Regional development policy should be rethought, study

Moldova should rethink the regional development policy because the National Regional Development Fund turned out to be inefficient. The authorities announced that they already drafted a new law on regional development. Eleven years of the creation of the National Regional Development Fund in Moldova and over six years of its de facto functioning, the allocations of millions of lei from the state budget didn’t produce the expected results, experts of the Institute for Development and Social Initiative “Viitorul” say in a study published in the Bulletin “Budget without secrets”, IPN reports.

According to Iurie Morcotylo, one of the study authors, the projects financed with money from the National Regional Development Fund refer more to infrastructure problems and do not generate economic opportunities for the population as they should when the population is more determined to leave Moldova. Moreover, even if communities won and implemented projects with the assistance of the Fund, the impact of these on the own incomes is rather low.

“We assessed the impact by a statistical fine, taking into account the revenues and costs per community – of those that benefitted from funds from the National Regional Development Fund and of those that did not. We ascertained that the own revenues of beneficiary communities haven’t increased. There is no big difference between the two even if the projects were implemented three-four years ago,” stated Iurie Morcotylo.

According to the experts, the Moldovan authorities should rethink the regional development policy, with emphasis on the economic development of regions, while the beneficiaries of these projects should represent at least one third of the inhabitants of a geographical region – north, center, ATU Gagauzia or south.

“If we want to have a fund that would promote regional, not local development, the regional project concept and the method of distributing money should be reviewed. It should be clear what for the money of the National Regional Development Fund is budgeted and allocated – we either give money to the poorest or we concentrate on projects that develop the competitiveness of communities in contrast to others,” concluded Iurie Morcotylo.

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