Economic Policies on March 17–31, 2009

Labour market

Moldovans earn lower salaries…

According to the National Bureau of Statistics (NBS) data, the average wage on economy accounted for 2,532 lei (173.6 Euros) in February 2009, by 1 percent less than in January, when it amounted to 2,555 lei (190 Euros). Given the depreciation of the leu versus euro, the wage in February (173.6 Euros) was by 8.6 percent lower than in January (190 Euros). Compared with February 2008, the wage in February 2009 rose by 13 percent, while the net average salary increased by 10 percent only.

The average wage in budgetary sector accounted for 2,237.3 lei (153.4 Euros) and rose by 24 percent compared with the similar period of 2008. The average wage in the real sector amounted to 2,707.8 lei (158.7 Euros) and rose by 10 percent, compared with the similar period of 2008. However, average wages as trend have decreased in majority of economic sectors, starting with the agriculture and ending with finance.

Employees in agriculture, hunting and forestry were paid the least — 1,236 lei or 84.7 Euros (compared with 1,260 lei or 93 Euros in January 2009), fishing and fish breeding — 1,659.3 lei or 113.9 Euros (compared with 1,348.7 lei or 100 Euros in January 2009), education — 1,930.6 lei or 132.4 Euros (compared with 1,766.6 lei or 130 Euros in January 2009), etc.

The highest wages, but lower than the last month were paid to employees in financial sector — 4,783.3 lei (328 Euros, compared with 5,822.8 lei or 430 Euros in January 2009), electricity, heating, gas and water providing industry — 4,442.4 lei or 304.7 Euros (compared with 4,522.1 lei or 335 Euros in January 2009), transportation and communication — 3,485.6 lei or 239 Euros (compared with 3,335.7 lei or 247 Euros in January 2009), real estate transactions — 3,247.2 lei or 222.7 Euros (compared with 3,164 lei or 234 Euros in January 2009), public administration — 3,140 lei or 215.4 Euros (compared with 3,017.6 lei or 224 Euros in January 2009).

Banking system

Guaranteeing rate on deposits by individuals was increased…

Under a decision by the management board of the fund for guaranteeing deposits in banking system (FGDBS) from December 22, 2008, the guaranteeing rate on deposits by individuals was increased from 4,500 lei up to 6,000 lei. The new rate will be in effect during April 1, 2009 — March 31, 2010.

The rise was operated by establishing a variation coefficient of 1,333.3 from the level set under Article 6 (1) of the law on guaranteeing deposits of individuals in the banking system — 4,500. Therefore, if the deposits of an authorized bank become unavailable, the fund guarantees the payment of 6,000 lei to each deponent, regardless of the number, size and currency of deposits.

As well, the bank’s obligation towards the deponent is calculated by summing all deposits inclusively the owed interest rate on the date when the unavailability of deposits was established. The amounts of guaranteed deposits in the banking system are raised from annual or quarterly contributions by commercial banks.

Under the law on guaranteeing deposits of individuals in banking system, the bank shall pay a single initial contribution equivalent to one percent of the deposits registered in the balance sheet of the bank and a quarterly contribution of 0.25 percent of the overall deposits guaranteed accordingly to the established level and recorded in the balance sheet of the bank at the end of every quarter. According to data published on the fund’s website, the fund for guaranteeing deposits of individuals includes about 73.7 million lei at present.

External position of country

Reserve currency down by about 490 million dollars this year…

According to the NBM accounts, the reserve currencies amounted to 1.18 billion dollars in late March, decreasing by about 490 million dollars (30 percent) compared with December 31, 2008, when they accounted for 1.67 billion dollars. In particular, the reserve currency of NBM declined by more than 168 million dollars in January and by about 140 million dollars in February. According to updated forecasts for 2009, the IMF says that Moldova’s reserve currency could decrease by 614 million dollars. According to a more pessimistic scenario, the country’s reserve currency could fall by 1.3 billion dollars, which means that Moldova could have no reserve currency, should remittances and exports keep dropping.

NBM representatives have earlier said that the reduction of official reserve assets in 2009 was linked to interventions on Moldova’s currency market under the shape of sales, payments on account of country’s external debt, other external payments, and reduction of the exchange rate of the currencies which make the reserves versus US dollar. In 2008, Moldova’s reserve currency increased by 338.72 million dollars (25.4 percent) up to 1,672,410,000 dollars. As for December 31, 2007, reserve currency of NBM accounted for 1,333,068,000 dollars.

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