Democracy and governing in Moldova
e-journal, year VII, issue 142, 16–31 July, 2009
Activity of Public Institutions
Activity of Public Institutions
1.1. Appointments/ Resignations
Dumitru Socolan was appointed General Consulate of Republic of Moldova in Germany (some of the lands), with headquarters in Frankfurt on Main.
Vitalie Condratchi resigned from the position of Head of Government Press Service, starting July 17, 2009.
Decision concerning the personnel ceiling of the State Tax Service. The personnel ceiling is reduced to 1939 units, as compared to the previous 2081 units.
Decision concerning the transmission of the SE "International Chisinau Airport". In order to execute the provisions of the Agreement concluded between the Republic of Moldova, EBRD and the European Investment Bank, the State Enterprise "International Chisinau Airport" is transmitted from the Transport Agency administration to the Public Property Agency under the Ministry of Economy and Trade.
Decisions approving certain regulations:
- Regulation on the expert examination of precious metals, precious stones and items made of these materials;
- Regulation on the procedure of submission, examination and registration of brands.
Decisions on funds allocations:
- 2,5 millions lei are allocated to the Orhei Rayon Council in order to cover the compensations for people who have been subjects of political repressions;
- 161 thousands lei are allocated to the Apparatus of Government from the reserve fund in order to cover the expenses of the SEECP Summit held on June 4 – 5 2009;
- necessary funds for covering all the expenses for materials and equipment that are to be purchased for capital repair of the buildings of Presidency and Parliament must be allocated by the Ministry of Finance, from special accounts opened at the State Treasury, to the general Department for administration of Government buildings and the Ministry of Construction and Territory Development.
1.3. Sittings. Decisions
Paying wages and social benefits
The prime-minister Zinaida Greceanii demanded all concerned institutions to ensure the defrayal of expenses for all social payments in time, respecting all the established volumes. The prime-minister invoked that unjustified delays of wage payments, wage and work schedule reductions, forced leaves and other similar situations presently occur in several localities, within social, medical and educational institutions. Greceanii mentioned that transfers from the state budget to the local authorities have not been blocked, but only diminished by 20%, on the account of local administration maintenance and not from means allotted to wage payments. The prime-minister stressed that today there are no reasons for any educational or social institutions to stop their activity, because all money transfers towards these institutions are totally fulfilled.
Denials on eventual interdictions
The Government of the Republic of Moldova firmly denies information published in the Moldovan press concerning the alleged draft government decision under which all Moldovan citizens will be banned to leave the country and work abroad for a term of two years.
The activity of the vice-prime-minister Iurie Rosca
The vice-prime-minister Iurie Rosca continued to be active in the eve of elections:
- undertook work visits: at the border sub-divisions of the Border Guard Service and the National Border Guard College of the town of Ungheni; at the General Police Station, Chisinau; at the Department of Road Police of the Ministry of Interior (MAI); at the first mobile-operating brigade of carabineers troops of MAI; at the Patrol and Sentinel Regiment "Scut" of the Chisinau General Police Station; at the first brigade of motorized infantry "Moldova" of the city of Balti; at the penitentiary No. 15 from the town of Cricova and at the sub-divisions of the Agency of Material Reserves, Public Acquisitions and Material Aid;
- chaired the meeting of the Commission for coordination of migration related issues in the Republic of Moldova and participated at the sitting of the CCCEC Collegium;
- presented the totals of his first month of activity as vice-prime-minister to the press.
The national program of economic habilitation of youth
A report on activity of the Coordinating Committee of the national program of economic habilitation of youth during July 2008 – July 2009 and the Program’s development opportunities for the next period were presented during the fifth meeting of the Committee. According to the report, 296 youth-run businesses started up within the Program, 84 millions lei were allotted, of which 33.6 millions lei are actually grants. The participants in the meeting ascertained the obstacles to Program development: the pledge demanded by the commercial banks and the lack of markets for the output of the entrepreneurs – Program beneficiaries. The members of the Coordinating Committee approved a decision, demanding the Organization for the Small and Middle Enterprise Sector Development under the Ministry of Economy and Trade to intensify the training courses, especially for the young entrepreneurs of the South and Centre regions of Moldova. Besides, the responsible institutions were recommended to examine the possibilities of extending the business areas suitable for credits with grants sections, and also to identify additional financial means for expanding the number of Program beneficiaries and the credit sum – from 300 thousands lei to 500 thousands lei.
