"Cutting edge improvements in the public procurement system in the Republic of Moldova through inclusiveness, creativity and law-abiding practices" is an EU-funded project launched on, May 18, by IDIS Viitorul. The project aims to strengthen civil society capacities to assess and monitor the public money spending and to promote dialogue between authorities and civil society organisations on the reform of public procurement.
"What happens in the field of procurement affects the pockets of every citizen. Public procurement represents about 10% of the GDP. Trust is manifested in the way the population looks at the priorities of the institutions by the way they can monitor them. And this project launched by IDIS Viitorul has this goal”, explained IDIS Viitorul director, Igor Munteanu.
Marco Gemmer, Deputy Head of the Operations Department at the EU Delegation to the Republic of Moldova, said that reforming public procurement is a challenging task not only for the Republic of Moldova. Progress can only be achieved when all the relevant stakeholders join hands: the government, civil society, business operators and the donors. That's why the EU supports initiatives which contribute to establishing and enhancing this co-operation”.
Project Coordinator, Carolina Ungureanu presented the activities and the expected results of the project. She stated "the project aims to strengthen the watchdog role of civil society ensuring a greater transparency of procurement. It will also assist governmental authorities, public procurement regulatory authorities and contracting authorities to respect the principles of good governance (transparency, efficiency, effectiveness, legality, ethics, and integrity) in order to improve the procurement system and, therefore, the quality of public investment. The project aims at ensuring wider public access to relevant information in the procurement system covering the entire operational cycle, from the planning stage to the execution of the contract, as well as any breaches of public procurement procedures. Last but not least, IDIS will contribute to the creation of an effective system for resolving public procurement challenges through monitoring of the activities of the recently established Complaint Settlement Agency and capacity building to operators on how to use the complaint mechanism”.
The Deputy Minister of Finance, Iurii Cicibaba, welcomed the support of the EU to the reform of public procurement in Moldova which was initiated by the Ministry of Finance in 2016. The Deputy Minister expressed the readiness of the authorities to collaborate with civil society on implementing the reform.
Representatives of the Public Procurement Agency, the Court of Accounts, the National Anticorruption Center, the Competition Council as well as civil society organisations and business operatiors shared their views on the challenges in improving public procurement and confirmed their willigness to collaborate with the project.
The event was organized within the framework of the project "Innovative improvements in the public procurement system of the Republic of Moldova through inclusion, creativity and law enforcement practices", funded by the European Union.
For further details, please contact the Press officer, Victor URSU, at the following address: ursu.victoor@gmail.com or at 069017396.
Transparency of public procurement is a guarantee of efficient and legal use of public resources and is an essential condition for integrity and lack of corruption in public procurement. Transparency supports the consolidation of a public procurement process. The contracting authorities, who actively participated today in the open workshop, are unsatisfied with the inadequacy of the training and guidance to provide support for the legal framework and subsequent changes: conducting procurement procedures and monitoring implementation of contracts.
"Transparency generates competition, and competition generates savings. The econometric analyzes carried out in the framework of impact studies at European level have shown that a small but stable rise in the level of transparency in public procurement leads to tangible savings. Thus, the publication of a contract notice generates savings of 1.2% compared to situations where no advertisements or other information related to a contract have been published ", explained trainer Diana Enachi at the workshop.
It recommends the use of electronic tools to ensure transparency and openness of data in public procurement, including opencontracting.date.gov.md, which will involve different actors in the public procurement system through active participation, feedback and application of monitoring mechanisms Of how public money is spent.
In turn, Viorel Chivriga, program director of IDIS Viitorul, said that the premise of the emergence of open contract was generated by the lack of transparency in the procurement process, corruption at different stages of the process and at different levels, poor monitoring of the implementation of contracts, Public revenue is not generated, allocated and rationally spent, positive experience is not widely disseminated, free competition is depressed.
Local authorities said that they often do not have the necessary training and experience in procurement, and large contracts are won by some and the same companies. "This is due to the fact that specialists working in public procurement are not motivated and migrate to the private sector."
