Press Release

Wednesday, September 18, 2002

IMF PLEADS AGAINST THE DECREASE OF TAXES

IMF is worried in regard to the existence in the draft of law on Budget for the year 2003 of "some pressures in regard to the decrease of taxes", AP FLUX informs.
Permanent IMF representative in the Republic of Moldova, Edgardo Ruggiero, declared to the press on Wednesday that "now is not the appropriate time for the drastic decrease in taxes". According to him, this could be accepted only when there exist concrete measures to increase revenues from other sources, "measures which would be directly identified, which would increase the taxable base and would improve the fiscal system in general".
Deputy director of Division B in the Europe II Department, Marta Castello-Branco declared in this connection that "IMF continues to plead against any decrease in taxes, because this is not correct".
In regard to fulfillment of the 2002 Budget, Edgardo Ruggiero mentioned that the IMF mission found "some pressures on the Budget in the fourth trimester of the current year". He specified that the Ministry of Finances will have a "pretty difficult period".
"For the Republic of Moldova is important to improve the business development environment. This is much more decisive when foreign investors are decided to invest in a country, more decided than the actual rate of taxes. In this sense is required a decrease in the cost for initiation of small business", Ruggiero concluded, cited by AP FLUX.

IMF PLEADS AGAINST CANCELLATION OF PRE-SHIPMENT INSPECTION OF GOODS

Deputy director of Division B in Europe II Department, Marta Castello- Branco declared on Wednesday, at a press conference, that IMF is "absolutely against cancellation of pre-shipment inspection of goods", AP FLUX informs.
According to her, if there is introduced the exemption from pre-shipment inspection, there will be decreased the possibility of higher income. She denied the fact that she had had an agreement with the officials from Chisinau in regard to cancellation of this service.
Marta Castello-Branco mentioned that the existence of a pressure from behalf of the private sector to cancel this program gives IMF the possibility to believe that "this program is successful". As a result of examination of the pre-shipment inspection activity was observed that the export has increased. "We believe that it is not correct to abandon now an efficient program", underlined Castello-Branco.
She also said that any technical problems that appear in connection to implementation of this inspection may be solved with the administration of the company which offers these services. "All the pre-shipment inspection programs from the world are seen as a transition stage. These are interrupted only when the country's customs are ready to perform this service. The inspection may last 2-5 years and not 6 months", specified Castello-Branco.
At the end of August of the current year, the Government sent IMF its protocol decision through which it solicits initiation of negotiations on elimination from the memorandum of compulsory use of pre-shipment inspection of goods.
According to the Report of the inter-departmental Committee on evaluation of the activity developed by SGS company, the pre-shipment inspection "did not contribute essentially to increase of budget accumulations and to solution of problems connected to contrabanda".
Marta Castello-Branco stayed in the Republic of Moldova, during September 10-18th, on a work visit, AP FLUX also informs.

IMF REPRESENTATIVE STATES THAT THE POSSIBILITY OF THE REPUBLIC OF MOLDOVA TO GO TO THE PARIS CLUB TO REQUEST DEBT RESTRUCTURING "IS NOT EVIDENT"

The possibility of the Republic of Moldova to go to the Paris Club to request debt restructuring "is not that evident", deputy director of Division B in Europe II Department, Marta Castello-Branco, declared on Wednesday, at a press conference, AP FLUX informs.
According to her, the Paris Club must make sure that the country that requests reorganization or forgiveness of debts has not other ways to solve the problem. "Those from the Club from Paris must be convinced that the country that requests this, follows some policies that are correct from the financial point of view", added Marta Castello-Branco.
Paris Club has certain indicators which are used to establish the country that need help more. "In present, these indicators, for the Republic of Moldova, are not that bad, as these are in some countries that stay in line", mentioned the expert.
The cited source specified that a more clear position regarding the existence or nonexistence in the Republic of Moldova of a financial disparity will be presented in October, AP FLUX also informs.

IMF REPRESENTATIVE STATES THAT THE REPUBLIC OF MOLDOVA WILL BENEFIT, IN 2003, FROM "TOO FEW CREDITS"

IMF might review its forecast regarding Gros Domestic Product (GDP) for the Republic of Moldova, which was of 5 percent of this year, AP FLUX informs.
Deputy director of Division B in Europe II Department, Marta Castello- Branco declared, on Wednesday, to the press, that this forecast was made on basis of "better results from this year". At the same time, she specified that as a result of a review of the forecast, it will be not higher than 6 percent.
Even more, Marta Castello-Branco said that "by the end of the current year, in the Republic of Moldova the inflation might grow".
Referring to the offer of non-reimbursable credits for the Republic of Moldova, the expert mentioned that "next year, the Republic of Moldova, unfortunately, will not benefit from too many credits". According to her, for Tarlev Government, the most important is to obey all the policies agreed upon with WB and IMF.
In the first half of the current year, compared to the same period of the last year, GDP increased by 6.4 percent and represents, in current prices, 9 billion 6 million 152 thousand lei, state the specialists from the Statistics and Sociology Department, AP FLUX also informs.