Negotiations for a 1 billion dollars credit
The Government of RM signed an understanding Memorandum with the top management of the Chinese state corporation COVEC, concerning a credit of approximately one billion dollars for the fulfillment of infrastructure and producing projects for the Republic of Moldova. The credit could be offered based on a state guarantee, under preferential conditions, for the fulfillment of different infrastructure projects: roads, energy, water supply systems, purge stations and industrialization of the agricultural sector and the development of processing sector, projects designed for creation of advanced production systems.
Sergiu Stati was appointed as Extraordinary and Plenipotentiary Ambassador of the Republic of Moldova in Turkey, under a presidential decree.
Valerii Diouzu was dismissed from the position of presidential adviser on information development issues, Head of the Information-analytical Department of the Apparatus of RM President.
The order "Gloria Muncii" ("Labor Glory") was awarded to:
- Dumitru Cambur, Head of main Culture and Tourism Department, Territorial-Administrative Unit Gagauz-Yeri;
- Ion Robu, Extraordinary and Plenipotentiary Ambassador of Republic of Moldova in the Republic of Azerbaijan;
- Ion Luchianov, member of the National Athletic Team.
The medal "Meritul civic" ("Civic merit") was awarded to Mihail Lazari, chair of Ocnita rayon.
The Order of Honor was awarded to Gianni Buquicchio, secretary of the European Commission for Democracy through Law of the European Council (Venice Commission).
The acting head of state issued a decree on awarding a group of artists.
The gasification process
The acting president of the Republic of Moldova convened a meeting on localities gasification. During the meeting, it was ascertained that 751 localities are still to be connected to the natural gas network, and that their gasification process is at different stages of fulfillment. Vladimir Voronin demanded the examination of reasons why the finalized gas pipes are still not exploited, within 10 days. Besides, Voronin spoke also about the necessity to finalize construction works for the 125 inter-rural gas-pipes until October 1, 2009 and to start the gasification works in the localities that have all the project documents ready in August – September.
Meeting with the Chair of the Central Election Commission of the Russian Federation
Vladimir Voronin met the Chair of the Central Election Commission (CEC) of the Russian Federation, Vladimir Ciurov, in order to exchange opinions on the early parliamentary elections held on July 29. Vladimir Ciurov announced the Russian Federation’s CEC availability to share its experience with the Moldovan Central Election Commission in the implementation of electronic voting technologies, as well as other procedures of modernizing the voting process, data collection and election results processing. The acting head of state mentioned the interest of Moldovan authorities for improving and modernizing the election process. Besides, the common idea concerning the need to maintain the ascending trend of the Moldovan-Russian relations in several sectors was expressed, no matter the early parliamentary election results and the post-election evolutions of Republic Moldova.
1. Real sector
Industry continues to regress…
In the first semester of 2009, the industry sector produced an output worth of approximately 10.63 billion lei (949.11 million US dollars) in current prices. The industrial production volume was 75.1% in comparable prices compared to the period January – June 2008. Therefore, the industry registered a decline of approximately 25%. The decrease of industrial output was influenced by the 41% reduction of production volume of the extraction industry, 27.3% – of the processing industry and 6.1% – of the energy field. This caused the decrease of total production volume by 0.7%, 23.4% and 0.8%, respectively.
The decrease of industrial production volume was caused especially by enterprises in the following sectors: vehicles and equipment production – approx. 52%; footwear manufacture – over 51%; production of devices and medical, precision, optical instruments – 50%; paper and cardboard production – 46.6%; non-ferrous metals products production – over 45%; distilled alcoholic drinks production – approx. 41%; vegetables and fruits processing and preservation – approx. 37%; textile production – 35.6%; wine production – approx. 34% etc.
The statistics show that the decline deepened in the following activities, as compared to May 2009: vegetables and fruits processing and preservation; dairy production; wine production; publishing houses, printing and reproduction of information materials; non-ferrous metals products; production and distribution of thermal-electric power. The enterprises hit by decline of output explain its origin by: difficulties concerning the sale markets, namely the demand reduction from foreign and local companies – consumers of industrial output; scarce raw material; insufficient financial resources etc.
2. Banking sector
The actions of the National Bank of Moldova aimed to liberalize the credit market…
During a meeting from the half of July 2009, the Administrative Council of the National Bank of Moldova (BNM) decided to reduce the base rate applied to the main monetary policy operations of BNM by 1 p.p. (down to 8%) and to reduce also the interest rate on "overnight" credits and long-term credits by 1 p.p., down to 10.5 and 8%. This seems to be one more signal for the banks to review their credit policy, aiming its liberalization.
