Only favorable business climate can attract foreign investment, experts

10.02.2016 09:42
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Only a favorable business and investment climate can enable Moldova to attract increased foreign direct investment to the economy, said experts who took part in an economic debate centering on FDIs, staged by the Institute for Development and Social Initiative “Viitorul” and Radio Free Europe, IPN reports.

Expert Ion Tornea said the Moldovan market is small, but has some competitive advantages compared with the markets of a similar size. Firstly, the labor force is cheap. Secondly, Moldova signed free trade agreements with many countries and the produced goods and services can be exported by potential investors duty-free. “Small investors can profit from these advantages, but when they come to Moldova and meet with bureaucracy, they become disappointed,” he stated.

Viorel Chivriga said that even if there are no statistics about the number of investors that came to Moldova and then left, it’s certain that some of these gave up the projects they initially intended to implement. A number of conditions should be met to make Moldova’s business and investment climate attractive and predictable for the potential investors. “First of all, the legal framework should be stable. It’s known that a Fiscal Code provision about VAT refund was modified 23 times,” said the expert.

He added that the model of participation in international business forums and exhibitions should be changed so that not one and the same persons are delegated to take part in them. The state institutions should do their job and be receptive to the demands of foreign and national investors, and persons suspected of acts of corruption should not be allowed to manage these institutions.

The experts also said that though the investment attraction and export promotion strategy for 2006-2015 had ambitious objectives, its results are below expectations.

The FDIs started to decrease in 2008. In the first nine months of 2015, the foreign direct investment in the national economy totaled US$ 3.473,4 billion, a decrease of 5.1% compared with the corresponding period of 2014.