World Bank helps economic entities in Moldova cope with crisis challenges

The additional credit to the Republic of Moldova in the amount of US$10 million for the Rural Investment and Services Project (RISP) II granted by the World Bank is designed to help the Moldovan economic entities cope with the challenges of the world financial crisis, said the World Bank Country Manager for Moldova Melanie Marlett, quoted by Info- Prim Neo. “RISP Program has been a real catalyst for start-up, non-agricultural businesses and rural entrepreneurs across Moldova,” Melanie Marlett said at a news conference on Monday. RISP director Liviu Gumovschi said that as a result of RISP I (2002-2006) and RISP II (2006) 1,800 new businesses have been created. This is about 14% of the total number of small and medium-sized businesses in Moldova. 300 loans to the value of US$12 million were granted from the US$15 million World Bank credit as part of RIPS II. There were set up 490 rural businesses. The remittances of the founders or their relatives were invested in 25% of these businesses. The RISP loans are provided through the local banks. They are repayable in 15 years, with a grace period of 3 years and an interest rate of up to 15% a year. Out of the 1,230 businesses created under RISP I, only 15 companies went bankrupt, which is a very low percentage, Liviu Gumovschi said. Alexandru Strulea, entrepreneur from Nisporeni district, said that after working abroad for several years, he managed to found a company and continue his parents’ dried plums business. “I used the money that I earned abroad and the RISPP loan to modernize the fruit drying process and to purchase equipment to diversify the range of products,” the businessman said. The decision to provide the additional credit for RISP II was taken by the World Bank Board of Directors on May 14. RISP II objectives are: to continue to foster post-privatization growth in the agricultural and rural sectors, by improving access of farmers and rural entrepreneurs to knowledge, know-how and finance; and to build capacity of the private and public institutions to ensure the sustainability of the activities.  An additional credit in the amount of US$10 million for the Competitiveness Enhancement in Moldova Project is to be approved this year. It will be used to improve the economic entities’ export capacity.