Some of the policies and initiatives launched in the recent past do not respond to the challenges of the national economy and are predominantly anchored in electoral interests and are not contributing to the welfare of the country, being rather populist, experts of the Independent Think Tank “Expert-Grup” stated in a press conference at IPN. The experts analyzed the quality of the policies and initiatives proposed by politicians in the June issue of the quarterly publication “Real Economy”.
Economist Iurie Morcotylo said the Democratic Party’s local roads rehabilitation initiative “Good Roads for Moldova” was approved with deficiencies in terms of financial resources. It is specified that investments in the repair projects will be made when the necessary financial resources are accumulated, but this is inacceptable. Under the legislation and good international practices, the public authorities must not approve projects if the financing is not identified. The program was not discussed and argued and it is not known what communities should benefit from repaired roads, what length of roads will be repaired, etc.
Economist Dumitru Pyntea spoke about the “First House” program, saying an extended group of persons who can access it is indicated: persons up to the age of 45. But under the Law on Youth, young persons in Moldova are considered those who are younger than 35. The program is intended for persons who didn’t own an apartment during the past 12 months only. Thus, for some of the persons this would not be the “first house”. The subprogram “First House 2”, which envisions the subsidization of loan payments for persons who work in the public sector, discriminates against employees working in other sectors of the economy. To motivate the public functionaries, the salary mechanism should be strengthened. “A question appears here: How socially targeted this program is? Or we distance ourselves from the social objective and this is turned into a program for stimulating lending activity for banks or for supporting further real estate transactions in the sector?” asked the expert.
The negotiation of a Free Trade Agreement with China is the newest commercial policy initiative . According to expert Vadim Gumene, the first negotiations took place in March and by then no analysis to show the economic rationality of such an agreement was conducted. “We ultimately have a very negative trade balance. We export 27 times less than China does, especially because the tariff policy of China is rather liberal,” stated Vadim Gumene.
As to the National Agency for Energy Regulation’s decision to raise fuel price ceilings (which was later suspended), “Expert-Grup” executive director Adrian Lupusor said that even if the Agency seems to justifiably apply the pricing methodology, the core of the problem is related to the overly generous trade margin included in the given methodology, which is of about 3 lei/liter. In order to solve this issue, it is necessary to increase the involvement of the Competition Council in order to detect and combat possible anticompetitive practices on the petroleum products market. Boosting competition is the main tool that will allow for sustainable fair price setting.