In order to increase the volume of liquidity in the banking system, a decision on reducing the norm of obligatory reserves in national and foreign currency by 2 p.p., from 16% to 14% within the calculation basis, saving additional banks’ financial resources – approx. 233 million lei, 11.5 millions US dollars and 12.7 million EURO – for crediting the real sector of the economy. These decisions aim to further maintain on a descendent trend the interest rates on credits and deposits, considering the future increase of the money offer. The possibility to lower the base rate and the norm of obligatory reserves was due to the continuous descendent trend of the inflation registered starting June 2008.
The measures for liberalization of the BNM’s monetary policy have already lowered the interest rate for deposits attracted and credits offered in the banking system. Therefore, the average weighted rate on deposits attracted by the banking system in Moldovan lei evolved from 20.7% (yearly) in January until 15.04% in June (-5.65 p.p.), and the average weighted rate on credits offered by the banking system in Moldovan lei evolved from 23.25% in January to 18.94% in June (-4.31 p.p.).
3. Public finances
The capital budgetary investments are dramatically falling down…
National Bureau of Statistics (BNS) data show that the amount of fixed investments represented approx. 3.43 billion lei in the first semester of 2009, decreasing by 38% compared to January – June 2008. The activity of foreign investors suffered most severe consequences, right after the public budget. The foreign investments stepped down by 48%, to 614.4 million lei. It seems that foreign investors became more prudent starting with the second half of 2008, when first signals of a negative impact of the global economical crisis on Moldova’s economy were noticed. Besides, economic agents and the population invest less than before. Their fixed investment amounted to 2.12 million lei in the first semester of 2009, lesser by approx. 29% compared to January – June 2008.
Rumors say that the Government levied a distraint on the budget investment expenses, while the budget deficit could exceed 2 billion lei, and the population and firms, including the foreign ones, have less available money. The structure of the fixed capital investments by forms of ownership consists of: 24% – by public economic agents with public ownership, 75.6% – by private economic agents, who have fulfilled approx. 76% of the total volume of construction – assembly works and 98.4% of dwellings brought into use.
4. Labour market
Increase in wages, just nominal…
According to the statistics, the average monthly wage in economy was approx. 2674 lei (238 US dollars) in the first semester of 2009 and increased by 10% as compared to the similar period of 2008. Therewith, the real wage in the same time period increased by approx. 9%. The average wage in the public sector was 2345 lei (209 US dollars) and increased by 18 % compared to the same period of 2008, in the real sector of economy – 2865 lei (256 US dollars) and increased by over 7% compared to the similar period of the last year.
In June, the average salary of an employee was 2844.5 lei. The average monthly wage rose by 3.4% and the real wage – by 4.2% compared to June 2008. In the real sector, the average monthly salary was 2970 lei (265 US dollars) and increased by approx. 6% compared to the similar period of 2008. In the budgetary sector, the average wage was 2627 lei (234 US dollars), namely 99.4% of last year’s level, therefore registering a decrease.
The public administration employees received, in the first semester of 2009, an average monthly salary of 3150 lei (281 US dollars), by 20% more than in the similar period of 2008. The official statistics shows that this is one of the biggest wage increases. According to the National Bureau of Statistics, only the employees from the health and social assistance sectors (21%, 2590 lei) and the employees from the entertainment, cultural and sports activities (21%, 2000 lei) received bigger increases.
The slowest wage increase was registered in the finance sector, by 3.8% more in a half of year. Even so, the bankers receive the biggest revenues – an average of 5600 lei per month. The smallest wages are traditionally being paid in the agriculture, hunting economy and sylvan culture. This is by the way the sector with the most employees. They received an average wage of 1290 lei (115 US dollars) or by 10% more than in January – June 2008. However, the constructors had to face the most important wage decrease – the wages have decreased by more than 10% in a half of year, to a monthly average of 2950 lei (265 US dollars), and the salary within the extraction industry diminished to 3160 lei (282 US dollars).
The election in Corjova polling station was thwarted
On July 29, 2009, on the Election Day for the Parliament of the Republic of Moldova, the polling station in Corjova village, situated on the left bank of the Nistru river, was thwarted. Both Chisinau and Tiraspol authorities consider that Corjova is under their jurisdiction. Chisinau confirms its’ rights by periodical attempts to organize elections in the village, and Tiraspol does the same thing by undermining these attempts. Just as it happened on the last Election Day, the entry into the polling station was blocked on July 2009, at 7 o’clock A.M. by approximately 400 individuals exclaiming: "Get your hands off Transnistria"; "No to illegal elections"; "No – to the territory pretensions against the territorial integrity of Transnistria". This kind of blockage is backed by Transnistrian authorities, who believe that the hostile Moldovan authorities put the stability of the region in jeopardy. As always, the Central Electoral Commission decided to change the voting place for Corjova inhabitants to the polling stations from neighboring villages, where Chisinau jurisdiction is beyond contestation.
