Supporting the development of the private sector in Moldova by transposing its needs into public policies, but also by involving it in the decision-making process on different platforms is one of the objectives pursued by the Center for Entrepreneurship and Economic Policies (CAPE). To this end, in partnership with the International Center for Private Entrepreneurship (CIPE), the current situation of the private sector as a result of the war in Ukraine was assessed. The findings of the evaluation, as well as the recommendations for overcoming the current challenges, were discussed during the presentation "Advocacy priorities of Moldovan SMEs for overcoming challenges in the context of war", held on November 30.
The presentation addressed the macroeconomic effects of the war in Ukraine on the economy of the Republic of Moldova, the resilience of the Moldovan business environment during the war, but also the importance of involving the business environment in a decision-making process.
"Our analytical center aimed to identify and analyze the impact of the war in Ukraine on the economy and the private sector in Moldova, the risks and opportunities felt by SMEs, including in the Transnistrian region, in order to develop practical recommendations for immediate anti-crisis measures", said the director of CAPE, Tatiana Lariușin.
The war in Ukraine represents a great challenge for the private and public sector, but at the same time a great opportunity to rethink the country's economy. Thus, on the one hand, the increase in prices for energy resources, including the suspension of electricity supplies from Ukraine, created a state of uncertainty within the private sector. The disruption of logistics chains affected supply and trade chains, and the blockade of the port of Odessa affected the exchange of products. On the other hand, the reorientation of exports to the EU market ensured stability for economic agents, and imports from Ukraine for the first half of 2022 compared to 2021 increased by 34.4%, and exports for the same period by 542%.
"Considering the current risks, it is necessary for political factors, business associations and the expert community to outline a series of areas that must be addressed in order to identify complex solutions to solve them. In this process, it is important to note that a strong and competitive private sector will contribute not only to economic and social development, but also to the strengthening of democracy and public institutions", said the CAPE program director, Ion Butmalai.
The latest economic developments aggravated by the massive energy crisis and the war in Ukraine have put pressure on the private sector and generated significant risks for economic stability. According to the report signed by CAPE, Economic resilience in times of crisis: business concerns regarding the management of the effects of the crisis states the lack of a strategic vision on the part of public institutions regarding the economic sectors that need to be developed and what the private sector should look like in the long term. At the same time, the business environment is subject to a rapid adaptation to reality.
"The business environment is facing a difficult period, involving various economic, logistical and social challenges, which, at the same time, could be turned into opportunities. Talking to the business environment and conducting an express survey among them, we can conclude that the current situation has significantly affected their activity. Respectively, entrepreneurs' profits have decreased, investments have decreased, domestic producers have lost their competitiveness, and raw material prices have increased substantially", says Veronica Russu-Marin, CAPE program director. According to her, it is necessary to streamline cross-border traffic and interconnect control services in the border information system; supporting the sustainability of the domestic producer, the application of trade liberalization mechanisms, but also the efficiency of the public-private dialogue.
At the same time, the business environment is directly interested in participating in the decision-making process, business associations wanting to get involved as efficiently as possible in the process of elaboration and consultation of draft normative acts. Moreover, this right is stipulated by law. In this sense, the Center for Entrepreneurship and Economic Policies supports the improvement of the regulatory framework, the implementation of existing transparency requirements in the Parliament, the modernization and creation of new tools to make the consultative process more efficient.
"The lack of public-private dialogue causes an enormous discrepancy between the agenda of public authorities' priorities and the agenda of business, which is felt in entrepreneurial activity and leads to the expansion of the informal sector of the economy and the reduction of state budget revenues", emphasizes the CAPE legal expert, Viorel Pîrvan.
We remind you that on November 1, the Center for Entrepreneurship and Economic Policies organized the round table "Permanent consultative and cooperation platform at the level of the Parliament: condition for the accession of the Republic of Moldova to the European Union". Representatives of the business environment and civil society, the measures to make the consultative process in the Parliament more efficient, assumed by the Republic of Moldova in the process of joining the European Union, were addressed. In the view of the business environment, the cooperation platform at Parliament level is a necessary tool and effective consultation in the decision-making process and creates the conditions for a sustainable partnership between business and Parliament.
In order to improve the transparency in the activity of the Parliament and to make the consultative process more efficient, a series of measures need to be taken, which refer to the regulatory framework, the existing transparency tools and new tools that need to be created.
Among the most important recommendations are the systematization of the rules regarding transparency in the parliamentary decision-making process in a single normative act, by including them in the current Regulation of the Parliament, in the future Parliamentary Code; taking measures to improve the process of organizing and conducting public consultations in permanent commissions, with mandatory information and consultation of business associations, employers' and professional associations; and last but not least, the mandatory institutionalization of the cooperation platform at Parliament level as a consultation tool in the decision-making process, with the regulation of the rules and procedures for the organization and activity of the platform.
The Center for Entrepreneurship and Economic Policies believes that the implementation of these recommendations will make the consultative process in the Parliament more efficient, in the context of the commitments assumed by the Republic of Moldova as a candidate country for the European Union, and as a result the dialogue with the private sector and the level of transparency will be strengthened, responsibility will increase the institution of Parliament, will improve public confidence and the image of Parliament.
The Center for Entrepreneurship and Economic Policy (CAPE) is an independent analytical center whose mission is to support the development of democracy and a functioning economy through public policies focused on the development of the private sector and the stimulation of private initiative. Through this, CAPE supports the participation of the business environment in the democratic process, the promotion of well-structured public-private dialogue, offers support to associations through expertise, facilitating the introduction of international anti-corruption and conduct standards, training and knowledge transfer.
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