● MONDAY, November 5
Pace of collecting incomes into public budget was kept in October, secretary of state
Secretary of state at the Ministry of Finance Ion Chicu said that after the fiscal reform that provides concessions for employers and employees was implemented, the pace of collecting incomes into the national public budget was kept in October. The growth pace of the collected amounts decreased, but the volume of incomes did not. Small redistributions between taxes were witnessed in October 2018. Ion Chicu said the growth pace of the collected amounts decreased, not yet of the volume of collected incomes. “In general, the incomes collected all the components of the national public budget on November 1, 2018 were by almost 4 billion lei higher than the incomes collected in the same period of 2017. This confirms our forecasts that the moment was opportune for implementing such a reform. Essential, but absolutely necessary essential diminutions of tax rates can be made not in all the situations, but only when the economy grows and the surplus of the collected amounts allows such a small reserve for the next periods,” stated the functionary.
Contest of grants for developing businesses in northern Moldova
A contest of grants for developing businesses in the northern districts of Moldova was launched in Bălți by People in Need Moldova as part of the project “A new impetus for developing businesses in the North Regional Development Region of Moldova” (2017-2019). The contest is intended for small and medium-sized enterprises and submissions are accepted until November 25. According the North Regional Development Agency, the country director of People in Need Moldova Silvia Bicenco told a news conference that through the agency of the activities held within the project they aim to support the business community in the north development region. The grants are designed for members of business associations, business incubators and SMEs based in northern Moldova.
Financial reports of National Integrity Authority do not contain significant distortions, audit
The financial reports of the National Integrity Authority generally provide a correct and reliable picture, the Court of Auditors ascertained after auditing the Authority’s financial situations on December 31, 2017. A relevant report was examined by the Court in a plenary meeting on November 5. The property managed by the National Integrity Authority was valued at 35 million lei at the end of 2017. Under the 2017 state budget law, the Authority last year received allocations of 5.8 million lei from the state budget. It accumulated revenues of 72,7000 lei. The audit team established that the Authority’s accounting policy was based on a document taken from the national normative framework that wasn’t adjusted to the specific activity of the institution. This determined a number of errors when reporting the situation concerning fixed assets, their wear degree and the circulating assets.
● TUESDAY, November 6
Moldova’s Railways to purchase 12 new locomotives
The state-owned company Moldova’s Railways will buy 12 new locomotives and will renovate the depot in Chisinau. A contract providing for this was signed with the American company that won the tender contest on November 6. The company’s director Iurie Topală told the press that the last time new locomotives were purchased 40 years ago and the current locomotives are out-of-date. A sum of €45 million will go to buy the locomotives and to repair the depot. The first locomotives will be delivered at the start of 2020. Iurie Topală also said that the locomotives are renewed as part of the process of reorganizing the state-owned company Moldova’s Railways. A tender contest for renovating the Bender – Basarabeasca – Etulia – Giurgiulești railroad will be announced soon. The €110 million project to restructure Moldova’s Railways is financed by the European Bank for Reconstruction and Development, the European Investment Bank and the European Union.
● WEDNESDAY, November 7
Igor Dodon: Russia could offer Moldova US$1bn for infrastructure projects
The Russian Federation could offered the Republic of Moldova US$ 1 billion for repairing roads, President Igor Dodon stated in a special edition on NTV channel . He said he discussed the possibility of obtaining massive support for infrastructure projects with his Russian counterpart Vladimir Putin. “The access to this support, which will consist of a loan and grant aid, offered by the Russian Federation, the Eurasian Union, is a very clear perspective for the Republic of Moldova,” stated Igor Dodon.
First ethno-tourist complex with Gagauzian specific inaugurated in Congaz
The first tourist complex with Gagauzian specific from Republic of Moldova was launched in Congaz village of Comrat district. Besides four traditional peasants’ houses with walls made of clay and roofs made of reed, the ethno-tourist complex “Gagauz Sofrasi” hosts a museum, cellar, national style restaurant with terrace, as well as a mini-hotel and an events’ hall, IPN reports, quoting a press release of UNDP. Complex owner Ana Statova employs 14 villagers. To develop and promote this complex, the owner benefited from mentoring and a grant of €18,500 from the European Union, through the SARD Program, implemented by UNDP.
