The World Bank Board of Directors today approved an additional financing credit to the Republic of Moldova in the amount of US $24 million for the Competitiveness Enhancement Project.
The additional financing will complement the existing allocation of US$ 14.3 million and will be used to scale-up matching grants to Moldovan businesses in improving their productivity, and provide lines of credit for investments and working capital needs of Moldovan export-oriented enterprises. "The Competitiveness Enhancement Project has supported Moldova's progress on the business environment agenda," said Melanie Marlett, World Bank Country Manager for Moldova. "It has helped domestic companies do business more easily, and more competitively. The additional financing will support Moldovan exporters in accessing new credit lines, which are so vital given the current economic crisis, and help Moldovan enterprises to improve their management and production practices."
The US $24 million will help exporting companies to access credit, which has been drastically reduced due to the socio-economic crisis affecting Moldova. The additional financing will also be used to support improvements in labor skills and management practices to increase the productivity of Moldovan companies. The rationale for these interventions is the creation of a favorable climate for Moldovan businesses to flourish and generate new jobs.
The Moldova Competitiveness Enhancement Project was launched in February 2006. To date, the Moldova Competitiveness Enhancement Project has assisted over 130 companies to implement international quality standards, which has led to increases in sales and product quality. It has fully equipped three national metrology laboratories, with another five to be completed by end of 2010. In addition, through reforms in the regulatory sector, the project has contributed to reducing the regulatory burden measured as management time spent on complying with regulations by 35% (from 19% in 2005 to 11% in 2008), and helped create a legal framework for credit bureaus in the country, which will facilitate easier access to financing for businesses. The project's objectives are to:
- improve the business environment in Moldova, through support to the regulatory reform agenda for the enterprise sector;
- modernize metrology, standards, testing and quality (MSTQ) systems, through strengthening national capacity in MSTQ and provision of internationally acceptable MSTQ services;
- provide access for enterprises to MSTQ services, through co-financing the implementation of international quality standards by Moldovan companies; and
- facilitate access to finance, through establishment of credit bureaus in Moldova.
