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Activity of Public Institutions

Government
Presidency

Illegal visas to maintain legality by Sergiu Grosu
The reason for "freezing" the Transnistrian conflict by Maxim Kuzovlev

Activity of Public Institutions

Government

1.1. Decisions

Decision on introduction of visa regime. A visa regime is introduced between the Republic of Moldova and Romania starting April 9, 2009. The decision does not invoke any special legal ground, does not explains visa application requirements and other details, just instructs the Ministry of Foreign Affairs and European Integration and the Border Guard Service to take the necessary actions for the execution of this decision.

Note by ADEPT: The Interior Ministry explained on April 10, 2009 the procedure to be respected by Romania’s citizens in order to get invitations and apply for visas. The regulation concerning the issuing of invitations to foreign citizens and stateless people approved under GD # 33 from 22.01.2004 will be applied, so that the applications will be submitted to the Bureau of Migration and Asylum of the Interior Ministry. The application will indicate the data of the inviter (complete name of the organisation, enterprise or institution; type; first and last names of the director of organization; registration number; state identification number IDNO; legal address; address of the office), as well as data on the invitee (first and last names; citizenship; birthday and place; permanent residence; data from identity card: type, series, issuance date and expiry date; personal data of minor children; purpose of the trip; institution to issue the visa; data on entry and border crossing station; duration of staying; data on previous sojourns; health insurance).

Decisions approving some regulations:

• Concerning the activity of the commission in charge with monitoring human rights in prisons;
• Concerning the record, drafting, storage and delivery of notary documents to archives;
• Concerning the establishing of expenses for execution acts;
• Concerning the alcohol-scope testing and medical examination to establish drunkenness and its nature;
• Concerning the security of electronic communication networks and execution of works in protection areas and electronic communication lines;
• Concerning requirements on arranging notary’s offices;
• Concerning the state register of non-commercial organisations.

1.2. Sittings. Decisions. Statements

Prime minister’s call on parents

In the appeal, Zinaida Greceanii says that the plans to bring young people’s lives under fire are not over and organisers of the biggest crime in Moldova’s history intend to use children again with the purpose to storm the Government building as well. If such an action is not prevented, avoiding human victims will be very hard, as the police will use all the necessary means inclusively weapons to defend Moldova’s statehood. The prime minister asks parents and teachers to discuss with children and persuade them not to get involved in illegal actions.

Donation by Gazprom

Moldova’s Government has got a donation worth 12.25 million dollars from the Russian Company S.A.D. Gazprom to purchase fuels for the state reserves. The humanitarian aid was provided under an agreement reached by Moldovan and Russian Presidents during the March 18, 2009 meeting in Moscow. The Agency for Material Reserves, Public Acquisitions and Humanitarian Aid will purchase black and Diesel oil for spring agricultural works and for energy security of the country.

Presidency

2.1. Decrees

State distinctions:

• The Honour Order was awarded to Svetlana Mihailescu, deputy director of the Theoretical High School Bogdan Petriceicu Hasdeu based in the Chisinau municipality;
• The Labour Glory Order was awarded to Elvira Griu, director of the Chisinau-based Theoretical High School Mircea Eliade. The same distinction was awarded to Pavel Buceatchi, minister of information development;
• Anna Cercasova, director of the public association Oraselul Copilariei based in Pirita village, Dubasari rayon, was awarded the Civic Merit Medal.

2.2. Sittings. Decisions. Statements

Restoration of Parliament and Presidency buildings

Moldova’s president has convoked a sitting on restoration of buildings stormed on April 7. According to a report presented by minister of construction and area development, the preliminary cost of repairing works is estimated at more than 300 million lei and this amount does not cover deteriorated furniture and equipment. Vladimir Voronin stressed the necessity to urgently begin the reconstruction works and the necessary amounts will be covered from the funds for educational institutions.

