EN - Reziliența Bussinesului Pe Timp de Criză - 2022

ECONOMIC RESILIENCE
IN TIMES OF CRISIS
BUSINESS CONCERNS
REGARDING THE
MANAGEMENT OF CRISIS
EFFECTS
2022 Ion BUTMALAI

Programme Director
“Digital Transformation and Economic Analysis”,
Centre for Enterprise and Economic Policy
Veronica RUSSU-MARIN
Programme Director “Entrepreneurship Development”,
Centre for Enterprise and Economic Policy
This Report is an output developed under the Initiative “Setting a favourable environment for constructive
capital”, implemented by Centre for Enterprise and Economic Policy (CAPE) in partnership with the
Center for International Private Enterprise (CIPE). The Centre for Enterprise and Economic Policy is an
independent analytical entity fostering inclusive economic development by involving the upstanding
business environment into the public-private dialogue to boost entrepreneurship and its capital.
The opinions mirrored in this Report belong to the Authors, and do not necessarily depict the CIPE
points of view.
Contents
Acronyms..................................................................................................................... 3
Summary...................................................................................................................... 4
I. Crises impact on the moldovan business environment.................................. 7

High costs, lack of skilled staff and unfair competition – these are the core
challenges experienced by the business environment............................................7
Anti-crises actions applied by the business environment.......................................9
Business environment perception towards anti-crisis actions approved
by the Government.....................................................................................................10
Business environment issues in the context of the war in Ukraine.....................13
Public-private dialogue quality.................................................................................15
II. Business environment proposals to overcome the current crises.............. 16

Measures to mitigate the pandemic crisis .............................................................16
Measures to mitigate the demographic crisis........................................................17
Measures to mitigate the economic crisis...............................................................17
Measures to mitigate the energy crisis....................................................................18
Measures to mitigate the shock caused by the war...............................................19
Measures to improve the public-private dialogue.................................................19
III. Conclusions and recommendations................................................................ 20
IV. Annexes............................................................................................................... 22
2 Economic Resilience in Times of Crisis: Business Concerns regarding the Management of Crisis Effects
Acronyms
CAPE Centre for Enterprise and Economic Policy
CEO Chief Executive Officer
CIPE Center for International Private Enterprise
CIS Community of Independent States
COVID-19 Coronavirus Disease 2019
EU European Union
GDP Gross Domestic Product
HoReCa Hotels, Restaurants, Catering
IT Information Technology
NBS National Bureau of Statistics
SMEs Small and Medium-sized Enterprises
VAT Value-added Tax
Economic Resilience in Times of Crisis: Business Concerns regarding the Management of Crisis Effects 3
Summary
One of the goals pursued by the Centre for Enterprise and Economic Policy (CAPE)
is to foster the private sector development in Moldova by transposing its needs
into public policies and involving it in decision-making on various platforms. For
this purpose, CAPE in partnership with CIPE, assessed the Moldovan business
environment perception concerning the anti-crisis actions approved by the Gov-
ernment during the previous two years, the action impact on businesses, as well
as the sector current situation after the pandemic, and more recently, as a result
of the war in Ukraine.
In order to achieve this goal, CAPE, in part- the discussions held with the focus-groups and
nership with Magenta Consulting, conducted of the in-depth interviews it has been found
two surveys (1-14 April 2022). The latter cov- that the business environment wishes to change
ered two reference groups composed of 107 the current economic model, which is based on
companies and 24 business associations. To labour force export and domestic consumption at
confirm and check the survey results, CAPE the expense of remittances.
organised five focus-groups and 23 in-depth
interviews (Survey methodology, sample, data The lack of skilled labour force, an issue raised
collection and results for each reference group by business people for years, has become
are detailed in Annex 1). The Authors depicted more topical against the background of migra-
and detailed the solutions suggested by the tion effects caused by the precarious economic
business environment to mitigate the shocks situation and enhanced by the war. The trend
of the past two years, and to enhance con- revealed among the questioned companies
fidence in public institutions. According to is that throughout the time of constraints im-
the Research, the business environment has posed by the pandemic, more than half of those
been particularly badly hit by the recent crises, companies worked without deriving any profit at
which augmented the private sector structur- all, the main purpose being to retain the qualified
al issues – a buck-passing by the Governances staff. This trend has been confirmed during the
over the last 15 years. It has been revealed that interviews and discussions held with the fo-
the upstanding business environment, geared cus-groups.
to competitiveness, transparency and market
principles, has greater expectations from the Amongst the core challenges mentioned by the
Governance than mere sector reforms. Out of companies focused on complying with market
principles, we identified, on the one hand, the This Report includes a number of conclusions
downturn due to the pandemic constraints, in- and recommendations both for the policy
creased prices for energy resources and huge makers and for the civil servants responsi-
logistic costs, and, on the other hand, systemic ble for decision-making and for public policy
corruption, lack of labour force due to migra- development related to the private sector.
tion, and unfair competition imposed by klep- Chapter II covers detailed measures suggest-
tocratic and oligarchic groups. The econom- ed by the private sector. The key conclusions
ic shocks triggered by the change in political and recommendations refer to the following
governance, electoral processes, and strong actions:
expectations of quick reforms augmented the
mistrust of business people towards the state
institutions. Interaction with public institutions:
Once the war in Ukraine commenced, the sit-

↘ Cutting down the overheads incurred by
uation was worsened by the soaring prices for companies due to the interference of public
natural gas used by Russia as an instrument to institutions by removing excessive bureau-
influence the domestic and external policy of cracy and corruption;
our country. More and more businessmen have ↘ Setting the necessary conditions to educate
rethought their priorities and switched from efficient and honest civil servants;
maintaining the business afloat and planning
its development after the removal of pandemic
↘ Improving the regulatory system by intro-
ducing new assessment mechanisms for
constraints to moving the business operations
the regulatory burden, such as M-TEST;
to Romania or Bulgaria. This is not only due to
security risks, but also to the lack of skilled la- ↘ Enhancing the public service quality
bour force, which would deepen as a result of through its digitalisation and interconnec-
mass migration caused by increased threats to tion of databases of the Tax Service, Cus-
our country safety. Nowadays, both the business toms Service, Bailiffs, Public Services Agen-
environment and public institutions are facing two cy, ANSA etc.
large dilemmas underpinned by limited resources
in the public and private sector to choose between
ensuring the economic/territorial security and in- Decision-making:
creasing the population purchasing power.
↘ Improving the public-private dialogue legal
frame to remove the possibility of using su-
Given these new realities, it is adamant to cre-
perficial consultations with the private sec-
ate a climate necessary to develop competi-
tor just to tick the decision-making obser-
tive/upstanding businesses, so that the latter
vance;
are not forced to emigrate along with their per-
sonnel to countries offering better business ↘ Improving communication concerning the
conditions. On the other hand, it is important decisions and legal acts influencing the pri-
to acknowledge that, regardless what political vate sector;
majority is governing, when the decision-making ↘ Promoting the independent platforms
process is unilateral without involving businesses where the private sector could launch col-
to devise public policies, then the outcome would lective actions and carry out sector or com-
remain unchanged, whereas the electoral prom- mon advocacy measures.
ises to achieve economic growth would remain
promises only.
Unfair competition:
↘ Ensuring surveillance over the trade opera-
tions on the segment not controlled by the
↘ Reactivating the Competition Council scru- Moldovan authorities to minimise unfair
tiny function to remove unfair competition competition caused by smuggled goods;
practices resulting from the kleptocratic ↘ Ensuring transport corridors and streamlin-
schemes, political protection and cartel ar- ing the authorisation issuance procedures.
rangements.
Competitive business climate:

Labour force:
↘ Setting mechanisms to underpin entrepre-
↘ Reforming the education system focused neurship capital, which would generate
on diploma issuance and fostering the one start-ups;
that trains professionals in compliance with
the labour market demand;
↘ Devising the legal framework for venture
funds or business angels;
↘ Adjusting the legal frame to take into account ↘ Setting the Entrepreneur Ombudsman to
remote work.
ensure observance of entrepreneurs’ rights.
Security:
↘ Developing programmes aimed at subsidis-

ing the investments into renewable energy
and increasing energy efficiency;
I. Crises impact on the
moldovan business
environment
This Chapter systematises the core issues en- vate sector perception concerning the meas-
countered by the Moldovan business people ures adopted by the Government to mitigate
over the past two years. It also depicts the pri- the negative effects experienced by it.
High costs, lack of skilled staff and unfair competition –

these are the core challenges experienced by the business
environment
The COVID-19 pandemic affected all economic ground and the crisis caused by higher prices,
sectors, in particular, those requiring physical most companies faced difficulties due to fewer
presence and work. The rural small and medi- customers, lower sales, tax and rent payments,
um-sized enterprises suffered the most. Hence, repayment of loans and lines of credit, amend-
more than 70% of respondents mentioned that ed grace period for imports, weak purchasing
business associations’ members were affected power of the population, fewer jobs, higher
by the pandemic. production and logistic costs, lack of liquidity
and failure to attract lines of credit, in particu-
Therefore, against the pandemic crisis back- lar, by the SMEs, switching to remote work.
Figure 1. Crises that affected the business associations’ members. Source: CAPE Survey
14
Number of business associations
12
10
0
The health crisis caused Political Instability Demographic Crisis Energy Crisis The war in Ukraine
by COVID 19
To a very large extent To a large extent To some extent To a small extent To a very small extent
Source: CAPE Survey
30
Figure 2. Key issues experienced by the business environment over the past two years
25 24
20
19
17 17 17
15
15 15
15 14
13 13 13
12
11 11 11
11 10 11
10 10 10 9
9
9
8 8 8
7
7
6 6
6 5 5 5
5 4
4
2
1
0
0 0 0 0 0 0 0 0
0
Lack of Staff Unfair Row Excessive Access to Infrastructure Equipment and Rent Payment Other No response
outlets Competition material bureaucracy inance machinery payment of taxes
Total Large and Medium Small Micro
Source: CAPE Survey
Figure 3. Company economic indicators after two years
No response 5 8 3 5
Decreased 55 57 63 24
Remained
the same 12 11 15 61
Increased 29 24 20 11
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Sales Profit Number of customers Number of employees
Source: CAPE Survey
The sales, profit and number of customers of the major problems they experienced dur-
dropped for half of interviewed companies, re- ing the pandemic, other problems referring to
gardless of their size. However, most compa- the public procurement procedures favouring
nies managed to retain their employees even specific companies and excessive bureaucracy.
when they experienced such difficulties. Pursu- Other businessmen pointed out corruption, in
ant to the data collected during the interviews particular, within the governmental agencies
and focus-group discussions, large and medi- that should support the domestic farmers and
um-sized companies mentioned unfair com- producers.
petition of illegally working companies as one
Circa 70% of respondents stated they were
“There are so many cases when they
forced to cope with the demographic crisis
do not consult with us, they do not hear
effects. Although the statistics present an av-
us, but impose unjustified rules. The
erage unemployment rate, the lack of labour
superficiality of the dialogue with public
force and exodus of active population have
institutions led to the amendment of the
become more acute. The trend of migration
Law on manufacturing and circulation
has been intensified by the military conflict in
of ethyl alcohol and alcoholic products.
Ukraine. During the in-depth interviews with a
Hence, it imposed the use of dissipation
business association representative, the latter
stoppers without consulting the sector
pointed out: “There are growth opportunities,
representatives. The whole sector involved in
but we have no people to work with”.
the production, dissemination or import of
A worth-mentioning issue we depicted during alcohol has been affected. The Government
the interviews with business people and associ- or institution vested with decision-making
ations is related to the low quality of public-pri- power to impose certain rules/restrictions,
vate dialogue. Quite often, in case of narrow approved such rules for themselves to
group interests, the authority representatives foster the interests of certain economic
involved in devising public policy failed to con- operators manufacturing those parts for
sult with the business environment, whereas our products”, an interviewed business
their decisions were not justified from the eco- environment representative stated.
nomic standpoint.
Anti-crises actions applied by the business environment

In order to keep their business afloat and ple undertook a range of measures, including
rescue it from insolvency, the business peo- higher costs for their products, postponement
Figure 4. Measures undertook by companies over the past two years

84
78
68 67 68
66
59 59 60 59 60
46 47 46
45
44
41 40 41 41
39
35 37 37
35 34 35 34
31 32
27 28 27 28 27 27 27
24 24
22 23
14
11 11 10
7 7
5
produse și servicii
Amânarea planurilor
Mutarea activității
costurilor
de producere
de investiții
costurilor
a activității
distanță
în online
de lucru
creditelor
Crearea noilor
Altele
de logistică
administrative
salariilor
Sistarea temporară
de la
Reducearea
costurile
CreștereaIncreasing
costs
Postponement of
investment plans
costs
Temporary cessation
of activity
Munca work
Reducing overheads
reduction
Moving the activity

online
Reduction of
working hours
loans
and services
Creating new products
Other
Reducerea orarului
production
logistics
Remote
Attracting
Wage
Reducerea
Atragerea
Total
Total Mari
Largeșiand
Medii
Medium Mici
Small Micro
Micro
Source: CAPE Survey
of investments, temporary standstill, cutting the economic situation has worsened: the ex-
down the overheads and salaries to retain the penses increased and the proceeds dropped.
same number of employees, adopting short- The business people renegotiated their rent
er work schedules, launching online activity, agreements to reduce the overheads and re-
attracting financial resourced through credit vised the business processes to optimise the
facilities or loans. costs. Likewise, greater attention was paid to
stock management to avoid its accumulation,
The interviewed companies state that over having intensified communication with the
the last two years, in particular, since the time customers to assure them their requirements
higher prices were set for energy resources, would be met.
Business environment perception towards anti-crisis

actions approved by the Government
Throughout 2020-2022, the Moldovan Govern- At the same time, 83% of business associations
ment has approved a range of actions to miti- are extremely satisfied and satisfied by the
gate the crisis effects over businesses (see the Digitalisation Package Implementation Pro-
List of Actions in Annex 2). gramme, as it came up with new concepts, in-
cluding the unilateral recognition of electronic
Pursuant to the Survey, circa 18% of inter- signatures; ordering the authorities to accept
viewed companies are satisfied how Govern- electronic applications from businesses. Like-
ment intervened and by the measures it im- wise, many processes were removed, which
plemented, 44% are dissatisfied, and 31% are required physical presence of entrepreneurs.
neither satisfied nor dissatisfied, the latter cat- This project was successful as it was support-
egory covering small and micro-companies. ed by and developed jointly with the business
Figure 5. To what extent private companies are satisfied how the Government
supported the business environment over the past two years
Micro
Micro 30 29 18 15 5 3
Small
Mici 44 13 9 13 16 4
Large and
MariMedium
și Medii 29 29 11 25 7 0
Total 31 27 17 15 7 3
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Nici satisfăcute
Neither șinor
satisfied nicidissatisfied
nesatisfăcute Deloc satisfăcute
Not satisfied at all
Nesatisfăcute
Dissatisfied Satisfăcute
Satisfied
Nu
Norăspund
response Foarte satisfăcute
Very satisfied
Source: CAPE Survey
environment. The Digitalisation Package was The elimination of tax invoice for the pur-
used by 73% of companies, the share being the chases settled with the bank card is the
same regardless of the company size. measure making 59% of respondents (in par-
ticular, the economic operators providing
Pursuant to the Survey, 27% of interviewed as- goods and services online) satisfied and very
sociations are satisfied that the Government satisfied. This measure has found expression
compensated the first 500 m3 of natural gas in the system of services with online settle-
consumed on a monthly basis by economic op-
ments for the tourism industry. For this pur-
erators during January – March 2022. The meas-
pose, a platform has been devised enabling
ure was intended for all economic operators,
the tourist premises to guarantee the book-
which contracted SA “Moldovagaz” services,
ing and payments in real-time, online, at more
but only part of manufacturing undertakings
favourable conditions than those provided
managed to enjoy its benefits. For instance, the
through booking.com.
rural households rendering accommodation
services “were not amongst the eligible subjects,
Less than half of business associations re-
although they were the first to accommodate,
free-of-charge, the flow of refugees”. sponded that their members failed to see the
effect, and less than 10% were dissatisfied by
Likewise, more than half of business associa- the measures regarding the compensations
tions (63%) say their members are satisfied by provided for limited activity, according to
the postponement of reporting and tax/fee which the state compensated 50% of the time
payment during emergency, and 61% are sat- their employees lost due to the imposed addi-
isfied by higher financial threshold for petty tax tional constraints. This relates, in particular, to
offences. The latter was adopted only in March HoReCa and tourism sectors during the restric-
2022, and many undertakings were forced to tions imposed by COVID-19.
settle the fines during the crisis.
Figure 6. What measure benefits did you enjoy over the past two years
Digitalisation
Pachetul package
de digitalizare 73 22 5
Compensareafor
Compensation a primilor
the first 500m
500 m33de
of gaz
gas consumat
consumed 27 68 5
Prelungirea termenelor
Extension de raportare
of reporting deadlines 23 68 9
Amânarea raportării
Postponement și plățiiand
of reporting impozitelor/taxelor
payment of taxes 20 73 7
Subsiding temporary unemployment

