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Activity of Public Institutions

Parliament
Government
Presidency

Appeal of GUAM and eventual implications by Igor Botan
Liberalisation of economy: between myth and reality by Iurie Gotisan

Activity of Public Institutions

Parliament

Note: According to the Art. 67 of the Constitution of the Republic of Moldova and to the Art. 35 of the Parliament's Regulation, the Parliament meets in its autumn session in September. According to a press release issued by the Press and Image Service of the Parliament, the Permanent Bureau has decided to hold the first meeting of the autumn session on the 5th of October 2006.

Government

2.1. Appointments. Reshuffles

Valeriu Lazar was revoked from the post of minister of economy and commerce and deputy minister Igor Dodon succeeded him.

Victoria Iftodi was revoked from the post of minister of justice and the chief of the governmental agent directorate of the Ministry of Justice, Vitalie Pirlog, representative of the Moldovan Government to the European Court of Human Rights, succeeded her.

Under constitutional provisions, the chief of state operates governmental reshuffles at the initiative of prime minister. The legislation does not require a public motivation of reasons of reshuffles, since these attributions have an exclusive political nature.

The Government has adopted several decisions concerning:

• appointment of Nina Lupan as deputy minister of finance. Previously, Lupan has headed the Central State Treasury;
• appointment of Andrei Cimili as director of the Sports Agency. Cimili is a professional athlete, winner of cycling competitions;
• appointment of Tatiana Bujoreanu as chief of the State Archive Service;
• relief of Nicolae Cibotari from the post of General Staff chief, deputy chief of the State Guard Service.

2.2. Official Decisions

Decision on creation of the agency for inspection and restoration of monuments. The agency will function within the Ministry of Culture and Tourism, will have 7 employees and will be in charge, among others, with creating a public digital database of monuments.

Decision approving the structure of the central apparatus of the Sport Agency. The agency will have 18 employees, except for technical personnel. The agency will supervise the activity of republican sport schools, the Athletic Arena and the National Stadium.

Decision approving the reform strategy of the state framework regulating the entrepreneurial activity. The Government calls the strategy "Guillotine-2" and laws regulating the activity of entrepreneurs will undergo an in-depth analysis within one year. Provisions that do not correspond to principles of market economy and require the involvement of public authorities in operational activity of enterprises will be annulled or modified.

Decision approving the concept on integrated information system of law enforcements. The document aims to encourage an ampler use of information gathered to prevent and combat offences, to increase the interaction between law enforcements.

Decision approving the 2006-10 development strategy of the State Tax Service. It aims to adjust the tax legislation to European standards, to intensify the activity aimed at filling the budget, to simplify the taxation, etc. About 130 million lei is needed to implement the strategy.

Decision approving the draft law on management and privatisation of public property. It brings new regulations on privatisation process through sale and concession of property, fiduciary administration, location, sale of unused assets, creation of commercial societies, etc.

Decision on action plan of the Government for the 4th quarter. The executive has plans to adopt a number of national concepts, strategies and programmes, new draft legislative acts or draft amendments to legislation in effect.

Decisions approving some draft legislative acts:

• on mandatory civil responsibility insurance for damages produced by motor vehicles. Insurance companies will hold the right to pay limited amounts for damages produced by motor vehicles, and persons from motor vehicles, their goods may also benefit of damages. The draft proposes a series of special exigencies for insurance companies.
• on modification of the law on privatisation of enterprises from tobacco and wine industries. The draft proposes that four enterprises (in Cupcini, Falesti, Floresti and Orhei) be privatised on basis of general principles, not on basis of individual privatisation and investments projects. The decision is motivated with the grave financial condition of enterprises and their unattractiveness for investors.
• on Conduct Code of public functionary. The draft code aims to establish high conduct standards for functionaries and contributes to reducing the corruption in public service. It proposes a series of restrictions and principles on career of functionaries, accordingly to international standards in the field.

2.3. Sittings. Decisions. Statements

Support of the World Bank

Vasile Tarlev has discussed aspects of cooperation between Government and the World Bank, with one of topics focussing on the efficient implementation of central public administration reform. Edward Brown said that the World Bank will support the implementation of reforms, especially in the field of central public administration, aimed at strengthening the government's capacities. Financial assistance will be provided for this purpose and the gathering of means from other donors will be coordinated. Also, Tarlev thanked the World Bank for supporting the implementation of EGPRSP by standing ready to offer a 10-million-dollar preferential credit.

Promotion of nut crops

The prime minister has chaired a sitting of the National Nut Promotion Council, which discussed aspects related to development of the nut crop in Moldova, problems and prospects to settle them. Vasile Tarlev ordered the finalisation of proposals on amendment of legislation in the field, which would be implemented in short terms. The premier demanded an action plan on creation of an efficient system for homologation of nuts and strict monitoring of nut seeds on market.

