The Independent Think-Tank Center "Expert-Grup" in cooperation with the National Environmental Center invites you to participate at the study launch event: "Implementation of Extended Producer Responsibility mechanisms to ensure waste recycling", developed with the financial support of the Embassy of Sweden in the Republic of Moldova.
The legislation of the Republic of Moldova defines the principle of Extended Producer Responsibility (EPR), but the mechanisms and practical tools that would ensure the effective implementation of this principle are missing. The study aims to analyze the interaction of key actors in the chain: producers/traders - consumers - recyclers - producers - state, incentive practices in this area and to propose mechanisms to stimulate participants in this process of return and recovery of waste resulting from the process consumption.
The event shall be attended by representatives of state institutions, civil society, diplomatic missions accredited in the Republic of Moldova, development partners, national and international experts.
The working language will be Romanian. The Romanian-English, English-Romanian simultaneous translation will be provided.
Event registration form
Funded by Sweden
For more than one year, the COVID-19 tests to extreme the limits of the national emergency systems across the world. In this brief, we apply the Integrated Emergency Management analytical framework to review the strategic response of the Moldovan government to the complex and multifaceted challenges that COVID-19 posed. The irresponsible behavior of Moldovan politicians, the negative personal example they gave to the wider public and the political intrusions in the crisis management have been among the key factors hindering Moldova’s progress in fighting COVID-19 and its socioeconomic consequences. A number of institutional measures are necessary to safeguard the independence and effectiveness of the emergency management bodies in the face of future crises.
Across the world, the COVID-19 crisis unfolded as a natural experiment exposing weaknesses and strengths of national systems for disaster management. By doing to, the crisis has been offering many lessons - albeit at huge human and economic costs. This note undertakes an overview of Moldova’s strategic response to crisis and a summary of key lessons.
Differently to other crises, COVID-19 manifests itself as a complex one encompassing each and every aspect of social life. While unique in its nature, magnitude and duration, the COVID-19 crisis involves all ‘classical’ features: 1) an existential and highly disruptive threat; 2) a huge initial surprise; 3) a sequence of cascading and rapidly unfolding ramifications; 4) short lead times and decision times; and 5) need for balanced response in a highly uncertain environment2. These features allow a brief analysis along the five key components of the Integrated Emergency Management (IEM) framework3:
1. Assessment, which encompasses identifying hazards and threats, assessing the likelihood of their materialization and measuring their disruptive impact.
2. Prevention, which is quite self-explanatory, albeit rarely possible in its entirety; when prevention is not possible, plans for mitigation and limitation of cascading effects are essential.
3. Preparation, an activity which essentially involves planning of actions, training, simulations and drills, essential inventories and stocks checks, allocation of financial resources.
4. Response, which is often the key phase in a crisis management, both by intended impact and complexity, as it requires high level of inter-agency coordination.
5. Recovery, the final phase which addresses the human, material, natural, economic and other impacts caused by emergency.
In case of diffuse crises like COVID-19, these components rarely unfold in as orderly a fashion as above; instead, they overlap and interact. Risks are assessed continuously at different geographical scales, while the preparatory plans are to be checked against reality and societal response. The effectiveness of the IEM assumes synergy of three managerial levels:
● Operational – the level where ‘real’ response and recovery work is undertaken;
● Tactical – the level ensuring that operations are coordinated, coherent and integrated;
● Strategic – this level sets goals, gathers feedback and adjusts the strategy accordingly.
We lack the professional expertise to assess the operational and tactical responses to COVID-19. By all means, the Moldovan medical personnel, as well as other frontline staff (such as police), deserve full appreciation for their steady effort and commitment. In the following we concentrate on the strategic level of the crisis response. Key errors have been made by Moldovan strategists, not by the doctors. However, it is clear that strategic failures inevitably undermine the effectiveness at lower levels.
Discussion of the strategic response to COVID-19 crisis in Moldova
To begin with, Moldova’s emergency legislation is considered adequate and in line with international standards4. Despite this, Moldova lacks formal IEM strategy and practice and the concept itself is not yet part of the policy. While Moldova is prone to many hazards of catastrophic nature, there is no comprehensive and systemic mapping of disaster risks. No surprise, the response to COVID-19 has been largely intuitive, and often mimicking what others were doing. We’ll turn now to components of the IEM one by one, albeit, as mentioned above, COVID-19 is not the typical case where the components would manifest sequentially, but instead they have been rather simultaneous.
Before the crisis itself, there was little Moldova could have done realistically to anticipate such a crisis, assess potential risks and get ready for it. Indeed, the COVID-19 has been a great surprise for the world. However, while the great majority of national leaders approached the COVID-19 with due concerns and seriousness, key Moldovan leaders positioned themselves as COVID-sceptics: the-then Moldovan president Igor Dodon stated on 20 of March 2020 that COVID-19 behaves “like a light flu, going through the body without even noticing it”5. This certainly contributed to the public attitudes depreciating the risk of the infection in Moldova.
