The article is available in Romanian.

The Independent Think-Tank "Expert-Grup" and the Ministry of Labour and Social Protection in partnership with the Soros Foundation Moldova organizes a public event aimed at presenting the concept of reform of the National Agency for Employment: "National Agency for Employment (ANOFM) reform: A new vision for a more competitive and innovative labour market" which will take place on May 2, 2023, 10:00 a.m., venue: Digital Park, Chisinau.

The purpose of the conference is to discuss the necessary policies and effective mechanisms for improving the services offered by the National Agency for Employment (ANOFM) for the years 2023-2026, so that the challenges and imbalances in the intermediation of the demand and supply of the labour market in our country are remedied, but also the strengthening and ensuring the notoriety of the institution. During the event, a representative survey will be presented regarding the beneficiaries' perception of ANOFM's activity and the reform concept of the institution. The conference will also represent a place for debating the vision proposed by the Government for strengthening the institutional capacities of the National Employment Agency, streamlining funding and digitizing services and employment measures, as well as increasing funding for the policy of active measures until in 2026, also taking into account the context of the EU Candidate status granted to our country.

The need to reform the National Agency for Employment (ANOFM) is a priority both on the Government's agenda and in the strategic planning documents. Thus, in the activity program of the government "Prosperous, safe, European Moldova", approved by Parliament Decision no. 28 of February 16, 2023, in the field of Labour and social protection, a series of activities aimed at ANOFM are mentioned, namely: Promoting the employment of able-bodied people from the inactive group and the formal employment of the unemployed registered at ANOFM, people with disabilities and other categories of the unemployed in general by strengthening the capacities of the National Employment Agency, implementing the vocational training voucher system, increasing investments in employment programs and simplifying them.

▶️ The live broadcast of the event will be available on May 2, starting at 10:00 a.m. on privesc.eu and the Facebook pages: Expert-Grup, Ministry of Labor and Social Protection, Soros Foundation Moldova.

The event's agenda

Economia Republicii Moldova își va reveni în 2023 și va recupera scăderea înregistrată anul trecut, generată de multiplele crize cu care s-a confruntat. Perspectivele economice pentru următorii ani sunt marcate de oportunități istorice, dar și de riscuri. Scenariul de bază al actualului orizont de Prognoză se bazează pe o redresare economică în 2023 de 4,7 % și pe o creștere economică în anii următori (5,4 % în 2024 și un coridor de creștere de 4-5 % în 2025-2027). Pentru următorii ani, principalele ipoteze avute în vedere pentru creșterea economică sunt stabilizarea situației de securitate din regiune, îmbunătățirea conectivității energetice și de mobilitate cu România și începerea negocierilor de aderare la UE. Concluziile și prognozele date se regăsesc în cea de-a #24 ediție a publicației MEGA -Moldova Economic Growth Analysis*, cu titlul „Relansarea economică din 2023: prognoze, riscuri și priorități de politici” elaborată de Centrul Analitic Independent „Expert-Grup” și lansată în 27 aprilie 2023, în cadrul conferinței de presă MEGA #24 „Economia Moldovei între ecoul războiului și reziliență: prognoze pentru 2023-2024”.

 

Economia moldovenească a fost puternic afectată în 2022 de o serie de crize fără precedent, cum ar fi agresiunea Rusiei din Ucraina, criza energetică, inflația persistentă și seceta. Aceste crize au pus firmele sub presiuni mari de costuri și de competitivitate, ceea ce a dus la o scădere economică de 5,9%, sectoarele economice cele mai afectate fiind agricultura, construcțiile și tranzacțiile imobiliare, precum și industria. Cu toate acestea, datorită măsurilor adoptate de Guvern și a sprijinului extern, au fost atenuate șocurile și economia a intrat în 2023 mai puternică și cu perspective bune de redresare rapidă.

„În pofida multiplelor crize care au afectat Republica Moldova în 2022 (criza energetică, seceta, inflația, război la hotar, criza refugiaților), s-a reușit menținerea unei stabilități macrofinanciare relative. Astfel, moneda națională a rămas pe poziții, sistemul bancar s-a dovedit a fi rezilient și bine capitalizat, iar sistemul de finanțe publice a rămas sub control. Aceasta a fost posibil preponderent grație suportului financiar, tehnic și politic din partea partenerilor de dezvoltare. Pentru 2023 prognozăm o creștere economică de circa 4-5% pe fundalul recuperării în agricultură grație condițiilor climaterice relativ favorabile, diminuării ratei inflației și, respectivă, relaxării politicii monetare și relansării creditării. Evident, situația de securitate din Ucraina și regiune, precum și dinamica prețurilor la resursele energetice rămân principalele surse de incertitudine și riscuri, care pot afecta această prognoză relativ optimistă” susține Adrian Lupușor, director executiv, Expert-Grup.

Potrivit autorilor publicației, anii 2023-2024 vor marca o perioadă de ,,revenire la normalitate" a dinamicii inflaționiste. Șocurile inflaționiste au început să se disipeze la sfârșitul anului 2022 și începutul anului 2023, IPC anual înregistrând o tendință descendentă. Decelerarea inflației se va menține pe întreaga perioadă 2023-2024, pe fondul unei baze de comparație ridicate, unui an agricol mai bun, al stabilizării tendințelor inflaționiste în regiune și al presiunilor inflaționiste limitate pe partea cererii la nivel intern.

În ceea ce privește structura veniturilor populației, ponderea salariilor crește, în timp ce rolul remiterilor se reduce treptat, deși acestea continuă să joace un rol important. Între 2012 și 2022, raportul dintre influxul de remiteri și PIB s-a redus de la 21 la 13,8%, iar ponderea remiterilor în venitul disponibil s-a diminuat de la 16 la 12 procente. În aceeași perioadă, ponderea salariilor s-a majorat cu 8 p.p., de la 42,7 % până la 50,7%. Pe termen mediu, creșterea veniturilor va fi susținută de majorarea salariilor, deoarece firmele vor fi nevoite să mărească costurile salarial pentru a atrage angajați calificați, susțin experții.