Concerns with youth problems

Prime Minister Vasile Tarlev has chaired a working sitting on creation of youth development opportunities and highlighted the need of reforming the extra-school education system. The premier sought the creation of a modern, European-style republican centre for children and youths on basis of the national palace of creation for children and teenagers.

Implementation of EU-Moldova Action Plan

The minister of foreign affairs and European integration has told a working sitting on implementation of the European Union-Moldova Action Plan (EUMAP) that the E.U. has accepted to discuss with Moldova the possibility of easing the visa regime for Moldovan citizens. The decision of the European Commission to open a Joint European Visa Issuance Centre in Moldova to receive visa applications for European states which do not have embassies in Moldova is another important result of actions aimed to render sensitive the E.U. member states. The prime minister said that the efficient implementation of EUMAP is a priority task for Moldovan authorities and "all documents which will be signed with the E.U. will be primarily executed." The Ministry of Foreign Affairs and European Integration will work out an audience schedule of ministries for fulfilment of the Action Plan. Moldova will pay a special attention to actions aimed to obtain the Asymmetrical Trade Preferences and conclude an Association Agreement with the EU.

Statement on Transnistrian referendum

The Moldovan Government has released a statement saying that the Transnistrian referendum is a way of torpedoing the process of negotiations on peaceful reintegration of Moldovan state. The Government does not recognise the results of the so-called September 17 referendum and considers that the tackling of this action in the context of the peaceful and definitive settlement of the conflict is impossible. The executive expresses gratitude to states and organisations participating in the process of political settlement of the Transnistrian conflict, notably the Russian Federation, Ukraine, the OSCE, the E.U. and the United States for univocally understanding the fact that the resolution of the Transnistrian problem is possible only with respect for sovereignty and territorial integrity of Moldova and shares the conviction of these states and organisations regarding the impossibility of officially recognising the results of "expression of voters' will" under information and administrative pressures on population from the secessionist region.

Communication of MFAEI concerning the gaining of Romanian citizenship

The press service of the Ministry of Foreign Affairs and European Integration (MFAEI) has released a communication saying that "the gaining of Romanian citizenship especially till Romania joins the E.U. in order to travel freely to the Schengen area is a wrong premise followed by Moldovan citizens." Romania's accession to the E.U. is not equivalent to the entry in the Schengen area and MFAEI notes that the European Commission is working on an initiative to create a Joint European Schengen Visa Issuance Centre in Chisinau in 2007. The opening of this centre in Chisinau will allow Moldovans to obtain Schengen visas in their country and not to visit embassies of European states in Bucharest and Kiev.

Concerns with cooperation with mass media

Premier Vasile Tarlev has told a roundtable on access to information that the Government calls for implementation of new and efficient practices of amplifying the relations between central authorities, mass media and civil society and it is looking for efficient tools in this regard. Tarlev noted that the Academy of Public Administration will implement a new course of training of "spokespersons for public institutions." He underlined that a governmental decision has obliged ministries to organise news conferences every month and to install "telephones of confidence".

3. Presidency

3.1. Decrees

The chief of state has signed a decree on appointment of Victoria Iftodi as Moldovan Ambassador to France. At the same time, Iftodi was revoked from the post of minister of justice.

The chief of state has awarded the Civic Merit Medal to Mr. Christopher J.Borgen, professor of law at the U.S. St.John's University, and Mr. A.Meyer, chairman of the European Affairs Committee of the Association of the Bar of the City of New York. He awarded the state medals for contribution to development and deepening of Moldovan-American relations of cooperation in the field of international law. The awarded persons are authors of the report "Thawing a Frozen Conflict: Legal Aspects of the Separatist Crisis in Moldova", which was unveiled in Chisinau last summer and taken over by Government as a guide for the use in the country reintegration process (GD # 891 from 03.08.2006).

Vladimir Voronin has awarded the Honour Order to the special representative of the Council of Europe (CoE) secretary-general to Moldova, Vladimir Philipov. The president awarded Philipov as a sign of high appreciation for merits in developing the relations between Moldova and the CoE, substantial contribution to promotion of democratic reforms in our country. Ambassador Philipov has recently completed his mission to Moldova.

The National Institute of Physical Education and Sport was reorganised into the State University of Physical Education and Sport under the presidential decree # 771 from 21.09.2006. The decree obliges the Ministry of Education and Youth to approve the new status of the university and to distribute the admission quotas on specialties every year.

