Foreign donors’ funds at risk of embezzlement - expert

Those USD 1.2 bln promised to Moldova by the European Union together with the international financial bodies and foreign donors will spur Moldova’s economy in case two conditions are respected: if the Government identifies correctly the utilization priorities, and if Moldova has the necessary absorption capacity for such a huge sum, economic analyst Valeriu Prohnitchi told Info-Prim Neo. “This sum is very important and if efficiently used, it can produce a serious impact on the human development in Moldova”, says the expert, considering though that there are still the risks of corruption and embezzlement. The expert is not sure whether Moldova has a list of detailed technical projects for which this enormous sum could be assigned. He also doubts whether there are managers in the public sphere who could adequately administrate this money. “It is a very large financial assistance and there is the risk that the money will be simply swallowed without producing any effects, as it happened in the case of other projects”, Prohnitchi claims. In spite of these, the expert says that these threats could be avoided. “Certainly, there should be a pressure exercised upon the Government, especially by the press, for the transparent utilization of the funds”, Prohnitchi added. [Freeing business and financing education] Prohnitchi considers that there are 2 things which must be realized in Moldova with respect to the fields that should constitute the target for the funds offered by foreign donors – “freeing business” and large investments in 2 priority sectors: infrastructure and education. “Moldova is a country providing good business opportunities, but it needs a good road infrastructure in order to focus on exports, which would create the adequate connections with the international traffic routes. There is also a need for access to sea transportation routes, cargo aircrafts for shipping goods, telecommunications and energy security. Referring to education, the expert sees a negative factor in the reducing of workplaces, despite the economic growth, which can be explained with the low qualification of young specialists, which does not allow them to face the requirements on the labour force market. At the same time, minister of Economy and Commerce Igor Dodon thinks that the financial assistance from the donors is a very positive signal for investors: both for those who already operate here, and those who keep an eye on Moldova. “It is extremely important that the Government fulfils the obligations took upon itself in Brussels on implementing the reforms started in the economy, social corruption countering, agriculture energy and other sectors. “We will launch reforms which already have a financial coverage soon. There is much to be done in the next three years and the vote of confidence of our international partners, including the EU which wishes to have a neighbour with a rather high quality of life, offers us the opportunity to conduct important changes”, Dodon emphasized. According to the minister, the Government is aware of the fact that Moldova loses very much without investments in the human capital. The message “Come to Moldova, we have cheap qualified labour force” starts fading without investments in human resources. At the moment there is a great demand for qualified technical specialists, this being the reason why MEC will stimulate matriculation especially in technical education institutions. A half of those USD 1.2 bln promised by the European Union will be allotted as grants and the other half - as long term credits with an interest rate not exceeding 1.5% per year. The funds will be used for the efficient implementation of the EU-Moldova Action Plan and the Economic Growth and Poverty Reduction Strategy Paper and will be directed with priority towards the realization of projects in the field of judiciary system reform implementation, public administration, education and healthcare reform, infrastructure, new workplaces in the social system, rural sector development. The sum of USD 1.2 bln is greater than the total amount of financial assistance offered to Moldova by international donors over the past 10 years, since the last meeting of the Consultative Group of Donors on Moldova.