The workshop was organized by IDIS Viitorul in the framework of the project: "Development of open contracting in Moldova through information and capacity building activities for participants in the public procurement process through developing information and capacity building for participants in the public procurement process Procurement process ", financed by the World Bank.
Civil society and citizens have a crucial role in "constraining" governments to make them more open, transparent and accountable. Local authorities who have participated today in the open-ended workshop say they want transparent acquisitions, but they are faced with an acute shortage of staff who are demoted by low public sector wages.
Diana Enachi, one of the workshop trainers, says the most important thing in procurement is free to access to information on all stages of the process, which is limited. "The concept of" open contracting "is based on two pillars: the opening of data and the active involvement of all actors, not just the two parties involved in contracting - the authorities and the private sector, but also the civil society and the citizens to be offered The ability to expose and notify the control bodies whenever they encounter a problem. When applying the principles of open contracting, they all have a win-win: the authorities that gain more value for public money, economic operators - healthy conditions of competition and non-discriminatory treatment. Civil society must have open access to data and the possibility of monitoring the use of public resources, and citizens - quality goods, services and public works.
"Public administrations acquire goods and services for their citizens: these purchases must be made in the most efficient way. Also, public procurement offers opportunities for businesses, thus encouraging private investment and concretely contributing to growth and job creation. Public procurement plays an important role in channeling European structural and investment funds", explained Viorel Chivriga, Program Director of IDIS Viitorul.
The contracting authorities stated at the workshop that public procurement procedures in some localities are difficult due to the lack of specialists and capabilities in the field. However, this hinders the process, and often local authorities lose their allocated funding.
The workshop was organized by IDIS Viitorul in the framework of the project: "Development of open contracting in Moldova through information and capacity building activities for participants in the public procurement process through developing information and capacity building for participants in the public procurement process Procurement process ", financed by the World Bank.
Public procurement has always been tempting for private companies. The competition has increased in recent years as well as the fight for public money. Authorities are making efforts to optimize public procurement procedures, but economic operators have stated in the workshop on open contracts that most contracting authorities are delaying payments for deliveries of goods, services or works. This reduces the interest of the economic agents to participate later in auctions, which affects competition in the procurement market.
"Public contracts are strongly exposed to the risks of corruption, which are even higher as transparency is lower. Open contracting helps us to prevent these risks from disclosing information throughout the procurement process and involving all actors. It is about the private environment and civil society by reporting irregularities and proposals to improve the quality of procurement. Where transparency is ensured and economic agents are well-informed and treated, their interest and degree of participation in acquisitions will increase", explained IDIS Viitorul economist Diana Enachi at the workshop.
Viorel Chivriga, Program Director of IDIS Viitorul, notes a break between budgetary policies and other development policies, and in order to address this challenge, it has to take into account the inter-relationship between open contracting and other relevant approaches within the framework of the PGI, such as the open development. In this respect, the Government should ensure that the data from the open-end initiative is complemented by other data sets relevant to development, such as sectorial strategies.
The economic agents who participated in the workshop noted the issue of the payments for the purchase contracts. Transfers are delayed as a result of lack of money from contracting authorities. Moreover, there is the 5% clause in the procurement contract for good execution, which also hampers the full payment set in the contract.
The workshop was organized by IDIS Viitorul in the framework of the project: "Development of open contracting in Moldova through information and capacity building activities for participants in the public procurement process through developing information and capacity building for participants in the public procurement process Procurement process ", financed by the World Bank.
The way in which public money is used has been and remains one of the most pressing problems faced by the Republic of Moldova. Transparent public procurement gives the tone of good governance, and open data platforms, such as the Open Contracting Portal in Moldova, ensure data transparency and active involvement of the company in procurement and decision-making processes. A state of the art procurement system is a growth tool if we take into account the fact that procurement contracts run annually between 5 and 10% of GDP. Unclear procedures, often excessively bureaucratic, have led to the delay of infrastructure works and the increase in corruption cases that seriously damage public budgets.