3.2. Sittings. Decisions. Statements

Examination of the Transnistrian problem

After returning from summer holidays, the Moldovan president convoked a sitting on September 16 on situation in the Transnistrian region on the eve of the referendum organised by separatist authorities. Taking part in the sitting were speaker, prime minister, minister of foreign affairs and European integration, minister of reintegration, interior minister, head of the Information and Security Service, and presidential adviser for interior policy. They examined issues related to situation in the security zone, circulation of goods in the Transnistrian section of the Moldova-Ukraine border, political situation in the eastern breakaway enclave. Vladimir Voronin highlighted the importance of a maximum stability in the security zone, indicating the need to continue the implementation of measures of social and legal support of population and economic agents from the Transnistrian region. Moldovan authorities will continue the peaceful country unification policy with calm and firmness.

Moldova's president received Louis O-Neill, head of the OSCE Mission to Moldova, on September 21 and discussed the OSCE's strong stance on non-recognition of the so-called Transnistrian referendum and its results. Vladimir Voronin described the resumption of the Transnistrian settlement negotiation process as necessary and opportune.

Concerns with GDP growth

The chief of state has convoked a sitting on identification of possibilities to ensure a constant growth of Gross Domestic Product under the current negative trends. Vladimir Voronin outlined the need of examining the extensive and intensive factors, which contribute to formation of GDP and proposed the implementation of an adequate investment policy, reduction of share of the shadow economy as solutions. The chief of state noted that though the GDP has grown in the past five years, it did not reach the level of 1991 and an action plan aimed at restoring at least the level of GDP registered in that period is needed in this context.

Development of commercial-economic relations with Ukraine

Vladimir Voronin has chaired a sitting with the participation of governmental officials that examined the commercial-economic relations with Ukraine, respect for the bilateral free trade regime, possibilities to enhance the Moldovan exports to this country, especially of wines and agri-food products. Voronin highlighted the special interest of Moldovan authorities to permanently improve the legal basis of bilateral trade exchanges, with respect for legitimate interests of the sides and norms of the international law. The president recommended the Government to examine these problems within the Moldovan-Ukrainian intergovernmental commission soon.

Statement on agenda of the U.N.

The Moldovan president has delivered a statement on agenda of the U.N. General Assembly, saying that the 61st session of the General Assembly is especially important because Moldova and its GUAM partners have managed for the first time to include the issue of the worst political problems of the region in the agenda of the Assembly. He said among others:

• the Moldovan authorities consider that it is abnormal that the U.N. did not discuss at all the frozen conflicts in the post-Soviet region;
• the goal of Moldova's efforts within the U.N. is to tell the truth to the entire world community about what is happening in the areas of frozen conflicts, what is happening in Transnistria, to tell the nature of this conflict, the essence of initiatives of the Chisinau authorities, the current perspectives of a definitive settlement of this conflict;
• the Moldovan Government sees its task in breaking the wall of silence around the Transnistrian conflict at the global level, mobilising the huge and multilateral potential of the U.N., which is capable to give a new impulse to the process of definitive settlement of frozen conflicts in the post-Soviet region.

New tasks for Chisinau City Hall

Vladimir Voronin has chaired a sitting on arrangement of the Valea Morilor park in Chisinau and called for the capital and complex reconstruction of the park and renovation of all objects inside of it. The chief of state indicated the opportunity of studying the experience of other countries in the field of sanitation of water basins and implementation of modern technologies for reanimation of the lake in the Valea Morilor park.

The Chisinau City Hall is due to draft a rearrangement strategy of the park, to start projecting works and to evacuate the water from the lake in order to clean it. The president noted that the implementation of the rearrangement project is important both for bringing one of central public gardens of Chisinau into relief and for improving the ecological condition of the capital.

Exchange of opinions about history

The chief of state has convoked a sitting on introduction of the integrated history course in pre-university education. Taking part in the sitting were decision-making officials of the Government, Parliament, education and science sectors, representatives of the Association of Historians. Vladimir Voronin told the sitting that he gets involved for the first time in talks on introduction of the integrated history course in the pre-university education system and he is concerned with so difficult start and with the fact that the talks on this issue threaten to split the society. The chief of state considers that divergences regarding the implementation of the integrated history course in the education system must be discussed calmly at sittings, roundtables, seminars, not in the street. The European integration was declared a strategic objective of our country through the March 2005 unanimous vote of 101 members of the Parliament and this fact means inclusively adjustment to exigencies of the European educational community, with the introduction of the integrated history in educational institutions being a small important step toward integration. It was underlined the need of making a difference between "historical science" and "historical education", with the latter following the final goal to cultivate the sentiment of patriotism, devotion and sacrifice for country, nation, national values, consciousness and historical memory. At the same time, it was noted that European countries have passed from the ethnocentric system (based on history of one nation) to multiculturalism and pluralism of opinions in the history teaching process. Voronin stressed that the history cannot be taught in pre-university institutions on basis of one source only because an ideal, perfect textbook does not exist and, therefore, the teaching of history requires more sources capable to present different opinions, viewpoints, and interpretations of one or another event. Scientists of academic institutions were reproached with lacking scientific studies of synthesis, which would establish the place of Moldova and Moldovans in European and universal history, as well as works which would reflect the contemporary history of our state. Many experts have bitterly criticised the contents of the integrated history textbooks, invoking wrong facts, non-transparent elaboration, and inappropriate contents for the current level of development of science. Representatives of educational authorities said that the debates on this issue have a political nature while children and students are deliberately attracted in these debates. Finally, Voronin called for the immediate elimination of the signalled drawbacks from contents of textbooks and for the creation of an expertise group, which would include representatives of all interested institutions or associations, to examine the second edition of integrated history books. According to Voronin, the events will be reflected honestly in schoolbooks, without attempts to interpret or rewrite the history.