The crisis itself in Moldova evolved in a snowball manner. What began as a sanitary crisis rapidly morphed into an economic one, with yet more psychological, social and political damage still likely to come.
On the one hand, the Moldovan government benefited of real-time data for monitoring the epidemiological component of the crisis.
On the other hand, the Government has not been able to satisfactorily measure the associated socioeconomic risks for a simple reason – lack of real-time data. Headline macroeconomic, sector-level and social climate indicators - all come with significant delays, giving rise to doubts regarding statistical quality, while the statistical infrastructure proved a bit too rigid to perform under new conditions requiring physical distance and remote work.
While companies hold useful alternative economic data, which can be potentially used for a more up-to-date assessment and for designing policy response (such as weekly dataon fuel sales, daily data on electricity consumption, hourly data on telecommunication services), the Government did little to harness them. As a result, the whole package of economic response measures has been lackluster and poorly-targeted6. As for the response to social risks of confinement (such as increased domestic violence, petty crime, abuse of substances, psychological distress and so on), it is simply missing.
With COVID-19 starting on a global scale, the possibility of prevention at the national level is questionable. However, once set in motion, it gathered steam with each new infection case. Preventing escalation and new waves is the key reason why epidemiologists emphasize the prevention measures at early stages of epidemics.
In this regard, Moldova failed lamentably. Besides poor enforcement of the adopted administrative restrictions, another reason has been the highly doubtful strategic decision of keeping to a relatively low level of mass testing7, despite a daunting positivity rate in Moldova – 30 percent of total tests taken between 26 of February 2020 and mid-March 2021. The exact reasons for this decision are not known, which in itself reveals another failure of a strategic communication during the crisis. Such a high rate of positivity obviously means that more testing should have been done and more rigid measures for prevention of virus transmission were warranted. In May 2020 the World Health Organization advised a 5 percent threshold of positivity rate for at least two weeks as a minimum criterion for ‘reopening’. By all means, as of mid-March 2021, Moldova should have been ‘closed’ or with very strict measures of individual confinement and territorial lockdowns.
Preparation should be done before the crisis itself strikes. In this regard, the national disaster management system turned out to be poorly prepared for any nation-wide crisis. With hindsight, the national responses to catastrophic droughts in the recent decade could have been more exemplary.
Among its unexpected positive consequences, the COVID-19 crisis raised awareness of the real social and economic value of the medical profession and the dramatic impact of brain drain. Very poor payment has been the main cause of the exodus: while in Moldova a medical doctor receives an average pay of 400 USD, in the neighboring Romania the same doctor can get up to 4000 USD8. Considering the proximity and cultural identity of Moldova with Romania, and dual Moldova-Romanian citizenship of many Moldovans, theoutflow of Moldovan doctors to Romania has been only a question of time. Between 2014 and 2019 a total number of 3,200 medical personnel left Moldova, i.e. the system lost 8 percent of its personnel in only five years.
The crisis also revealed a core problem related to domestic capacities of production of pharmaceutical, medical and sanitary essentials, as well as very poor management of strategic goods, here including food.
While formal rules for interaction among different organizations are enshrined in the emergency legislation, they were rarely practiced in realistic national drills. Poor interoperability led to utterly anomolous situations when emergency situations were instituted by local public authorities without any consideration of the national policy.
Unfortunately, the Moldovan government was not able to provide an integrated response to multiple challenges posed by the COVID-19 crisis. By and large, the epidemiological component of the crisis has been adequately addressed at operational and tactical level, but the overall epidemiological strategy lacks coherence and clarity. As a result, some of the initial decisions were hastily adopted (such as initially closing all retail and then reopening some, or organization of snap partial elections in Hancesti district amid difficult local epidemiological conditions at the early stages of the epidemic), while others have been slowly adopted (such as reintroducing the lockdown, which is imperatively required by current conditions as of March 2021).
The economic and social response package has been even more disordered, giving rise to suspicions of vested interests and corrupt arrangements. Giving 5 percentage points reduction in the VAT rate to the HORECA sector, while leaving other affected economic sectors without comparable fiscal support is only one of the most illustrative cases. In fact, there was not even a unique, national-level, plan of actions for economic response; the National Bank of Moldova adopted its own measures, while the Ministry of Economy, the Ministry of Finance and Prime-Minister’s Economic Council tried to outcompete each other rather than to cooperate for adoption of a unique governmental plan. As a result, the support to firms and people amounted to only 0.8 percent of the GDP (the lowest in the region) and only an estimated share of 6 percent of companies benefited of any form of direct or indirect support.