Smirnov threatens to apply adequate response actions
After the consultations in the "5+2" format held in Vienna in June, the Transnistrian leader Igor Smirnov met the ambassador of the Russian Federation in Republic of Moldova and the head of OSCE mission in Moldova, Philip Remler in order to discuss the perspectives of resuming the dialogue in the "5+2" format. According to Philip Remler, there are several issues that are to be solved; this is why the negotiations must be resumed without pre-conditions. Igor Smirnov contested this approach mentioning, as usually, the existence of a package of agreements signed by Moldovan authorities which are not being respected. The last example concerns the signing of Barviha Declaration on March 18, 2009. According to this Declaration, the negotiations in the "5+2" format could start again after creating corresponding conditions. The president Vladimir Voronin acts as usually, he accepts certain things, signs documents that should confirm his agreement and then refuses to fulfill the engagements. This is exactly what happened when the Barviha Declaration was signed. Voronin committed to meet Smirnov on March 25, 2009 and then refused to participate in the meeting with no explanations. From Smirnov’s point of view, no perspective for resuming negotiations in the "5+2" format exists, taking into account the behavior of Moldovan authorities. What should be done relates to continuing the work of the group of experts in order to solve the social-economical issues. Smirnov threatened that his regime will give an adequate response if Chisinau will try to pressure Tiraspol economically and commercially.
Rusia and Transnistria support each other
After the resign of Evgheni Sevciuc, the Chairman of the Supreme Soviet on July 8, 2009 his Moscow upholder, Konstantin Kosaciov, chair of the Foreign Affairs Committee of the State Duma arrived in Tiraspol to support Sevciuc in his relationships with Smirnov administration. As Smirnov has more powerful upholders in Moscow, Kosaciov’s mission was reduced to discussing with Smirnov about the cooperation between Russian Federation and Transnistria. At the meeting, Smirnov mentioned that Transnistria needs to extend the cooperation with Russia for mutual benefits. Kosaciov sustained the implementation of Russian standards of education and the harmonization of Transnistrian legislation with the Russian one, confirming that the Russian business feels comfortable in the separatist region. Besides, Kosaciov reconfirmed the official Russian position towards a resolution of the conflict between Chisinau and Tiraspol – Russia will support the solution agreed by both equal sides of the conflict. Kosaciov underlined that Russia will not use Transnistria as exchange for relationships with third parties in the international political process.
The project for amending the Transnistrian constitution
The Ministry of Justice of the separatist region published the amendments to the Transnistrian constitution in order to bring it in concordance with the constitutional norms of the Russian Federation. The Transnistrian experts think that ex – speaker’s Evgheni Sevciuc initiative to modify the Transnistrian constitution was misappropriated, and thus Smirnov tries to fortify his position. Formally, the amendments boil down to borrowing certain Russian constitutional norms but actually the transfer of responsibilities from the Transnistrian presidency to a Cabinet of Ministers is intended. Still the cabinet will be subordinated to the presidential institution that nominates and dismisses ministers at it will.
The foreign relations in the second half of July have been influenced by the election campaign for the early parliamentary elections.
European Union calls on the Moldova’s authorities in the eve of the July 29 elections
In the period that preceded the early parliamentary elections of July 29, the European Union addressed to authorities and political parties from Republic of Moldova to ensure free and fair elections, freedom of expression and mass-media freedom, to create equal conditions for all election contestants, to not allow intimidations towards mass-media, NGOs and political parties, and to respect the right of assembly etc. The calls have been addressed through the EU Special Representative in Moldova, Kalman Miszei, the Extraordinary and Plenipotentiary Ambassador of Sweden in Moldova, Matz Aberg, and the Polish minister of foreign affairs, Radoslaw Sikorski, during their meetings with Moldovan authorities.
Even more, during a work visit in Chisinau on July 24, Radoslaw Sikorski demanded the authorities, the representatives of the opposition parties and civil society to cooperate on the basis of a large social consensus, to continue the democratic reforms in the country, to investigate the April 7 events, to prove openness for cooperating with EU and its’ close members [Romania], ensuring an equal treatment for all EU citizens. At the same time, Radoslaw Sikorski related the strengthening of EU – Moldova dialogue to free and fair elections on July 29. The Polish minister of foreign affairs confirmed that, if a positive international evaluation of the elections will be registered, Poland will offer its support: for promoting Moldova at European level, particularly to negotiations of the new EU-Moldova agreement; for including Moldova in the European financing mechanisms and the Eastern Partnership projects; to negotiations of Moldova with international financial institutions (IMF, WB, BERD etc.); for the launch of a comprehensive package for democracy support in Moldova.
