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Democracy and governing in Moldova
e-journal, year VII, issue 144, 1–18 September 2009
Activity of Public Institutions
Activity of Public Institutions
1.1. Appointments. Dismissals
Election of deputy Chairpersons of the Parliament:
- Serafim URECHEAN – first deputy Chairman, AMN parliamentarian;
- Marcel RADUCAN – PDM parliamentarian;
- Iurie TAP – PLDM parliamentarian;
An office of deputy Chairperson was reserved to PCRM, but the latter did not nominate any representative.
Members of the Parliament’s Permanent Bureau were nominated as follows:
- Maria POSTOICO, Vladimir TURCAN, Igor DODON and Grigore PETRENCO -PCRM parliamentarians;
- Vlad FILAT – PLDM parliamentarian;
- Anatol SALARU – PL parliamentarian;
- Marian LUPU – PDM parliamentarian;
- Veaceslav UNTILA – AMN parliamentarian.
The speaker, first deputy speaker and deputy speakers of the Parliament are ex-officio members of the Parliament’s Permanent Bureau.
The Parliament will have 9 permanent commissions:
- The legal commission for nominations and immunities, headed by Ion PLESCA, AMN;
- The commission for economy, budget and finance, ruled by Veaceslav IONITA, PLDM;
- The commission for national security, defence and public order led by Igor VREMEA, PCRM;
- The commission for foreign policy and European integration headed by Igor CORMAN, PDM;
- The commission for human rights and interethnic relations led by Vadim MISIN, PCRM;
- The commission for public administration, environment and regional development led by Valentin GUZNAC, PCRM;
- The commission for agriculture and food industry, led by Dmitri TODOROGLO, PCRM;
- The commission for social protection, health and family headed by Vladimir HOTINEANU, PLDM;
- The commission for culture, education, research, sport and mass media led by Corina FUSU, PL.
On September 11, the Parliament made a decision, taking notice of the resignation of Mr. Vladimir VORONIN and declaring the vacancy of the post of President of the Republic of Moldova. Under another parliamentary decision, Parliament Speaker Mihai GHIMPU was nominated interim President of Moldova.
On September 17, the Parliament took notice of the Government’s resignation in absence of the interim Prime Minister, Vitalie PIRLOG, who did not attend the sitting without any adequate motivation.
1.2. Legislative acts
Law on modification and completion of the law concerning the Government. Under the law, the cabinet of ministers will be made of 16 ministries and 8 central institutions. It will include the following ministries:
The central institutions subordinated to the executive will be:
- Ministry of Economy;
- Ministry of Finance;
- Ministry of Justice;
- Interior Ministry;
- Ministry of Foreign Affairs and European Integration;
- Ministry of Defence;
- Ministry of Construction and Regional Development;
- Ministry of Agriculture and Food Industry;
- Ministry of Transportation and Road Infrastructure;
- Ministry of Environment;
- Ministry of Education;
- Ministry of Culture;
- Ministry of Labour, Social Protection and Family;
- Ministry of Health;
- Ministry of Youth and Sport;
- Ministry of Information Technologies and Communications.
- The National Bureau of Statistics;
- The Agency for Land Relations and Cadastre;
- The Bureau of Interethnic Relations;
- The Border Guard Service;
- Moldsilva Agency;
- The Agency of Material Reserves;
- The Tourism Agency;
- The Centre for Combating Economic Crimes and Corruption.
The State Chancellery will be established and the office of State Minister will be introduced. As well, the draft modification to the law on Government lifts the restriction for cabinet members to have double citizenship. The new cabinet does not include the Ministry of Reintegration in charge with the Transnistrian settlement process. A deputy prime minister of the new Government will take over the tasks of this ministry.
Laws on ratification of some international conventions and agreements. They ratify several bilateral conventions on avoidance of double taxation (with Belgium, Portugal, and Ireland) and approve funding agreements.
Statement concerning the social-economic situation in the Republic of Moldova and necessary actions to cushion the effects of the crisis. The document adopted by the Parliament notes among others the following facts:
- the crisis has hit all economic fields, producing serious social effects;
- by taking irresponsible and unprofessional actions, the communist government has worsened the effects of the world financial crisis in the country and led industries, agriculture, construction, transportation, domestic and foreign trade, public finances to the bridge of collapse;
- the annual budgetary deficit in 2009 will be about 6 billion lei or 12 percent of GDP;
- the degradation of business and investment climates after incompetent actions of the communist government reduced the pace of foreign direct investments by 50 percent;
- the crediting debts worth over 1.5 billion lei raised by Government towards economic agents reduced the circulating funds and blocked the operation of some enterprises, reducing the exports by 30–35 percent;
- the Government delayed the implementation of anti-crisis measures.
