OREANDA-NEWS. Over the past few years Moldova has been rolling out an ambitious reform programme which has been rewarded with average growth rates of 7 per cent from 2000 to 2005. However, recent developments have exposed the country’s over-reliance on the Russian market for exports of agricultural products and high external energy dependence. Further efforts are needed to decrease this dependence by expanding the base of the country’s economy and diversifying its export markets, the EBRD says in its new strategy for Moldova.

According to a respective press-release of the EBRD, last year growth declined to 4 per cent because of Russia’s ban on Moldovan wine imports and the doubling of gas prices. Despite difficult circumstances the country continued a prudent monetary and fiscal policy. Remittances from Moldovans working abroad continue be an engine for economic growth.

In assessing Moldova’s development the new strategy identifies the following challenges: improving the business climate, supporting economic diversification and reform of the energy and municipal sector. Moldova needs to reinforce the rule of law, reduce government interference in the economy and step up its fight against corruption.

The EBRD will pursue the following operational objectives:
• Private Enterprise: The Bank will continue to pursue investment opportunities in all enterprise sectors and will facilitate foreign investment. Working capital may be provided to agribusinesses under the recently established warehouse receipt system. The Bank will continue to provide non-financial support to private enterprises through its Turn Around Management and Business Advisory Services programmes.

• Financial Institutions: The EBRD will seek to extend its cooperation to new partner banks which meet EBRD's transparency and corporate governance standards and will assist in the development and promotion of new financial instruments such as mortgage financing, leasing and energy efficiency credit lines. The Bank may consider further equity investment in banks, leasing companies and mortgage providers and will explore opportunities to support the non-banking financial sector.

• Infrastructure: To enable Moldova to take full advantage of its new EU neighbourhood status, the Bank will give priority to projects that promote regional integration. The Bank is committed to resume its municipal infrastructure lending and will - to the extent possible - co-finance public infrastructure projects with other IFIs and donors.

Moldova is part of the EBRD’s Early Transition Countries Initiative launched in 2004 to stimulate market activity in the Bank’s lowest-income countries of operations by using a streamlined approach to financing more and smaller projects, mobilising more investment, and encouraging economic reform. The initiative has allowed the Bank to increase its activities in Moldova.

To-date, the EBRD has signed 59 projects in the country worth almost ?230 million .