Economic Policies

1. Real sector

Industry is on the permanent decline...

Official statistics show that all industrial enterprises made production worth about 13 billion lei (approximately 770 million euros) in January-August 2006 or by 5.7% less than in the similar period of 2005. The reduction of wine production by 48% was the main cause of decline of industrial production in the period concerned.

At the same time, the production volume of food and drink enterprises has declined by 19%. The recession of industry has influenced the economic growth in Moldova and, therefore, the Government has reduced the macroeconomic indicators for 2006 and 2007.

Economic growth this year could be lower than average on CIS…

According to the latest report World Economic Outlook by the International Monetary Fund (IMF), the Moldovan economic growth will be this year below the average on CIS, more than 3%, compared with 6.8% in CIS. The IMF forecasts the highest economic growth for Azerbaijan - 25.6%, followed by Turkmenistan 9.0%, Kazakhstan 8.3%, Tajikistan 8.0%, Armenia and Georgia 7.5%. The Russian economy will grow by 6.5%, while the Ukrainian economy is expected to grow by 5%.



The real GDP growth in CIS will likely be about 7% in 2006 and a decline of down to 6.5% is forecasted for 2007. This region continues to benefit of high prices of goods and high incomes from export. Moldova registered a 5% economic growth in the first half of this year, as the industry has regressed and the agriculture has stagnated while consumption has permanently grown.

2. Prices and inflation

Inflation will grow slowly, but surely...

The inflation rate could register a maximum of 1.5% in September. Prices of vegetables remained at the level of August, while some of them became cheaper. Prices of fruits are generally acceptable, but prices of peaches and grapes have beaten all records, this being an unprecedented phenomenon in Moldova (1-2 dollars per kilogram of grapes). Tariffs of services provided to population will insignificantly grow and they will be influenced by delivery costs of energy agents for sure. As regards prices of fuels, we consider that they will not change. Although they are on the decline on international market, it is not advantageous for domestic importers to lower the prices, especially on the eve of winter.

3. Banking sector

Share of foreign investments in banking system has grown…

The share of foreign investments in capital of Moldovan banks rose by 4.2% in January-August 2006, up to 54.8% of the total of assets. In comparison with the similar period of 2005, the share of foreign capital in Moldovan banks has grown by 3.3%. The share of foreign capital has grown after the Italian bank Veneto Banca bough all shares in the commercial bank Eximbank last May and increased its capital by about 10 million euros.

At the same time, total assets of the banking system of Moldova amounted to 20.5 billion lei (1.54 billion dollars) in late September and they rose by 14.25% in eight months of this year and by 28.7% compared with the similar period of 2005. The shareholder capital of banks accounted for 3.4 billion lei (255.8 million dollars) and rose by 17.1 percent in January-August 2006. The highest share of foreign investments in the total of assets of Moldovan banks was registered in 2003, notably 61%.

4. Foreign trade

Export diversification rate is on the decline…

The Ministry of Economy and Commerce has unveiled data showing that Moldova exported goods within more than 700 tariff groups in 2005, compared with over 1,000 groups in 1998. The export diversification indicator is on the decline. Moldova becomes dependent on exportation of some categories of commodities only such as agri-food products, textiles. The export concentration degree is very high. As for example, food products, drinks and tobacco covered 36% of overall exports of Moldova in 2005. Thus, Moscow's interdiction against Moldovan spirits reveals that exports have a very high geographic concentration degree. The low competitiveness of domestic products and services conditioned by high costs and inefficient management make the Moldovan production less solicited on foreign markets.