EUBAM’s mandate was prolonged until 2011
The European Commission decided to extend the mandate of the European Union Border Assistance Mission in Moldova and Ukraine (EUBAM) for two years more, starting with December 1, 2009. The prolongation of the EUBAM mandate happened due to requests from Moldovan and Ukrainian authorities.
European Union will allocate 70 millions Euro for investment projects within PEV
The European Commission announced the allocation of 70 millions Euro to the Neighbourhood Investment Facility within the Neighborhood European Policy (ENP). These funds are intended for developing investment projects in the energy, transport and ecology sectors, as well as the development of small and middle enterprise sector and the social sector.
Republic of Moldova – Romania
The freeze in Moldovan – Romanian relations persists. The Moldovan authorities continue to accuse Romania of interfering in the internal affairs of Moldova. The last statement of the Moldovan Government released on July 16 blames Romania’s government for openly supporting certain Moldovan political forces and for openly expressing its’ preferences for the victory of these forces in the July 29elections give an appreciation on the statements. At the same time, the Government of RM demands EU to assess Romania’s statements and actions and to mediate the Moldovan-Romanian issues. According to the statement, Republic of Moldova is willing to sign a border and basic Moldovan-Romanian treaties, but Romania is the one who delays it.
Besides, the Romanian president, Traian Basescu stated in an interview with Radio Free Europe that Romania will not stop to repel the accusations of interference in Moldova’s internal affairs.
Note by ADEPT: It should be pointed out that Traian Basescu’s support for the election of Vladimir Voronin as president of RM in the 2005 elections was not considered at that time as interference in Moldova’s internal affairs.
Republic of Moldova – Russia
Negotiations over the Loan Agreement between the Governments of R. Moldova and Russian Federation concerning a 150 million US dollars state credit provided to the Republic of Moldova have been initiated. The funds are to be used for financing investment projects for the road infrastructure and the rehabilitation of water supply systems. The credit is supposed to be repaid within 15 years.
Republic of Moldova – China
On July 23, Republic of Moldova signed an intention Memorandum on lending 1 billion US dollars credit from the state China National Overseas Engineering Corporation (COVEC). After signing the Memorandum, an agreement between the Governments of China and of R. Moldova must be signed, with an furhter Parliament ratification. The credit will be offered for a 15 years term, with a grace period of 3 years. The interest rate on credit has not yet been established. According to the minister of construction and territory development, Vladimir Baldovici, the credit will be used for financing roads, energy, water supply and sewerage infrastructure projects, but also for creating advanced production systems.
Republic Moldova – Council of Europe
The European Court of Human Rights (ECHR) has passed decisions on the cases Baroul Partner A. vs. Moldova (the case of Soroca Gravel and Granite Quarry) and Olaru and others vs. Moldova. In both causes, the Court established the violation of the right to a fair trial and to property. The Court did not propone on the just satisfaction, reserving a separate decision on this matter. The Government of Moldova and the claimants have been called to present written observations on just satisfaction to the Court within three months or to eventually come to an amiable agreement. (Source: www.echr.coe.int and www.lhr.md).
Report of the EC Commissioner for Human Rights on his visit in Chisinau during April 25 – 28, 2009
On July 17 2009, the Council of Europe Commissioner for Human Rights, Thomas Hammaberg, publicly presented a report concerning his visit to Moldova at the end of April. According to the report, "the violations of the prohibition against ill-treatment, which surfaced so acutely in April 2009, must be tackled head-on in order to restore the climate of confidence which is essential to a solid civil society". In his report, the commissioner states that decisive actions are needed in order to enforce a firm attitude of "zero tolerance" of ill-treatment throughout the criminal justice system, inclusively by reviewing the behavior of guilty policemen and their superiors. Besides, Thomas Hammaberg underlined that free expression and the access to information must be also protected in crisis times.
Republic of Moldova – OSCE
OSCE/BIDDO Mission for monitoring the July 29 early parliamentary elections published a report with preliminary findings and conclusions concerning the election process. According to Election Observation Mission (EOM), "the July 29 early parliamentary elections in Moldova overall were well administered, allowing for competition of political parties representing a plurality of views". Many of the OSCE and Council of Europe standards were met. Still, according to EOM, the election campaign was negatively influenced by subtle intimidations and bias in media coverage in favor of certain political forces. Other shortcomings noted were related to the accuracy of voter rolls and use of administrative resources. According to OSCE observers, these shortcomings must be remedied in the future (ex. the establishment of a centralized electronic voter register), inclusively by continuing democratic reforms.