The structure of the Moldovan economy is heavily geared towards resale of goods and the provision of services rather than own production. However, this was not always the case. Important changes, that clearly reflect the strong presence of remittance-financed consumption in the economy, occurred in the structure of output and jobs between 2003 and 2008. The most significant was a decline in own production as a source of business revenue. In 2003, close to 30 percent of total …

Firm-level data confirm the increasing reliance on services as a driver of growth, and the accompanying decline in the contribution of industry to growth. It confirms productivity growth – particularly in the service sectors like construction, wholesale and retail, transport storage and communication, and real estate (renting);, and the general lack of employment and value creation in the economy. This section uses the Moldovan Annual Financial Statements Survey and the Annual Structural Enterprise Survey (Box 1) to conduct more disaggregated analysis of the economy.
Box 1.1:Data Sources for Micro Analysis
The Annual Financial Statement Survey (AFSS) is a mandatory statement that all firms registered in Moldova are required to submit at the end of the fiscal …

Moldova‘s growth in the period 2000-2008 was jobless. Growth came from capital accumulation and productivity gains in the face of a declining labor force. The remittance-funded investment boom and structural transformation of the economy into services show up in growth  accounting results using Solow‘s decomposition (see Figure 1.17) shows that strong annual TFP growth drove output growth starting 2000 and running through 2006. This partly reflects the emergence of new exports, but it mostly reflects the transformation of the economy and movement of the labor force into services. Throughout there was negative growth in labor supply and positive capital investment, implying a rapid increase in capital per worker, which curiously shows up for services (largely …

Moldova’s growth improved significantly over the 2000s averaging 6.3 percent per year before the global crisis.
Figure 1.9 – Moldovan GDP Index (1991-2008)
From the start of the new century, Moldova began to recoup some of the estimated economic losses suffered after the disintegration of the Soviet Union in the 1990s. Real economic growth averaged over 6 percent (see Figure 1.9). Although credible, this still lagged average growth of 7.4 percent for CIS countries between 2000 and 2007.

Many public expenditure reforms in Moldova are overdue. Tax policy and administration reforms still receive more focus in the annual Government action plan than expenditure reforms. Considerable effort is still required to introduce evidence-based strategic priorities in the investment budget with project screening, selection and appraisal drawn from appropriate cost-benefit analyses. Existing public infrastructure, particularly the road network, is in urgent need of higher levels of maintenance spending to prevent the further deterioration. As will be explained in Chapter 3, the education system requires important reforms. With aging and an increase in the dependency ratio, reforms to make the pension system sufficient and affordable should be given priority sooner rather than later.
The global crisis hit …

Remittances helped to finance an ever-larger public sector footprint on the economy during 2000-2008. Throughout the growth episode of 2000-2008, Moldova’s Government maintained fiscal balance through the collection of buoyant tax revenues rather than by expenditure restraint. Robust VAT on remittance-funded imports buoyed up tax revenue, which crept up by 3 percentage points of GDP between 2004 and 2008. Fiscal prudence would have generated budget surpluses during the period of high growth. Instead, between 2004 and 2008 growth in Government spending in Moldova kept pace with nominal GDP growth. Perhaps most troubling is that between 2004 and 2008 public consumption rose by 5 percentage points of GDP.

The global crisis led to a sharp decline in GDP in 2009, exposing the vulnerability of remittance-financed and import-intensive economic growth. The effects of the global meltdown were transmitted to Moldova in the fall of 2008, as the recession hit major trading partners – Russia, Ukraine, Romania, and Western Europe, leading to sharp falls in remittances and export earnings. Real GDP fell by 6.5 percent. Unemployment increased from 5.5 percent of the workforce in the first quarter of 2008 to 9.1 percent in the first quarter of 2010 when urban unemployment peaked at 11 percent. Remittances drastically declined – by 37.4 percent (year on year) in 2009 to 20.8 percent of GDP (from about 30 …