Before the investiture of the new Government, the Parliament of Moldova urges the acting Government:
- To avoid financial deadlocks by honouring its commitments towards economic agents;
- To immediately stop any abusive state control on business environment, except for planned inspections;
- To apply a cautious fiscal administration;
- While executing the budget, to refrain from risky actions capable to break down the budgetary system and undermine the real economy;
- To relieve the crisis situation in the winemaking and vine growing sector.
Decision concerning the liquidation of a state enterprise. It gives green light to the initiative by the Ministry of Agriculture and Food Industry seeking the liquidation of the State Enterprise Directorate General on Research, Education and Professional Formation.
Decisions on approval of some regulations:
- The concept of the automatic information system called state register of domestic violence cases;
- The regulation concerning the organisation and functioning of the Community Centre for Early Development of Children aged 3-(6)7 years old;
- The regulation concerning the management of the tariff contingents for the import of white sugar and sugar products;
- The sanitary regulation concerning food supplements;
- The regulation concerning the acquisition of drugs and other medications for the needs of the healthcare system;
- The sanitary regulation setting requirements for the sale of bio destructive products.
Decisions concerning the allocation of funds from the reserve fund of the executive:
- 739,600 lei will be allocated to compensate losses related to the exemption in 2008 of owners of farm lands located on the other side of the Rabnita-Tiraspol route from mandatory state social insurance contributions and mandatory health insurance fees to the following public authorities:
- National Social Insurance House – 566,600 lei to compensate losses of the state social insurance budget;
- National Health Insurance Company – 173,000 lei to compensate losses of the mandatory health insurance funds;
- Prosecutor-General’s Office – 309,200 lei to organise and conduct the sitting of the Coordinating Council of Prosecutor-Generals from CIS members states on October 28–30, 2009.
2.2. Sittings. Decisions
Interim Prime Minister Vitalie Pirlog has chaired several working sittings which focussed on issues relating to:
- Criminal situation in country;
- Situation in the agriculture and conducting of season works;
- Social-economic situation in the Republic of Moldova.
Note by ADEPT: Vladimir Voronin was President of the Republic of Moldova until September 11 and the vacancy was further declared, with Parliament Speaker Mihai Ghimpu being nominated interim President.
Last decrees by President Vladimir Voronin
The "Order of the Republic" was awarded to:
- Vasili Panciuc, mayor of the Balti municipality;
- Tatiana Constantinov, scientific adviser for the Public Institution "Encyclopaedia of Moldova";
- Gheorghe Russu, former director of the National Health Insurance Company;
- Alexei Myller, manager of the Russian company S.A. "Gazprom".
The "Labour Glory" Order was awarded to:
- Anatoly Podmyshalskiy, directorate chief of the Russian Company S.A. "Gazprom";
- Serghei Drobot, editor-in-chief of the newspaper "Kishinevskie Novosti";
- Valentin Bodistean, director-general of the "Valiexchimp" Ltd.;
- Leonid Volneanschi, director-general of the Joint Venture "ELAT" S.A.
The "Founder Bogdan" Order was awarded to writer Ion Druta as a sing of profound gratitude for the special contribution to the national revival, merits to development of cultural relations with other countries and prodigious work aimed to enhance Moldova’s international prestige. Ion Druta is the first knight of the "Founder Bogdan" Order.
The "Honour Order" was awarded to some employees of the Public Institution "Encyclopaedia of Moldova":
- Constantin Manolache, director;
- Mircea Bologa, scientific adviser;
- Ivan Jarcutchi, scientific adviser;
- Valery Golubev, deputy manager of the Russian Company S.A. "Gazprom";
Under a presidential decree, Viorel Melnic, director-general of the Customs Service, was awarded the special ranking of major general of the Customs Service.
Note by ADEPT: Under the law on the service in the customs organs, the chief of state shall award the special rankings from major general of the Customs Service and upper at the initiative of the director-general of the service and with the consent of the Government.
