● Tuesday, May 31
Cheese and sour cream with foreign fats sold with reduced VAT
Several dairy companies during about eight years, until 2019, sold cheese products and sour cream with foreign fats at a reduced VAT rate of 8% instead of 20%. The Competition Council determined that as a result, the amount of taxes paid into the state budget was by almost 100 million lei lower. Moreover, there were created unfair competition conditions with regard to the companies that paid VAT of 20%. The Competition Council established that the privilege was given by the National Standardization and Metrology Institute to SA “JLC”, SA “Incomlac”, SA “Lactis” and SA “Fabrica de unt din Florești” by illegally allocating tariff positions for dairy products containing foreign fats. As a result, discriminatory conditions were created on the market for the other dairy producers.
● Wednesday, June 1
Rise in gas rates will lead to increase in food prices, opinions
Jurist Stanislav Pavlovschi called on the authorities to increase citizens’ financial capacities so that these could keep pace with the soaring prices.
“The prices grow everywhere, it’s true. But the price rises in our country are different that those in other countries. This happens because there are interests here. Some enrich themselves at the expense of the people. The pays are also important. Do we have a political force in Moldova that can solve this problem? The problem of the ruling party is that they fully isolated themselves and do not accept any piece of advice,” stated Stanislav Pavlovschi.
The representatives of PAS blame the crisis in the region for the state affairs and note that the Government will try to partially subsidize the natural gas rates.
Energocom extends contract with MGRES for one more month
The joint stock company Energocom has extended the contract for the purchase of electricity at the price of 59.90 USD/MWh with the Kuchurgan Power Plant (MGRES) for one more month. Furthermore, a contract for the supply of 30% of the electrical energy needed by Moldova will be signed with the Ukrainian state-run company EnergoAtom. The average price of electricity for June will be about 65.03 USD/MWh, Deputy Prime Minister Andrei Spînu, Minister of Infrastructure and Regional Development, has announced.
PM Gavrilița: Cooking oil prices haven’t increased as badly as speculated
Prime Minister Natalia Gavrilița says that cooking oil prices have not risen as much as was speculated. According to her, this is due to the fact that cooking oil has been designated a socially important product, but also due to the fact that the Government sent out a clear signal that it would not accept speculation.
“This week we saw in several store chains a decrease in the price of oil, which instead of selling 56 lei per bottle, as announced by some manufacturers, sells for 34-37 lei”, said Natalia Gavrilița.
€150 million in financial assistance from EU
The Republic of Moldova will benefit from financial assistance amounting to 150 million euros from the European Union. The Government has approved the initiation of negotiations and the signing of the Loan Facility Agreement between the Republic of Moldova, the EU and the National Bank of Moldova. The decision was taken in the context of the approval by the European Parliament and the Council of the European Union, on April 6, 2022, of the decision on granting additional macro-financial assistance to the Republic of Moldova. The document provides for €150 million in financial assistance, of which €30 million in the form of a grant. The disbursement will take place in three installments.
● Thursday, June 2
Creative potential in Moldova will be monetized by support programs
The creative potential existing in the Republic of Moldova will be monetized through support programs and through institutions that are part of the process of developing the creative industries. The cultural and creative sectors will be developed in the Republic of Moldova through the program “Creative Moldova”. A law to attract foreign investments to filmmaking and the audiovisual sector will also take effect, representatives of the cultural and creative sectors of the Republic of Moldova announced in a news conference.
Moldova sees improvements as regards public access to budget information
The Republic of Moldova has witnessed improvements as regard public access to central government budget information, according to the Open Budget Survey 2021. The budget transparency score of Moldova rose from 57 in 2019 to 65 in 2021 out of a total of 100. This means the citizens had greater access to information on how the central government raises and spends public resources, which they need to become involved in the decision-making process.
Moldovans can purchase 3.7 times less natural gas than a year ago, Veaceslav Ioniță
With an average official salary, the Moldovans can buy 459 m3 of natural gas or 3.7 times less than a year ago, said economic expert of the Institute for Development and Social Initiatives “Viitorul”, who posted a table to this effect. This way, in the third quarter of last year, a net average official salary could be used to buy 1,675 m3 of natural gas, but now, at a distance of a year, the quantity that can be bought is of 459 m3 of gas.