Băncile moldovenești au intrat în criza din 2022 bine capitalizate și pregătite să suporte astfel de șocuri, având în vedere întărirea cadrului regulamentar și îmbunătățirea guvernanței băncilor după criza bancară din 2015. Ca rezultat, sectorul bancar s-a dovedit a fi robust la șocurile din 2022, ieșind mai rezistent din criză, cu indicatori îmbunătățiți de lichiditate și adecvare a capitalului. Riscul de creditare, care a crescut semnificativ în 2022 datorită recesiunii economice, inflației și incertitudinii legate de războiul din Ucraina, a fost gestionat adecvat de bănci.

Stabilitatea sectorului bancar a fost consolidată prin politica monetară prudentă a Băncii Centrale a Moldovei, care a recurs la majorarea ratei rezervelor obligatorii pentru a proteja bilanțurile băncilor. Ca rezultat, creditarea s-a stabilizat, ponderea activelor fără risc în totalul activelor a crescut, în timp ce indicatorii de lichiditate și adecvare a capitalului s-au îmbunătățit. Lichiditatea și capitalizarea ridicate ale sectorului bancar, împreună cu relaxarea politicii monetare și îmbunătățirea dinamicii economice și inflaționiste, vor pregăti terenul pentru o redresare economică robustă în 2023-2024.

Autorii publicației MEGA, ediția #24, au mai subliniat faptul că în anul 2023, menținerea sustenabilității fiscale va continua să fie pusă sub presiunea contextului regional, care rămâne a fi foarte incert, iar, în vederea realizării priorităților sociale și economice asumate de Guvern, pentru anul 2023 a fost planificat un deficit major, care va constitui 6% din PIB, în acest context,  Moldova trebuie să valorifice la maximum oportunitățile care derivă din statutul său de țară candidat la UE, care va aduce o deschidere de finanțare și mai mare din partea comunității externe. Pe termen scurt și mediu, spațiul fiscal rămâne limitat, fiind estimat la aproximativ 1,5% din PIB. Prin urmare, atragerea granturilor și a împrumuturilor în condiții concesionale de la donatorii, și respectiv, creditorii externi va rămâne o premisă importantă pentru finanțarea noilor inițiative de politici și a noilor proiecte de investiții publice.

În ceea ce ține de balanța de plăți, nu s-au materializat temerile privind fuga capitalului din Moldova și epuizarea activelor de rezervă, care circulau la începutul războiului din Ucraina. De fapt, în contul financiar al balanței de plăți au fost înregistrate intrări nete de capital cu 37% mai mari față de 2021. Nerezidenții nu și-au retras depozitele din sistemul bancar moldovenesc, din contra, depozitele străinilor au crescut, iar investitorii străini și-au majorat considerabil investițiile directe în Moldova. Banca Națională a Moldovei (BNM)a făcut intervenții pe piața valutară la începutul anului pentru a satisface cererea de valută care a crescut subit, însă această situație nu a durat mult timp. Pe parcursul anului 2022, pe fundalul intrărilor mari de capital din exterior, activele de rezervă ale statului au crescut și au atins un nivel record.

Cu toate acestea, sunt necesare măsuri de corectare a deficitului exagerat de cont curent, determinat de persistența problemelor de competitivitate a exporturilor moldovenești, precum și de dinamica prețurilor la resursele energetice importate. În acest sens, este crucial ca Moldova să profite de oportunitățile pe care i le oferă statutul de țară-candidat la aderare la Uniunea Europeană, implementând reformele necesare și promovând politici structurale de stimulare a ofertei. 

Analiza pe larg poate fi citită aici,  prezentarea este disponibilă aici.

Înregistrarea video a conferinței:

Galerie poze 

*Notă: MEGA este un acronim în limba engleză pentru Moldova Economic Growth Analysis. 

MEGA este o recenzie bianuală publicată de EXPERT-grup din 2009, cu scopul de a explica fundamentele tendințelor economice recente din Moldova, analiza politicilor economice și propunerea de soluții pentru strategiile de dezvoltare economică ale Republicii Moldova.

The Moldovan economy faced an unprecedented mix of crises in 2022, but thanks to proper crisis management and external support it entered 2023 stronger and with good prospects for a speedy recovery. Stagflation, on the background of the energy crisis, draught and war in Ukraine, called for unprecedented and rapid policy responses. Thus, within months, the Government adopted a series of bold policy measures that contained the shocks. In order to support the demand amid the unprecedented increase in energy tariffs, it was introduced the mechanism of compensation to cover part of the energy tariffs for households; in order to support the businesses, it was increased the capitalization of the programs implemented by the Organization for Entrepreneurship Development; in order to address the energy crisis, for the first time in the history of Moldova, alternative sources of natural gas and electricity were used and natural gas has been stored as measures to increase energy security; in order to support the budget stability, the government switched to financing the budgetary deficit, primarily, from external sources, which were available due to the generous support from development partners. At the same time, the macro-financial stability was preserved, due to a prudential monetary, foreign exchange and regulatory policy, which kept the national currency stable, the banking sector well capitalized and robust and that allowed inflation to start decelerating by the end of 2022. 

The effects of Russian aggression in Ukraine, the energy crisis, persistent inflation and drought have put firms under severe cost and competitiveness pressures. As a result, 2022 brought an economic downturn of 5.9%, with the economic sectors most affected being agriculture, construction, real estate and industry. The main challenges for firms were related to: (i) the loss of markets and suppliers in Russia, Ukraine and Belarus, (ii) the need to rebuild many logistics routes with the loss of access to the port of Odessa, (iii) the substantial increase in transport and logistics costs as Moldova became a major transit point for goods to and from Ukraine, (iv) higher costs for energy resources, (v) more expensive financing because of monetary policy tightening, and (vi) lower sales on the domestic market because of erosion of the purchasing power of the population.

The economic outlook for the coming years is marked by historic opportunities, but also risks. The baseline scenario of the current forecast horizon is based on an economic recovery in 2023 of 4.7% and economic growth in the following years (5.4% in 2024 and a growth corridor of 4-5% in 2025-2027). For the coming years, the main assumptions considered for economic growth are the stabilization of the security situation in the region, the improvement of energy and mobility connectivity with Romania and the start of EU accession negotiations. The materialization of these opportunities can create an enormous synergy effect for attracting investment and modernizing the country. At the same time, risks remain an important variable and these include the risk of escalation of the war in Ukraine, volatility in the energy market, a global recession, hybrid threats from the Russian Federation, but also the behavior of policy makers and currently limited administrative capacities. 

