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‘Republic of Moldova and the Russian Regions’ – Moldo-Russian Economic Council Session
6 June 2019
15:00—16:15
KEY CONCLUSIONS
Developing relations is appealing to Russia and Moldova

People of Moldova see Russia as a strategic partner <…> It is not just about the economy. Historically we have friendly relations — Igor Dodon, President of the Republic of Moldova.

In terms of investment returns, the potential [of Russian investment in Moldova, – Ed.] is enormous. There are huge opportunities in various segments of the economy — Boris Titov, Presidential Commissioner of the Russian Federation for the Protection of Entrepreneurs’ Rights.

A little over a year ago, <…> we saw the first efforts to build the infrastructure, to start appropriate events and development institutes. The First Moldovan-Russian Forum was prepared and took place with the support of Mr. Dodon. <...> The number of participants – 200 business people from Russia and almost 500 business people from Moldova – has proved there is enormous interest and a need for this platform that appeared in a timely fashion. <…> The Moldo-Russian Economic Council has been established — Andrei Nazarov, Co-Chairman, Delovaya Rossiya (Business Russia).

We plan to open a retail chain in Moldova — Andrey Pavlov, Founder and President of Zenden Group.

Economic cooperation between the countries is on the rise

We see that the negative trend in trade that existed before 2016 <…> gave way to growth. Turnover has been rising little by little – 10–15% a year. <…> Russia is number one investor in Moldova’s economy. <…> We have over 900 joint operations. I think we still have room for growth, for further development — Igor Dodon, President of the Republic of Moldova.

Over the last years, our economic relations have demonstrated strong performance. <…> In the first quarter of this year, the turnover has seen the increment of 10.5%. And that happens after a year-over-year growth of 30% in 2018 — Dmitry Kozak, Deputy Prime Minister of the Russian Federation.

ISSUES
No cooperation on the government level

Over the last 2.5–3 years, we have not seen any cooperation on the government level — Igor Dodon, President of the Republic of Moldova.

The relations on the government level have been completely frozen <…> Moldovan officials have even been banned from visiting the Russian Federation — Dmitry Kozak, Deputy Prime Minister of the Russian Federation.

Trade limitations

Despite the growth, the turnover is behind what it used to be in 2012, and Moldovan export is three times smaller — Elena Gorelova, Adviser to the President of the Republic of Moldova on Economic Issues.

We have 286 items in gas turbine parts <...> Today, we make only 27 of them. And those 27 items – we already have the protocol for that – will go to the facility in Omsk starting from 1 January 2020. It means this whole matter will be over — Olga Burtseva, General Director, Plant Topaz JV JSC.

There are complications. Unfortunately, we do not export walnuts to Russia — Nikolay Cherniy, General Director, AMG – Agro Management Grup.

Agricultural product and energy sources dominate in trade

Moldova is an agricultural complex, and Russia is about energy. It is a step back compared to Moldo-Russian relations in the Soviet Union – they involved industry, military, technology, etc. — Elena Gorelova, Adviser to the President of the Republic of Moldova on Economic Issues.

SOLUTIONS
Restoring the dialogue between the governments

These days – these hours even – give us a chance to create a government in Moldova <…> If this government is formed, it will be formed based on the principles the President insists on – reasonable foreign policy, strategic partnership with the Russian Federation, clear rules and guarantees for the Russian businesses that enter Moldova — Igor Dodon, President of the Republic of Moldova.

Everyone – including the government [of Moldova, – Ed.] – roots for defreezing relations, fully restoring cooperation and the work of intergovernmental agencies that bear the responsibility to develop trade and economic relations. <…> We need to overcome this political crisis as soon as possible and start putting things back together. <…> The key issue is restoring the work of the commission — Dmitry Kozak, Deputy Prime Minister of the Russian Federation.

Developing cooperation on the regional level

We have vast interregional cooperation. <…> 71 Russian regions have agreements and relations with the Republic of Moldova. This is a huge potential to boost cooperation. <…> It is thousands of jobs both in the Republic of Moldova and in the Russian Federation — Dmitry Kozak, Deputy Prime Minister of the Russian Federation.

Last week, for the first time in the history of our Republic the President of Moldova paid a visit to the republic of Bashkortostan. <…> [All parties] felt that businesses share an interest. This is probably one of the key outcomes of the visit. <…> Three agreements were signed during the visit — Radiy Khabirov, Acting Head of the Republic of Bashkortostan.

There was a specific agreement to create a trade house based on two chambers of commerce and industry. <…> We are planning a business mission [to Moldova, – Ed.] — Timur Khakimov, President, Chamber of Commerce and Industry, Republic of Bashkortostan.

Developing industrial ties

The industrial potential that still exists in Moldova should be involved in production chains. <…> We could give the Moldavian economy a totally different look through Russian investment. It is not just wine, fruit and high-quality agricultural materials. If Moldavian economy is part of the big Russian economy, it will resolve many economic and social issues — Elena Gorelova, Adviser to the President of the Republic of Moldova on Economic Issues.

98% of the [enterprise’s] capital is Russian. <…> Number one area of expertise [at Topaz] is instrumentation. Then it is high-precision mechanics. Number three is electrophysical material processing technologies. 50–60% of the volume is machine building, and the remaining two are the so-called smart areas, which are 25–20% each. Our facility has an R&D cluster. <…> We collaborate with all technics- and technology-oriented colleges in Moldova. <…> We collaborate with Russian facilities and use Russian parts — Olga Burtseva, General Director, Plant Topaz JV JSC.

We have been cooperating with Rostselmash for 20 years. We have done a lot for Rostselmash to look at their partners from a different perspective. We have created new standards and involved the company’s top management in this process — Vasiliy Kirtoka, President, DAAC Hermes.

Protecting Russian investment

When you bring in investment, there should be a system of assistants that protect those institutes. <…> We would be highly interested in seeing a commissioner – if we apply our terminology – that would protect both Moldavian and international entrepreneurs — Boris Titov, Presidential Commissioner of the Russian Federation for the Protection of Entrepreneurs’ Rights.

We need a clear instrument to protect Russian investment in Moldova. <…> There a proposal to start collaborating on that — Tatyana Mineeva, Vice President, Committee for Ecology, Delovaya Rossiya (Business Russia); Chairman, Public Council at the Department of Education of Moscow, Business Rights Commissioner, Moscow City Government.

Revoking trade limitations

Removing customs duties resulted in an increase in apple export of 27% [year-over-year, – Ed.] over the first three months [of 2019, – Ed.] — Ion Perju, Adviser to the President of the Republic of Moldova on Agro-Industrial and Public Administration Issues.

The goal is to restore the turnover to the level of 2012 in the nearest future. To reach it, we need to lift the existing limitations. They concern customs duties for 19 categories of Moldavian goods — Elena Gorelova, Adviser to the President of the Republic of Moldova on Economic Issues.

Updating the lists of Moldavian exporters

We need to review and update the lists of [Moldavian, – Ed.] exporters. This is a primary objective — Igor Dodon, President of the Republic of Moldova.

As of today, 130 [Moldavian, – Ed.] manufacturers have the right to export to the Russian market. These lists were created back in 2014. They have never been reviewed. They include 130 exporters, and only half of them export. These lists need to be reviewed — Ion Perju, Adviser to the President of the Republic of Moldova on Agro-Industrial and Public Administration Issues.

The material was prepared by the Russian news agency TASS