The chief of state has signed decrees revoking (relieving) from offices some dignitaries:
- Igor Dodon, minister of economy and trade;
- Victor Stepaniuc, deputy prime minister;
- Galina Balmos, minister of social protection, family and child;
- Vasilii Sova, minister of reintegration;
- Violeta Ivanov, minister of ecology and natural resources;
- Pavel Buceatchi, minister of information development;
- Mariana Durlesteanu, minister of finance;
- Vladimir Baldovici, minister of construction and area development;
- Mihail Barbulat, minister of culture and tourism;
- Iacob Timciuc, minister of local public administration;
- Igor Colenov, director-general of the Border Guard Service, commander of the Border Guard Troops.
As well, several presidential advisers and functionaries of the presidential administration (PA) were relieved from offices in connection with the resignation of Moldova’s president:
- Domenti Oxana, adviser for social development affairs;
- Vasilica Tudor, adviser for foreign policy and European integration;
- Reidman Oleg, adviser for economic affairs;
- Moldovan-Batrinac Viorelia, adviser for culture, education and science;
- Griciuc Petru, adviser for agro-industrial complex and public administration issues;
- Puscuta Serghei, adviser for financial affairs;
- Vremea Igor, adviser for legal matters, head of the law and public relations directorate;
- Russu Alina, head of the Directorate General (PA);
- Sirbu Serghei, deputy chief of the law and public relations directorate (PA);
- Morei Ion, secretary of the Supreme Security Council.
First decrees by interim President Mihai Ghimpu
The first decree issued by Mihai Ghimpu nominated Vladimir Filat as candidate to the office of prime minister.
The second decree suspended the April 8, 2009 Government Decision which introduced visa requirements for Romania’s citizens.
3.2. Sittings. Statements
Sitting on situation in energy sector
On September 5, the outgoing President Vladimir Voronin convoked a sitting with all decision makers from energy sector of the country and discussed issues relating to this area and natural gas tariffs. It was noted that the natural gas tariff could be reduced by about 10 percent, with competent authorities being expected to do this starting September.
Ensuring efficient functioning of state institutions
On September 11, Parliament Speaker Mihai Ghimpu, interim chief of state, convoked the heads of law enforcement bodies and security forces coordinated by Government and instructed them to ensure the normal functioning of their institutions till the nomination of a new cabinet of ministers. Ghimpu urged the state institutions to work well throughout the transfer of authority, so that people would not feel the lack of rule. Representatives of the institutions concerned assured that the situation is under control, they work normally and there no premises that the underworld could destabilise the situation.
1 Recent press reports criticised the chief of state for having awarded more than 2,000 state orders in eight years of rule, inclusively more than 70 supreme distinctions "Order of the Republic", which give the right to holders to additional monthly allocations worth 500 lei (about 45 US dollars) from the budget.
2 Observers noted that enterprises affiliated to the S.A "ELAT" were part of major electoral sponsors of PCRM.
1. Labour market
Employees of budgetary system earn more than those from private companies…
According to statistics and media reports, each forth employee in Moldova is paid from public funds. On the other hand, the great majority of active population (about 70 percent) is employed in the private sector and another 5 percent in joint ventures. A budgetary employee in Moldova earns almost 2,700 lei (240 dollars) on average, which is by 23 percent more than paid to an employee of private companies. The discrepancy between wages of budgetary workers and employees of the private sector is not new, but it has deepened in connection with the economic crisis. In an electoral year the Government operated a series of salary rises, while many private companies had to reduce their wages. For example, a budgetary employee in the financial sector earns 7,100 lei on average a month, which is by nearly 2,000 lei more than earned by owners of private companies. The same situation is observed in the area of transportation, industry and construction. The state pays about 1,700 lei a month on average to employees in the agriculture sector, while private farmers earn approximately 1,200 lei a month. For example, wages in the healthcare and education sectors are higher in the real sector than those paid from the state budget. According to official statistics, budgetary employees in the healthcare and social assistance sectors earned 2,600 lei on average a month, while fellows from private companies were paid 3,100 lei, and the proportion in the education sector is 2,000 lei for the public sector and 3,000 lei for the private sector.