Subvenționarea șomajului tehnic și staționar 15 78 7
and standstill periods
Interest subsidy
Subvenționarea dobânzii on loans
la împrumuturi 12 84 5
Compensation of 50% of the time not worked

Compensarea a 50% din timpul nelucrat de angajați 11 84 5
by employees
Elimination of tax invoices for purchases settled with
Eliminarea facturii iscale pentru achizițiile cu cardul 10 77 14
bank cards
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Yes
Da No
Nu No răspund
Nu response
Source: CAPE Survey
Half of business associations mentioned that ered their goods, even when their activity was
the compensation for temporary unemploy- ceased.
ment had no effect on their members, and
10% were dissatisfied, as they were supposed The business people also stress they are aware
to settle all taxes and then get the compen- the state has got limited resources. However,
sations. Under the standstill situations, small they do not understand why businesses try to
companies did not have such possibility as they maximise the return on each MDL spent, while
were lacking liquidity and had limited capacity the civil servants do not follow the same ap-
to benefit from lending operations. On the oth- proach, especially when they spend taxpayers’
er hand, the companies had insignificant re- money.
serves to keep them afloat for a month or two.
A business association representative pointed
out to this end:
“We are dissatisfied by the how important

decisions are taken with no assessment
programme to measure their impact on
“All these measures disadvantaged pri-
businesses. This is a defective practice that
marily the undertakings that worked
brings no value”.
transparently. When it came to tax reliefs,
all firms derived benefits, even those that
worked semi-illegally”.
In the same vein, there are shortcomings in

terms of communication and publication of
information. In many cases, the decisions are
More than half said that subsidising the in- published on various online resources, and
terest on contracted bank and/or non-bank their search and subsequent interpretation is
loans did not have tangible effects. time consuming. “We have the impression that
such approach is used especially to discourage
the business people.”
In addition, the business people think that un-

“No negotiations were conducted with the clear or vaguely described selective measures
banks, the interest rates were not re-eval- and eligibility criteria, in combination with the
uated, and force-majeure conditions were deficiencies of public services and with exces-
not recognised”. sive bureaucratic procedures, deprive them
from the state support. At the same time, the
lack of skilled staff within the state institutions
and deficient communication among the state
More than half of associations are dissatisfied entities lead to “ministries failure to meet the
by the fact of lowering the VAT rate to 6% for flow of requests”. As a result, trust in state in-
HoReCa only. For instance, the transport sector stitution is vanishing. We have the perception
neither worked during emergency nor enjoyed that the procedure used for a specific measure
any benefits, while HoReCa companies deliv- is complicated and cumbersome.
Business environment issues in the context of the war in
Ukraine
The war in Ukraine, and the sanctions ap- is closed; therefore, no sea container trans-
plied towards Russia and Belarus ended/ portation is possible. This caused operation-
ceased the activity of companies that had al difficulties and imposed repositioning of
trade relations with Russia. The business transport flows and the shipment of goods
people mentioned that the break of trade via other ways. The additional costs for han-
relations, destabilisation/break of the sup- dling the uploaded container and ensuring
ply chain logistic and the steep increase of their storage have also increased. “The war
prices and costs are the primary issues they conflict in Ukraine practically closed 60% of the
have encountered this year. Odessa sea port international freight market”.
Figure 7. War impact on trade relationships with Russia and Ukraine
100
89
90
80
73
70
60
50
40
30
22
20
10 5
3 3 3 3
0
Nu
No Yes andDa,despite
dar dinthe
cauzawar, we Nuresponse
No răspund Da,but
Yes, dardue
războiul
to thenuwar,
a
didrăzboiului relațiile
not stop the au fost
partnership stopat relațiile
the activities were stopped
stopate sau sistate or suspended
Ukraine
Ucraina Russia
Rusia
Source: CAPE Survey
Concurrently, some Moldovan economic oper- companies being unable to settle payments or
ators have no raw materials: “We experienced get transfers.
difficulties related to the import of raw materials,
foodstuff, equipment, etc. Circa 40% of HoReCa Another sensitive topic tackled by the busi-
imports originated from Ukraine”. The prices for ness people is that more than half of their em-
Ukrainian goods increased also due to dramat- ployees claimed they would leave the country
ic increase of logistic costs. should Russia invade Moldova. Concurrently,
more than 40% of companies stated they were
Largely, small and micro-companies were inclined to work with a Ukrainian company,
mostly affected by the war. Likewise, the in- and more than half of them were eager to em-
ternational sanctions announced against the ploy Ukrainian refugees temporarily staying in
Russian banks and banking system affected Moldova. Some undertakings that experienced
substantially the payment system, the private staff shortage were inclined not only to employ
Figure 8. To what extent the war adversely affected the Moldovan companies
Micro
Micro 39 36 9 9 5 3
Mici
Small 39 32 13 3 14 0
Large and
Mari și Medii
medium 36 13 14 0 37 0
Total
Total 39 34 10 8 7 2
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Într-o oarecare
To some extentmăsură Foarte mult
Very much În niciA un fel
little Puțin Rather
Mult
much Nu răspund
No response
Source: CAPE Survey
Ukrainian refugees, but also to accommodate The private sector, in particular, small and
them. Women of working age, refugees from micro-companies expressed their concerns
Ukraine, are welcome at the Moldovan light in- regarding the production costs, drop in con-
dustry companies. sumption and higher prices for raw materials.
Figure 9. Businessmen’ views for the next six months
Lipsa materiei
Lack prime
of raw material 20 25 13 22 19
SistareaTemporary
temporarăor sau permanentă
permanent a activității
cessation of activity 10 40 22 16 12
Plecarea angajaților
Employees’ resignation 29 29 14 14 14
Incapacitatea de atoplăti
Failure salarii
pay salaries 19 40 20 13 8
Întîrzierea plăților
Delayed cătretofurnizori
payments suppliers 22 38 20 17 3
Incapacitatea de a acoperi costurile

Failure toadministrative
cover overheads 25 39 18 12 7
Reducerea volumului de producție

Production shrinking 32 38 5 13 12
Întârzierea plăților
Delayed din partea
payments from clienților
customers 32 39 12 13 5
Creșterea prețului
Increased pricemateriei prime
of raw materials 38 33 1 8 21
Scăderea
Decreased consumului
consumption 32 40 13 6 8
Creșterea costurilor de producere