Economic growth from 2000-2008 was driven by a boom in domestic demand funded by remittances, whilst agriculture and manufacturing struggled. From the start of the new century, Moldova began to recoup some of the economic losses suffered after the disintegration of the Soviet Union in the 1990s. Real economic growth averaged just over 6 percent. Although credible, this still lagged the average for CIS countries over the same period. Industry, agriculture, and exports of goods have lagged behind growth of services and imports throughout the decade. Between 2006 and 2008 real value added in both industry and agriculture contracted and employment fell. As labor fled abroad, Moldova became one of the world’s most remittance-dependent countries. …

The essential immediate priorities for policy reform, the “sine qua non” of an EU-focused agro-based export strategy are as follows:

Eliminate any remaining entry restrictions that enable market dominance across sectors.
Liberalize transport route operators and facilitate their entry and improve governance and transparency in the management of the transport sector, (including tariffs).
Eliminate (through the “Guillotine approach”) all outdated technical standards including the outdated GOST food product standards, and adopt at once EU standards.
Give farmers access to approved seeds and seedlings in the EU common catalogue and access to all fertilizers and pesticides approved in the EU.

This report assembles evidence from Moldova’s macro-economic accounts, from household, farm and firm data surveys, and from Government expenditure data, to draw the conclusion that Moldova needs to develop a second engine of growth from exports of goods and services. We conclude that to accelerate growth and poverty reduction and to close the current account imbalance, Moldova’s Government should prioritize reforms and investments in public services and infrastructure that resurrect traditional agro-based exports and stimulate the ICT sector. The former is required to capitalize on Moldova’s revealed comparative advantage and to stimulate rural growth and poverty reduction. The latter could create more highly skilled service sector jobs for the underemployed Moldovan youth as they advance …

Moldova, once the “garden” of the Soviet Union, is the poorest country in Europe.
Income per head has been growing rapidly since 2000, but slower than the average for other Eastern European countries, and it remains well below the level Moldova had during Soviet times. Moldova returned to economic growth in 2010. Preliminary estimates show 6.9 percent real GDP growth in 2010 helped by growing exports and remittances. However, neither capital inflows, exports nor FDI drove Moldova’s economic prosperity before the global financial crisis: rather it was laborers flowing out and sending back remittances. Moldova experienced jobless growth. Instead of wages, remittances increased the disposable income of rural households. Constrained banking and a poor investment climate …

The Deputy Prime Minister and Minister of Economy said that at the meeting of the Moldtelecom’s Administrative Board during which the company’s leadership presented a report on 2010 investments.

The respective contract will be signed with it by the State Administration of Roads on March 15, InfoMarket was informed at the Ministry of Transport and Roads.

A concrete case of misinterpretation of public sector behavior due to failure to appreciate the complexity of the transition process is the emphasis in Moldova by many external and domestic actors on corruption. Few governments are free of corruption, and attempts to make relative judgments about the degree of corruption are doomed to failure or to stating the obvious, except when comparing extremes. In the case of Moldova, writings on corruption focus on reporting it as a problem and offering dubious indices of its severity (see for example Obreja, Efim, Gasca, and Potirniche 2002; and Chirtoaca, Nicolae, Gudym and Petrushin 2000). While description and attempts to measure may be informative, the central issues for this …

Because institutions evolve from practice as well as from statute, the transformation of these institutions into effective management units could not be done quickly; tough small changes can have a major impact. In the context of building appropriate institutions, it is the impression of the authors of this report that some representatives of international agencies, and many Moldovans, do not fully appreciate the difficulty of institutional transition. This is manifested in a tendency to attribute all the problems of policy implementation to bureaucratic inefficiency, lack of commitment by public servants, and a culture of corruption. While no large organization, public or private, is free of these maladies, the public management problem in Moldova is much …

For all of Central and Eastern Europe the twentieth century brought the ravages of war and dictatorship. While it is not possible to assess objectively which country suffered most, it is beyond controversy that the experience of Moldova was unimaginably grim. In the first decade of the century a great ethnic pogrom left communities divided and hostile; to be followed by a second in the bleak summer of 1941, when the country fell under military occupation, which would last for over three years. The end of the Second World War brought peace, but a peace that many Moldovans viewed as a new foreign occupation. No visitor to the country can for long remain ignorant of …

It was said by the US Vice President Joseph Biden in his statement for the Moldovan people in the framework of his official visit to the republic.

