The economic year 2006 one the worst – expert
2006 was one of the worst in the last few years from the economic point of view. It resembled 1998, when the crisis in Russia affected the economic situation in Moldova. The current year has also been a difficult one mostly because of Russia, but these complications have been amplified because of a very weak government, the economic analyst Veaceslav Ionita told Info-Prim Neo.
The expert asserts that, thanks to the remittances from abroad, the years 2002 and 2003 marked a great import of capital in Moldova, which ensured an apparent welfare. The naïve government, on the other hand, believed that it is enough to stay still in order that the things go well. Negative forecasts for 2006 were confirmed: the agriculture practically stagnated, because without investments and an intensive agriculture no progress can be achieved. “Till 1996 the state was the landowner, and Moldovans did not have the traditions to work from their own initiative. This is why today both parties learn to have a partner”. The act of acknowledging this could last for at least 3 or 4 years.
On the other hand, the Moldovan industry dies “without the chance to learn a thing”, the expert says. He backs his affirmation with the low quality of the property. In 1996, when massive privatisation started in Moldova, the state transferred the worst assets into private property, compared to the practice of other countries where, first of all, the quality of the best assets have been improved in order that they are sold for a good price later, Ionita stated.
As time passed, the initially privatised low quality enterprises continued to regress. The other enterprises, especially those from the wine-producing sphere, have been sold via varied suspicious schemes, so that they became the property of irresponsible owners, who failed or refused to run an efficient management. As a result, this industrial sphere failed on the internal market with no chance to conquer the foreign one, due to the inefficient administration, low quality products and high prices.
[An employed person feeds two unemployed mouths]
Moreover, as the analyst asserts, Moldova has the only budget to be mostly based on consumption in Europe. The country already registers the phenomenon of negative remittances, where people start to sell their houses and take the money abroad, to those counties where they established their households. The Social insurance budget for 2006 decreased for the first time in the last few years because of the shortage of the population able to work. “In our country, practically, an employed person maintains two unemployed, a fact which has a severe impact on the social insurance budget”, the expert says.
[Moldova - a tramp waiting for the European bus]
Concerning the good economic features of the current year, Veaceslav Ionita says that he did not observe any. An exception could be the promises of those USD 1.2 bln by the international donors, but even in this case the expert is sceptical about the Moldova’s capacity to attract this money, because till present it hadn’t had a tradition in working with donors. While investments of about USD 5 bln have been made in South East Europe since 2003, Moldova didn’t get a single dollar as result of those 8 “poor” projects presented within the frameworks of the South East Europe Stability Pact. The only money to reach Moldova, USD 7 mln was due to Romania, which won a trans-border project.
Ionita expressed his concern about the fact that neither the government nor all the experts who could be potentially consulted in Moldova would help in attracting funds. The only chance would be if foreign experts would work out financing projects for Moldova. However, in this case it would mean a “foreign government”, and Moldova should acknowledge the necessity of internal intellectual capacity growth in order to decide by itself what to do with this money.
Concerning the interest of the West in allotting these finances to Moldova, Ionita compared the situation with “a vagrant that boards a bus and provokes disgust of the other passengers”. The EU member states will never leave Europe and this is why they are interested in creating a stability zone in the South East Europe and find “normal” partners to respect this stability, Veaceslav Ionita added, cited by Info-Prim Neo.