In the structure of the population's income, the share of labour earnings is increasing, while the role of remittances is decreasing, although they continue to play an important role. Between 2012 and 2022, the ratio of remittance inflows to GDP decreased from 21% to 13.8%. Additionally, the share of remittances in disposable income has fallen from 16% to 12%. During the same period, the share of labour earnings increased by 8 p.p., from 42.7% to 50.7%. In the medium term, income growth will be supported by an increase in labour earnings. In addition to economic growth, the increase in salaries will be driven by the mismatch between labour supply and demand. In order to attract qualified employees, firms will be forced to increase labour costs.

The mismatch between labour demand and supply may favor labour earnings’ growth for a certain period, but in the long term, it is necessary to increase labour productivity. The labour supply in Moldova is largely provided by unskilled workers. In this context, increases in labour earnings in the Republic of Moldova will lead businesses to shift towards other markets where unskilled labour is cheaper or to automate their activities. To ensure decent wages and salaries in the long term, it is necessary to increase labour productivity, by reforming the tertiary education and the research sector, and improving the investment climate. 

For 2023, maintaining fiscal sustainability will continue to be challenged by the regional context that still fuels uncertainty. The Government has already committed a substantial deficit for 2023 (6% of the GDP), resulting from a budget construction aiming to sustain critical social and economic priorities. The higher planned expenditures are not accompanied by commensurate revenue increases, therefore further war spillovers or other shocks could pose additional risks to the budget. For the next period, the fiscal policy tends, on the one side to ensure sufficient liquidity for SMEs and stimulate private investments, while on another, focuses on strengthening fiscal discipline in a manner that will boost revenue mobilization and reduce the shadow economy.

Moldova should seize the opportunity offered by its EU candidate status and capitalize on the openness shown by the development partners. In the short and medium term, the fiscal space remains limited, being estimated at around 1.5% of GDP. Securing additional grants and concessional financing from donors and creditors will remain an important requisite for funding new policy initiatives and new public investment projects. The credibility and predictability that the EU candidate country status offers to the Republic, will further mobilize financial assistance. However, this background also sheds light on the current problems related to the limited capacity of authorities to assimilate foreign assistance. Thus, issues related to strategic planning, correlation of foreign assistance with development needs, management, and implementation of capital investment projects should be eliminated.

The Moldovan banks entered the crisis of 2022 well capitalized and prepared to bear such shocks, given the strengthening of the regulatory framework and improving banks’ governance after the banking crisis of 2015. As a result, the banking sector proved to be robust to the shocks of 2022, emerging more resilient from the crisis, with improved liquidity and capital adequacy indicators. The credit risk, which significantly increased in 2022 given the economic recession, inflation and uncertainty around the war in Ukraine, has been adequately managed by banks. The share of non-performing loans (NPL) remained relatively low (lower compared to the pre-pandemic period), suggesting an adequate quality of the banks’ loan portfolios. This is reinforced by comfortable liquidity and capital adequacy indicators, which, despite the shocks, remained at comfortable levels. Also, all liquidity indicators remained in the safe zone, in much better situation compared to the regulatory requirements. These indicators suggest that the banking system not only overcame well the crisis of 2022, but emerged even stronger from it, being well-capitalized, with sufficient liquidities, which can support the economic recovery of 2023-2024. 

The banks remained profitable during the crisis, despite shrinking interest margin. The monetary policy tightening had a much stronger effect on the interest rates of deposits compared to credits, leading to a shrinking interest margin. However, it did not undermine the profitability indicators of banks because, while the average interest rate on deposits increased, the share of long-term deposits in total bank deposits, which bear the highest interest rates, decreased. It complicated the historical structural issue of maturity mismatch of liquidities of Moldovan banks, because of high uncertainty around the economic and security situation of the country that the owners of deposits to increase their liquidity by switching to shorter-term deposits. Another important factor was the increase in interest rates on state securities and NBM certificates after the monetary policy tightening that supported the profitability of banks. 

The high liquidity and capitalization of the banking sector, along with monetary policy easing and improving inflationary dynamics will lay the ground for a robust economic recovery in 2023-2024. Assuming that in 2023 the security situation in the region will marginally stabilize, the inflation will continue decelerating with continued monetary policy easing, the agricultural year will be better than in 2022 and the economic situation in the region will also marginally improve, the banks’ balance sheets will continue expanding at a high pace. Namely, the volume of new loans is forecasted to increase by 28% and 18% in 2023 and 2024 respectively. The growth rate will be much higher in the case of consumer loans (+51% and +21% for 2023-2024) compared to firms (+22% and 17% for 2023-2024), especially taking into account the low comparison basis: in 2022, the volume of new loans to population decreased by 35%, while in the case of firms they grew by 26%. As a result, the total stock of loans will expand by +24% in 2023 and 14% in 2024, which will stabilize around 13%-14% during 2025-2027.

Overall, the central bank promotes a conservative and cautious monetary policy, responding adequately to the inflationary dynamics and the balance of risks, but promoting a more forward-looking monetary policy should be considered in the future. During 2022, given the second-round effects of external inflation shocks (mainly, the inflationary expectations and the second-round effects of energy price hikes), the central bank significantly tightened its monetary policy, both by raising the policy rate and mandatory reserves rate. The main reasons for this monetary policy tightening were to address the second-round inflationary effects of the cost-push inflation shocks of 2022, by mitigating the raising inflationary expectations, limiting lending and withdrawing idle liquidity from the banking sector. As long as it became clear that the inflation upward trend reversed, the central bank started to gradually ease the monetary policy by cutting the policy rate, but being more cautious in cutting its mandatory reserves rate. The reason is that, on the one hand, the central bank intends to stimulate lending in national currency, by cutting the mandatory reserves rate in MDL and keeping unchanged the rate in foreign currency; on the other hand, the high level of idle liquidities in the banking sector does not allow the NBM to cut the mandatory reserves rates further. 