Increased production costs 41 33 5 5 16
0 10 20 30 40 50 60 70 80 90 100
Sigur da Mai mult
Definitely yes da Puțin
Rather yesprobabil Sigur nu Definitely
Rather not Nuyes
răspund No response
Source: CAPE Survey
Public-private dialogue quality
There are obstacles to anti-crisis actions expe- stitutions. As per the businessmen’ opinion,
rienced by the business environment, namely the key factors affecting the public-private di-
its deficient communication with the state in- alogue efficiency are as follows:
• Ability to take quick decisions in crises;
• Efficiency and competence of governance to implement the measures;
• Bureaucracy and corruption;
• Political will (of the Parliament majority);
• War and geopolitical situation;
• International context;
• Lack of natural resources;
• Financial support capacity in applying anti-crisis actions due to economic and budget decline;
• Eligibility criteria for undertakings;
• Legal and regulatory framework;
• Information sufficiency (or insufficiency);
• Consultations on anti-crisis actions (existing or non-existing) within working groups.
II. Business environment
proposals to overcome
the current crises
This Chapter depicts a range of anti-crisis measures formulated by focus-groups and during the
in-depth interviews. The measures are systematised depending on their implementation urgency.
Measures to mitigate the pandemic crisis

Short-term (immediately)
↘ Developing amendments related to occupational safety to mirror the new realities concerning
to remote work;
↘ Facilitating e-commerce by streamlining the instant payment system;
↘ Revising the existing frame on personal data protection: alignment with the relevant European
practices.
Medium-term
↘ Ensuring digitalisation of public services at the central and local levels to avoid mandatory phys-
ical presence;
↘ Providing platforms to interconnect the state institutions via One-stop shops;
↘ Ensuring business digitalisation: electronic payment mechanisms, online cash registers, ex-
panding the validity of electronic signature (from two to five years), digital/electronic systems
to remotely identify/interact with the customer;
↘ Implementing programmes to encourage and consult the businessmen in the area of e-com-
merce;
↘ Organising awareness-raising campaigns for international Medial to attract investors and tour-
ists into our country;
↘ Setting the “Entrepreneur’s Ombudsman”.
Long-term
↘ Developing a programme to ensure cyber security.
Measures to mitigate the demographic crisis
↘ Expanding the IT visa programme to safeguard family reunification;
↘ Setting a Digital Nomads programme and establishing the legal framework for remote work
and framing the IT free-lancers in the tax field;
↘ Revising the unemployment benefits for the young people to offer them employment incen-
tives;
↘ Setting a motivation system for efficient civil servants.
Medium-term
↘ Investing in the education system development and in teachers’ reconversion;
↘ Revising the regulations of seasonal labour (Law of day-labourers), introducing incentives to
employ low-skilled workers.
Measures to mitigate the economic crisis
↘ Annulling the sanctions resulting in frozen accounts, and suspending state inspections in 2022;
↘ Developing a programme that grants liquidity mechanisms by providing loans with preferential
interest rates;
↘ Re-scheduling the settlement of taxes, salaries;
↘ Ensuring quick settlement of subsidies for the files submitted in 2021 and 2022;
↘ Expanding the VAT reimbursement programme from the producers’ debit against the labour
remuneration taxes and fees (Law No. 60/2020);
↘ Reducing the taxes for transporters by lowering the VAT rate from 20% to 10% for the transpor-
tation of goods and travellers;
↘ Lowering the costs of authorisations issued for the transportation of goods (they are tenfold
higher than those in the neighbouring countries);
↘ Curbing bureaucracy to obtaining authorisations for transportation (issuance of electronic au-
thorisation without physical presence);
↘ Reducing the “queues at customs points” (Leuseni Customs Point), revising the time allotted to
customs procedures, surveillance in real-time.
Medium-term
↘ Lowering the VAT for important sectors;
↘ Developing certain support measures to channel the agricultural produce towards markets oth-
er than the CIS markets, as well as the added-value products;
↘ Applying mechanisms aimed to stabilise and govern the prices;
↘ Keeping low interest rates for farmers;
↘ Increasing domestic production competitiveness through mechanisms aimed to lower the pro-
duction costs;
↘ Carrying out promotion activities for Moldovan companies/goods at the international level,
having involved the economic representatives by the Moldovan Embassies abroad;
↘ Removing the barriers to export: removing tariff quotas, streamlining customs procedures,
etc.;
↘ Implementing some measures to efficiently manage the state funds;
↘ Dividing the producers into micro, small, medium and large entities.
Long-term
↘ Developing a national programme to develop niche products with high additional value;
↘ Setting a fund to support the undertakings, which rely on innovations, including those aimed to
enhance energy efficiency.
Measures to mitigate the energy crisis
↘ Reducing at least by 50% the VAT for natural gas and excise tax for fuel;
↘ Stabilising the fuel prices (for at least 30 days) as their constant fluctuation adversely affects
financial planning;
↘ Subsidising the costs for electricity and natural gas, in particular, the costs of producers work-
ing in the power intensive industries;
↘ Reimbursing 50% of the Diesel costs incurred by farmers for agricultural works.
Medium-term
↘ Subsidising the capacities to generate renewable energy resources.
Long-term
↘ Developing a national programme aimed at developing alternative energy sources.
Measures to mitigate the shock caused by the war
↘ Compensating the costs incurred by the local people hosting Ukrainian refugees;
↘ Implementing measures to combat propaganda;
↘ Carrying out measures to support the business environment without too many formalities and
engage them in helping the refugees;
↘ Setting water and road communication ways with the East, export ways to the EU. Setting the
optimal section for imported goods and materials (ex. transportation, constructions);
↘ Developing a plan of support measures to reduce the logistic cost increase margin following
the change of transportation itineraries for goods and products.
Medium-term
↘ Ensuring food security: supporting the local production, constraining exports, removing cus-
toms duties for the imports of goods that cannot be purchased in the country;
↘ Ensuring the stability of logistic chains: external negotiation of road and sea logistic lanes/
corridors for the CIS countries, expanding the customs work capacity and supplementing the
number of authorisations to travel on the EU territory.
Measures to improve the public-private dialogue
↘ Increasing the efficiency of public-private dialogue and avoiding the superficial feature as-
signed to it;
↘ Developing national sector programmes with regular participation of business associations;
↘ Organising brainstorming sessions;
↘ Organising discussion fora and public consultations.
Medium-term
↘ Involving business associations in the development of national sector programmes;
↘ Boosting the regulatory reform;
↘ Developing measures to improve the performance of employees;
↘ Ensuring that the bills affecting the private sector are approved only after being consulted with
business associations.
III. Conclusions and
recommendations
The Moldovan business environment is great- thors come up with a number of proposals and
ly interested to be part of reforming and de- recommendations systematised as follows:
cision-making processes in our country, ac-
knowledging the importance of alignment with
international standards. The large number of Interaction with public institutions
initiatives suggested by businesses reveals
Making the public service more efficient
the private sector high degree of consolida-
by minimising the costs incurred by the
tion and involvement in the country economic
private sector due to bureaucracy, excessive
development. Moreover, the upstanding busi-
regulations:
ness people do not pursue the immediate prof-
it only; they observe how the country evolves.
Therefore, setting a business climate attractive
▶ Cutting down the overheads incurred by
companies due to the interference of public
for upstanding companies is a major goal for
institutions by removing excessive bureau-
any governance.
cracy and corruption;
The Moldovan business wishes that political ▶ Setting the necessary conditions to educate
actors, public institutions and society under- efficient and honest civil servants;
stand the need to rethink the economic mod- ▶ Improving the regulatory system by intro-
el in order to become competitive in specific ducing new assessment mechanisms for
niches. The deep economic crisis that lasted the regulatory burden, such as M-TEST;
for two years proved that the state could not
operate in a parallel world, which operation is
▶ Enhancing the public service quality
through its digitalisation and interconnec-
paid for out of the collected taxes. Therefore,
tion of databases of the Tax Service, Cus-
close cooperation is needed between the pri-
toms Service, Bailiffs, Public Services Agen-
vate sector and state institutions, resulting in
cy, and ANSA etc.
tangible incentives for entrepreneurs to stay
in the country and contribute to its economic
development.
Decision-making
Regretfully, the effects of the military conflict Improving the public-private dialogue quality
will have a long-lasting nature, and we should to foster inclusive economic development:
feel its effect throughout the next six months as
the logistic chain-related crisis would deepen, ▶ Improving the public-private dialogue legal
as well as the energy and food crises. Nonethe- frame to remove the possibility of using su-
less, as yet unseen, Moldova is moving closer perficial consultations with the private sec-
to the EU, enjoying opportunities for the soci- tor just to tick the decision-making obser-
ety it must employ. For this purpose, the Au- vance;
▶ Improving communication concerning the Energy and territorial security
decisions and legal acts influencing the pri-
vate sector; Heavy dependence on imported energy
▶ Promoting the independent platforms