Accusations against Romania

During a briefing on April 10, 2009 Moldova’s president stressed the importance of investigating "forms and methods of Romanian citizens’ participation in preparations for the April 7 events." According to Voronin, known facts already build evidence in this regard:

• The advising of the three political parties (Liberal Democratic Party, Liberal Party and "Moldova Noastra" Alliance) by the Romanian Embassy at all stages of electoral campaign;
• The organisation of large groups of young students and their partial transportation to the Republic of Moldova to participate in the street protests;
• The participation of Romanian citizens and experts in the April 7 events;
• The active information support provided by all Romanian media outlets to street protests, the interpretation of these events as fair and revolutionary.

Discontentment with condition of professional education

Moldova’s president has convoked a sitting on reorganisation and optimisation of secondary-professional and vocational education institutions, signalling some serious shortcomings in the professional-technical education system relating to: quality of the education process; relevance for labour market; efficiency of use of financial, material and human resources. It was noted that the network of professional schools and colleges is much extended, having curricula which do not meet the market requirements; these institutions were not covered by the modernisation process, becoming inefficient and producing very large expenses. It was invoked the indifference and lack of reaction towards lots of controls by the Chamber of Auditors, which established grave violations in terms of accreditation of colleges and professional schools; management of funds and estates; violation of legislation on establishing of education and hostel accommodation fees; abuses related to acquisition of goods, signing of renting contracts and bookkeeping. The president ordered the reorganisation and modernisation of the professional education system accordingly to technical progress and needs of the country. He instructed the Government to work out and implement a plan on reorganisation and modernisation of colleges and professional and vocational schools, so that the educational process to restart under new conditions on September 1, 2009.

Discontentment with public procurements in healthcare system

Vladimir Voronin has chaired a sitting on organisation of public acquisitions for necessities of the healthcare system and drug control, reiterating very grave shortcomings of the medications procurement mechanism in the healthcare sector. The chief of state invoked the inefficiency of the regulation on acquisition of medications for the healthcare system, the lack of an anti-corruption survey on this document, as well as of a mandatory methodology for assessing the participants in auctions, the lack of a planning of necessities on drugs for a certain period. It was indicated the personal responsibility of decision makers from the Drug Agency with the inefficient existing mechanism of organisation and conduct of public procurements, as well as of control on drug prices, which endangers the quality of medical services and obstructs a strict control on prices of drugs purchased via public acquisitions. The chief of state demanded the dismissal of the Drug Agency director-general for non-state attitude towards his service.

Economic Policies

1. Prices and inflation

Moldova records deflation for 4th month…

Moldova records a deflation for the third month in a row this year. The Consumer Price Index (CPI) in March was 99.2 percent compared with February 2009 and 101.2 percent compared with March 2008 (CPI in March 2008 was 101.1 percent, compared with February 2008 and 115.4 percent, compared with March 2007), according to the National Bureau of Statistics. The decline of average consumer prices by 0.8 percent was linked to the fall of food prices by 1.5 percent, manufactured goods by 0.4 percent and tariffs for public services by 0.1 percent. Meanwhile, tariffs for public interurban motor transportation services decreased by about 5 percent in March, while handmade house repairing services by 1.5 percent. Prices have decreased by 1.8 percent this year. Thus, the consumer market of Moldova undergoes deflationary processes starting December (prices decreased by 0.2 percent in December, 0.1 percent in January, 1 percent in February and 0.8 percent in March).

2. Investment climate and external position of Moldova

Economic impact of political battles will be strong…

The political instabilities and the last week’s developments in Chisinau will hit the investment climate in general and foreign investors in particular for sure. They were reticent until now with placing their business in Moldova, but their reticence will double from now on.

In addition, fears of foreign investors who are or have plans to come to Moldova receive a confirmation from outside, too. For example, the international financial evaluation agency Fitch has raised concern about situation in Moldova, warning that Moldova’s rating could fall from "B-" currently. Moldova’s rating is part of the junk category, which does not recommend investments.

According to Fitch experts, the political and economic situation in Moldova is very difficult and already poses a high political risk and dangers will be experienced in continuation on a long term and will hit the economy, so that its quality will worsen and this fact endangers the crediting relations with international financial giants such as IMF, WB, EC, etc.