Despite the major shocks of 2022, the central bank managed to maintain a relative stability of the national currency and overall resiliency of the macro-financial situation. The national currency remained stable despite the multiple shocks and difficult economic conditions. It was possible due to the central bank’s timely interventions on the domestic currency market. Namely, in order to avoid excessive depreciation of the Moldovan leu during the harshest times of the crisis (e.g. after the war in Ukraine started or when the import prices for energy increased), the NBM sold from its international reserves sufficient foreign currency in order to contain the increased demand for foreign currency and mitigate the pressure on MDL. However, during the following months, the level of reserves consolidated thanks to the international financial support from development partners.

2023-2024 will mark a period of “return to normality” of the inflationary dynamics. The inflation shocks started to dissipate at the end of 2022 and the beginning of 2023, with the annual CPI posting a downward trend. The deceleration of inflation will last throughout the entire 2023-2024 period, on the grounds of a high comparison base, better agricultural year, stabilization of inflationary trends in the region, and limited demand-side inflationary pressures at the domestic level. Hence, assuming that there will not be any major cost-push inflationary shocks, the CPI will continue declining down to 13-14% average for 2023 and 5.5% in 2024. The inflationary deceleration will allow the central bank to ease its monetary policy further during 2023-2024. 

Fears of capital flight from Moldova and depletion of reserve assets, which were circulating at the beginning of the war in Ukraine, did not materialize. In fact, net capital inflows recorded in the balance of payments financial account were 37% higher than in 2021. Non-residents have not withdrawn their deposits from the Moldovan banking system, on the contrary, foreigners’ deposits have increased and foreign investors have significantly expanded their direct investments in Moldova. The NBM intervened in the foreign exchange market at the beginning of the year to meet the sudden surge in demand for foreign currency, but this situation did not last long. During 2022, on the background of large inflows of foreign capital, the state's reserve assets increased and reached a record level.

However, action is needed to correct the exaggerated current account deficit, caused by the persistence of competitiveness issues of Moldovan exports as well as by the price dynamics of imported energy resources. Chronic deficits lead to the accumulation of external debt over time which, although not currently exceeding sustainability limits, may result in a debt crisis in the future. In this respect, it is crucial that Moldova seizes the opportunities offered by its status as a candidate country for EU membership by implementing the necessary reforms and promoting structural policies to boost supply.

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About MEGA

MEGA is an English acronym standing for Moldova Economic Growth Analysis. MEGA is a biannual review published by EXPERT-GRUP since 2009 with the purpose of explaining the fundamentals of the recent economic trends in Moldova, analysing economic policies and proposing solutions for the economic development strategies of the country. 

Centrul Analitic Independent „Expert-Grup” invită  reprezentanții mass-media la cea de-a 24-a ediție a conferinței MEGA (Moldovan Economic Growth Analysis – Analiza Creșterii Economice a Republicii Moldova) cu titlul: „Economia Moldovei între ecoul războiului și reziliență: prognoze pentru 2023-2024”

Conferința de presă va avea loc joi, 27 aprilie, începând cu ora 14.00, la sediul Expert-Grup, str. Vlaicu Pârcălab 3 , Chișinău (atenție: adresă actualizată). 

În cadrul evenimentului va fi lansată ediția a 24-a a revistei economice MEGA (Moldovan Economic Growth Analysis – Analiza Creșterii Economice a Republicii Moldova), publicație care reprezintă analiza tendințelor macroeconomice și sectoriale conturate pe parcursul anului 2022 și oferă prognoza principalilor indicatori economici pentru anul 2023-2024.  

Conferința va servi și drept platformă de discuții cu reprezentanții mass-media privind cele mai importante evoluții și riscuri economice, inclusiv reforme economice, mediul de afaceri, bunăstarea populației, piața muncii, tendințele inflaționiste, cadrul bugetar, politica monetară, sector financiar și comerț extern. Conferința va putea fi urmărită LIVE pe www.privesc.eu și pe pagina de facebook: Expert-Grup

Pentru a participa vă rugăm respectuos să accesați link-ul înregistrare de mai jos:

Înregistrare        Agenda

The Independent THink-Tank "Expert-Grup", the Institute for European Policies and Reforms (IPRE) and the Legal Resource Centre of Moldova (CRJM), within the initiative #ThinkTanks4EUMembership, in cooperation with the Friedrich Ebert Foundation in the Republic of Moldova, issued the first shadow report on the Action Plan for the implementation of 9 recommendations of the European Commission in the context of Moldova's EU membership application. 

The #MoldovaEUCandidateCheck report reflects the main findings regarding the progress, constraints, and priorities recommended for each of the 9 commitments undertaken by the Republic of Moldova. The report is the result of an independent monitoring and evaluation exercise of the implementation of the Action Plan, adopted by the National Committee for European Integration, in the period from 1 July 2022 to 31 March 2023 and is based on a methodology focused on quantitative and qualitative assessment.

Experts of the three organizations estimate that the overall average degree of implementation of the 9 commitments is 3.8 out of 5 possible points. Out of the 60 actions assumed by the authorities in the Action Plan related to the 9 commitments, only 14 actions (23.33%) were implemented without deficiencies, while 21 actions (35%) were implemented with certain shortcomings, 23 actions (38.33%) were initiated and have been in the process of implementation, and 2 actions (3.33%) were not initiated yet.

According to the authors, the best rating – 4.66 points – is attributed to the reform aimed at public finance management (commitment 7), where most of the actions have been implemented.

The justice reform (Commitment 1), the implementation of the Venice Commission's recommendations (Commitment 2), the public administration reform (Commitment 6) and the protection of human rights (Commitment 9) were evaluated by 4 points out of 5, which means that most of the planned actions have been implemented with certain shortcomings or have been in the process of implementation.

At the same time, the fight against organised crime (Commitment 5) was assessed with 3.8 out of 5 points, while the fight against corruption (Commitment 3) – with 3.55 points. These ratings indicate that the majority of actions have been initiated but have not been completed by the time of the evaluation.