Also, Moldova has insufficiently used the trade preferences awarded by western countries because it failed to comply with international standardisation, certification and quality control systems. Although Moldova benefits of the Generalised System of Preferences GSP+ starting January 1, 2006, Moldovan exports to the European Union have advanced very slowly and they have even declined on some positions. Moldovan exporters did not recover so far after the "cold shower" applied by the Russian Federation on Moldovan wines and food products and they failed to meet most of quality standards in order to make the production competitive on the E.U. market. The Government should "ring the bells" in these directions. We think that the 2006-15 strategy on attracting investments and promoting exports which the Government has recently launched will mark the passage from elaboration of some strategies to their implementation and will not have the fate of the precedent documents forgotten on shelves of governmental structures.

5. Labour market

Medium salary on economy is on the rise...

The average salary on economy accounted for about 1,600 lei (94.5 euros) in January-August 2006 and it has grown by 29% compared with the similar period of 2005. The highest salaries were paid in financial sector in the period concerned, notably 3,759 lei, followed by transportation and communication - 2,459 lei, constructions - 2,233 lei, industry - 1,985 lei, public administration - 1,945 lei. At the same time, workers in agriculture and forestry sectors were paid the least - 732 lei, fish breeding sector - 1,073 lei, teachers earned 1,212 lei on average, doctors and social assistants earned 1,291 lei.

It should be mentioned that starting July 2006 the tariff salary for the first qualification category of workers in agriculture and forestry sectors, as well as for enterprises with maximum 9 employees was increased from 360 lei up to 500 lei. The tariff salary for the first qualification category of workers of other branches of national economy will be 700 lei, compared with 550 lei formerly.

Transdnistrian Conflict

"Frozen" conflicts on the UN agenda

The UN General Assembly has accepted the request of the GUAM states to include the subject of "frozen" conflicts from the former USSR on the agenda of its 61st Session. The debate will take place on 6 November 2006, and the key argument put forward by the foreign ministers of the GUAM states for holding it was that although these conflicts are "frozen", they continue to be a threat to international security, as well as an obstacle to the democratisation and economic development of the region. Moscow has been against organising such a debate, the Russian Foreign Minister, Serghei Lavrov, called the GUAM proposal as a "purely propagandistic act" and an "irrelevant" one, as long as the break away entities do not participate in the debate. On the other hand the Russian Foreign Minister said that regardless of the results of the UN General Assembly debate, Russia will not allow GUAM peacekeepers to be deployed in the FSU conflict areas.

On 26 September the Moldovan Minister of Foreign Affairs and European Integration, Andrei Stratan, held a speech at the UN General Assembly. The head of the Moldovan diplomacy called on Russia to accelerate the process of withdrawal of Russian troops and weapons from the Transnistrian region and to deploy an international inspection of its weapons depots in the region. Stratan showed concerned with the inefficiency of the existing peacekeeping mechanism in Transnistria and pleaded for its transformation into a multinational force with international mandate. Moreover, Stratan stated that the "Transnistrian conflict is most and foremost a "product" of the geopolitical interests and designs" and that the conflict "has been unleashed with external support" immediately after the proclamation of independence of Moldova. Minister Stratan underlined the need for a more active involvement of the UN in the settlement of "frozen" conflicts and expressed his hope that the debate thereupon at the General Assembly will facilitate the process of settlement of conflicts in Azerbaijan, Georgia and Moldova.

The 17 September referendum

On 17 September in the Transnistrian region took place the so-called referendum regarding Transnistria relations with the Russian Federation and Moldova. According to the data published by the region's Central Electoral Commission, around 310 000 voters participated in the ballot, which is 78,6% of the Transnistrian electorate. Of these, 97,2% voted "for" the "independence of Transnistria and its free subsequent joining of the Russian Federation" and 94,9% voted "against" "giving up the sovereignty of Transnistria and joining the Republic of Moldova".

According to Transnistrian authorities, the ballot was monitored by 130 international observers from the CSI, Central and Western Europe, including a group of deputies in the Russian State Duma. They have released some common conclusions regarding the referendum whereby the vote was held in accordance with the Transnistrian electoral laws, and the generally accepted principles and norms of democratic elections.

The US, EU, OSCE, Ukraine and other states and international organisations have stated that they do not recognise the referendum or its results. The Russian Federation has not recognised the referendum either, however, the Russian Foreign Minister, Serghei Lavrov, stated that the referendum "took place with the respect of all procedures, in a democratic and open manner" and called upon the two sides to come back to the negotiations table "on the basis of agreements reached to date".

The Government of Moldova issued on 18 September a statement in which it stated that it did not recognise the Transnistrian referendum and would not take into account its results within the settlement process. The Moldovan Government called the referendum a means to set back the process of territorial reintegration of Moldova and an attempt to "conserve the authoritarian and criminal character of the power in the region". At the same time, the Moldovan Cabinet thanked the states and organisations participating in the political settlement process for adhering to the principle of solving the conflict respecting the territorial integrity and sovereignty of the Republic of Moldova.