A two-digit recession could be recorded for 2009…
The clear fall of basic economic indicators in the national economy for the 1st quarter of 2009 had a negative impact on the evolution of GDP for the first half of the year. Thus, the GDP was worth about 27.87 billion dollars in January-June 2009 in current prices on market, and decreased by 7.8 percent in real terms, compared with January-June 2008 (www.statistica.md). The gross value added in the commodity sector has declined by 16.7 percent in connection with the serious fall (by 24.4 percent) of the gross value added in the industry. The gross value added in agriculture, hunting and forestry was by 2.1 percent higher than in the similar period of the last year. In terms of contribution to the GDP formation the gross value added in the commodity sector decreased by one percent, halting the dynamic of GDP (decreased by 3.5 percent). The gross value added in the service sector decreased by 3.4 percent, compared with the similar period of the last year. Taxes on products collected to the national public budget decreased by more than 15 percent, reducing the GDP volume index (by about 3 percent). As for the use of GDP, the internal demand (final consumption and gross capital formation) in the 1st semester of 2009 decreased by more than 19 percent, particularly in connection with the decline of the gross fixed capital formation by about 37 percent and overall final consumption by more than 8 percent. The export and import of goods and services decreased by 12.5 percent and about 28 percent.
3. Banking sector
NBM provided more than 1.25 billion lei to banks in the first eight months…
The National Bank of Moldova provided credits worth 1,254.9 billion lei overall to commercial banks this year, particularly for crediting the real sector of economy, inclusively about 745 million lei in June-August. The loans were released for the basic rate of NBM. Thus, while the average interest rate on credits released by NBM to commercial banks was 11 percent in March-May, it went down to 7.63 percent in August. Banks contracted the credits for 310–350 days in the last three months. Commercial banks use the NBM loans to credit economic agents for an interest rate of over 15 percent. The average rate on bank credits in Moldovan lei was 17.97 percent in July, compared with 23.25 percent in January. The largest "infusion" of liquidities in the bank system was operated in March, 435 million lei. NBM notes that it carried out REPO operations to buy state securities worth 346 million lei in May-July for an average interest rate of 10.65 percent in May, 9.86 percent in June and 9.00 percent in July.
4. Public funds
Budgetary deficit seen from outside…
According to a report by the World Bank for the Pittsburgh G-20 meeting, the Republic of Moldova which is very dependent on remittances could face a serious deficit in 2009, perhaps up to 10 percent of GDP, additionally to the sudden constriction of the foreign funding. It says that remittances from Moldovans working abroad, equivalent to more than 30 percent of the GDP in 2008, were enough to compensate a current account deficit, which would count for 25 percent of the GDP without these remittances. As two thirds of remittances were coming from Russia, Moldova was seriously hit by the global crisis and remittance inflows as share in the GDP are expected to fall down to half. By continuing to enhance the impact of the economic shock, most of remittances fund the household consumption and fuel imports, which are very important to the Government for fiscal revenues. Remittances from Moldovan individuals (residents and non-residents) via Moldovan banks decreased by nearly half (by 46.5 percent) in July, down to 98.58 million dollars, compared with 180.79 million dollars. Moldovan nationals and foreign citizens sent 613.35 million dollars via Moldovan banks in seven months, which is by 34.5 percent less than in the similar period of last year. The national public budget deficit went up to 2.5 billion lei after seven months, with the Government having to issue more state securities and cover the deficit. The World Bank notes that "while the global economy gives unsure signs of recovery, 43 developing countries with low revenues keep remedying the consequences of the global recession, and this stresses the necessity of increasing the support to the poorest countries which face the crisis and economic volatility." The report says that the poorest countries face a deficit of 11.6 billion dollars for essential expenses, a sudden decline of the trade, capital inflows, remittances and tourism; additional efforts are required despite the actions taken until now.
Russia likely to recognise the independence of Transnistria
The chairman of the Russian State Duma’s commission for relations with CIS member states and co-nationals, Aleksey Ostrovsky, has stated in an interview with the Russian media that the Russian Federation could recognise the independence of Transnistria, should the new Moldovan leadership approach Romania so close that to run the risk to be "assimilated" by Bucharest. Representatives of the Coalition for European Integration denied any plans to unite the Republic of Moldova with Romania, with changing Moldova’s statehood being a decision which could be made through a referendum alone.
Transnistria expects the new leadership of Moldova to respect the Barvikha Declaration
The foreign minister of the self-proclaimed Moldovan Transnistrian Republic, Vladimir Yastrebchyak, has stated in an interview with the Russian agency Interfax that "Transnistria hopes that the new leadership of Moldova would respect the agreements reached during negotiations," citing the Barvikha Declaration signed by the presidents of Russia, Moldova and self-proclaimed Transnistrian Republic. Yastrebchyak assured that Transnistria is carefully monitoring the developments in Chisinau and stands ready for any political evolutions in Moldova. As well, he was circumspect over a shortly restart of the consultations between mediators and guarantors, given the "internal political instability in Moldova" and lack of a clear ruling structure in Chisinau.