resources and the unresolved territorial
conflict undermine economic development:
where the private sector could launch col-
lective actions and carry out sector or com-
mon advocacy measures.
▶ Developing programmes aimed at subsidis-
ing the investments into renewable energy
and increasing energy efficiency;
Unfair competition and business climate ▶ Ensuring surveillance over the trade opera-
tions on the segment not controlled by the
The endeavours of kleptocratic groups to Moldovan authorities to minimise unfair
protect their interests deactivated the functions competition caused by smuggled goods;
of institutions empowered to investigate the
abuses committed in the private sector:
Competitive business climate
▶ Reactivating the Competition Council scru-
tiny function to remove unfair competition Lack of a competitive business climate forces
practices resulting from the kleptocratic the companies to move to other countries:
schemes, political protection and cartel ar-
rangements. ▶ Setting mechanisms to underpin entrepre-
neurship capital, which would generate
start-ups;
Labour force ▶ Devising the legal framework for venture
The business environment misses a number of funds or business angels;
opportunities due to the discrepancy between ▶ Setting the Entrepreneur Ombudsman
the education system supply and the labour to ensure observance of entrepreneurs’
market demand: rights.
▶ Reforming the education system focused

on diploma issuance and fostering the one
that trains professionals in compliance with
the labour market demand.
IV. Annexes
Annexes 1
SURVEY: ASSESSING THE PRIVATE SECTOR PERCEPTION

CONCERNING THE ANTI-CRISIS ACTIONS
Research Methodology ● 13 in-depth interviews with the directors of

business associations.
In order to conduct this Research, the Centre
for Enterprise and Economic Policy has identi-
fied two reference groups to assess the busi- Data collection from companies
ness environment position in terms of anti-cri- 1. Testing the Questionnaire intended for
sis actions and public policy proposals aimed companies. The Questionnaire was devel-
at improving the business climate. oped and fine-tuned by Magenta Consult-
ing along with CAPE. Next we carried out
Reference Groups: several tests in Romanian. The Question-
naire was fine-tuned after each test de-
● private companies – CAPE contracted Ma-
pending on the pilot-interview results.
genta Consulting to carry out this Research;
2. Questionnaire programming. The Ques-
● business associations – CAPE conducted
tionnaire was programmed by the IT De-
the Research itself.
partment, and the DB was installed on a
secured server. The programmed Ques-
Quantitative and qualitative research meth- tionnaire also contributed to the quality of
ods were used to achieve the goal, namely: collected data as it allowed to directly mon-
● Telephone survey (CATI – computer-assist- itor the interviews from the Headquarters.
ed telephone interview) of 107 companies; 3. Selecting and training the Interviewers.
● Survey of 25 business associations through We selected a team of Interviewers with a
Google Forms; great deal of experience in conducting CATI
surveys, involving the general public and
● Three focus-groups divided by business
companies, and provided them with appro-
sectors, with the participation of 30 busi-
priate training.
nessmen;
4. Action on spot. The Survey was conducted
● Two focus-groups with the participation of
over the phone. The Interviewer was guided
13 business association representatives;
by the Questionnaire programmed on the
● 10 in-depth interviews with the directors of screen. The interview was conducted in the
private companies; language convenient for the respondent.
The Questions were followed attentively and of 24 business associations from various sec-
read exactly as they appeared on the screen. tors.
5. Focus-groups. Focus-groups imply 1. Questionnaire. The Questionnaire includ-
semi-structured discussions, conducted as ed blocks of questions related to crisis per-
per a moderating guide comprising open ceptions and measures undertaken by the
questions. The Focus-groups were organ- Government that influenced the business
ised online and involved 8-10 participants. environment (from the business associa-
The Moderators observed the group dy- tions’ perspective) and the effects caused
namics, listened to the responses, observed by the military conflict and humanitarian
the participants’ willingness to discuss a crisis. The participants were asked what ex-
topic and their reticence towards other pectations their members had concerning
topics. People holding a strong position in the solutions identified by the Government.
the company decision-making were select- 2. In-depth interviews. In-depth interviews
ed as respondents, i.e. people who decid- were conducted as discussions with the
ed the company future, the management business association leadership from var-
of company resources (Founder, Director, ious sectors, which lasted for 40-60 min-
CEO, and Financial Manager). The Moderat- utes, depending on the respondent and
ing Guide for focus-groups was developed the Moderating Guide. The open questions
by Magenta Consulting and approved by were set based on the received responses
CAPE. from the Questionnaire. Per total, 13 in-
6. In-depth interviews. In-depth interviews depth interviews were conducted.
were conducted online as face-to-face- dis- 3. Focus-groups. The Focus-groups were
cussions between the Moderator and the conducted online, as a round-table, in-
Respondent, which lasted for 40-50 min- volving up to seven participants. Two sub-
utes, depending on the respondent and ject-matters were identified on the basis of
the Moderating Guide. The Moderator re- data derived from the Survey, which were
lied on a semi-structured guide containing discussed in the focus-groups: 1) Anti-crisis
open questions. Per total, 10 in-depth in- measures to re-launch the business under
terviews were conducted for this Research. the current circumstances; and 2) The busi-
The Moderating Guide for focus-groups ness environment Interaction with public
was developed by Magenta Consulting and institutions to address quickly and effec-
approved by CAPE. tively the issues.
The participants were provided with the Sur-

Data collection from business vey initial outcomes to identify their views and
associations perceptions regarding the measures applied
by the Government and communication with
The Centre for Enterprise and Economic Policy decision-makers. Subsequently, they discussed
has got a DB with contact information of more the solutions and arguments underpinning the
than 70 business associations from Moldova. respondents’ options, checking some conclu-
For this purpose, CAPE selected 24 associations sions made by the Research Team. The Survey
from various economic sectors to participate in respondents included business associations’
the Research. Concurrently, CAPE collected the leadership, represented by presidents or exec-
data from associations, covering the responses utive directors.
Outcomes related to companies companies was suggested as a sampling base.
As the share of large and medium-sized com-
The companies were randomly selected from panies is insignificant, the number of Ques-
the DB held by Magenta Consulting, having ob- tionnaires planned for large, medium-sized
served the national breakdown of companies and small companies within the sample was in-
by sector and company size. The annual aver- creased. Upon presenting the Research results
age number of employees was the key criterion at the national level, the data were weighted
used for company breakdown by size. A proba- to adjust the sample structure pursuant to the
bilistic sample proportional with the number of National Bureau of Statistics 2020 data.
SAMPLE DATA
Table 1. Breakdown by size
Large Medium Small Micro Total