Changes to program with IMF related to increase in financial assistance for Moldova
Parliament adopted in the first reading amendments to two laws concerning the attraction of external foreign loans from the International Monetary Fund following the augmentation of the financial assistance for the country. The Executive Board of the International Monetary Fund (IMF) on May 11 approved an augmentation and rephasing of access under the Extended Credit Facility and Extended Fund Facility Arrangements for the Republic of Moldova. Total access under the blended 40-month ECF/EFF arrangements approved in December 2021 was increased by about US$260.11 million (SDR 194.26 million) to about US$795.72 million (SDR 594.26 million).
One fourth of salary earners are exposed to risk of financial consequences of pandemic crisis
Approximately one fourth of the salary earners are exposed to increased and extreme risks of suffering the financial consequences of the pandemic crisis, shows an analysis of the risks to the remuneration of the most vulnerable employees that was carried out by the Center “Partnership for Development” (CPD) with financial support from Soros Foundation Moldova.
Parliament sets up special inquiry committee on inflation
On the recommendation of the Supreme Security Council, Parliament has set up a special committee for looking into the inflation control decisions and monetary policy adopted over the past 18 months. The decision was adopted by 52 votes.
PAS lawmaker Radu Marian will preside over a special committee set up by Parliament to examine how well fuels market regulations work. The Communists-Socialists and the Shor Party have not delegated any members to the committee. The committee has been set up on the recommendation of the Supreme Security Council, by 52 votes.
● Friday, June 3
Law that authorizes Ltds to issue bonds adopted
The limited liability companies (Ltds) will have the right to issue bonds, as a law that was given a final reading by Parliament provides. The MPs adopted amendments to the law on limited liability companies and to the law on the capital market. The issuing of bonds will enable the Ltds to attract loans for financing the activity at domestic and foreign levels and will encourage competition on the financial instruments market, augmentation of investments and stimulation of the development of the business community.
Viorel Gherciu: Excise duties on diesel fuel could be fully refunded to some categories of farmers
Even if the wheat harvest is projected to be lower than last year, the Republic of Moldova will not face a food crisis, Minister of Agriculture and Food Industry Viorel Gherciu assured. According to him, the food prices are influenced by the prices of energy resources and the Government will provide additional funds to small and medium-sized farmers. The minister said that owing to the unfavorable weather conditions, the wheat harvest this year is expected to be lower, but the state will have enough quantities of grain for internal consumption and for export.
Bank commissions levied from SMEs on card payments will be capped
Bank commissions charged from small and medium-sized enterprises on card payments will be capped. Currently, they represent about 2-3% of the value of the transaction. MPs of the Party of Action and Solidarity propose that these should be reduced to 0.5%, but not more than 5 lei per transaction. PAS MP Dumitru Alaiba told a news conference that cash facilitates the development of the underground economy. “Promoting non-cash transactions – payments by card where it is possible - is one of the methods for gradually whitening the economy that does not force the citizens to make sudden changes,” stated Dumitru Alaiba, who heads the Parliament’s commission on economy, budget and finance.
World Banks approves new loans for Moldova and non-reimbursable contribution
The World Bank’s Board of Executive Directors has approved an Emergency Response, Resilience and Competitiveness Development Policy Operation (DPO) in the amount of $159.24 million for the Republic of Moldova. The DPO includes IBRD financing with a loan in the amount of $43 million and a concessional contribution on a non-reimbursable basis under the Global Concessional Financing Facility (GCFF) in the amount of $9.24 million, as well as an IDA credit in the amount of $107 million. Agence Française de Développement is expected to provide parallel financing in the amount of €60 million. “This budget support will help the Government of Moldova mitigate the impacts of the war in Ukraine on refugees and households, as well as build resilience and enhance competitiveness to reduce vulnerabilities to future shocks,” runs a press release of the World Bank.
