IMF国际货币组织全球-Republic-of-Moldova_Selected-Issues_20页_745kb

Summary of the Governance Assessment of the Republic of Moldova

Core Content

This document presents a governance assessment of the Republic of Moldova, prepared by the International Monetary Fund (IMF) as background for a periodic consultation. It evaluates key areas of governance and institutional frameworks, focusing on corruption, rule of law, AML/CFT, regulatory framework, fiscal governance, and financial sector oversight. The assessment is based on internationally comparable data, technical assistance reports, and expert evaluations, highlighting vulnerabilities and policy recommendations for improvement.

Main Issues and Key Findings

1. Corruption

• Moldova is perceived to have systemic corruption, ranking poorly in both grand and petty corruption indicators.
• Anti-corruption institutions and legislation exist, but enforcement is weak, linked to low independence, political appointments, and weak whistleblower protection.
• Public sector corruption is high, with insufficient transparency in budget and procurement processes.
• A significant share of firms expect to pay bribes, especially for infrastructure-related activities such as construction permits and utility connections.
• AML/CFT framework is important in combating corruption, but vulnerabilities remain in preventing illicit financial flows, detecting money laundering, and ensuring transparency of beneficial ownership.

2. Rule of Law

• Rule of law is perceived as weak in Moldova, particularly in criminal and civil justice, regulatory enforcement, and constraints on government powers.
• The judiciary is not independent, with low public trust and perceived corruption.
• Investor protection is weak, with scores significantly below the EU average in expropriation and minority shareholder protection.
• Contract enforcement is costly and time-consuming, and property rights are not adequately protected in practice despite legal frameworks.

3. Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT)

• AML/CFT vulnerabilities facilitate corruption and undermine financial stability.
• The framework is inadequate, with weak enforcement and limited international cooperation.
• Key areas for improvement include:
  • Preventive measures to stop illicit proceeds from entering the financial system.
  • Transparency in beneficial ownership information.
  • Criminal justice to detect and prosecute money laundering.
  • International cooperation for asset recovery and cross-border investigations.

4. Regulatory Framework

• Market competition is limited, with Moldova ranking below several countries in the Global Competitiveness Index.
• The state-owned enterprise (SOE) sector is large and hinders private investment due to non-competitive practices, legal monopolies, and price controls.
• Energy sector regulation is particularly weak, with politically influenced and non-transparent tariff-setting.
• Trade regulation is burdensome and corrupt, with slow procedures and high costs for importers.
• Regulatory transparency is relatively good, but procedures for construction permits are problematic.

5. Fiscal Governance

• Revenue mobilization is weak due to low tax efficiency, corruption, and extensive tax exemptions.
• Tax evasion and informality are significant, leading to revenue losses of about 3.5% of GDP.
• Public spending is inefficient due to poor procurement practices and inadequate public investment management.
• Fiscal transparency is above average, but monitoring of SOEs and joint-stock companies is incomplete, and subnational fiscal risk management is lacking.

6. Financial Sector Oversight

• Weak financial regulation and supervision can lead to macroeconomic instability.
• Significant progress has been made in the banking sector since the 2016 FSAP, particularly in shareholder transparency and fitness and probity.
• Supervisory capacity and autonomy remain key challenges for effective financial oversight.

Policy Recommendations

• Strengthen anti-corruption institutions and ensure their independence and effectiveness.
• Improve judicial independence and public trust in the legal system.
• Enhance AML/CFT enforcement, including better identification of beneficial owners and international cooperation.
• Reduce SOE dominance and promote fair competition.
• Improve energy sector regulation by ensuring transparent and timely tariff adjustments.
• Streamline trade procedures and increase automation to reduce corruption and inefficiencies.
• Address the informal economy and tax evasion through better revenue administration and tax compliance.
• Improve fiscal transparency and public participation.
• Strengthen public investment management and ensure consistency and coverage of the framework.
• Enhance the capacity of the financial sector supervisory agency to ensure autonomy and effectiveness.

Conclusion

Moldova faces significant governance and institutional challenges, particularly in corruption, rule of law, and financial sector oversight. These weaknesses hinder economic growth, investor confidence, and public accountability. Addressing these issues requires comprehensive reforms, enhanced enforcement, and international cooperation, especially in the context of post-banking fraud recovery. The IMF emphasizes the importance of systematic and evenhanded analysis to guide these reforms and improve the country's macroeconomic stability and competitiveness.