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Moldova has made important steps toward further integration with the EU. In June 2013, the authorities concluded the technical negotiations on the Association Agreement and creation of a Deep and Comprehensive Free Trade Area (DCFTA), which is expected to bolster trade between Moldova and the EU, improve competition and the business environment, improve quality and safety standards and attract new foreign investment. The Association Agreement and DCFTA were initialled in late-November 2013, and signing and entry into force are planned for 2014.
Moldova is an early transition country with significant transition challenges across virtually all sectors of the economy. In the next Strategy period the Bank will focus on addressing the following strategic priorities:
Creating the enabling conditions for private sector development. The Moldovan economy still faces significant challenges deriving from a weak business environment and poor corporate governance, which must be strengthened in order to increase competitiveness and attract more investment. Governance and transparency in the banking sector are particular concerns which must be addressed to develop local capacity and create a platform for attracting investment.
Promoting European standards and regional integration. Adopting European standards is essential to enhance the competitiveness of Moldova’s manufacturing and agribusiness sectors. In parallel, improving transport and communications links is vital to facilitate Moldova’s integration into European and wider regional markets. Public sector operations should target those areas that help stimulate sustainable growth, driven by net exports and based on productive industries, and do not overburden the state budget.
Enhancing commercialisation and sustainability of municipal enterprises. Moldova’s municipal utilities suffer from decades of neglect. Urgently needed capital investments are deterred by the below cost recovery levels of tariffs. The Bank will therefore focus on encouraging commercialisation and regulatory reform, including tariff reform, to strengthen the sustainability of municipal transport, water and district heating providers.
The Bank will continue to cooperate closely with other international financial institutions and multilateral and bilateral partners, including the European Union, in its operations as well as through policy dialogue to maximum transition impact in Moldova.
Last updated 12 May 2014