The largest arrears have been recorded in the area of de-oligarchisation (Commitment 4), which was assessed by 3.3 points out of 5, and cooperation with civil society (Commitment 8), which was assessed by experts with 2.8 points, taking into account the list of planed actions.

The online version of the #MoldovaEUCandidateCheck report and the results of the monitoring exercise reflected in the online Dashboard are available on euromonitor.md/en. The Report is also available on Expert-Grup’s web-site here (in Romanian language) and on here (in English).

The draft Monitoring Table and the Report were subject to internal peer-review by the team of authors, as well as to an external review during the multi-stakeholder consultation meetings conducted during March and early April 2023 with the participation of the relevant national authorities and representatives of civil society. The final version of the Report took into account the results of the consultative meetings.

In July 2023, the evaluation of the first Report and the Monitoring Table will be reviewed and updated to reflect the final implementation results, given that the deadline for fulfilling the 9 commitments is June 2023, when the European Commission will initiate the preparation of the first Report within the EU Enlargement Package, which will be published in autumn this year.

It should be reminded that on 23 June 2022, the Republic of Moldova obtained the EU candidate country status. The EU decision was based on the favourable opinion of the European Commission, after the evaluation of the completed questionnaire, in the context of the accession application submitted by the Republic of Moldova in March 2022

In April 2022, the National Commission for European Integration (NCEI) was established. Chaired by the President of the Republic of Moldova, the Commission is an inclusive platform that brings together members of the Government, parliamentarians, representatives of civil society and local authorities, which ensures the strategic coordination of the European integration process. On 4 August 2022, NCEI approved the Action Plan for the implementation of the measures proposed by the European Commission in its Opinion on the Republic of Moldova's EU membership application (hereinafter the Action Plan).

Find the interactive version of the report  #MoldovaEUCandidateCheck  

This Report was developed within the "Moldova-EU Candidate Check: 9 steps towards the opening of accession negotiations with the European Union" Project implemented by the Institute for European Policies and Reforms, Expert-Grup, and the Centre for Legal Resources (CRJM), in cooperation with the Friedrich Ebert Foundation (FES).

On 23 June 2022, the Republic of Moldova obtained the European Union (EU) candidate country status. The EU decision was based on the favourable opinion of the European Commission, after the evaluation of the completed questionnaire, in the context of the accession application submitted by the Republic of Moldova in March 2022. The first report of the European Commission on the progress made by the Republic of Moldova in the EU enlargement policy will be published in autumn 2023.The answers to the EU questionnaire were also supplemented with the input of Moldovan experts from the diaspora and civil society. IPRE, Expert-Group, and CRJM, in collaboration with the Soros Moldova Foundation, within the #ThinkTanks4EUMembership initiative, contributed to the preparation of the Republic of Moldova's answers to the EU Questionnaire.

 

In April 2022, the National Commission for European Integration (NCEI) was established. Chaired by the President of the Republic of Moldova, the Commission is an inclusive platform that brings together members of the Government, parliamentarians, representatives of civil society and local authorities, which ensures the strategic coordination of the European integration process. On 4 August 2022, NCEI approved the Action Plan for the implementation of the measures proposed by the European Commission in its Opinion on the Republic of Moldova's EU membership application (hereinafter the Action Plan).In this context, IPRE, Expert-Grup and CRJM, as part of the #ThinkTanks4EUMembership initiative, in cooperation with the Friedrich Ebert Foundation have started a process of monitoring and evaluation of the implementation of the 9 recommendations of the European Commission.The results of the monitoring exercise are reflected in the #MoldovaEUCandidateCheck Monitoring Table available online here: https://euromonitor.md/en. The main findings regarding the progress, constraints, and priorities recommended for each of the 9 commitments undertaken by the Republic of Moldova are reflected in this Report, which presents the developments from 1 July 2022 to 31 March 2023. In July 2023, the assessments reflected in Report #1 and the #MoldovaEUCandidateCheck Monitoring Table will be reviewed and updated to reflect the final evaluations, given that the deadline for fulfilling the 9 commitments is June 2023, when the European Commission will initiate the elaboration of the first report within the EU Enlargement Package, which will be published in the autumn of this year.

Executive summary

As a result of the evaluation, the overall average for the degree of implementation of the 9 commitments is 3.8 points out of a maximum of 5. Out of the 60 actions corresponding to 9 measures provided by the authorities in the Action Plan:  14 actions (23,33%) have been implemented without deficiencies, 21 actions (35%) have been implemented with certain shortcomings, 23 actions (38.33%) are in the process of implementation, and 2 actions (3,33%) have not been initiated yet.

In the field of justice reform (1st commitment), we note that most of the actions planned by the authorities have been implemented with certain shortcomings or are being currently carried out (4p). Thus, among the achievements are the adoption of Law no. 120/2021 for amending the Constitution and related legislation, with the aim of improving regulations regarding the judicial system. Other laws have been adopted that have consolidated the activity of the Judicial Inspection, amended legislation on the National Institute of Justice (INJ) and the prosecution, and introduced an extraordinary evaluation of candidates for the Superior Council of Magistracy (CSM) and the Superior Council of Prosecutors (CSP). The evaluation of judge and non-judge candidates for the CSM was completed, and the evaluation procedures for candidates for the CSP were initiated. On March 30, 2023, Parliament elected three non-judge members to the CSM, who were evaluated by the pre-vetting Commission. The main constraints relate to exceeding the deadline for evaluating candidates for the CSM and CSP, set for December 2022, and extended until June 2023. Although on March 17, 2023, the General Assembly of Judges was to elect the new judge members who had passed the extraordinary evaluation in the CSM, the judges interrupted the session and postponed the vote for April 28, 2023. Consequently, until March 31, 2023, no appointment of judges in the CSM and prosecutors in the CSP had taken place. The evaluation of candidates for the colleges of judges and prosecutors was not initiated. The legislation regarding the activity of the prosecution was not adjusted in accordance with the recommendations of the Venice Commission set out in point 41 of Opinion no. 1086 of June 20, 2022. A clear mechanism for verifying the wealth and interest declarations submitted by candidates enrolled at the INJ and an internal mechanism for verifying the integrity of judges and prosecutors at all stages of their careers were not regulated. 