After the referendum, the Transnistrian leader, Igor Smirnov, stated that he will launch a series of reforms intended to harmonise the Transnistrian legislation with the Russian one in the financial, economic and fiscal spheres, but also to join the Russian Ruble area. In addition, Smirnov stated that he had sent a legislative initiative to the Supreme Soviet to reform the state power in Transnistria. If this reform will be carried out by the Russian model as well, then it will most likely envision the strengthening of the so-called power vertical and redistribution of state prerogatives in favour of the "president".

On 19 September Smirnov left to Moscow for consultations with the Russian leadership. He held a press conference in Moscow on 21 September at which he stated that "Transnistria has submitted an application for joining the Russia - Belarus Union", but that "because we are an unrecognised republic, we do not have this right yet". Asked about the prospects of Transnistria joining the Russian Federation, Smirnov said that the "[17 September] referendum was not about joining Russia, but about the independence of our republic". "It is necessary to create our own state to preserve the Transnistrian society that has formed throughout centuries", Smirnov added.

On the other hand, a number of deputies in the Russian Duma have pleaded for the diplomatic recognition of Transnistria and the initiation of the procedure of its adherence to Russia. At the plenary sitting of 20 September, the deputy speaker Vladimir Jirinovski said that Russia needs to respect the will of the inhabitants of Transnistria to obtain international recognition, while the "Rodina" faction proposed to adopt an Appeal to the Russian president in this sense.

Meanwhile, in the Transnistrian region has started the campaign for the "presidential elections" scheduled for 10 December 2006. The Transnistrian electoral body has so far received two official requests for registration of candidacies - from Andrei Safonov, editor of newspaper "Novaia Gazeta" from Bender, and the Supreme Soviet deputy, Piotr Tomaili. Igor Smirnov, "president" of Transnistria for three consecutive mandates, has been nominated by the workers of the "Moldavkabel" plant, and later by the patriotic party of Transnistria led by his son, Oleg Smirnov.

Foreign Affairs

Republic of Moldova - Council of Europe

Ambassador Vladimir Philipov, special representative of the Council of Europe secretary-general to Moldova, has completed his mission to Chisinau and Ambassador Vladimir Ristovschi will succeed him. Mr. Philipov has highly appreciated the relations of cooperation and partnership with Moldovan authorities and the conditions of activity. The ambassador noted that Moldova has obtained palpable successes in all fields of activity in three years, especially regarding the approaching to the European Union. Philipov and Chisinau officials said at farewell meetings that the start of negotiations on end of the CoE monitoring on Moldova is planned for an "immediate perspective of cooperation".

Moldova's prime minister has sought the CoE's support for gaining the regime of Asymmetrical Trade Preferences and signing of an Association Agreement with the European Union, at a farewell meeting with Mr. Philipov. The sides agreed on opportunity of working out a Moldova-CoE action plan for 2007-09.

The Committee of Ministers of the Council of Europe (CoE ambassadors) continued at the September 27 meeting the examination of measures of execution of the ECHR judgment on "Ilascu and Others versus the Republic of Moldova and the Russian Federation". The Moldovan delegation has told the Committee of Ministers that the Moldovan minister of justice has appealed to his Russian counterpart and the Reintegration Ministry has received only the response of the OSCE Mission in Chisinau to the recent appeals regarding this case. Requested by Moldovan delegation, the CoE Secretariat-General will work out a detailed report concerning the actions taken by European states in compliance with the 4th Interim Resolution of the Committee of Ministers on Ilascu case. Representatives of the Russian Federation avoided any comments on this issue during the meeting of the CoE's Committee of Ministers.

Republic of Moldova - European Union

A new strategy of communication on the European Neighbourhood Policy, which will address the Black Sea region, including Moldova will be drafted at the last sitting of the E.U. Council of Foreign Ministers by the end of this year. The Council took note of a request by the Greek delegation, supported by certain other delegations, for the E.U. to strengthen its relations with the Organisation of the Black Sea Economic Cooperation and to develop a comprehensive policy towards the Black Sea region.

President Voronin has met the E.U. special representative for Moldova, Adriaan Jakobovits de Szeged, and discussed current problems linked to the Moldova-E.U. relations. In particular, the sides studied the efforts for implementation of the E.U.-Moldova Action Plan, the perspective of development of the dialogue after the accession of Romania and Bulgaria to the E.U., participation of the E.U. in the process of territorial reintegration of Moldova. The sides indicated the need of resuming the Transnistrian settlement negotiations as soon as possible, with Voronin saying that the talks must be based on the law on basic principles of the Transnistrian region's status adopted by Moldovan Parliament in July 2005. They also discussed the start of the dialogue on possibility to ease the visa regime for Moldovans, opening of a joint Schengen visa issuance centre in Moldova, gaining of the regime of asymmetrical trade preferences with the E.U. by Moldova.

