IMF resident representative advises local authorities to increase tariffs for utilities

The resident representative of the International Monetary Fund in Moldova, John Mathisen, recommends the local authorities of Chisinau to increase gradually the tariffs for utilities. The IMF official met with Mayor General Dorin Chirtoaca on Thursday, July 12. According to Mathisen, to maintain an efficient and productive economy, the Fund recommends the local authorities to maintain a level of tariffs which would cover the costs of the producers. In his words, the public utilities have to benefit from sufficient incomes to cover their basic needs and be able to provide high-quality services. Also, the IMF official advised the local authorities to make efforts to work out and introduce identification and subsidising systems for the poor as fast as possible, in order to reduce the negative effects of the increases. Johan Mathisen told Info-Prim Neo that the decision to partly cover increases in tariffs for heat from the city coffers was a prompt solution, but not the best one. Although the best solution would be to subsidise only the poor strata of the population, Mathisen said that this system can be implemented only if the local authorities stop subsidising all the consumers. Mathisen specified that the implementation of a subsidising system for the poor is a difficult issue for any administration, including for the new administration of the city. Asked to comment whether the Chisinau authorities will take into consideration or not the recommendations of the IMF, Mayor Dorin Chirtoaca said that the tariff has to be set by the Chisinau Municipal Council, which will be informed about the discussions with the representative of IMF. The visit of the IMF representative to the City Hall took place in light of the fact that IMF, besides offering financial assistance to the state, is also providing consultancy and recommendations on the fiscal policy; tax administration and collection of tax arrears; monetary-budgetary policy, best international practices; management and privatisation of companies and state-owned units; development of the financial field and consultations for local authorities with a view to overcoming the misbalances in economy at macroeconomic level.