Chisinau Municipality 7 10 22 24 63
North 2 3 4 7 16
Centre 2 3 6 6 17
South 1 1 4 5 11
Total 12 17 36 42 107
Table 2. Breakdown by sector, % of the total number per category.
Large and
TOTAL, Small, Micro,
Sector Medium,
N=107 N=36 N=42
N=29
Agriculture 13 11 17 12
Processing industry 15 21 21 14
Production of electricity, gas, or hot water 0 0 3 0
Constructions 5 11 23 3
Wholesale 33 37 18 35
Transport 3 11 5 2
HoReCa 6 4 3 7
IT 0 4 0 0
Financial intermediation services 2 0 5 2
Real estate 7 0 0 8
Consulting 13 0 3 15
Education 0 0 3 0
HR 0 4 0 0
Recreation services 2 0 0 3
Figure 1. Breakdown by region, segregation by gender and position of the
interviewed people as a % of the total number
70
60
50
40
30
20
10
0
Founder/ Director Head of Accountant Other Male Female North Chisinău Centre South
Owner Department
Position Gender Region

Poziția Genul Regiunea
Total
Position Mari și
Large andMedii
Medium Mici Micro
Small Micro
Figure 2. Number of employees by groups – seasonal and permanent as a % of the total number
None 81
101+ 0
Seasonal employees
51–100 0
31–50 0
21–30 0
11–20 2
6–10 5
1–5 12
101+ 2
Permanent employees
51–100 1
31–50 2
21–30 3
11–20 4
6–10 14
1–5 74
0 10 20 30 40 50 60 70 80 90
Figure 3. What year did the company start working?
The data are presented as a % of the total number
Micro,
Micro,N=42
N=42 5 31 26 35 3
Small,
Mici,N=36
N=36 25 25 33 14 3
Large and
Mari și Medii, N=29 27 43 16 11 4
Medium, N=29
TOTAL,N=107
TOTAL, N=107 8 31 26 32 3
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
1990-2000
1990-2000 2001-2010
2000-2010 2011-2016 2017-2021
2017-2021 Nu știu/Nu
I don’t răspund
know/No response
Figure 4. Revenue structure depending on the type of customers.

Micro, N=42
Micro, N=42 22 19 59
Mici, N=36
Small, N=36 8 27 65
Mari și Medii,
Large and 3 47 51
N=29
Medium, N=29
N=107
TOTAL, N=107 20 21 59
0% 20% 40% 60% 80% 100%
Persoane izice
Individuals Persoane juridice
Legal entities Ambele categorii
Both categories
Difficulties and problems experienced by the companies over the past two years
Figure 5. What primary problems encountered by your company over the past two years
were the most important? The data are presented as a % of the total number
35
30 30
30
26
25 24
21
20 19
17
17
15 13 13 13 13
13
11 11
10 10
10 9 9
8
7 7
6
5 4 5 5 5
5 4 4
4 4 3 2
3 3 3 3 3 3 3
0 0 0 0 0 0 0
0
No Access to Other Excessive Unfair Equip- Infra- Lack of Raw Staff Rent Payment
response finance bureaucracy Compe- ment and structure outlets material payment of taxes
tition machinery
Total
Total LargeMari
and Medium
și Medii Small
Mici Micro
Micro
Figure 6. What secondary problems encountered by your company over the past two years
30
were the most important? The data are presented as a % of the total number
25 24
20
19
17 17 17
15
15 15
15 14
13 13 13
12
11 11 11
11 10 11
10 10 10 9
9
9
8 8 8
7
7
6 6
6 5 5 5
5 4
4
2
1
0
0 0 0 0 0 0 0 0
0
Lack of Staff Unfair Row Excessive Access to Infrastructure Equipment and Rent Payment Other No response
outlets Competition material bureaucracy inance machinery payment of taxes
Total Large and Medium Small Micro
Figure 7. How did your company indicators change over the past two years?
No response 5 8 3 5
Decreased 55 57 63 24
Remained
the same 12 11 15 61
Increased 29 24 20 11
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Sales Profit Number of customers Number of employees
Figure 8. What measures did your company undertake to respond to the crises during
the past two years? The data are presented as a % of the total number; more than one
response is possible
84
78
68 67 68
66
59 59 60 59 60
46 47 46
45
44
41 40 41 41
39
35 37 37
35 34 35 34
31 32
27 28 27 28 27 27 27
24 24
22 23
14
11 11 10
7 7
5
produse și servicii
Mutarea activității
Amânarea planurilor
costurilor
de producere
a activității
distanță
în online
de investiții
costurilor
de lucru
creditelor
Crearea noilor
Altele
de logistică
administrative
salariilor
Sistarea temporară
de la
Reducearea
costurile
costs
Postponement of
investment plans
costs
Temporary cessation
of activity
Munca work
Reducing overheads
reduction
Moving the activity

online
Reduction of
working hours
loans
and services
Creating new products
Other
Reducerea orarului
production
logistics
Remote
Attracting
Wage
Reducerea
Atragerea
Total
Total Mari
Largeșiand
Medii
Medium Mici
Small Micro
Micro
Figure 9. In your opinion, how did the country economic situation change over the past
12 months? The data are presented as a % of the total number
Micro
Micro 48 32 10 7 30 0
Mici
Small 40 30 13 12 50 0
Large and
Mari și Medii 36 38 13 10 30 0
medium
Total
Total 47 32 10 8 30 0
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
S-a
Hasînrăutățit foarte
gotten a lot tare
worse S-a
Hasînrăutățit
worsenedîntr-o oarecare
to some extent măsură
AHas
rămas
beenlathe
felsame S-a
Hasîmbunătățit
improved toîntr-o
some oarecare
extent măsură
Nu știu/Nu răspund
DK/NR S-a
Hasîmbunătățit
improved a foarte
lot mult
Figure 10. To what extent are you satisfied by the way the Government supported the private
sector over the past two years? The data are presented as a % of the total number
Micro
Micro 30 29 18 15 5 3
Small
Mici 44 13 9 13 16 4
Large
Mari and
și Medii 29 29 11 25 7 0
Medium
Total 31 27 17 15 7 3
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Nici satisfăcute
Neither șinor
satisfied nicidissatisfied
nesatisfăcute Deloc satisfăcute
Not satisfied at all
Nesatisfăcute
Dissatisfied Satisfăcute
Satisfied
Nu
Norăspund
response Foarte satisfăcute
Very satisfied
Figure 11. Which measures out of those approved by the Government were used by
your company? The data are presented as a % of the total number
Digitalisation
Pachetul package
de digitalizare 73 22 5
Compensareafor
Compensation a primilor
the first 500m
500 m33de
of gaz
gas consumat
consumed 27 68 5
Prelungirea termenelor
Extension de raportare
of reporting deadlines 23 68 9
Amânarea raportării
Postponement și plățiiand
of reporting impozitelor/taxelor
payment of taxes 20 73 7
Subsiding temporary unemployment

Subvenționarea șomajului tehnic și staționar 15 78 7
and standstill periods
Interest subsidy
Subvenționarea dobânzii on loans
la împrumuturi 12 84 5
Compensation of 50% of the time not worked

Compensarea a 50% din timpul nelucrat de angajați 11 84 5
by employees
Elimination of tax invoices for purchases settled with
Eliminarea facturii iscale pentru achizițiile cu cardul 10 77 14
bank cards
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Yes
Da No
Nu No răspund
Nu response
Figure 12. To what extent are you satisfied by the measures approved by the Government?
Elimination of tax invoice for purchases

Eliminarea facturii iscale pentru achizițiile cu cardul 44 47 6 00 3
settled with bank cards
Digitalisation package
Pachetul de digitalizare 34 49 8 6 3 0
Compensation for the first 500 m3

Compensarea primilor 500m3 de gaz consumat 31 49 5 7 8 0
of gas consumed
Subvenționarea dobânzii la
Subsiding împrumuturi
loan interests 26 52 6 15 00
Extension termenelor
Prelungirea of reportingdedeadlines
raportare 8 59 31 11 0
Compensation of 50% of the