The Finnish E.U. Presidency has released a statement on delayed execution of the ECHR judgment on "Ilascu and Others versus the Republic of Moldova and the Russian Federation" case at the meeting of the CoE's Committee of Ministers. The statement reiterates the stance that the sides sentenced for violation of the European Convention on Human Rights must implement all ECHR judgments unconditionally. The respondent states must take all necessary actions to stop the arbitrary detention of applicants and to obtain their immediate release. The Russian CoE Committee of Ministers Presidency is at half-way and the non-execution of the ECHR judgment continues to shadow this presidency, seriously threatens the credibility of the human rights protection system of the CoE.

Moldova's minister of foreign affairs and European integration has told a meeting chaired by Premier Vasile Tarlev that the E.U. has accepted to discuss with Chisinau the possibility of facilitating the visa regime for Moldovans. In this context, the European Commission has promised to open a Joint European Visa Centre in Moldova.

The E.U. Presidency has released a statement regarding the September 17, 2006 referendum held in the Transnistrian region of Moldova. According to the document, the European Union realises that the "referendum" in the Transnistrian region contravenes to the internationally recognised sovereignty and territorial integrity of Moldova, while the situation in Transnistria does not allow the population to express itself freely. The E.U. reiterated that it does not recognise the "referendum" and its results, calling on mediators and observers of the five-plus-two negotiation process led by the OSCE to deliver public statements in this respect and invited the sides to restart the five-plus-two negotiations immediately and to work on a rapid and transparent settlement of the Transnistrian conflict.

It was agreed during an official visit of representatives of the Moldovan Parliament to Brussels to extend the format of communication and dialogue with the European Parliament. This statement was delivered by Moldovan Speaker Marian Lupu, who said that the dialogue will mean periodical visits of Moldovan parliamentarians to European structures, an intense communication with representatives of the key political groups of the European Parliament, especially with the European People's Party, of Socialists and Liberals.

Ambassador Ian Boag, head of the European Commission Delegation to Ukraine and Belarus, has said after the 3rd meeting of the E.U. Border Assistance Mission to Moldova and Ukraine that food-stuffs and other goods are flowing freely into the Transnistrian region of Moldova and there are no administrative or other obstacles hindering this flow of imports. The Advisory Board endorsed the first part of an EC-financed project called BOMMOLUK (Improvement of Border Controls at the Moldova-Ukraine border worth 9 million euros).

The E.U.-financed TACIS Project "Sustenance of Small and Medium Businesses in Rural Regions of Moldova" was officially launched at a seminar held in Chisinau on September 29. The main goal of the project is to sustain the rural development and the implementation of EGPRSP in Moldova by stimulating the growth of small and medium-sized enterprises in rural regions and consolidating their contribution to the Gross Domestic Product, trade, and creation of jobs. The project aims to assist the Moldovan Government in creating a political, institutional, legal and regulatory framework supported via development of small and medium enterprises based in rural regions. The project is worth 1.9 million euros.

Republic of Moldova - Romania

The chairman of the Romanian Senate, Nicolae Vacaroiu, was on an official visit to Moldova on September 25-26 and met with Moldovan speaker, prime minister, president and other high-ranking dignitaries. Vacaroiu said that Romania wants to see Moldova following it on the European integration path as soon as possible, while the main goal of his official visit to Chisinau was to upgrade the interparliamentary relations between the two states and to make them progress to a new quality level. According to the Romanian Senate head, these relations did not meet the expectations and now they should develop more dynamically for the benefit of citizens of the two countries.

Romanian President Traian Basescu has said in a speech when he received the Konrad Adenauer award that "Europe will not be a whole as long as the Western Balkans and the Republic of Moldova are not part of the European Union." Romania will plead for continuation of geopolitical transformations, adoption of the E.U. Constitution and accession of Moldova and countries in the Balkan peninsula to the E.U. in a medium-term perspective, Romanian President Traian Basescu has stated to the TV channel EuroNews. The chief of state underlined that the E.U. will enlarge toward the Black Sea region for the first time through accession of Romania and Bulgaria, will approach this area and will have to participate in settlement of the problems faced by this region. The problems of the region include four frozen conflicts in the Black Sea area, which are a hotbed of instability, produce illegal trafficking in weapons and drugs.