The implementation of open contracting standards will increase access to information on the entire procurement process, but also reduce bureaucracy and corruption. It also makes it possible to interconnect with other government platforms so that users can access multiple types of data on one portal, such as those in the State Registry of Legal Entities or the National Courts' Portal.
The concept of "open contracting" is a relatively new one, so the foundations of the "Open Contracting" initiative were launched in 2010 on the occasion of an event aimed at improving the governance of the extractive industry in Africa. Among the first supporters of the initiative were internationally renowned organizations such as the World Bank Institute (WBI), Transparency International (TI), the International Cooperation Agency (GIZ), etc. The necessity of an instrument that would generate more transparency and efficiency in public procurement has led to the implementation of open contracting in the Republic of Moldova", explained economist Diana Enachi to the participants in the workshop on open contracts that took place today.
Viorel Chivriga, Director of Programs at IDIS Viitorul, argues that public procurement is an essential aspect of public investment: it stimulates economic development in Europe and is an important element in boosting the single market. In the Republic of Moldova, the World Bank has begun a broad process of harmonization of procurement principles and procedures. The basic principles for public procurement are transparency, economy, and efficiency, equal opportunities for all bidders, help for contractors and small local businesses.
Economic agents said at the event that they are facing limited information, unannounced controls and lack of collaboration between contracting authorities and decision-makers.
The workshop was organized by IDIS Viitorul in the framework of the project: "Development of open contracting in Moldova through information and capacity building activities for participants in the public procurement process through developing information and capacity building for participants in the public procurement process Procurement process ", financed by the World Bank.
In order to ensure that the considerable amounts of public money that go annually through public procurement are not vulnerable to corruption risks and public interest prevails in the public contracting process, transparency and openness of data are indispensable. However, open contracting is the one that ensures the application of these principles throughout the public procurement process, but also the active involvement of all actors, including the private sector and the civil society. This was also the topic of the workshop organized by IDIS Viitorul for a group of representatives of civil society and the media, who expressed their interest in the principle of open contracting in public procurement.
"Governments have the duty to ensure that supervising bodies, including the Parliament, the Court of Auditors or contracting authorities, have access to and use the information they publish, take into account and react to their citizens' feedback, and encourage dialogue and consultations between the contracting parties and civil society organizations to improve the quality of contracting results", explained Viorel Chivriga.
According to him, the expected results are: transparency in public procurement, reduced bureaucracy in the system, partnerships, cooperation with stakeholders in the modernization of public procurement, ensuring monitoring of public procurements throughout the whole process, free competition, compressing and elimination of illegalities in the field of public procurement and the transfer of experience, positive practices and expertise to the sector.
Diana Enachi, who spoke about open contracts, said the benefits are "getting value for money" for authorities, streamlining public budgets/spending, ensuring fair competition and non-discrimination for the private sector, especially for SMEs, risk management of corruption and fraud prevention, the ability to analyze and monitor purchases, and generate solutions to the issues that arise.
The workshop was organized by IDIS Viitorul in the framework of the project: "Development of open contracting in Moldova through information and capacity building activities for participants in the public procurement process through developing information and capacity building for participants in the public procurement process Procurement process ", financed by the World Bank.
A recent study signed by experts Sergiu Tofilat, Victor Parlicov and Tudor Soitu proves that Moldova-Gaz has paid about $ 1.3 billion as direct subsidies to the Transnistrian separatist regime in the years 2007-2016. Although the natural gas was offered, these resources were converted by the Tiraspol administration in budgetary resources, which different wages and social obligation, payments to support bureaucracy and defense and security were paid, giving thus separatist vital resources for the survival of the regime. These funds covered about 35.3% of the total budget of this region in the last 10 years. The irony of this is that Moldova is a minority shareholder in a company, which finances a separatist regime on the own sovereign territory.