While presidential electoral campaign in 2020 may have deterred adoption of some unpopular yet necessary measures, from our point of view, the most fundamental problem undermining the national response has been the diluted leadership caused by divergent political goals and hidden agendas. To illustrate this point: the national legislation provides that during the period of declared emergency the Commission for Emergency Situations (CES), chaired by the Prime-Minister, is the highest and the only decision-making body responsible for overall strategic coordination. Contrary to this imperative provision, during the period of emergency in 2020 the CES received orders and advice from the Supreme Council of Security (SCS) and from the Unique Center of Command (UCC) – both controlled by then-president of the country. While the SCS is a permanent advisory body, the UCC is not even foreseen by the national legislation, and has been an ad-hoc invention of the then-president Igor Dodon.
As heavy political figures tried to dominate the picture, the public voice of medical and epidemiological professionals was silenced. While there are indications that behind-the-door discussions were often heavy and that politicians disputed with health specialists, these meetings have not been adequately documented, and there was not enough transparency behind the reasons for adopting this or that policy.
No surprise, then, the Government found it very difficult to implement the anti-crisis measures. The adherence of the population to restrictions has been very poor, medical masks are not universally used, city markets and buses are overcrowded, trust in vaccines is very low, while one quarter of the population seem to be COVID-deniers. Lamentable personal examples of the national leaders contributed to these dismissive popular attitudes: the then-president meeting and giving full hugs to veterans of war; the prime-minister organizing the wedding of his son amid public health emergency restrictions; the public health officials not wearing masks in closed public spaces etc.
Assessment of this phase is irrelevant, as COVID-19 crisis is yet far from over. Nonetheless, it is obvious that problems affecting the efficiency of planning and response are guaranteed to undermine the recovery phase.
How to prepare (better) for future crises?
As international relations get more complex, the crises become more diverse, while their frequency is set to increase. For Moldova, which grows more integrated in the global economy, a key implication is that its exposure to global threats and hazards will broaden. Moldovan society itself turns more interdependent, which creates new vulnerabilities. The domestic and international mobility of people increases thus facilitating the spread of risk carriers. Urban settlements, especially the capital area, provide home to people resettling from rural areas and thus boosting the demand for and concentration of additional critical infrastructure.
As the exposure to hazards and threats will inevitably increase, the key strategy for maintaining the continuity of life at “normal” levels is to reduce vulnerability and to build resilience against known and unknown threats and hazards. A number of points are worthwhile being emphasized.
Comprehensive assessment of existing and potential risks is imperative. This assessment should be done by a permanent or periodically convening body, of sufficiently high stance in the hierarchy. It can be created anew or the mission can be entrusted to the secretariat of the Supreme Council for Security. The body should adopt a cross-organizational approach to risks evaluation, have access to all relevant technical documentation, while at the same time enjoy a sufficient degree of intellectual freedom and creativity. A formal, comprehensive, periodically reviewed and updated map of risks with detailed technical advice and organization-level recommendations should be the main output of its activity.
Innovative use of conventional and alternative data is necessary for early warning, effective emergency management and evidence-based policy response. Statistical strategy and program of statistical works should be reviewed against the evidence brought forward by COVID-19 crisis, and the statistical procedures should be adapted to function under restrictions. Data sharing agreements should be signed with private holders of useful data. The provisions of the law on protection of personal data should be brought in line with the need of the statistical authorities to access personal data for the sake of sampling and survey. It may sound ridiculous that during lockdown, the national statistical authorities could not undertake telephone-assisted households and labor surveys because they do not have access to the register of cell phone numbers.
Besides, an integrated information system for management of strategic supplies is warranted. The information system should integrate data on stocks available with private and public suppliers, at central, regional and local levels. This will also require legal amendments regarding the commercial trade rules during emergency situations.
Standard operating procedures (SOPs) should be developed for public and private sector to fit different emergency scenarios. COVID-19 has shown that unclear, ambiguous directives may increase the vulnerability amid an ongoing emergency. While normally SOPs are defined for case management in hospitals, the COVID-19 has proven that they are necessary across all economic sectors in order to maintain an acceptable level of economic functionality and security.
Performance of the emergency management institutions amid COVID-19 crisis should be thoroughly audited against the written rules and procedures. The results of the audit should be used to better insulated them from political interferences in the future crises. Politicians should take a step back during emergency situations. They may formally remain in the headlines, but they should be aware of how poor disaster managers they really are. During COVID-19 crisis they too easily resorted to populistic decisions undermining the overall crisis management strategy. Institutional framework should be reviewed and secondary legislation be adopted to ensure that professionals are really in charge during emergency.