Regarding the implementation of the recommendations of the OSCE/ODIHR, as well as the Venice Commission (Commitment 2), the Action Plan included the reference to the adoption of the new Code, a measure that was implemented with certain shortcomings (4p). Thus, on December 8, 2022, the Parliament adopted the new Electoral Code of the Republic of Moldova, implementing the majority of OSCE/ODIHR recommendations, evaluation mission reports, and Constitutional Court addresses. Institutional changes focus on the composition and method of appointment of members of the Central Electoral Commission. The new Electoral Code allows for elections to be held in two days in certain electoral districts or polling stations for objective reasons, such as pandemics, exceptional situations, or high voter turnout. The list of subjects that can participate in elections has been expanded, including initiative groups and electoral blocs. The consultative process related to the adoption of the Electoral Code involved all interested parties, such as civil society, political parties, and the public administration. However, it should be noted that the decision of the authorities to include a single activity in the Action Plan seems to be a rather narrow interpretation. In the authors' opinion, Commitment 2 is expected to additionally reflect the evaluation of the implementation of the Venice Commission's recommendations with reference to Commitment 1, namely the completion of essential stages of comprehensive justice system reform in accordance with Venice Commission Opinion No. 1058, related to the draft law on the prosecution service and Venice Commission Opinion No. 102 on the judiciary system. Additionally, the authorities should objectively determine whether other recently announced draft laws fall under the category of "essential stages of comprehensive justice system reform," such as the reform of the Supreme Court of Justice and the evaluation of Supreme Court judges, the extraordinary evaluation of judges and prosecutors (full-vetting), the conventional draft law called the de-oligarchization package (which is reflected in Commitment 4), or the package of laws on the Intelligence and Security Service. 

In the field of combating corruption (commitment 3), most actions are implemented with certain shortcomings, or have been initiated and are in the process of implementation (3,66). The main progress was the adoption in July 2022 of legislative changes and the implementation of a new mechanism for criminal prosecution, trial, and conviction in absentia of individuals who evade participation in criminal proceedings. The Anti-Corruption Prosecutor's Office managed to investigate more corruption cases than in 2021 and has also increased the number of cases sent to court. The proportion of sentences and cases sent to court for corruption cases has increased slightly from 2021 to 2022. Moreover, the values of fines and special confiscations have increased significantly. One of the main constraints is the existence of deviations from the initial terms for carrying out the actions provided for in the Action Plan. The main priorities that the authorities need to focus on in the immediate future are the adoption in the final reading of the draft amendment to the Code of Criminal Procedure for delimiting the competencies between the National Anticorruption Centre (NAC) and the Anti-Corruption Prosecutor's Office (APo), the project of amendments to the Criminal Procedure Code and Law no. 59/2012 for improving and increasing the efficiency of special investigation measures, the project of amending the Law on whistle-blowers that is to transpose EU Directive 2019/1937, as well as the publication of a strategic analysis of the convictions adopted in 2022 in corruption cases, related acts, and corruptible deeds.

Regarding the "de-oligarchization" (commitment 4), most actions are in the process of implementation (3,3p). The Ministry of Justice has drafted a bill to eliminate excessive influence of private interests on economic, political, and public life. The bill has been consulted with the public, and the Venice Commission has issued a preliminary opinion that will be taken into consideration by the authorities in finalizing the draft law.  The draft contains several problematic provisions, contrary to the international commitments of the Republic of Moldova in the field of human rights. The draft Action Plan on de-oligarchization measures has been developed and the consultation process for the draft plan has been initiated. The Central Electoral Commission has established the Supervision and Control Division for the Financing of Political Parties and Electoral Campaigns to monitor, analyse, verify, and control the financing of political parties and electoral campaigns. The Audio-visual Media Services Code has been amended to allow the regulation of activity reports of media providers by the Audio-visual Coordinating Council. The government has adopted the State Ownership Policy in the form of the Strategy for managing state property in enterprises and companies with state capital for the years 2022-2030, which requires immediate actions to implement good corporate governance practices. However, the Law on Public-Private Partnership is to be adjusted to the principles and objectives of the state property strategy and the OECD recommendations on public governance principles for PPP.

In the field of combating organized crime (commitment 5), most actions have been implemented and some are in the process of implementation (3,88p). Thus, the Government has adopted and initiated the implementation of the Internal Affairs Development Strategy for the years 2022-2030. The Criminal Assets Recovery Program for the period 2023-2027 has been adopted. In addition, employees of the Ministry of Internal Affairs and the General Inspectorate of Police have participated in several experience-sharing activities with Interpol, Europol, Eurojust, etc. Although with deviations from the initial deadline set in the Action Plan, on March 30, 2023, Parliament adopted the Cybersecurity Law, which transposes EU Directive 2022/2555 (NIS 2). Priorities for 2023 include the entry into force of the Cybersecurity Law and the Law on the Prevention and Combating of Money Laundering and Terrorism Financing, and the adoption of the related regulatory framework and implementation of Moneyval recommendations. 

In the field of public administration reform (commitment 6), most actions have been fulfilled and an action related to the digitalization of public services is in the process of implementation (4P). Twelve electronic services have been launched in the field of cadastre and eleven others have been integrated with the MDelivery service. A support mechanism for the staff of public authorities to achieve priority tasks has been established, and decisions to increase the headcount limit of policy-making units within the Central Public Administration have been promoted. An ex-post evaluation report of the Public Administration Reform Strategy 2016-2020 has been developed and a new Public Administration Reform Strategy was adopted, which addresses the issue of public officials' salaries and professionalization, delimitation of roles within the public administration, and consolidation of fiscal autonomy of local public administration, has been approved. In the context of implementing the revised Roadmap on Local and Regional Democracy, progress has been made in consolidating the tax base of level I local public administration through changes to budget and fiscal policies for 2023, but progress in delimiting public property is modest. The main priority is to consolidate public administration authorities through salary reform and to avoid the practice of incentivizing public officials by including them in the boards of state-owned companies.