The Finance Minister said it, speaking on the national television. He said the tax policy in Moldova in 2011 would stay practically the same, as last year, giving more confidence to the business environment.

The number of subscribers increased from 2009 by 22.42 thousand (1.97%) and reached one million 161 thousand. The volume of sales of fixed telephony services decreased by 0.66% and recorded 1 billion 915 million leis, according to the data available with the National Regulatory Agency for Electronic Communications and Information Technology (ANRCETI).

Prior to considering the aspects of the transition, it is essential to recognize that gender is central to understanding the transition process. Further, gender equality plays an important role in growth, employment and poverty reduction, and cannot be ignored. The fundamental policy changes associated with the transition process are likely to affect men and women differently because of their different positions, roles, and responsibilities in society. The unequal treatment of men and women cannot only be questioned on human and equity grounds but is also economically inefficient. As a result, the development of effective economic policies requires gender analysis and the mainstreaming of gender into the development of the policies themselves, including the budgeting process.It …

The average market cost of a square meter of apartments in the Moldovan capital in July, August and September last year amounted to 625 euros.

The companies Grape Valley, Salcuta, Barza Alba, Imperial Vin are called the producers of poor-quality production, according to the Rospotrebnadzor’s press release. 712 samples (lots) of alcohol production, produced at 24 Moldovan enterprises in the total volume of 3 million 776 thousand 284.6 liters have been examined in the Hygiene and Epidemiology Center’s laboratories in Moscow in 2011.

Seven farmer associations held a press conference today being concerned about the draft law on 2011 budget published on the website of the Ministry of Finance, stipulating allocation of 250 million leis for subsidies.

The Economy Minister Valerii Lazar said it during the discussion of the project of restructuring the Moldovan Export Promotion Organization presented during the special meeting at the Ministry of Economy with representatives of public structures, international organizations, non-governmental organizations and others participating.

Other contractual arrangements
15 per cent (141) of the total additional work force consisted of ‘other contractual arrangements’, divided over the various regions (as set out in Annex II, chart 9). This figure includes contracts with ICMC, Surge and IRC.
Surge, IRC and ICMC
It was suggested by internal memorandum, dated 24 June 2005 – following a 2004 management recommendation from the external auditors – to exclude staff employed through Surge, IRC and ICMC from the definition of project staff as provided in the 2001 IOM/FOM; “(This) deployment scheme was conceived as a way to address UNHCR’s decreasing capacity to respond to the sudden but temporarily and rapidly expanding staff in the field. (…) Prior to …

It will be organized by the Chamber of Industry and Commerce of Moldova with support from the Moldovan Investment and Export Promotion Organization (MIEPO), Moldova’s Embassy in Germany and Hamburg’s Chamber of Industry and Commerce.

It grew $8.57 million (13.5%) in comparison with January last year, according to the National Bank of Moldova. Particularly, $60.81 million (84.7% of the total transfers for this period of time) were received through different fast money order systems. US dollar accounted for about 49.4% in the structure of currency transfers in January 2011, euros – 40.9%, Russian rubles – 9.7%. As it was reported earlier, money transfers to Moldova from individuals from abroad through commercial banks in 2010 totaled $1,244.14 million, up $62.12 million (5.3%) in comparison with 2009.

At the same time, diesel oil import remained practically on the previous year’s level – 309.1 thousand tones, and import of liquefied gas grew 10.4% – to 66.8 thousand tones.

The respective inquiry was submitted by Moldova to the World Trade Organization’s secretariat on March 3, according to the WTO’s website.