Transparent and well-communicated decisions are of key importance for public trust. Meetings of the bodies involved in management of future emergencies should be adequately documented / taped / videorecorded. This is very important not only for the sake of transparency and public control, but also as a factor deterring political figures from intruding too much. Public communications guidelines should be developed and shared by all levels (operational, tactical, strategic), messages should be coherent and consistent across all levels.
Community mobilization should be improved. In this regard, emergency management bodies should stand ready to establish partnerships with influential community leaders. During COVID-19 the Government failed to realize that religious organizations, including the two orthodox churches represented in Moldova, could be very useful in convincing the community to abide by restrictions and rules. Failing to do so, some organizations adopted skeptical attitudes regarding the pandemic and, probably to a significant, yet unknown extent, contributed to spreading the infection.
Improved international cooperation. EU-Moldova Association Agreement may be an opportune framework which Moldova could use, not only for response per se (here including vaccination), but also for learning more advanced practical experience. The Chapter 21 on Public Health foresees in Article 114 that the parties shall cooperate in area of epidemiological surveillance and control of communicable diseases, such as for example HIV/AIDS, viral hepatitis and tuberculosis, as well as increased preparedness for public health threats and emergencies. Moreover, the Chapter 22 on Civil Protection the parties shall cooperate and provide mutual assistance in case of emergencies.
This article is available only in Romanian.
Despite international efforts, COVID-19 cases continue to rise, in particular because of the novel UK and South African variants spreading across the globe. Furthermore, many countries in Europe are experiencing a slow vaccination rollout compared to the United Kingdom, the United States, and Israel with no indication of when an increased response will occur. Reasons for the slow vaccination rates have been attributed to a low supply of vaccines. Hesitancy for the COVID-19 vaccines, in particular when it comes to taking the vaccine developed by AstraZeneca, is one other factor that slows down the immunization process. Although vaccine acceptance has been recently on the rise in many developed countries, this is not the case in Moldova where according to survey results released a few weeks ago only 1 out of 3 respondents declared to be willing to get the vaccine when it will be available. Even more worrisome is the refusal of some health workers to take the vaccine as this sets a bad example for the general population.
This short policy paper proposes three strategies to increase vaccine acceptance and uptake using insights from behavioral science.
Behaviorally-informed strategy 1: Make salient the endorsement of vaccines by trusted leaders and public figures
A potential response to vaccine hesitancy is to provide endorsement of vaccination from social figures in the media and from the government, which would send a social signal to people of the benefits of vaccination for oneself and the community. Groups that influence institutional signals include political decision-makers, health workers, media outlets, digital platforms, immunization program managers, and community and religious leaders. Health care providers, such as doctors and health government officials, remain the most trusted advisor and influencer of vaccination decisions. Multiple studies have shown that health care professionals are more likely to recommend vaccination if they themselves have been vaccinated, which can be influenced by improving their knowledge of the vaccine and showing them how many of their co-workers support the vaccine. The appeal to top public health officials’ endorsement of the vaccine has also been shown to increase vaccine acceptance within the general population. For example, in a US randomized survey experiment, endorsement of a COVID-19 vaccine from Dr. Fauci (primary US expert on pandemic response) had a significant effect in increasing beliefs and vaccine uptake. However, using the COVID-19 vaccine for perceived political benefits, such as Donald Trump or Nancy Pelosi endorsing vaccination, did not affect vaccine beliefs or uptake. Therefore, using political figures to promote the vaccine in a country with high political polarization may have no effect on the intention of the general population to take the vaccine.
Behaviorally-informed strategy 2: Make it easy to get the vaccine
When it comes to changing behaviors, one simple policy with a potentially noticeable impact is to change the default option: instead of asking people to book an appointment at a nearby clinic, public authorities could work with employers to automatically book appointments for their employees, leaving them the freedom to opt-out. Results from previous behavioral studies on the take-up of vaccines show that this measure has the potential to dramatically increase the number of people who get a vaccine. A group of researchers from Rutgers University (USA) sent a letter to 408 university employees to inform them about a campaign of vaccination against influenza. Employees were divided in two groups (without knowing that). The first group received an email indicating the date, time and place where they had to be vaccinated. In other words, their appointment had been scheduled for them, but they could cancel it any time (opt-out). The other group received an email requesting them to choose a date to be vaccinated (opt-in). The results show a significant effect of the opt-out option: 92% of the employees in the first group kept their appointment and therefore received a vaccine, while only 50% of those in the second group made the necessary appointment in order to be vaccinated.