President Basescu has stated to Radio Liberty that the accession of Romania to the E.U. must not create obstacles for the free move of Moldovans and Romanians to other countries. Romania will discuss eventual solutions to this problem with the E.U., so that Romanians from other countries be not obstructed to travel and enter their motherland. Basescu regretted that Romania has earlier withdrawn from the number of mediators of the Transnistrian settlement process, but assured that it will monitor the documents, proposals and the entire Transnistrian settlement process beside the E.U.

Romanian Foreign Minister Mihai Razvan Ungureanu has reiterated that there is an illegitimate regime in Transnistria supported strongly by well-armed troops, involved in smuggling, illegal trafficking in goods, and violation of human rights. This regime is "ready to blackmail the neighbours and the legitimate Government of Moldova with its arms and munitions, a regime which cynically parodies the democracy, organising illegal referendums," Ungureanu stated. He assured that the ties with Moldova will be deeper after Romania joins the E.U. Ungureanu hopes that "the chance of prosperity that we give will be used," while the Moldovan authorities are expected to give more substance to political commitments toward Bucharest. The foreign minister recalled that Romania was the main provider of economic assistance for Moldova and it has granted economic aid worth 114 million dollars in 16 years.

Romanian policemen have held four Moldovan nationals who intended to cross the Romania-Hungary border illegally in order to arrive in the West. The Romanian police issued the necessary acts before filing penal cases against the four Moldovans on illegal border crossing charges.

Republic of Moldova - Russian Federation

Three factions from the Russian State Duma which control about 20 percent of the mandates demand the start of the diplomatic procedure for recognition of independence of the self-proclaimed Transnistrian Moldovan Republic. According to Russian press reports, the draft was tabled by Rodina, Narodnaya Volya and the Liberal Democratic Party factions. They seek the introduction of direct flights between Moscow and Tiraspol and the opening of a Russian consulate in the Transnistrian region.

Russian President Vladimir Putin has told a news conference while on a visit to Paris that he did not know that Tiraspol leader Igor Smirnov visited Moscow, while the Transnistrian referendum must be regarded in the light of territorial integrity of Moldova which the Russian Federation recognises.

Russia's foreign minister was asked at the session of the U.N. General Assembly about Moscow's reaction to discussion of post-Soviet frozen conflicts. Sergey Lavrov said that this intention is a "politicising of the problem" while the United Nations is not the indicated forum to discuss these conflicts. Lavrov considers that the initiators of talks "follow propagandistic goals and are not interested in the functioning of the existing negotiation format."

The Ministry of Foreign Affairs and European Integration asks the Russian Federation to close the office which processes the acts for Russian citizenship. The Moldovan representation to the OSCE has informed the Permanent Council of the organisation about inadequate actions of the Russian authorities.

Although it has promised to start inspecting wineries in Moldova in early October, the Russian Phyto-sanitary Service Rospotrebnadzor did not make any preparations for this purpose. But Rospotrebnadzor chief Gennady Onishchenko has recently said that the way of Moldovan wine products to the Russian market is actually closed. Onishchenko considers that the Moldovan authorities "are trying to look at this problem from political aspect and this fact leads to a complete impasse."

The Moldovan minister of finance has met with his Russian counterpart and reached a preliminary agreement on restructuring of some debts of Moldova toward the Russian Federation. The meeting took place in Singapore, where the two officials attended the annual meeting of the IMF and the World Bank. According to Minister Mihai Pop, the sides have agreed to restructure some debts toward Russia, which consist of arrears for the basic debt - restructuring of interests on credits released by Moscow after the basic debt was restructured in May via the Paris Creditors Club.

Moldova in the world

The United States describes Russia's decision to establish a passport insurance facility in Moldova's Transnistrian region and Moscow's decision to simplify the procedures for Transnistrians seeking Russian citizenship as moves that threaten to undermine Moldova's sovereignty and territorial integrity. The U.S. ambassador to the Organisation for Security and Cooperation in Europe, Julie Finley, has delivered this statement at the OSCE Permanent Council in Vienna. Finley urged again Russia to fulfil its 1999 Istanbul Commitments to withdraw all troops and munitions from the territory of Moldova. Also, the U.S. again urged the Russian government to inform the Transnistrian authorities immediately, and to state publicly, that it will not recognise any claims to independence or support any move to annex Transnistria to the Russian Federation.

Studies, Analyses, Comments

Appeal of GUAM and eventual implications
Igor Botan, 30 September 2006

The May 22 Kiev GUAM summit decided to sanction this regional organisation and to establish its priorities, including the settlement of the separatist conflicts in member states

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Liberalisation of economy: between myth and reality
Iurie Gotisan, 30 September 2006

The new minister of economy has told the investiture ceremony that the basic principle of his activity will be to implement the existing strategy and to continue the liberalisation of economy

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