In Moldova’s opinion, the disadvantageous conditions for its production in the Ukrainian market are set by Ukraine’s Law “On the rates of the excise tax on ethyl alcohol and spirits” with alterations of 2008. Ukraine’s Ministry of Economic Development and Trade said this law had expired after the recent entry into force of the new Tax Code. As it was reported earlier, in mid-February 2011 Ukraine addressed to the WTO with a request to hold consultations with Moldova regarding the discriminating, in its opinion, import duty for environment pollution in the amount of 0.8-3 leis …

UNOPS
Based on the information received from the respective Bureaux, OIOS established that UNOPS contracts have mainly been issued in the Africa region (8 in Eritrea and 33 in Kenya) and to a lesser extent in Europe (2 UNOPS contracts were issued in Azerbaijan). Though the Asia bureau did not officially report the use of UNOPS in their region, OIOS is aware that UNOPS contracts have also been issued in Malaysia. OIOS was further informed by DHRM that UNOPS contracts have not been issued at UNHCR Headquarters between 1 January 2005 and present. DOS noted in its response to the draft report that there are 45 UNOPS in Malaysia, 46 in Kenya and 7 in Eritrea. …

economic policies
This report is part of a larger UNDP project on the macroeconomics of poverty reduction, which at the time this study began had covered six East and Southeast Asian and several Central Asian countries. The Bureau for Development Policy of UNDP has helped to initiate a broad range of global, regional and country programmes designed to help fashion more pro-poor economic policies. The primary purpose of this set of activities has been to broaden the dialogue on pro-poor policies at the national, regional and international levels. While each report stands on its own, addressing the specif c circumstances of each country, taken together they provide a consistent analysis and vision of the poverty reduction …

United Nations Volunteers
UNVs were generally referred to by the staff of the bureaux interviewed by OIOS for the purpose of this audit as the ‘next best thing to project staff’, both in terms of cost and in terms of the timeliness with which they can be recruited. In their view this was particularly the case for national UNVs who can be hired immediately in emergencies at a substantially lower cost than international UNVs, thereby allowing for the economical flexibility that UNHCR needs. UNHCR can be content that UNVs have established and fair contracts that clearly identify their status as non-UNHCR staff members. This valuable resource is re-emphasized in the UNHCR Policy on the use of …

On the last day of the week, MDL slightly increased against US dollar, by about 0.386 leis for $1. As of March 4, the National Bank set the official exchange rate of 11.9662 leis for $1.

Particularly, the average prices for crop production in Moldova in 2010 grew 57.8%, for livestock production – 4.7%, according to data of the National Statistics Bureau.

It was said by Moldovan Prime Minister Vladimir Filat at the meeting in Chisinau with Catherine Ashton, Deputy Chairman of the European Commission, High Representative for Foreign Affairs and Security Policy of the European Union.

Since its signing in 1994 and its entering into force in 1998, the Partnership and Cooperation Agreement, the legal framework of Moldova – European Union relations, has not changed even if, sub¬sequently, in 2004, the EU launched the European Neighborhood Policy (ENP) within which the EU-Moldova Action Plan and Eastern Partnership have been developed. Being a state with pro-Europe¬an aspirations, Moldova wants to amend its legal framework that would imply recognition of EU membership prospects. It is obvious that for this to occur, several conditions must be met. In addition to efforts to promote internal reforms, Moldova needs to have the support of European states in this process. The fact that Poland will hold the …

The press release of the Association of Banks of Moldova reads that the recent accusations voiced by independent experts for banks preventing “sustainable economic development of Moldova” and the extensive coverage of the problems the banks are also accused of, form a biased perception of Moldova’s banking sector.

It is stipulated by the amendments to the Law on motor roads passed by the Parliament on Thursday. According to them, construction and modernization of toll motor roads, bridges is permitted if there is an alternative free motor road. The expenses for their building and maintenance will be compensated by the payment for the traffic.

The strategy was developed as it is necessary to ensure sustainable economic growth and further promotion of economic and social reforms in the country, according to the head of the National Commission for Financial Market Mihail Cibotaru.

Individual Contractor Contracts
Another problem created by the special service contracts found is that some of those contracts use the term ‘individual contractor’ to define the status of the ‘employee’ (see for instance paragraph 22 and the case of Yemen). This is inconsistent with the meaning of ‘contractors’ as set out in several UNHCR instructions. In OIOS’ opinion, the term ‘individual contractor’ should only be used in relation to commercial contracts with private or commercial companies, firms or para-statal enterprises, whose services are required to obtain technical expertise and professional assistance that are not available in-house or from traditional (governmental) implementing partners. Such ‘independent contractor’ contracts have been issued and approved by UNHCR Headquarters …