The authors of the study, released on April 12, 2017, claim that this happened because Moldova does not use any control lever control of the monopolist – company, Moldova Gaz, a subsidiary company of the Russian concern Gazprom. The energy sector makes the country vulnerable because 85% of primary energy consumed comes from outside the area controlled by the national authorities and almost 100% of natural gas is purchased from Gazprom via Moldova-Gaz. Relations between these companies with the Government of Moldova are often unstable and ambiguous.
Gazprom interests in Moldova were almost always strictly political rather than economic. Its work served as the operational platform for the promotion of the Russian strategic agenda, which was limited to: maintaining the country depending on the overall energy, maintenance of the Transnistrian conflict in a frozen state, and strengthening the role of Russia as a hegemon mediator in prioritizing development country, says Victor Parlicov energy expert of IDIS Viitorul. In turn, Tudor Soitu said that "natural gas sector has undergone a raider attack in the country, which lasted four years (1994-1998) and happened at least in two stages. Following a series of decision makers in Moldova, as well as swelling debt and artificially undervaluing of assets, S.A.D. "Gazprom" has obtained control over enterprises which have the critical infrastructure for transport and distribution of natural gas in our state, say the experts say the Policy paper "Impunity and renter understanding in the energy sector of the country”.
Sergiu Tofilat said big businesses in the Russian Federation have used several fraudulent schemes in the Transnistrian region, using the subsidies for natural gas, recovering up to now about 1.8 billion US dollars. Unfortunately, these schemes were made with the participation of stakeholders in Chisinau.
The authors of the publication recommend authorities to urgently review Moldovan policies in relation to energy companies in the context of the Transnistrian debt for gas. As long as the current contracting scheme works and there is no solution for liabilities related to natural gas consumption on the left bank, the economic activity of such enterprises from the Transnistrian region leads to the inevitable worsening of the debt problem for gas.
The study provides an assessment of overall conditions, mechanisms, and tools through which authorities can restore the legality in the energy sector, defending the interests of citizens in their capacity as final consumers of energy and taxpayers. The study is done in a case of public interest.
The publication can be downloaded here.
For further details, please contact the press officer, Victor URSU at ursu.victoor@gmail.com or by phone 069 017 396.
On April 6, experts from IDIS “Viitorul” presented the Socio-Economic Development Strategy of Gagauzia (SDSEG) 2017-2022. In preparing the document, with the support of the authorities from Gagauzia and the Executive Committee meetings, discussion panels and workshops on areas were organized and businessmen were interviewed. This activity is carried out with the financial assistance of the European Union within the program "Support to agriculture and rural development in Gagauzia and Taraclia" (SARD), implemented by the United Nations Development Program through IDIS “Viitorul”.
IDIS Viitorul expert, Viorel Chivriga said that the document is a reform agenda for Gagauzia and the objective is to make changes in the social, economic and political field. The document contains suggestions for developing the key areas while the authorities are interested in the prosperity of the region and raising the living standards of citizens. Is a signal to foreign business that the Gagauzia is an interesting area, which in recent years has shown good results.
The document aims to create jobs, attract foreign investment, economic development and raising the living standards of citizens.
"The strategy is developed in close cooperation with the authorities in Comrat. It is a complex document and covers important areas for the development of Gagauzia and increase the welfare of citizens in the region for the period 2017-2022. Five groups of experts on well-defined areas participated in the design of the strategy. The analysis was discussed at 12 thematic meetings of thematic and the strategy itself – at about eight events with the participation of authorities from Comrat. The Socio-Economic Development Strategy of Gagauzia includes: vision, the mission of the SDSEG, priorities, actions to be taken and the action plan", said Liubomir Chiriac, vice director IDIS “Viitorul”.
The document was developed over a period of five years and focuses on: sustainable use of natural resources, human resources, and social sector development, ensuring sustainable economic growth in the region, territorial branding and promoting the image of Gagauzia nationally and internationally.
The document was developed for a period of five years and focuses on: sustainable use of natural resources, human resources and social sector development, ensuring sustainable economic growth in the region, territorial branding and promoting the image of Gagauzia.