Regarding the reform of public finance management (commitment 7), most of the actions have been implemented (4.66 points). A regulation on low-value public procurement has been developed and approved, a formal procedure for identifying eligible public investment projects to be included in the Medium-Term Budgetary Framework/State Budget Law project has been established, and the scope of the public investment management framework has been expanded. A public finance management development strategy for the period 2023-2030 has been developed, aimed at improving the quality of macroeconomic and fiscal forecasts, establishing an adequate accounting and reporting system in the budgetary sector, the continuous development of the public finance management information system, and ensuring the use of public funds in accordance with good governance principles.

In the field of civil society cooperation (commitment 8), most of the actions are in the process of implementation (2.8 points).  However, the Framework Regulation on non-repayable financing of non-commercial organizations' projects and on improving the process of developing public policy documents has been adopted. The Ministry of Justice has drafted a law on access to public interest information, but the current version of the draft, does not address the issues raised by journalists. On the other hand, transparency and predictability in the decision-making process are still affected in Parliament, where the transparency of projects under review has been affected on average by 69%. In addition, the permanent platforms for consultation with civil society at the level of Parliament and Government have not yet been launched. The State Chancellery needs to expedite the consultation and approval of the new Concept on the development of civil society, and authorities need to improve the ex-post evaluation mechanism of legislation to understand if the intended objectives have been achieved.

In the field of protection of human rights (commitment 9), most of the actions have been implemented (4). Amendments have been adopted to the regulatory framework to ensure non-discrimination and equality, including the expansion of discrimination criteria and amendments to the Contravention Code. In addition, adjustments have been made to the Ombudsman Law, and criminal and procedural legislation has been aligned with the provisions of the Istanbul and Lanzarote Conventions. However, there have been delays in approving these laws due to objections from the President of the Republic and deviations from legislative technique. In addition, there have been challenges in implementing the Program to support the Roma population for the years 2022-2025. It is recommended to improve inter-institutional dialogue and cooperation between the Ministry of Education and Research and the Ethnic Relations Agency, implement the Program to support the Roma population, and revise legislation for clarification and separation of the responsibilities for detecting cases of incitement to discrimination.

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This publication is developed within the "Moldova-EU Candidate Check: 9 steps towards the opening of accession negotiations with the European Union" Project implemented by the Institute for European Policies and Reforms, Expert-Grup, and the Centre for Legal Resources of Moldova (CRJM), in cooperation with the Friedrich Ebert Foundation (FES). The publication represents an independent evaluation by the authors on the degree of implementation of the Action Plan for the implementation of the 9 key political and economic criteria identified by the European Commission in its June 2022 opinion, approved by the National Commission for European Integration (NCEI), which also includes representatives of IPRE and Expert-Grup, civil society organizations that are members of the National Platform of the Civil Society Forum of the Eastern Partnership. The opinions presented in the report belong solely to the authors and do not reflect the position of the National Platform of the Civil Society Forum of the Eastern Partnership, NCEI, or the Friedrich Ebert Foundation.

Potrivit datelor BNS, la începutul anului 2022, populația UTA Găgăuzia era de 121,7 mii de locuitori, inclusiv 49,4 mii de locuitori din mediul urban și 72,3 mii de locuitori din mediul rural. Începând cu anul 2018, se constată o scădere a populației din cauza excesului numărului de decese față de numărul de nașteri. În 2021, sporul natural negativ a constituit 3,9‰. Ponderea populației în vârstă de 60 de ani și peste este de 24%. Comparativ cu 2014, acest indicator a crescut cu 6 puncte procentuale, ceea ce arată un proces accelerat de îmbătrânire demografică.

În pofida faptului că UTA Găgăuzia are o rată totală a fertilității mai mare decât în țară în ansamblu  ̶  1,85 născuți-vii la o femeie de vârstă reproductivă, acest indicator este în scădere treptată, la fel ca și numărul anual de nașteri. Astfel, în 2014 s-au născut 1,9 mii de copii, iar în 2021 – doar 1,5 mii. În viitor, această tendință se va intensifica, deoarece în vârsta reproductivă vor intra generații mai puțin numeroase. În același timp, atitudinile reproductive ale populației sunt mai ridicate decât în restul țării. Peste 70% dintre cei intervievați consideră că numărul ideal de copii într-o familie este de „trei sau mai mulți”; în zonele rurale, majoritatea covârșitoare are această opinie (peste 80%), iar în mediul urban, ponderea este ceva mai scăzută (57%). Numărul mediu de copii pe care populația de vârstă reproductivă intenționează să îl aibă este de 2,67 copii, adică semnificativ mai mare decât nivelul necesar pentru reproducerea populației (2,1).

Rezultatele studiului au arătat că în UTA Găgăuzia nu se acordă suficientă atenție planificării familiale. Conform datelor obținute, utilizarea metodelor de contracepție este la un nivel foarte scăzut. Din numărul total de femei intervievate de vârstă reproductivă (15-49 de ani), care nu erau însărcinate la momentul sondajului și nu încercau să rămână însărcinate, doar 22,1% au declarat că folosesc cel puțin o metodă de contracepție, în timp ce 42,0% au declarat că nu folosesc nicio metodă. În același timp, s-a constatat o rată ridicată a refuzurilor de a răspunde la această întrebare: 35,9% dintre respondente fie au refuzat să răspundă, fie nu au putut da un răspuns. Acest lucru sugerează că populația nu este suficient de informată despre astfel de concepte precum „sănătatea reproductivă” și „drepturile reproductive”.

Regiunile sudice ale Republicii Moldova, inclusiv UTA Găgăuzia, se evidențiază în mod tradițional prin rate mai ridicate ale mortalității și o speranță de viață mai mică. Trebuie de menționat că în anii dinaintea pandemiei Covid-19 situația s-a îmbunătățit ușor. Creșterea mortalității cauzată de pandemie a afectat populația cu vârste cuprinse între 50-64 de ani și 65 de ani și peste, bărbați și femei deopotrivă.