Service Contracts
OIOS found that although UNHCR has not developed or issued any guidelines on hiring personnel under Service Contracts (similar to those used in UNDP), some field offices have proceeded in hiring staff under this type of contractual arrangement. As at the end of December 2005, it has been determined that there were at least 69 persons employed by UNHCR under various versions of special service contracts (Annex II, chart 7). The service contracts reviewed by OIOS were irregular contracts both in nature and content. Some of those contracts were UNHCR ‘service contracts’ created on an ‘ad hoc’ basis, others were ‘UNDP service agreements’ created by UNHCR field offices (using the UNDP SSA model), while …

Project Staff Working Group – 2001/2002 – recommendations and current status
In 2001 a working group was established by PCOS to review project staff and to make recommendations on how to phase them out. The working group, in its final report, dated March 2002, established that as at the end of 2001 some 1099 project staff were working for UNHCR,2 divided over the different regions. Of these 1099 project staff, recommendations were made to regularize 264 (24 per cent); to discontinue/terminate 516 (47 per cent); to convert 18 (1.6 per cent) to an individual contractor contract; to hire services through companies (security and cleaning), which would equate to 264 (24 per cent) persons, and to convert …

The indicators’ growth resulted from the increase in the number of users and traffic in mobile telephony networks, according to the National Regulatory Agency for Electronic Communications and Information Technologies.

The respective decision was made by the Cabinet at its sitting Wednesday to ensure the uninterrupted supply of bread and bakery goods to the population and to preserve stability of prices for their in the home market.

The state budget revenue in 2011 is planned to total 19,071.181.7 million leis (+11.1% in comparison with 2010), state budget expenditure – 20,354.074.1 million leis (+8.3%) and deficit – 1,266.892.4 million leis (in 2010 – 1,621.9 million leis).

It is planned to be implemented in the framework of the TRACECA project (the Transport Corridor Europe-Caucasus-Asia). It was said by the general manager of the public enterprise Marculesti international free airport Serghei Ciobanu at the meeting with Deputy Prime Minister and Minister of Economy of Moldova Valerii Lazar.

Project Staff Working Group -2001 2002 – recommendations and current status
UNHCR
In 2001 a working group was established by PCOS to review project staff and to make recommendations on how to phase them out. The working group, in its final report, dated March 2002, established that as at the end of 2001 some ! 099 project staff were working for UNHCR,: divided over the different regions. Of these 1099 project staff, recommendations were made to regularize 264 (24 percent); to discontinue terminate 516 (47 per cent): to convert 18 (1.6 per cent) to an individual contractor contract; to hire services through companies (security and cleaning),’ which would equate to 264 (24 per cent) persons, and to …

AUDIT FINDINGS AND RECOMMENDATIONS
A UNHCR Project Staff and Additional Workforce
The information received by OIOS from the field through the bureaux and PCOS,
indicated that there was an overall consensus that project staff, as defined in the 2001 audit and following IOM81.2001 &FOM 79/2001 ‘UNHCR Project Star, dated 21 September 2001, had been phased out as at the end of October 2005. This was confirmed by UNHCR in its General Assembly Report (A AC.96/1011), ‘UNHCR Annual Programme Budget – 2006″, dated 30 August 2005, which reads that UNHCR had “taken steps to regularize this category”, and that only “a limited number of (…) staff had continued to work under this arrangement during 2005″.
OIOS noted however that the …

AUDIT OBJECTIVES
The main objective of the review was todetermine the effectiveness of UNI ICR’s policy
to phase-out project staff. The review also aimed to assess the adequacy of the central procedures established for monitoring the additional workforce arrangements, as well as the current contractual arrangements for the hiring of such personnel.
Unicef
AUDIT SCOPE AND METHODOLOGY
The audit focused on the present status of the implementation of the policy for the phasing
out of project staff, as well as the administration and procedures adopted to achieve this. OIOS followed up on the findings and recommendations made in 2001 to ensure they had been adequately implemented, and were still valid in the current working environment. Moreover, although not within the initial …

Veaceslav Ionita, chairman of the parliamentary commission for economy, budget and finance, was elected the head of the central commission for controlling income and property statements