”, in partnership with Radio Free Europe, Ion Tăbârță stated that the economy of the Transnistria region has been in a grave recession for the past few years. Starting with 2014, its main macroeconomic parameters have worsened. Gross Domestic Product has fallen by 7.5%, industrial production - by 20%, exports - by 26%, imports by 47%, and market consumption capacity by 21%. Population income has fallen by 33%. Meanwhile, the regional budget has managed to cover only 60% of the necessary costs.

“The Transnistrian recession can by explained by the relative lack of structural changes on the market, which has essentially kept its Soviet structure. Add to that the monopoly of the Sheriff company, which dictates all the rules,” said Tăbârță.

The expert believes that the cause of the recession is geopolitical in nature. He claims that an important detail for the region’s commerce is the Free Trade Agreement, which - in spite of the deceiving prophecies of EU goods flooding the regional market - has proven beneficial to Tiraspol, which can ship its goods to the EU without taxes and excises, thus saving a share of its economic agents.

Ion Tăbârță mentioned that Chisinau should insist on Tiraspol abiding by the provisions of the FTA. That is, Chisinau should be allowed a higher stake in the economic control of the left bank. Consequently, the Transnistria region can assume a positive economic dependence regime towards the right bank, thus creating proper conditions for social-economic - followed by political - cohesion between the left and right banks of the Nistru.