● THURSDAY, November 8
Bill on Târgu Mureș–Iași–Ungheni highway passed in Bucharest
A bill to approve the building of the Iași-Târgu Mureș highway called the Union Highway was adopted by the Chamber of Deputies of Romania as the decision-making body on November 7. According to Agerpres.ro, the bill initiated by MPs of the People’s Movement Party and signed by representatives of all the parties provides that the Union Highway starts at Romania’s border with Moldova by a bridge over the Prut and ends by a connection to the A3 Brașov – Borș highway near Târgu Mureș city. The Union Highway will be financed with state budget funds through the Ministry of Transport, with foreign loans and non-reimbursable European funds and/or through a public-private partnership.
IDA lends €30 to Moldova for Land Registration and Property Valuation Project
The International Development Association, which is a member of the World Bank Group, will lend Moldova €30.1 million for implementing the Land Registration and Property Valuation Project. Parliament on November 8 ratified the relevant financing agreement. Dorel Noroc, division head at the Ministry of Finance, said in Parliament that the loan will be provided in the form of an investment project in concessional conditions, repayable in 30 years. The grace period is five years, while the interest rate is fixed and is 1.38% annually. €15.3 million will be used to register land, while €5 million to valuate property. The land administration system will get €7.8 million in financing for strengthening its capacities. Other means will be used to strengthen the project management capacity.
Retail trade based on patent would be possible in 2019 as well
The deadline for trading based on patent that expires on December 31, 2018 could be extended until December 31, 2019, in accordance with an amendment to Article 4 of the Law on the Entrepreneur’s Patent that was approved by the Cabinet. The Ministry of Economy and Infrastructure explained such a move is needed given the slow transition to independent activity or other legal forms of entrepreneurship. On the other hand, the patent limits the consumer’s right as this cannot exercise the right to replace the purchased goods if they turned out to be of a poor quality. In order to develop economic activities and to improve control over the mentioned risks, the legal framework was modified in January 2017 by introducing a new legal form of entrepreneurship - independent activity. This form enables to start a business in a simplified way. The authorities established that only 1,500 trading private individuals migrated from patent to independent activity during January 2017 – September 2018. Over 9,100 patents for retail trade were still valid this September. The Ministry of Economy and Infrastructure in 2019 intends to implement a series of measures to encourage the switchover to independent activity.
● FRIDAY, November 9
2019 state budget provides for expenditure of 47.6bn lei
The draft state budget law for 2019 was approved by the Cabinet in its November 8 meeting, IPN reports. The costs for social protection were raised by 2.2 billion lei. Besides the financing of the new measures aimed at socially supporting persons on low incomes and elderly persons, financial resources will be allocated for improving the policies to support the families with children and to protect the children in situations of risk. The 2019 budget will keep the investment component. Over 3.5 billion lei will go to implement projects financed with foreign funds. About 66 projects financed with foreign funds will be under implementation next year. The most important of these refer to road infrastructure. There will also launched new projects in education and agricultural development.
Pavel Filip: No salary in budgetary sector will be lower than minimum subsistence level
The budget - funded employees will have higher pays and the current salary system will be reformed so as to ensure a continuous rise in the incomes of salary earners, stated Prime Minister Pavel Filip, commenting on the draft law on the unitary salary system in the budgetary sector that was approved by the Government. “The document will contribute to creating a transparent, equitable and attractive salary system that will remunerate the professional performance of employees from each area of activity,” stated the Premier. Under the reform concept, the salary will consist of the fixed part and the variable part. The variable part will depend on the employee’s performance and particularities of the job. The law guarantees the keeping of the salary raised until now if a salary lower than the previous one is set for an employee in accordance with the new salary rules.
Amendments made to law on voluntary declaration and fiscal stimulation
The tax paid into the state budget from the voluntarily declared amounts of money will rise from 3% to 6%. Parliament on November 8 amended the law on voluntary declaration and fiscal stimulation. Speaker of Parliament Andrian Candu said the amendments were agreed with the International Monetary Fund and the World Bank following missions of experts that came to Moldova after the initial law was adopted. The persons who were or are subjects of assets and personal interests declaration according to Law No. 33 on the declaration of property and personal interests cannot be subjects of voluntary declaration of assets. The same applies to the family members – husband or wife, minor child, including the adopted one, or the person maintained by the subject of declaration and also live-in lovers.
DCFTA at four years of implementation in Moldova
Owing to the implementation of the Deep and Comprehensive Free Trade Agreement (DCFTA), which forms part of the Association Agreement with the European Union, Moldova’s exports of agrifood products to the EU rose by 44% and Moldovan producers’ competitiveness improved as a result. This also had important macro-social effects. However, to be able to fully benefit from the DCFTA, a stable economic and political farmworker should exist and more attention should be devoted to the export of products of animal origin by modernizing the quality infrastructure. Also, the advantages of the DCFTA should be popularized in the business sector, economic expert Adrian Lupușor stated when presenting the analysis of the impact of the four-year implementation of the DCFTA. The analysis shows that after four years, the European Union became the most important and reliable commercial partner for Moldovan producers. €2 of €3 won from Moldova’s exports comes now from the EU, as opposed to €1 of €2 in 2014, which is a net growth of about €367 million in exports.