It is well-known that Moldova’s Memorandum with the IMF is almost over (May 2009), the WB relations with the Government are relatively strained, though two tranches have been disbursed in the last half a year for infrastructure projects, and a similar situation is observed in the relationship with the European Commission. But their further relations with the Government will be mainly conditioned with an IMF memorandum. Even more, it is worth recalling that besides main international crediting structures there are investment projects of other countries such as Spain, the Netherlands, Lichtenstein, Japan etc., which may complete their mission at any moment because of the lack of elementary freedoms and democratic principles in Moldova.

In addition, since Bucharest supported Moldova in the European integration process, the introduction of visas for Romanians will hit the business environment, particularly that many foreign businesses in Moldova are managed from Romania, an EU member state. Therefore, the economic impact of political battles will be strong, particularly because Moldova is dependent on external funds, from EU funds to remittances by nationals working abroad.

The global economic crisis has contributed to tensions in the country, since remittances by Moldovans working abroad have decreased. Moldova’s external debt of about 4 billion dollars or 70 percent of the Gross Domestic Product of 2008 is very high, though it is not bigger than in other small, developing countries. The figure includes both the public and the private debt. This year, Moldova still has to pay 12 million dollars from a bond issue with a fluctuating interest rate maturing in October, and this will press the state budget.

3. Macroeconomics

Crisis effects: forecasts by IDEA club…

The IDEA Club has released eventual forecasts in the current economic conjuncture in a commentary by Sorin Hadirca within a sitting on world economic recession and its impact on Moldova. A question "going about" and troubling all is: is Moldova able to use the world economic recession for its interests. Club members agreed that the recession per se is not an opportunity and brings just problems: reduces the confidence, the consumption, builds a vicious circle born by price fall, cuts the sales, brings external vulnerability and enhances the unemployment.

However, it is reasonably to assume that some countries will get rid of the recession sooner and others later, depending on their exposure and policies. Then countries which will get rid of the crisis sooner will be in a more advantageous position in terms of competition on international markets, and will be the first to collect the fruit of regained confidence of consumers, strengthening their shares on those markets this way.

Advantages for some…

It was also discussed that some companies will be advantaged inclusively during the crisis. These companies are either competitive in terms of costs, or "rich" in liquidity.

As regards the second group, IDEA experts indicated commercial banks from Moldova which, enjoying high liquidity and solvency indicators (the least for the time being), could make an expansive move forward markets from neighbouring countries. Of course, this step is associated with a certain risk level, while an in-depth market analysis is absolutely necessary. However, much is to be gained. It is known that prices of shares fall below their fair market value during a crisis for clear reasons: panic, liquidity deficit, repatriation of some investments. When the panic is over the quotation of companies which survive on market undergoes a correction – prices of shares regain their market value. This activity is called "cherry picking" in the financial world, suggesting that shares of companies are bought for very low prices. In a medium prospect, the expansion of some banks on neighbouring markets would do a favour to exporters and competitiveness per total.

Some forecasted macroeconomic indicators…

The same sitting used the expert method which produced pessimistic rather than optimistic results: the PIB will be 1.4 percent in 2009, inflation (December 2009/December 2008) – 5.8 percent and the unemployment rate will grow up to 9.6 percent.

Indicators	Min.	Average	Max.
GDP	-4.0	1.4	5.5
CPI	3.0	5.8	9.0
Unemployment rate	7.1	9.6	15.1

Considering the GDP, IDEA experts tried to regard it in the light of performance of its components: consumption, investments (inclusively expenses and public investments) and net export. Therefore, a negative impact of the consumption and household investments is expected and it will be partly compensated by performance of the net export (which could have a positive influence on GDP for the first time after many years). The rise of budgetary expenses and available funds to cover the deficit could also have a positive impact on GDP.

The performance of CPI is "positive" due to the reduction of the aggregated consumer demand. In these conditions, Moldova records a deflation for several months in a row and this situation would change should the Moldovan leu depreciate.