European Union will support Republic of Moldova to overcome the economic crisis
The special representative of the European Commission in Chisinau, Cesare de Montis, met Parliament Speaker Mihai Ghimpu on September 16 and assured that the European Union is ready to provide the Republic of Moldova with the necessary support to overcome the economic crisis, inclusively by calling upon international financial organisations. As well, Cesare de Montis called for the resumption of negotiations on the new Moldova-EU agreement.
The European Union also expressed support to the new Government via its Special Representative in Chisinau, Kalman Miszei, who assured that EU will cooperate with the new Government, political parties and Moldovan society, regardless of the internal political situation. However, Miszei continued, both the EU and the International Monetary Fund and World Bank would like Moldova to overcome the political crisis by establishing a political consensus needed to avoid new parliamentary elections and work out long-term action and cooperation plans with the future Government.
Republic of Moldova – Romania
After the Coalition for European Integration got the ruling and the Party of Communists of the Republic of Moldova went into opposition, both Moldovan and Romanian authorities gave clear signs for thawing the bilateral relations. The Bucharest leadership, which earlier supported the parties participating in the coalition, reconfirmed its support to the new governance. As well, the Romanian Parliament expressed plans to set soon a National Agency for Citizenship in charge with facilitating the regaining of Romanian citizenship and to open a Parliamentary Bureau in Chisinau for the "educational formation of children, regaining of citizenship, voting mode".
Chisinau has also taken concrete actions to restore the Moldovan-Romanian relations. On September 17, the interim president of the Republic of Moldova, Mihai Ghimpu, signed a decree which cancelled the visa requirements for Romanian citizens. At the same time, the candidate to the office of Moldovan prime minister, Vlad Filat, informed that after cancelling the visa requirements for Romania, the new Government will consider the issues on signing of the small border traffic agreement and opening of Romanian consulates in Cahul and Balti.
Republic of Moldova – Russia
The special representative of the Russian Foreign Ministry, A Nesterenko, explained at a briefing on September 3 the formal position of the Russian Federation towards situation in the Republic of Moldova. According to the Russian official, Russia is ready to keep developing the relations with Moldova in key areas of mutual interest. Representatives of the Coalition for European Integration have repeatedly expressed their position regarding the importance of the Moldova-Russia relations and necessity to develop them.
Republic of Moldova – China
On September 7, the head of the delegation of the National Assembly of People’s Representatives from China (ARP), member of the ARP Permanent Committee, Hu Kangsheng, chairman of the ARP Legal Commission, met the outgoing president of Moldova, Vladimir Voronin, and outgoing Premier Zinaida Greceanii. The officials discussed economic cooperation between the two countries, with the Chinese representative expressing the interest of China’s authorities to strengthen mutual understanding and friendship with Moldova.
Note by ADEPT: The Chinese ARP representative did not meet any member of the Coalition for European Integration and Moldovan Speaker Mihai Ghimpu.
Republic of Moldova – Council of Europe
On September 17, the European Court of Human Rights (ECHR) pronounced the decision on the application Manole and Others vs. Moldova, unanimously indicating the violation of freedom of expression. The Court did not order any damages, reserving this issue for a separate decision. Under the ECHR decision, the Moldovan Government and the applicant company shall submit written observations on this issue to the Court and eventually sign an amicable agreement within three months. (Sources: www.echr.coe.int, www.lhr.md)
PACE Report on implementation of Resolution 1666 (2009) concerning the functioning of democratic institutions by Moldova
On September 9, CoE co-rapporteurs Josette Durrieu (France, Socialist Group) and Egidijus Vareikis (Lithuania, PPE/CD) presented during the sitting of the PACE Monitoring Committee the report on the implementation of Resolution 1666 (2009) concerning the functioning of democratic institutions by Moldova. The report notes that the fresh elections of 29 July 2009 have not resolved the political crisis and institutional deadlock in Moldova and, therefore, PACE calls upon the dominant coalition and the opposition to enter into meaningful negotiations on the election of the chief of state and avoid new parliamentary elections. As well, the Monitoring Committee calls upon the Moldovan authorities to continue to work on the implementation of Resolution 1666 (2009), in strict compliance with the recommendations of the Council of Europe Commissioner for Human Rights, Thomas Hammarberg.
1 Statement delivered by Romanian Senator Viorel Badea at a news conference in Chisinau on September 1, 2009.