Compensarea a 50% din timpul nelucrat de angajați 1 54 25 0 20
time not worked by employees
Subsiding temporary unemployment and

Subvenționarea șomajului tehnic și staționar 0 29 39 15 1 15
standstill periods
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Foarte satisfăcut
Very satisfied Satisfăcut
Satisfied Nici satisfăcut
Neither și nici
satisfied satisfăcut
nor dissatisfied
Nestisfăcut
Dissatisfied Foarte nesatisfăcut
Very dissatisfied Nu știu/
Don’t Nu răspund
know/No response
Figure 13. Do you think the Government is responsive to the private sector problems?
Micro 32 28 26 13 2
Mici
Small 42 19 32 5 3
Large and
Mari și Medii 40 17 30 14 0
Medium
Total
Total 33 27 26 12 2
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Receptiv
Responsive
Deloc receptiv Nu este Not
Not responsive at all
receptiv
responsive
Nu știu/Nu răspund
Don’t know/No response
Foarte receptiv
Very response
Figure 14. To what extent do you trust the following institutions? By trust it is meant that the
institution represents your interests and carries out its work in the most appropriate way.
Agenția Servicii Publice

Public Services Agency 35 33 17 9 6
Serviciul
State Fiscal
Tax Service 34 45 11 7 3
Guvernul
Government 27 30 18 16 9
ServiciulService
Customs vamal 25 33 14 8 20
Parlamentul
Parliament 22 37 24 11 6
Poliția
Police 20 31 25 16 8
Ministerul
Linede resort
ministry 19 19 27 13 21
Serviciul Informații
Intelligence și Securitate
and Security Service 17 29 17 12 25
Armata
Army 12 21 15 18 34
Procuratura
General Generală
Prosecutor’s Office 11 24 27 19 20
Consiliul concurenței
Competition Council 10 26 15 28 21
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Sigur am încredere
Definitely trust Am încredere
Rather trust Mai degrabă
Rather nu am încredere
don’t trust
Nu amtrust
Don’t încredere
at all Nu știu/Nu
Don’t răspund
know/No response
Figure 15. How satisfied are you by the quality of the following processes influencing
your company? The data are presented as a % of the total number
Concurența loială
Fair competition 18 22 19 13 22 05
Calitatea
The legilor
quality sectoriale
of sectoral laws 11 38 21 16 5 5 2
Controalele de stat
State controls 10 36 36 7 9 02
Calitatea
Qualityserviciului public
of public service 8 32 26 17 8 1 7
Coerența
Coherence ofdeciziilor CNESP
CNESP decisions 6 32 26 17 10 3 6
Calitatea
Quality ofdialogului public
public private privat
dialogue 5 22 33 25 9 1 5
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Foarte satisfăcut
Very satisfied Satisfăcut
Satisfied Nici satisfăcut
Neither satisfiedșinor
nici satisfăcut
dissatisfied
Nestisfăcut
Dissatisfied Foarte nesatisfăcut
Not satisfied at all Nu
Notse aplică
applicable
Nu știu/
Don’t Nu răspund
know/No response
Figure 16. Does your company have commercial relations with companies from
Ukraine or Russia? The data are presented as a % of the total number
100
89
90
80
73
70
60
50
40
30
22
20
10 5
3 3 3 3
0
Nu
No Yes andDa,despite
dar dinthe
cauzawar, we Nuresponse
No răspund Da,but
Yes, dardue
războiul
to thenuwar,
a
didrăzboiului relațiile
not stop the au fost
partnership stopat relațiile
the activities were stopped
stopate sau sistate or suspended
Ukraine
Ucraina Russia
Rusia
Figure 17. What is the revenue value of your company generated from the relations with the
companies from Ukraine or Russia? The data are presented as a % of the total number
100
4
12 6
90
9
80 13
13
70
60 30 14
50
40
27
30
54
20
13
10
6
0
Ukraine, N=34
Ucraina, N=34 Russia,
Rusia,N=21
N=21
pînă
up tola 10%
10% 0%
0% 11-25%
11-25% Nu știu/Nu
Don’t răspund
know/No response 26-50%
26-50% 51-100%
51-100%
Figure 18. To what extent has the war in Ukraine affected your company?
Micro
Micro 39 36 9 9 5 3
Mici
Small 39 32 13 3 14 0
Large and
Mari și Medii
medium 36 13 14 0 37 0
Total
Total 39 34 10 8 7 2
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Într-o oarecare
To some extentmăsură Foarte mult
Very much În niciA un fel
little Puțin Rather
Mult
much Nu răspund
No response
Figure 19. To what extent has your company been affected by the sanctions imposed on Russia?
Micro
Micro 31 30 15 11 8 5
Mici
Small 18 17 19 19 24 3
Large and
Mari și Medii 30 21 27 2 12 7
medium
Total
Total 29 28 16 12 10 5
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Deloc
Not at all Într-o
To oarecare măsură Rather
some extent Mult
much Puțin
A little Foarte mult
Very much Nu știu/Nu răspundresponse
Don’t know/No
Figure 20. What difficulties out of the listed would your company most likely encounter during
the next 4-6 months? The data are presented as a % of the total number
Lipsa materiei
Lack prime
of raw material 20 25 13 22 19
SistareaTemporary
temporarăor sau permanentă
permanent a activității
cessation of activity 10 40 22 16 12
Plecarea angajaților
Employees’ resignation 29 29 14 14 14
Incapacitatea de atoplăti
Failure salarii
pay salaries 19 40 20 13 8
Întîrzierea plăților
Delayed cătretofurnizori
payments suppliers 22 38 20 17 3
Incapacitatea de a acoperi costurile

Failure toadministrative
cover overheads 25 39 18 12 7
Reducerea volumului de producție

Production shrinking 32 38 5 13 12
Întârzierea plăților
Delayed din partea
payments from clienților
customers 32 39 12 13 5
Creșterea prețului
Increased pricemateriei prime
of raw materials 38 33 1 8 21
Scăderea
Decreased consumului
consumption 32 40 13 6 8
Creșterea costurilor de producere

Increased production costs 41 33 5 5 16
0 10 20 30 40 50 60 70 80 90 100
Sigur da Mai mult
Definitely yes da Puțin
Rather yesprobabil Sigur nu Definitely
Rather not Nuyes
răspund No response
Business association outcomes
Figure 21. How many members does your association have? (% of the total number)
8%
25%
67%
mai puțin de 50 mai puțin de 150 mai mult de 300

Less than 50 Less than 150 More than 300
Figure 22. What issues did the members of your association encounter over the past two years?
Lipsa pieței Lack

de desfacere
of outlets 14 6 4
Concurența neloială
Unfair competition 11 9 4
Birocrație
Excessive excesivă
bureaucracy 14 9 1
Platapayment
Rent chiriei 1 11 12
Acces la inanțare
Access to finance 13 8 3
Achiziționarea de echipamente
Purchase of equipment 4 11 9
Plata impozitelor
Tax payment 9 11 4
Materie primă
Raw materials 4 9 11
Personalul
Staff 16 7 1
Altele
Other 3 7 14
0 5 10 15 20
În primul rînd Secondly