	Min.	Average	Max.
Recession term (years)	0.0	1.0	2.5

Opinions regarding the duration of recession in Moldova were likely polarised. Speaking about the end of recession requires a clear term of its beginning. Or, the classical definition – the GDP decreased two quarters in a row – does not stand on in the current conjuncture, as the GDP increased by 7.3 percent in 2008. However, assuming a beginning of recession which is currently developing (the decline of industry by about 27 percent is a proof in this regard), IDEA experts forecast that the economic growth pace will be resumed in the 1^st quarter of 2010. They indicated the need of an anti-crisis plan aimed to support the overall demand and protect the banking system. For more details, see http://clubulidea.wordpress.com.

Foreign Affairs

The nature of Moldova’s foreign policy and bilateral relations was determined by developments relating to the April 5, 2009 parliamentary elections.

EU position on electoral process before the Election Day, April 5, 2009

April 2, 2009

During the meeting of the OSCE Permanent Council held in Vienna, the European Union presents a statement on the preparations for the elections in the Republic of Moldova on 5 April 2009. The statement notes that "on the whole the election campaign is generally pluralistic and that the preparations for the election are being managed […] in a transparent and professional manner". Nevertheless, are pointed out certain negative elements, "specifically the abuse of administrative resources, question ns concerning the way voter lists are drawn up and unbalanced media coverage in favour of the outgoing majority party". In the same statement, the UE reminds that attributes great importance to the parliamentary elections on 5 April being conducted in a democratic manner and that "encouraged the Moldovan authorities to strengthen the rule of law and to implement their commitments on human rights and fundamental freedoms".

EU position on holding the April 5, 2009 parliamentary elections

April 6, 2009

OSCE /ODIHR Election Observation Mission (EOM) to the Republic of Moldova, which has also included a delegation of the European Parliament (EP), has presented a statement of preliminary findings and conclusions on the April 5, 2009 parliamentary elections. According to the statement, the elections were correct and positive and "took place in an overall pluralistic environment, offering voters distinct political alternatives and meeting many of the OSCE and Council of Europe commitments". In the election observers’ view the voting on Election Day was well-organized and took place in a calm and peaceful atmosphere, without any major incidents reported. The observers have positively assessed the electoral and counting procedures, although a number of significant procedural shortcomings were noted. According to the EOM, further improvements are required to ensure an electoral process free from undue administrative interference, to guarantee freedom of expression and access to information and to increase public confidence. The preliminary findings underline more drawbacks that remained unsolved: the misuse of administrative resources, alleged cases of voters and candidates’ intimidation by the police, issues related to the campaign coverage by mass media (including the public broadcaster Moldova 1), lack of uniformity in voter registration, impossibility for citizens residing in Transnistrian region to express their right to vote. Despite these conclusions, the appraisals of election made public by European officials at a press conference for presenting the OSCE/ODIHR statement were very positive. In particular, Marinne Mikko, Chairwoman of the EP Delegation declared that "We [EOM] noted real improvements in comparison with the 2005 parliamentary elections", while Petros Efthymiou, head of the delegation of the OSCE Parliamentary Assembly was delighted with the progress of democracy in Moldova. In other interview to Estonian Radio, Marianne Mikko told that "the parliamentary elections just held in the Republic of Moldova are causing positive emotions in Europe", and both OSCE and the EU highly appreciated the quality of preparation and holding the elections by the Moldovan authorities.

Commissioner for External Relations and Neighbourhood Policy, Benita Ferrero-Waldner has congratulated the Moldovan people for their active participation in parliamentary elections, stressing that elections were conducted in a peaceful and orderly manner and in an overall pluralistic environment. The European Commissioner has underlined also the shortcomings reported by the International Election Observation Mission, urging the newly-elected Parliament to implement the Mission’s recommendations.

April 7, 2009

Commissioner for External Relations and Neighborhood Policy, Benita Ferrero-Waldner has called upon all involved to stop the acts of violence in Chisinau and urged all concerned to engage in dialogue and avoid statements that could further inflame the situation. Benita Ferrero-Waldner has reminded that "any complaint in connection to last Sunday’s election should be addressed through the existing channels".

The EU Czech Presidency has released a statement that condemns the use of violence in Chisinau and calls for restraint on all sides. The Presidency reminded that according to the preliminary findings of the International Election Observation Mission, the elections met many international standards and commitments, but certain further improvements are required.

