Economic decline will be of 7%, ex-minister

Ex-minister of finance Natalia Gavrilița said that Moldova’s economy will regrettably have to pay for the mistaken socioeconomic policies pursued by the authorities in the context of the pandemic crisis and it is already anticipated that the economic decline will be of 7%, even if the recession next March could be of 3-4%. Polls among the entrepreneurs show that one third of them, especially the small entrepreneurs, are concerned that they could go bankrupt in the spring of 2021, when they have the accounting records. The issue was developed in a public debate staged by the Institute for Strategic Initiatives in partnerships with the Konrad Adenauer Foundation in Moldova, IPN reports.

According to Natalia Gavrilița, the government chose to adopt policies that would advantage large companies. It was hard to access the instituted facilities. The money offered in the private sector were only 8% absorbed. The situation is very difficult. It is expected that problems will be encountered with employment and jobs and the people will continue to see the migration as a solution for remaining afloat.

According to the ex-minister, the developments in 2021 should be anticipated. In crisis periods, the management of processes, especially fiscal administration, continues as if there is no crisis “Work should be done in concert with the business entities. One thing should be ensured in fiscal policy – the business entities should be able to work with fiscal inspectors so as to reschedule some of the debts without imposing halts or penalties. The burden can be eased by offering work capital to business entities by different ways,” she stated, noting the zero tax on reinvested profit can be a solution.

Natalia Gavrilița said a solution is to also offer concessions on the payment of some of the taxes in exchange for the legalization of particular transactions. Online transactions should be encouraged by offering deductions. The way of starting a business should be massively de-bureaucratized by reducing costs. The mechanism should be rethought so as to ease the starting and running of businesses.

The most important thing is to combine forces during the crisis so as to offer the people safety, good programs aimed at those who face poverty. There should be state funds for stimulating demand so that the people have resources to buy goods and services.

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