Firstly În al doilea rînd Nu ne-am confruntat
We did not face
Figure 23. How satisfied are you by the following actions approved by the Government?
Digitalisation
Pachetul package – services
de digitalizare for pentru
– servicii the business
mediulenvironment
de afaceri 12 8 4 0
Elimination of tax invoice
Eliminarea for purchases
necesității paid for
facturii iscale ptwith the bank
cu cardul card
bancar 9 5 10 0
Increase
Majorarea subsidies in
subvențiilor dinthe totaltotatla
suma investment amount
a investiției 4 9 9 2 0
Enforcement
Aplicarea of warnings
avertizărilor for offences
pentru încălcări pânăuplato5000
5 000MDL
MDL 7 8 8 10
Postponement of reporting
Amânarea raportării și aand payment
plății taxelorofșitaxes and fees
impozitelor 3 12 6 1 2
Extension ofde
Prelungirea termenelor economic activity
raportare reporting
a activității deadlines
economice 6 6 9 2 1
Compensation
Compensarea50%
50%ofdin
the valoarea
amount oftimpului
time not nelucrat
worked bydeemployees
salariați 3 8 11 2 0
Compensationprimilor
Compensarea for the first
500500
m3mde
3
ofgaz
natural gas
natural
consumed by economic operators
consumați de agenții economici
6 11 5 2 0
Subsidising
Subvenționarea employee
salariilor salaries
angajaților 3 8 10 1 2
SubsidisingSubvenționarea
temporary unemployment
șomajului and standstill
tehnic period
și staționare 2 9 10 1 2
Subsidising
Subvenționarea interest
dobânzilor la on loanssi
credite and borrowings
imprumuturi 3 7 10 2 2
VAT refund/reduced
Rambursare rate
TVA/cota redusă (6%HoReCa)
(6% HoReCa) 2 9 9 1 3
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Foarte satisfăcut
Very satisfiedSatisfăcut Nu a avutItvreun
Satisfied had noefect
effect Nesatisfacut
Dissatisfied DelocNot
satisfăcut
satisfied at all
Figure 24. In your opinion, how effective are these platforms for carrying out the
anti-crisis actions for the business environment?
Social
Rețelele de Media
socializare 7 6 4
Media
Mass media 4 9 4
Chamber of Commerce
Camera and
de comerț Industry
și industrie 1 12 4
Association ofPatronatele
Employers 5 7 5
Advisory
Consiliile Councils
Consultative petolanga
Ministries andși
ministere Agencies
agenții 0 11 6
Secretariatul de Evaluare a Impactului de

Regulatory Impact Assessment Secretariat (RIAS) 4 4 9
Reglementare (SEIR)
Economic
Consiliul Council
Economic 4 8 5
Altele
Other 3 4 10
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Foarte eiciente Destul de eiciente Ineiciente

Very effective Quite effective Ineffective
Figure 25. How do you assess the anti-crisis actions undertaken by the Government
over the past two years?
70 67%
60
50
total
number
40
numărul
total
30
din
%of
%
20
13% 13%
10
4% 4%
0
Nesatisfăcător
Unsatisfactory APuțin
littleSatisfăcător
satisfactory Satisfăcător
Satisfactory Bine
Good Foarte bine
Very good
Annexes 2
LIST OF ANTI-CRISES ACTIONS APPROVED BY THE GOVERNMENT

DURING 2020-2022
2020
1. VAT Refund Programme, Law No. 60 of 23-04-2020 on setting some measures to support the
entrepreneurial activity and amending certain regulatory acts.
2. Programme for interest subsidising.
3. Programme for subsidising temporary unemployment and standstill periods.
4. Expanding the deadlines for economic activity reporting (other than that related to taxes and
fees).
5. Postponing the reporting and settlement of taxes and fees.
2021
1. 6% VAT rate for HoReCa during emergencies.
2. Law on the mechanism of investment consideration in the areas with state security importance.
2021-2022
1. Allowances to employees temporarily unemployed worth 50% of their basic salary when the
economic operator activity is ceased in full.
2. Limited activity regime, implying that the State compensates 50% of the time not worked by the
employees due to the imposed additional constraints.
3. Increasing the Subsidy Fund by 50%.
4. Increasing the compensations for the cold period of the year from MDL 500 to MDL 700 for
socially deprived population.
5. Finance the minimum pension increase to MDL 2000.
2022
1. Compensating the first 500 m3 of natural gas consumed by economic operators.
2. Compensating the first 150 m3 of natural gas consumed by population.
3. Increasing the threshold from MDL 1000 to MDL 5000 for petty offences; warnings not fines
shall be applied for offences valued up to MDL 5000.
4. Eliminating the tax invoice for purchases settled with the bank card.
5. Monthly subsidies worth 80% of the employee salary for six months provided to the economic
operator that hires the unemployed from the following categories: young people aged between
16 and 24 years coming from deprived families, people with disabilities, people aged 50 years
and more at least for 12 months.
6. Implementing the Digitalisation Package.
7. Introducing the term of micro-producer (holding up to two hectares) to be eligible for the sub-
sidies paid in advance.
8. Increasing the subsidy from 25% to 75% of the total investment for production cooperatives.
9. Increasing the subsidy from 25% la 45% of the total investment for livestock undertakings.
10. Construction of solar panels and wind power stations on agricultural land with no need to
change the intended use of those lands, only demountable constructions are allowed for pho-
tovoltaic panels.
11. Reducing the local fee for HoReCa by 50% during the Code Red period.
Economic Resilience in Times of Crisis:
Business Concerns regarding the
Management of Crisis Effects
The Center for Entrepreneurship and Economic Policy (CEEP)

Adress: Republic of Moldova, Chisinau, 45 B, Puskin str., MD-2005
E-mail: office@cape-md.org
Facebook: @CAPEMoldova
Website: www.cape-md.org
The Center for Entrepreneurship and Economic Policy (CEEP) is an independent analytical center,
which has the mission of supporting the development of democracy and the functioning economy
through public policies focused on private sector development and stimulating private initiative.

EN - Reziliența Bussinesului Pe Timp de Criză - 2022

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

EN - Reziliența Bussinesului Pe Timp de Criză - 2022

Uploaded by

Copyright:

Available Formats

ECONOMIC RESILIENCE

2022 Ion BUTMALAI

I. Crises impact on the moldovan business environment.................................. 7

II. Business environment proposals to overcome the current crises.............. 16

III. Conclusions and recommendations................................................................ 20

CAPE Centre for Enterprise and Economic Policy

CEO Chief Executive Officer

CIPE Center for International Private Enterprise

CIS Community of Independent States

COVID-19 Coronavirus Disease 2019

GDP Gross Domestic Product

HoReCa Hotels, Restaurants, Catering

NBS National Bureau of Statistics

SMEs Small and Medium-sized Enterprises

VAT Value-added Tax

Once the war in Ukraine commenced, the sit-

Competitive business climate:

↘ Developing programmes aimed at subsidis-

High costs, lack of skilled staff and unfair competition –

Source: CAPE Survey

Total Large and Medium Small Micro

Source: CAPE Survey

Figure 3. Company economic indicators after two years

Sales Profit Number of customers Number of employees

Source: CAPE Survey

Anti-crises actions applied by the business environment

Figure 4. Measures undertook by companies over the past two years

Moving the activity

Business environment perception towards anti-crisis

Subsiding temporary unemployment

Compensation of 50% of the time not worked

“We are dissatisfied by the how important

In the same vein, there are shortcomings in

In addition, the business people think that un-

Figure 7. War impact on trade relationships with Russia and Ukraine

Source: CAPE Survey

Source: CAPE Survey

Figure 9. Businessmen’ views for the next six months

Incapacitatea de a acoperi costurile

Reducerea volumului de producție

Creșterea costurilor de producere

• Ability to take quick decisions in crises;

• Efficiency and competence of governance to implement the measures;

• Bureaucracy and corruption;

• Political will (of the Parliament majority);

• War and geopolitical situation;

• Lack of natural resources;

• Eligibility criteria for undertakings;

• Legal and regulatory framework;

• Information sufficiency (or insufficiency);

• Consultations on anti-crisis actions (existing or non-existing) within working groups.

Measures to mitigate the pandemic crisis

Measures to mitigate the economic crisis

Measures to mitigate the energy crisis

Measures to improve the public-private dialogue

▶ Promoting the independent platforms

▶ Reforming the education system focused

SURVEY: ASSESSING THE PRIVATE SECTOR PERCEPTION

Research Methodology ● 13 in-depth interviews with the directors of

The participants were provided with the Sur-

Table 1. Breakdown by size

Large Medium Small Micro Total

Foarte eiciente Destul de eiciente Ineiciente