Datele privind autoevaluarea stării de sănătate arată că majoritatea populației în vârstă aptă de muncă își apreciază pozitiv starea sănătății, ca fiind „foarte bună”, „bună” sau „satisfăcătoare”. În rândul populației cu vârsta de 65 de ani și peste, 61,1% și-au evaluat starea de sănătate ca fiind „satisfăcătoare” și 24,5% ca fiind „proastă sau foarte proastă”, fără diferențe semnificative în funcție de sex. Aceasta înseamnă că unul din patru rezidenți în vârstă de 65 de ani și peste are posibilități limitate de a îmbătrâni într-un mod activ și sănătos. În același timp, proporția persoanelor vârstnice care își apreciază starea de sănătate ca fiind „foarte bună” sau „bună” este mai mare în mediul rural (17,8%) decât în mediul urban (9,2%).

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Analiza a fost elaborată în baza datelor revizuite ale populației și migrației la nivel territorial estimate de către Biroul Național de Statistică în anul 2022 și datelor Studiul Generații și Gen (GGS), care este primul și cel mai complex studiu demografic longitudinal, desfășurat până în prezent în peste 24 de țări ale lumii. GGS este parte a programului internațional coordonat de Comisia Economică a Națiunilor Unite pentru Europa (UNECE) și Institutul Interdisciplinar de Demografie din Olanda (NIDI). Programul Generații și Gen este implementat de către Fondul Națiunilor Unite pentru Populație (UNFPA Moldova), în parteneriat cu Ministerul Muncii și Protecţiei Sociale al Republicii Moldova (MMPS), Biroul Național de Statistică, Institutul Interdisciplinar de Demografie din Olanda (NIDI). Desfășurarea programului este posibilă grație suportului financiar oferit de Ministerul Muncii și Protecției Sociale, Fondului Parteneriatului pentru Dezvoltare India-ONU și UNFPA. Concluziile acestui studiu au menirea de a furniza autorităților locale din Republica Moldova date dezagregate despre schimbările demografice din Republica Moldova, astfel ca autoritățile să elaboreze politici demografice centrate pe oameni și ajustate la necesitățile reale ale acestora. Totodată, concluziile acestei analize vor fi utilizate de către autorități pentru a identifica măsuri de transformare a crizei demografice într-o oportunitate, pentru a susține dezvoltarea țării și a promova reziliența demografică în Moldova. Vedeți în acest infografic cele mai importante concluzii realizate în baza Profilului demografic al UTA Găgăuzia.

Acest document a fost elaborat cu suportul Ministerului Muncii și Protecției Sociale al Republicii Moldova (MMPS), Agenția Elvețiană pentru Dezvoltare și Cooperare (SDC) și Fondului ONU pentru Populație (UNFPA Moldova) și nu prezintă în mod necesar punctul de vedere al UNFPA Moldova, SDC, MMPS sau oricărei dintre organizațiile afiliate.

Energy policies in the Republic of Moldova continue to be driven by three interrelated constraining factors – (i) limited indigenous resources consisting mainly of biomass, which cover only about 25% of domestic consumption, (ii) a homogeneous structure of the natural gas and electricity market with monopolistic or market-dominant suppliers, and (iii) low energy efficiency throughout the value chain from generation up to final consumption of resources in all sectors of the national economy. The listed factors correlate perfectly with the three dimensions of the concept of energy security, which is based on the availability, affordability and sustainability of an energy system.

Since 2010, as a contracting party to the Energy Community Treaty (ECT), the Republic of Moldova is committed to transpose and implement the acquis communautaire into the national legislation. Since then, the EU policies, adapted to the conditions of the contracting parties to the ECT, continue to serve as a reference and guidance for a coordinated approach of the challenges the energy system of the Republic of Moldova faces.

By approving the 2030 Energy Strategy , Moldova has aligned its overall energy objectives with those of the European Union. Thus, over the last decade, the efforts have been directed towards achieving these objectives, including ensuring the availability, affordability and sustainability of energy resource consumption.

An objective assessment of the outcome of the efforts made can serve as a factual assessment of the energy situation at the beginning of 2023 in terms of the progress achieved in meeting the commitments made under the ECT. 

Against the backdrop of the acute energy crisis, which took off in the second half of 2021, the new national political and geopolitical context in February 2022 forced the acceleration of energy reforms. Similar to the so-called ‘perfect storm’  of events that triggered and amplified the natural gas and electricity price crisis in 2021, subsequently, through the concurrence of several internal and external factors, some remarkable achievements were made in progressing with the energy reforms in Moldova, especially in terms of diversification of energy supply sources.

The status of EU candidate country, obtained on 23 June 2022, significantly raises expectations not only for the progress of harmonization, but also for the implementation of the acquis communautaire in the Republic of Moldova.

The situation in the Republic of Moldova is heavily influenced by the new geopolitical conditions, uncertainties and risks related to the developments on the energy resource markets. This requires not only to continue the fast-paced implementation of reforms and to increase resilience to shocks induced by the multitude of overlapping crises, but also to set the policy priorities in the energy sector according to the expectations of both the society and development partners. Moreover, the objective to accelerate the European integration process suggests the need for aligning the priorities with the EU ambitious policies.

An important signal, proving awareness of the challenges to be addressed, is the establishment of a ministry dedicated to the energy sector. It is worth noting the speed with which the Ministry of Energy has communicated its medium-term development vision and priorities, which are derived from the Government Activity Program and meet the Government’s three general strategic objectives by 2030. Moreover, in the context of the EU integration objective, a new long-term goal has been announced – to decarbonise the economy by 2050, in line with the EU’s objective of becoming climate-neutral by 2050.

SECURITY OF NATURAL GAS AND ELECTRICITY SUPPLY

The first medium-term priority of the authorities is to ‘prevent and mitigate potential energy crises, including by securing strategic gas purchasing and stocks and by diversifying electricity supply’. Indeed, taking into account the structure of gross domestic energy consumption, the sources of supply with energy resources, the share or the market power held by each of them, the resources contributing most to the degree of vulnerability regarding security of supply are natural gas and electricity.

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This publication was produced with the financial support of the European Union and the "Friedrich Ebert" Foundation (FES). Its content is the content represents the sole responsibility of the "Civil Society for European Integration" project, financed by the European Union and co-financed by the "Friedrich Ebert" Foundation. The content of the publication belongs to the authors and does not necessarily reflect the vision of the European Union and the "Friedrich Ebert" Foundation (FES).