April 8, 2009

The European observer, Baroness Emma Nicholson, has declared that she has misgivings with results of the OSCE statement, the OSCE statement being "too warm and friendly".

April 9, 2009

The EU Presidency Trio (the Czech, French and Swedish Ministers of Foreign Affairs) during their meeting in Sarajevo have reiterated the previous messages and declared that "the EU remains ready to work with Moldova in accordance with European values and principles and […] to further strengthen mutual relations between EU and Moldova". In this regard, the role of the Special Representative of the European Union for Moldova is essential. Besides, the EU called on the Government of Moldova to resume normal relations with Romania, as "for the EU it is essential to enjoy good relations with its neighbours" and to respect the constitutional freedoms, all parties refraining from any violence.

April 10, 2009

The Moldovan minister of foreign affairs and European integration, Andrei Stratan has told in his interview with the "Financial Times" and the Hungarian Radio that the introduction of visa regime for Romanian citizens does not mean the closing of borders with Romania, but is aimed to introduce a stricter border control after the April 6–7 events. As regards the significance of the Eastern Partnership for the Republic of Moldova, taking also into account the latest events, Andrei Stratan has appreciated the good cooperation Moldova had with the UE, but he is discontent with the current "vacuum in Moldova-EU relations". According to Moldovan minister "Moldova is a little bit confused, because does not clearly understand where its European way is passing – through Western Balkans or through Ararat mountain". (source: MFAEI press release)

Kalman Mizsei, the EU Special Representative for the Republic of Moldova met Andrei Stratan, Vice-prime-minister, and the minister of foreign affairs and European integration who has presented the position of Moldovan authorities on the situation in the country. Kalman Mizsei affirmed that the European Union has been carefully watching the events in Chisinau and it is ready to offer the necessary aid for settling the crisis. The European official has underlined the balanced EU position on the events in Chisinau, but has also stressed the importance of respecting the right of citizens to free expression and public assembly and for citizens to respect the constitutional norms.

April 11, 2009

The outgoing president Vladimir Voronin had a telephone conversation with the EU high Representative for Foreign and Security Policy, Javier Solana and asked him to send a delegation to Moldova to observe the situation there after recent protests that took place in Chisinau on April 7 in order "to avoid the speculations in mass media on the latest events in the Republic of Moldova". (source: Infotag)

April 13, 2009

The EU has decided to send a post-election monitoring mission to Chisinau. The European Commission has welcomed the decision of Moldovan authorities to recount the ballots in the parliamentary elections and declared inadmissible the application of violence and violation of the right to free assembly.

April 15, 2009

The EU Special Representative for the Republic of Moldova, Kalman Mizsei has declared that the leaders of the four parties that entered the Parliament after the April 5 elections (PCRM, PL, PLDM and AMN), should work out a basis for national reconciliation, set up working bodies of the new parliament and approve the government. According to Mizsei, it is very important that all four parties to stop using an "improper language" at characterizing each other, while the European Union will do everything in its power to help Moldova get back to a normal life. Mizsei gave assurances that the basis of democracy on which the press freedom is built will be preserved in Moldova, while the EU will do its best to conciliate the participants in conflict. In this regard, the European Union Chisinau office is working to help the conflicting sides start a constructive political dialog aimed at overcoming the current situation. (Source: Infotag)

The EP Foreign Affairs and the Delegation for relations with Moldova has met in an extraordinary meeting on the political situation in Moldova. The European parliamentarians call for calm and underline solidarity with Romania.

Bilateral cooperation

Republic of Moldova – Romania

The Moldova-Romania relations have dramatically worsened in the period concerned. Shortly after the April 7 protests and the storming of the Parliament and Presidency headquarters, President Vladimir Voronin has accused Romania of involvement in the riots. In consequence, Romanian Ambassador in Chisinau Filip Teodorescu and another two employees of the Romanian Embassy were declared personas non grata on Aril 8, 2009. The same day, the Moldovan Government decided to introduce visas for Romania starting April 9, 2009. According to the Government, this decision aims at "consolidating the efforts to maintain the control on protests in Chisinau."