For more details, please contact the Public Relations Coordinator of IDIS "Viitorul", Victor Ursu - 069 017 396 or e-mail ursu.victoor@gmail.com
Developing businesses in Moldova feels in figures given that in recent years more and more foreigners come to Moldova to analyze investment opportunities. Is a rising branch, explained the Program director at IDIS “Viitorul”, Viorel Chivriga, at the Congress of Local Governments (European Congress of Local Governments) in Krakow on 27 to 28 March 2017.
"The business tourism in Moldova is growing. It's about official trips, visits of employees or other persons for commercial reasons, participation in exhibitions, conferences, conventions and incentive trips. This form also intersects and the wine, rural, cultural, religious, gastronomic, nostalgic, environmental, automotive, weekend, and urban tourism. Moldova has the potential to practice this form of tourism", said Chivriga.
Tourism potential can be exploited, and also developed using the synergies from business, local government, central government and NGOs. On the other hand, it is evident the necessity to combine more qualities, which give a particular aspect of this sector, creativity, originality, and individuality. On medium and long term, developing businesses in Moldova will be determined by economic reform agenda, attracting investments and investors, and the transfer of experience, expertise and technology to Moldova.
Between 27 to 28 March 2017 in Krakow, Poland the third edition of the Congress of Local Governments (European Congress of Local Governments) was held. In the event, at the panel "Business Tourism - A Development Opportunity for Cities and Regions" spoke Viorel Chivriga, Ion Leuca, President of Glodeni rayon, Martine Grivot, Deputy Mayor for External Relations, Orléans, France, Mirela Koci - Executive Director, AULEDA Local Economic Development Agency, Albania, Oleg Matukevich, President of Foundation for information and technology for SMEs, Russia.
For more details, please contact the Public Relations Coordinator of IDIS "Viitorul", Victor Ursu - 069 017 396 or e-mail ursu.victoor@gmail.com
After March 21, the Ministry of Finance officially launched the First Home Program, which states that citizens of up to 45 years of age can buy a housing with state-guaranteed real estate loans, said journalist Vlad Bercu listed in the program "15 minutes of economic realism" the main risks and benefits of the program.
The First Home Program is required for young families, especially since the 2014 census data showed that 80,000 families are in rent. It is certain that the number of applicants for housing is much higher than the program's possibilities. Finance Minister Octavian Armasu said in an interview that 10,000 people could submit applications within the program without specifying the period.
"It is a good time to launch the First Home Program when interest rates on mortgages are at the lowest rate - 7% free of charge. In addition, apartment prices have stabilized and will not grow in the coming years", says Vlad Bercu.
The benefits of the program are that the beneficiaries contribute only 10%, while the bank's rate is 25%. By government decision, banks' commission was capped at 1%, and the state provided a 50% guarantee of the cost of the credit if the beneficiary of the credit would become incapacitated. At the same time, a government decision reduced certain payments for the registration of the dwelling.
The journalist also identified certain risks in the event of economic instability. "One problem is that some of the recipients of credit might become incapacitated. The Ministry of Finance estimates that 5% would be the share of those who could not pay their payments, which is why the 50 million guarantee for the current year is set. For example, in Romania out of the 200,000 program beneficiaries, only 2% went into default", Bercu said.
"Very many young people who would like to buy a house would not be eligible under the program because state salaries are below the limit accepted by banks and privatized most of the business pay salaries in the envelope," Bercu said.
At the same time, the journalist also draws attention to the interest rate risk, which today is 9.3% annually, but following a crisis, the interest rate could rise overnight. Also, "currency risk should not be neglected. The cost of the apartments is in euro, and in case of depreciation of the leu, the beneficiaries of the loans will have to make more money out of their pocket. The very cheap loans for real estate in the time of stability under a financial crisis like in the US left thousands of people homeless. In such a situation, the Government's guarantee might be insufficient to cover the risks of commercial banks.
The show is made by IDIS "Viitorul" in partnership with Radio Free Europe.
For further details, please contact the press officer, Victor URSU, at the following address: ursu.victoor@gmail.com or at 069017396.