“PARE 1+1” program extended until 2021
The program to attract remittances to the economy for developing small and medium-sized enterprises “PARE 1+1” was extended until 2021. The Cabinet on November 8 approved a bill to this effect. Minister of Economy and Infrastructure Kiril Gaburici said the program showed that it can help augment productive investments in business activities in Moldova coming from remittances. It also supports the migrant workers on their return to the country and the families that are maintained by remittances. The approved bill facilitates the procedure for applying to the program, extends the list of participants, optimizes the set of necessary documents, etc.
Information campaign to facilitate access to one-stop shop of permissive documents
An information and awareness-raising campaign to facilitate the private sector’s access to the one-stop shop of permissive documents (authorizations, certificates, etc.) will be carried out with the World Bank’s support. The subject was discussed by the Government’s secretary general Lilia Palii and representatives of the World Bank. According to the State Chancellery, the information campaign will facilitate the creation of an environment that will favor the development of SMEs and the national economy. The interlocutors underlined the support provided by the World Bank experts, who ensured continuous assistance in developing a strategy for implementing the platform in the conditions of the Republic of Moldova.
Traps set by ”cheap” credits
Announcements of “cheap” loans filled the advertising market during the past few years. “During only 15 minutes”, “without security”, “only with the identity card” and “without commission” are the offers that make an increasing number of people fall into the traps of microfinance organization. They shortly realize they are full of debts owing to the considerable costs with misleading interest and heavy penalties. Figures show each fourth active persons benefited from the services of non-banking financial institutions. The subject was raised in a TV feature on Radio Free Europe of the series “Simply so”. Economic researcher of the think tank “Expert-Grup” Dumitru Pântea said many people do not have access to bank loans because they do not meet the harsher lending conditions. The microfinance companies share out money in an uncontrolled way and develop with rapid steps. Among the most often violations committed by microfinance companies are the non-indication of the effective annual interest rate in commercials. Only the monthly payments are indicated and the consumers are thus misled. The advertisements say the interest is “0%”, but the offer is actually for the first three days and the interest can reach 20-30% or even 100%.
● SATURDAY, November 10
Difference between lowest and highest salaries is of about 33 times
The highest salary in the Republic of Moldova is 35,880 lei, while the lowest one is 1,200 lei, which is a difference of about 33 times. The ratio recommended by the International Labor Organization is 12 to 1. Moldova is yet far from this proportion. By the new salary reform, the ratio will be decreased to 15 to 1 and equity will be thus ensured in the current salary system in the budgetary sector, Minister of Finance Octavian Armașu stated in the meeting of the Government’s press club. The minister noted the necessity of adopting the new salary law derived from the wide inequities in the incomes of different categories of budget-funded employees. There are several groups of employees whose salaries are set by different mechanisms and there are several laws that govern this area. There is now a wide discrepancy between the highest and lowest salaries and the goal is to reduce this discrepancy.
Cigarettes to grow more expensive
Starting with next year, the minimum selling price of cigarettes will be higher. According to the 2019 draft state budget law approved by the Cabinet this week, the minimum price of a package of filter cigarettes will be 25 lei, while of a package of cigarettes without filter 19 lei. The sale of cigarettes with or without filter at higher prices than the minimum reference prices will be fined 50% of the value of the given cigarettes, starting from the minimum reference price, but not less than 1,000 lei. The minimum price for the period between July 1 and December 31, 2018 was 21 lei per package of filter cigarettes and 14 lei per package of cigarettes without filter.
Private tax will represent 1% of purchase value of property put up for privatization
The draft state budget law for 2019 approved by the Cabinet this week envisions the collection of a private tax on transactions with public property, including shares, performed in the privatization process. The private tax will represent 1% of the purchase value of the publicly owned property put up for privatization. The tax is paid before the signing of the sale and purchase contract and is transferred to the state budget or the local budget, depending on who the owner of the property is. The private tax is not paid if the public property is transferred free under the private ownership of resident private individuals who do not perform entrepreneurial activities. The orphans and children from children’s homes and orphanages also do not pay the private tax. If the sale and purchase contract is terminated because the buyer does not fulfil or inappropriately fulfils the undertaken obligations, the sums paid as private tax are not refunded.