Behaviorally-informed strategy 3: Remind people that there is a vaccine reserved for them
A recent experiment conducted with thousands of participants who were unaware that they were participating in a scientific study has tested 19 messages designed to boost adoption of the influenza vaccine. The top performing message led to a 4.6 percentage point boost in vaccination (an 11% increase) at the cost of sending two text messages. The first text, in this condition, sent 72 hours before the patient’s appointment at the local medical center noted that “it’s the flu season” and “a flu vaccine is available for you”. The second text in this condition, sent 24 hours before the appointment, stated simply that “this is a reminder that a flu vaccine has been reserved for your appointment”. The underlying theory behind this intervention emphasizing that a vaccine has been “reserved” for the patient is the concept of mental accounting. For example, one basic principle in economics is that money is fungible. To say that money is fungible means that, regardless of its intended use, all money is the same. However, studies in behavioral economics found that this principle is often violated in practice. For example, people tend to categorize their money into separate non-fungible accounts: savings accounts, retirement accounts, etc. The idea is that you’ll tend to spend less on temptation goods (for example, buying an expensive watch) if your bonus is transferred automatically on your “savings account” instead of your normal account. Taking money out of your “savings account” makes you feel more guilty. This is exactly the idea of the reminder that a vaccine has been “reserved” for you: in theory, the vaccine can be used for anyone but labeling it as reserved for someone specifically makes that person feel guilty if s/he doesn’t take it on time.
Based on the aforementioned strategies to increase vaccine acceptance and uptake, we make the following detailed recommendations that may help public authorities to design a vaccination strategy that integrates behavioral insights. Recommendations are made in the order of their implementation priority:
1. Improve the knowledge about the vaccine safety among healthcare workers.
2. Show healthcare workers how many of their peers approve of getting the vaccine. In case the statistics do not show strong approval of vaccination among healthcare workers, use data from neighboring countries that show higher approval rates.
3. Appeal to top officials in the healthcare system to promote vaccination (local experts on pandemic response, directors of hospitals).
4. Use the opt-out strategy to automatically book appointments for employees that are allowed to be vaccinated at their workplace (healthcare workers).
5. When vaccination opens to vulnerable individuals who are easy to locate and to communicate with (either because they live in retirement homes or because they are under active medical surveillance), automatically book appointments leaving them the freedom to opt-out.
6. Once vaccination opens to the general (less vulnerable) population, design public information campaigns that show (high) vaccination rates among the healthcare workers. Furthermore, use trusted public figures to promote vaccination and at the same time avoid politicizing this practice (i.e., do not use political figures).
7. Use text messages to promote vaccination among all types of individuals (priority workers, vulnerable individuals, general population) that make use of the mental accounting concept -- that is, inform individuals that a shot has been reserved for them.
Asociația Obștească „Centrul Analitic Independent EXPERT-GRUP” anunță concurs pentru selectarea unei companii sau persoane fizice care să presteze servicii de redactare și corectare a publicației „Deepening EU–Moldovan Relations”, ediția 3, tradusă din limba engleză spre limba română, elaborată în cadrul proiectului „Înțelegerea Acordului de Asociere și a ZLSAC dintre UE și Ucraina, Georgia și Republica Moldova”.
Volumul total estimat de semne ce urmează a fi redactate/corectate este de 633 233 caractere fără spații. Limba pentru care se solicită servicii de redactare: Română.
- CV-ul personal sau în cazul persoanelor juridice CV-ul complet al persoanei ce se va ocupa de redactare. CV-ul trebuie să includă toată experiența relevantă;
- Exemple relevante de texte scrise, redactate;
- 2 referințe (persoane fizice sau juridice) care pot confirma expertiza și care au beneficiat de serviciile ofertantului.
Oferta financiară din care să reiasă prețul total net și eventualele taxe ce se pot aplica (exemplu: TVA pentru companii).
- Preț net per 1 pagină / regim normal, Numărul de pagini (format 1800 caractere fără spații) executate în regim normal / pe zi;
- Preț net per 1 pagină / regim de urgență/zile de odihnă, Numărul de pagini (format 1800 caractere fără spații) executate în regim de urgență / pe zi.
Cerințe minime înaintate ofertanților:
- Cel puțin 3 ani de experiență în redactarea textelor similare la nivel de organizații internaționale și/sau naționale;
- Înțelegerea terminologiei legale, economice, financiare, legislație europeană (experiență similară cu asemenea texte);
- Cunoașterea la nivel avansat a limbii române: ortografie, stilistică și morfologie.
Termenul limită de depunere a ofertelor este: 26 martie 2021, ora 10:00.
Centrul Analitic Independent Expert-Grup anunță extinderea termenului pentru depunerea ofertelor privind contractarea serviciilor de locațiune oficiu care să corespundă criteriilor minime înaintate mai jos:
Spațiul oferit spre chirie trebuie să aibă între 150 – 260 m2. Spațiu de lucru suficient pentru cel puțin 10 birouri și o sală de ședințe.