In a press release by the Romanian Foreign Ministry, the Romanian authorities rejected categorically the accusations brought by the Moldovan authorities that Romania meddles into Moldova’s interior affairs, stressing that the communist governing transfers the responsibility for internal problems in Moldova on shoulders of Romania and the Romanian citizens. At the same time, the Romanian Foreign Ministry assured that it "will not take similar measures against employees of the Moldovan Embassy in Bucharest and will maintain the free-of-charge visa system for Moldovan citizens."

On April 14, 2009, Romanian President Traian Basescu addressed the reunited chambers of the Parliament regarding the political situation in Moldova and state of the Moldovan-Romanian relations. The Romanian president described as unacceptable the accusations brought by the Chisinau governing against Romania. Speaking about the future of Moldovan-Romanian relations, Mr. Basescu dissociated with the acting Chisinau governing which he described as hostile with Romania, promising that Romania will not take revenge and "will keep supporting an active policy for the benefit of Moldova’s citizens and integration of this country into the European Union." As well, Romania will keep supporting the people from Moldova who feel themselves Romanians; awarding scholarships to Moldovan youths in order to study in Romania; supporting the development of Moldovan civil society. Even more, Romania will facilitate the procedure of regaining the Romanian citizenship by those who lost it despite their willingness.

During a TV address on April 15, 2009, Moldova’s outgoing President Vladimir Voronin labelled Traian Basescu’s speech as "an example of state revanchism", accusing Romania one more time of meddling into Moldova’s affairs, promoting a fundamentalist and aggressive Romanianism and taking actions aimed at political destabilisation in Moldova. At the same time, Voronin invited Romania to sign the basic political treaty and the border treaty, stir up efforts within the European Union with the view to get the right for Moldovan citizens to a free move, so that to demonstrate its respect for Moldovan statehood and wish to help Moldova on the European integration way.

Note by ADEPT: No evidence on involvement of Romania or any other countries in the Chisinau protests was provided so far.

Republic of Moldova – Russia

During developments in Chisinau, the Russian authorities have repeatedly supported the actions taken by Moldova’s leadership to manage the political crisis produced by the protests in the capital. Many Russian politicians supported the accusations brought by Moldova’s authorities against Romania, blaming the neighbouring country for the destabilisation of situation in Moldova. A press release by the Russian Foreign Ministry recognises the good conduct of parliamentary elections in Moldova and says that the goal of disturbances was "to compromise the performances achieved in the last years in strengthening the sovereignty of Moldova and to influence the election results."

At the same time, outgoing President Vladimir Voronin accused Russia of maintaining the Transnistrian conflict and delaying the settlement for geopolitical reasons. Voronin said in an interview with newspaper El Pais that Russia supports the authority of Smirnov "who meets her orders" and all Transnistrian ministers who are members of the Russian security service.

Multilateral cooperation

Republic of Moldova – Council of Europe

ECHR decisions

On April 7, 2009, the European Court of Human Rights (ECHR) pronounced decisions on the cases Hyde Park and others vs. Moldova (No. 4), Breabin vs. Moldova and Straisteanu and others vs. Moldova. It established the violation of the following rights and freedoms: the freedom of meeting and association, the right to freedom and security, the right not to be subjected to torture and inhuman and degrading treatment, the right to an effective appeal, the right to motivation of detention, the right to property. The Court ordered 200 Euros in pecuniary damages, 60,000 Euros in non-pecuniary damages and 6,600 Euros in costs and expenses for the three cases. (Source: www.echr.coe.int, www.lhr.md)

Studies, Analyses, Comments

Illegal visas to maintain legality
Sergiu Grosu, 15 April 2009

At its sitting of April 8, 2009, immediately after the verbal instruction of the outgoing Moldovan President was made public, the Government adopted Decision no. 269 on imposing visa regime with Romania

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The reason for "freezing" the Transnistrian conflict
Maxim Kuzovlev, April 15, 2009

The conflict in the Transnistrian area has kept on for about 20 years. During this term, the conflict has passed through a series of stages – from its "hot stage" (military actions in 1991–1992) to the present status quo. A new generation has grown up all these years, which does not know the Soviet times and has lived in the actually divided state

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