The amendment of the budget must be the top priority of new Government. The survival of the budget system depends on the reassessment of the macroeconomic framework, the disposable finances, the costs and financial consolidation, says an analysis presented by the Independent Analytical Center “Expert-Grup” on July 28. Analysis author, ex-minister of finance Veaceslav Negruta, who returned to the NGO sector after leaving the Government, said that Moldova entered serious financial difficulties after the development partners suspended the provision of financing, IPN reports.
“The failure to get 3 billion lei in foreign financing (grants and loans that were to be offered to Moldova) means that the Government lacks financial coverage and this absence will become more pronounced. There is no possibility of substituting the external financial resources that will not enter the budget as the country does not have access to lending resources on international markets. Moreover, the internal lending resources became more expensive. The weighted average rate of state securities on the primary market, which is the interest rate paid by the government for borrowing at internal level, reached 16.3% in the first half of this year, as opposed to 5.5% at the beginning of 2014,” stated Negruta.
The author formulates a series of measures that should be taken immediately to remedy the situation. First of all, there must be abandoned the idea of self-isolation of the country, which is promoted by some of the politicians. After the new Government is voted in, the negotiation of a new cooperation agreement with the IMF must be resumed.
Negruta also said that the new Government must work out an anti-crisis two-year plan and must focus on the promotion of the initiated reforms so as to be credible in the communication with civil society and the development partners. Measures to ‘de-offshorize’ the commercial transactions by eliminating the offshore companies from the contracts involving public money should be taken. This step will allow the commercial flows to serve the internal economic system of the country, contributing to fiscal consolidation.