Chișinău, sectorul Centru, în perimetrul străzilor Alexandru cel Bun – Mateevici și Bulgară – Toma Ciorbă.
Compartimentarea și amenajarea
Oficiul propus spre chirie trebuie să fie compartimentat în 3-4 încăperi destinate birourilor plus a sală de ședințe, 2-3 băi și o bucătărie mică. Sala de ședințe trebuie să poată acomoda cel puțin 10 persoane. Este de preferat ca spațiul propus spre chirie să nu conțină mobilier și să nu necesite reparații cosmetice sau capitale.
Luminozitatea, aerul condiționat și încălzirea
Oficiul trebuie să aibă instalat sistem de încălzire (propriu sau care permite controlarea temperaturii independent de restul clădirii) precum și sistem de condiționare a aerului pentru fiecare birou. Spațiul trebuie să fie bine iluminat atât în mod natural precum și artificial.
Oficiul propus spre chirie trebuie să permită conexiunea internet și telefonie de la Starnet.
Accesul în clădire
Spațiul propus spre chirie trebuie să aibă intrare separată pe care nu o vor folosi alte personae. Ușa de intrare trebuie să permită instalarea sistemul de restricționare a accesului. Se va acorda preferință intrării amenajate pentru persoane care se deplasează cu căruciorul.
Cel puțin 6 locuri de parcare incluse fie disponibile în mod liber în apropiere.
Disponibilitatea și durata contractului de chirie
Spațiul trebuie să fie disponibil incepând cu 1 mai 2021 pentru o perioadă minima de 24 luni cu posibilitatea de a extinde termenul de chirie după această data.
- Formularul completat în conformitate cu Anexa 1;
- Extrasul din registrul bunurilor imobile;
- Planul oficiului și poze reale.
Ofertele depuse vor fi valabile pentru o perioadă de cel puțin 20 zile calendaristice din data depunerii ofertei.
Criteriile de evaluare a ofertelor: Ofertele recepționate vor fi evaluate din punct de vedere tehnic prin prisma criteriilor tehnice înaintate în tabelul de mai sus precum și cel mai mic preț oferit per m2 de chirie.
În contextul situației actuale din țară privind răspândirea virusului COVID-19, vă anunţăm că oficiul Centrului Analitic Independent „Expert-Grup” va fi închis în perioada 17 martie - 17 aprilie 2021. Echipa organizației îşi va desfăşura activitatea la distanţă, asigurând totală disponibilitate online.
Vă rugăm să nu ezitaţi să ne contactați. Datele de contact ale echipei sunt disponibile aici.
Pentru informații adiționale:
The priority agenda now switches to the challenges of undertaking mass vaccination against COVID-19. Thus, on March 24, within the framework of the “3 DCFTAs” Project, CEPS in cooperation with the Eastern Partnership Civil Society Forum is organizing an online COVID-19 Eastern Europe webinar: "And now for vaccination".
The webinar will debate the plans and early experiences of vaccination in Eastern Partnership states and Russia, as well as in the EU. However the waves of infections and deaths have not yet finished, and in many cases, third waves now overlap with vaccination drives. The likely impacts on the economy and society in 2021 will also be discussed.
The event will be open for audience participation in the Q & A session.
● Veronika Movchan, Institute for Economic Research and Policy Consulting, Kyiv;
● Denis Cenusa, Expert-Grup, Chisinau;
● Tamara Kovziridze, Reformatics, Tbilisi;
● Benyamin Poghosyan, Political Science Association of Armenia, Yerevan;
● Shahla Ismayil, Women Association for Rational Development, Baku, Steering Committee EaP CSF;
● Andrei Yahorau, Centre for European Transformation, Minsk, EaP CSF;
● Andrey Makarychev, University of Tartu;
● Alexandra Yatsyk, Free Russia Foundation.
● Michael Emerson, Associate Senior Research Fellow, CEPS.
Date: March 24, 2021;
Time: 14:00 - 15:30 CET, 15:00 - 16:30 Chisinau Time;
This event is free and open to the public.
We kindly ask you to register in English by March 23, 2021.
Please connect to the event 5 minutes prior (13:55) to allow time for technical assistance and troubleshooting. Questions to the panelists should be addressed in Q&A chat.
Video will be taken during the event. It may be processed and used by the organisers.
By registering to this event, you are granting us the rights to do so.