Price of gasoline exceeds 32 lei/liter
The fuel prices reached new highs. For the next three days, the National Agency for Energy Regulation set the price ceiling for gasoline “95” at 32.09 lei/liter, up 0.16 lei on today. The price of diesel fuel will be by 0.20 lei higher and will be 28.50 lei/liter.
Interest rates raised
The interest rates on loans were increased and by such a move the National Bank of Moldova aims to discourage lending and excessive consumption. The interest rates on deposits were also increased so that the people are motivated to economize and not to spend. This way, the interest rate on overnight loans was set at 20.5%, while those on overnight deposits – at 16.5% a year, up 3 percentage points each.
Inflation peak could be higher than NBM forecast, governor
The annual rate of inflation grew from 22.2% in March to 27.1% in April because a number of factors overlapped each other. Besides the import component of the inflation process, an important factor that amplified inflation was the delay in adjusting the regulated tariffs, the governor of the National Bank of Moldova (NBM) Octavian Armașu told a news conference in which he presented the monetary policy decision. According to the governor, the prices of energy resources and foods products seem to be higher than the anticipated one and the inflation peak is expected to be higher than projected.
Value of remittances coming from abroad declined
Remittances from Russia almost stopped and forecasts show that the value of remittances from the EU will decline. In such conditions, this source of financing consumption will be negative compared with the previous periods, the governor of the National Bank of Moldova Octavian Armașu told a news conference. According to him, most of the central banks of the large economies, such as the U.S. and the EU, said firmly that they will resort to more robust restriction of the monetary policy. “This will definitely have an impact on the economy in those regions. In particular, we are interested in the European area. So, our anticipation is that the aggregate demand and economic activism in these regions will suffer particular stagnation. This means that we could experience pressure on remittances from there too. We speak about the development of remittances in nominal terms. In real terms, remittances in the next quarters will follow a downward trend,” stated Octavian Armașu.
● Saturday, June 4
Road freight transport of Moldova to be exempted from permits in EU
The road freight transport in bilateral and transit regime is to be exempted from permits. The road transport operators of the Republic of Moldova will be offered continuous mobility, new opportunities and freer access to the European economic market, the Ministry of Infrastructure and Regional Development announced at the official round of talks on the signing of an agreement on the liberalization of road freight transport between the Republic of Moldova and the European Union on the liberalization of road freight transport.
Iuliana Cantaragiu: Environmental permit for Rybnita steel works could be issued for five years
Minister of Environment Iuliana Cantaragiu admits that the extension of the environmental permit for the Rybnita steel works is a compromise solution reached with the Transnistrian authorities for obtaining a lower price of electricity. She said that the works already submitted the application for an environmental permit valid for a period of five years. Among the conditions for issuing this is the payment of an environmental tax into the state budget. Under the Commission for Exceptional Situations’ decision, the period of validity of the environmental permit for the Rybnita steel works was extended until June 30. At the same time, Energocom extended the contract for the purchase of electrical energy with the Kuchurgan Power Plant at the price of 59.90 USD/MWh. The minister of environment said this is a bargain that enables Moldova to benefit from cheaper electrical energy.
Igor Grosu: I want to see solutions from Moldovagaz, not only requests to raise tariffs
The Speaker of Parliament criticized Moldovagaz after its chief Vadim Ceban said that the National Agency for Energy Regulation increased the natural gas rate insufficiently and the purchase price of gas is not covered. Igor Grosu said those from Moldovagaz should act in the interests of the citizens of the Republic of Moldova and should come with solutions for overcoming the crisis not only with proposals to increase the rate.
Igor Zubcu elected president of National Trade Unions Confederation
Igor Zubcu was elected president of the National Trade Unions Confederation in the fourth Congress of the Confederation. Sergiu Sainciuc and Lilia Franț were elected vice presidents of the Confederation. The new administration was elected for a five-year term. The delegates to the Congress, who represented 24 national trade union centers, ascertained that the observance of the basic rights of salary earners, trade union members, remains a problem.
