The agreement with the International Monetary Fund, if it is signed, is a last lifeline offered to Moldova to come out of this self-isolation and collaborate with other development partners. This opinion was voiced by economic expert and former Ministry of Finance Veaceslav Negruta during a public debate on the topic “The economical and political importance of Moldova’s Agreement with the IMF and the political ability to implement it”, the 58th in the series “Developing political culture through public debates”, organized by IPN in partnership with Radio Moldova.
The experts thinks that a memorandum with the IMF is the last chance and solution for Moldova to get out of international isolation, which is a consequence of the authorities’ actions over the last three years. With no running IMF program, without coherent economic, social and financial policies, Moldova is alone and all the external funding from other development partners is blocked. “I am sure this aggravated the situation and affected the whole macro-economy of Moldova”, said Negruta.
According to him, the IMF Memorandum is the only meas to ensure some coherence in the government’s economic, financial and social policies. Negruta also noted this is the first time there is a focus on the reform of the judiciary and the fight against corruption, which is a premiere for the agreements between Moldova and the IMF.
In his opinion, there was a lot of effort over the past 3 years to avoid an IMF agreement. “Governments and governors were taken down only to prevent an agreement with the IMF from happening. It’s point zero from where negotiations started in 2016”, said Negruta.
He explained that at the moment Moldova has a technical agreement with IMF experts. This means there is a letter of intent signed by four high-ranking Moldovan dignitaries. “Unfortunately, all the commitments in that letter and its annexes, the so-called draft memorandum, have not been presented to the other members of the government or the Parliament, who are supposed to make sure that Moldova meets all the requirements for a positive answer from Washington. This will be the source of some surprises and tensions in the upcoming months”, said the expert.
In his opinion, 60% of the new memorandum is about the banking system: improving the transparency of shareholding, good corporative governance in the banking sector, restoring its credibility and the independence of the National Bank. A key element is the investigation and recovery of the stolen money.
Another condition is revising the budget. “It is well-known that in 2016 the budget was approved late and it is obviously unrealistic. As such, it has to be revised, but this implied big social and political costs. We need to ask the authorities to come forth and explain to us and to their own members of the government what does this revision mean, because it is about adjusting expenses and some tax amendments, meant to reduce the gap between budgetary needs and possibilities. This should be done in September”, explained Negruta.
Because of the elections, he expects the whole job and the responsibility for it to be assumed unilaterally by the Cabinet in order to avoid causing problems for some governing parties.
The public debate about “The economical and political importance of Moldova’s Agreement with the IMF and the political ability to implement it” was the 58th in the IPN series “Developing political culture through public debates”, organized with the support of German Foundation Hanns Seidel.