Purpose of the analysis
The recent rise in the number of COVID-19 infections, which was most likely caused by new virus strains, stirred heated public debates about the need to enforce tougher restrictions in order to prevent the virus from spreading. In this context, as a result of the recent meeting of the Supreme Security Council, President Sandu suggested to impose a 2-week state of emergency and for the Government to develop the list of restrictions regarding social and economic activities, which would be then submitted to the Parliament for consideration and approval. The idea of establishing these restrictions (or a lockdown) is controversial per se, as its impact will be felt by everyone, implying costs for some and benefits for others. On the one hand it could lead to economic and social costs, with particular damage to small enterprises and employees with lower salaries, especially if we take into account the population’s low income and the economy that is barely recovering from the most severe recession in the last 20 years, while on the other hand a lockdown could relieve some of the pressure on the health system, prevent infection spreading and allow saving people’s lives. Nevertheless, the heated arguments about this issue miss a cold review of the effects caused by the lockdown of 17 March - 16 May 2020, which could be used as a yardstick for understanding the effects of a potential lockdown in 2021. This analysis estimates those effects on the level of infection cases and deaths caused by COVID-19, as well as on the major economic indicators, by means of precise econometrics and statistical techniques.
Impact of the lockdown on the health situation
Methodological set up
In order to estimate the lockdown impact on the health situation, we specify two very simple econometric models, which proved to be very precise. The models allow to estimate the key drivers of infection and death rates caused by Covid (please refer to Annex A for more detailed specification of econometric models). Respectively, these are:
- External factor. Taking into account that the pandemics is an external shock for the country, it is necessary to include into the model a variable that controls for the regional and world tendencies of virus spreading, because they affect the situation in Moldova. The most relevant indicator in this regard is the infections' and death rates registered in Romania, taking into account the geographic and economic proximity of both countries. Thus, the model takes into account the epidemiological situation in Romania as an explanatory factor for the epidemiological situation in Moldova. Inclusion of this variable excludes the necessity to add variables for other countries because, given the global nature of the pandemics, there is a high correlation among countries. In such conditions, in order to ensure a proper fit of the model, it is sufficient to include one single variable, which has the most direct influence on the situation in Moldova.
- Inertial factor. Taking into account the nature of the virus spreading, the number of infections and deaths caused by Covid also depends on the past tendencies (e.g. the higher the number yesterday, it is more likely that today and tomorrow the numbers will also be higher).
- The lockdown. The model will take into account the impact of the lockdown during the state of emergency imposed during March 17 – May 16, as it is assumed that it allowed to slow down the spreading of the virus. In this way, we will be able to estimate the efficiency and impact of that lockdown, which could serve a valuable input into the ongoing debates about the potential lockdown in 2021.
- Post-lockdown period. It is assumed that after lifting the restrictions on May 16, the virus started to spread at a higher speed, leading to a spike in number of infections and deaths. Therefore, we include into the model another binary explanatory factor that controls the period of one month past two weeks from the lockdown being lifted (after the restrictions were lifted and past the virus incubation period, we had a rapid increase in the number of infections and deaths). This will allow us to estimate whether the lockdown was lifted at the right moment or it was too early, which will also serve as an important lesson learned in 2020 for the potential lockdown in 2021.
- Weekdays. Taking into account that on Sundays the number of reported infections and deaths tends to be lower, which is compensated by higher numbers on Mondays, we include the weekdays in order to control for this seasonal factor and increase the accuracy of the model.
The estimation results reveal that the 2020 lockdown allowed decreasing the number of new infection cases by 20% and the number of deaths by an impressive 45% (regression results are presented in Annex B, while the forecasts based on this model are presented in Annex C). If we extrapolate these figures to the situation in 2021 and take into account the forecasts on infections and deaths for the upcoming 30 days, we can estimate that imposing a lockdown would decrease the number of new cases by around 12.3 thousand and, most importantly, it will allow saving around 287 people. These figures apply strictly to the following 30 days, during which we forecast that, if a lockdown is not imposed, another 61.5 thousand infection cases and 1,432 deaths would be registered. Moreover, the lockdown impact on decreasing virus spreading and reducing the number of deaths will be felt over the following months, because decreasing the number of infection cases by around 12.3 thousand during these 30 days will protect other 36.9 thousand people that potentially could be infected in chain (based on the hypothesis that one infected person would infect three other people). Given that the share of deaths out of total cases, according to the forecast for the next 30 days is around 2.3%, we can conclude that additional 849 deaths will be avoided. All in all, imposing a 30-day lockdown will allow avoiding the infection of around 49.2 thousand people and saving 1,136 lives.
Impact of the lockdown on the economic situation
Estimation of the 2020 lockdown impact on the economic situation is trickier and we will use a slightly different approach. The reason is that the economic dynamics in 2020 was obscured by the overlapping of the pandemic crisis and two other crises: a slowdown in the economic growth noticed since the autumn of 2019 and the drought of 2020 that substantially the agricultural production and agro-industrial exports. Respectively, in order to estimate the net impact of the lockdown it is necessary to ‘control’ all other factors that also influenced (mostly negatively) the economy in 2020. Respectively, in order to estimate the net impact, we will compare the de facto developments during the lockdown period (17 March – 16 May 2020) with the potential evolutions that would have happened if there wasn’t any lockdown. Also, we will analyze some key macroeconomic indicators that are available on monthly frequency, in order to analyze to what extent their dynamics was affected during the lockdown period (17 March – 16 May 2020).
First of all, we will estimate the lockdown impact on budget receipts. For this purpose, we will analyse the impact over the revenues from taxes (mainly VAT, excise duties and income tax), which are proportionate to the level of consumption and overall economic situation; we will also analyse the impact on the collection of mandatory social and medical insurance contributions, which are proportionate to the level of salaries and employment rate in the economy. The estimates confirm a negative shock, but not a dramatic one, of the lockdown on both sources of revenue. Thus, in the lockdown months (March – May 2020) the collected taxes were MDL 1.3 billion lower than the estimated level if no lockdown would have been imposed3 . When it comes to mandatory social and medical insurance contributions, the collected amount was MDL 373 million lower than the amount that would have been collected in the absence of a lockdown. Thus, we can state that the net impact of the lockdown on the national public budget is estimated at around MDL 1.7 billion (or about 3% of total public revenues) – calculated as the difference between actual collection during March – May 2020 and what could have been collected if no lockdown was imposed. At the same time, we do not see a dramatic effect and the dynamics in the following months showed a marginal improvement of budget receipts.
The next indicator is the Industrial Production Index (IPI), which is closely related to the main macroeconomic indicator, which is unfortunately available only with quarterly frequency – the Gross Domestic Product. During the lockdown months this index registered a steep decline, which was much more dramatic than the estimated development in case of a no-lockdown scenario. The biggest blow happened in April 2020, when the volume of industrial production decreased by 26% compared to April 2019, while in a no-lockdown scenario the decrease could have been 2.5 times smaller (however, the index would have declined anyway under the overall impact of the pandemic). At the same time, it is worth mentioning that the industrial activity started to recover slowly immediately after the lockdown was lifted, which revealed a certain adaptability and flexibility of the industrial complex. Thus, despite the dramatic repercussions of the corona crisis, decreased internal and external demand, but also the lack of actual support of the Government for companies and entrepreneurs4 , the industrial activity finished year 2020 close to zero (in December the index decreased by only 1.8% and in November 2020 it even registered a 2.8% increase compared to the similar period of the previous year).
Another important indicator that highlights both the level of consumption and economic activity is the import dynamics. When it comes to this indicator we also notice a sudden decrease in April 2020 (-45%) and May 2020 (-32%) compared to the previous year, which was almost twice as deeper as it would have been in a nolockdown scenario. In this respect, it is necessary to mention that the descending trend started way before the lockdown. In case of this indicator we also notice a visible recovery in the post-lockdown period. Similar dynamics (V-shaped) are also typical for other indicators that measure the level of economic activity in the country (e.g. domestic trade in goods and services), which reveals that most companies perceived the lockdown as a temporary measure and after it was lifted they resumed their activity (although only partially), which led to a certain compensatory growth of the economic activity (the growth is insufficient to overcome the corona crisis, but a marginal recovery compared to the lockdown period is visible).
A new lockdown: to be or not to be?
The econometric estimates confirm the beneficial impact of the 2020 lockdown on the health situation. It allowed decreasing the number of new COVID-19 cases by around 20% and reducing the number of deaths by around 45%, compared to a no-lockdown scenario. Surprisingly, its economic costs were not as dramatic as it is often claimed. It is true that 2020 was the year of one of the worst recessions in the last 20 years, but this was caused by the overlapping of two crises: the drought and the COVID-19 impact on the internal and external demand. The lockdown had a certain net effect that had worsened the situation for two months, but this effect was compensated by a marginal economic recovery, during the post-lockdown period. The budgetary impact of the lockdown was also far from dramatic, being estimated to about MDL 1.7 billion (about 3% of total public revenues in 2020), which was also followed by a marginal recovery of budget receipts over the following months. Given the analysis of the 2020 lockdown impact, we can state that a potential lockdown for only 30 days in 2021 will prevent the infection of around 49.2 thousand people and save over 1,100 lives. Taking into account that Government’s priority zero should be to prevent the virus spreading and save human lives, in circumstances where the number of infection cases and deaths grows rapidly, it is obvious that imposing a new lockdown is necessary. At the same time, in order to mitigate the economic costs, which could be higher than in 2020, because companies and population had mostly exhausted their reserves, the lockdown needs to be correlated with certain compensatory measures focused on two goals: (i) access to financing for companies, by issuing state guarantees; and (ii) compensation of salary losses for employees, to an extent of around 75%.