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  • The enabling environment for sustainable enterprises in Moldova

    for

  • The enabling environment for sustainable enterprises

    in Moldova

  • Copyright © International Labour Organization 2019

    First published 2019

    Publications of the International Labour Office enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to ILO Publications (Rights and Licensing), International Labour Office, CH-1211 Geneva 22, Switzerland, or by email: rights@ilo.org. The International Labour Office welcomes such applications.

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    ISBN: 9789220315132 (print)

    9789220315125 (web pdf)

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  • iii

    for

    Foreword Enterprises thrive in a business environment that is conducive to their development and growth. It is therefore important to not only provide assistance to enterprises and their support organisa- tions but also put in place a conducive regulatory, policy and institutional environment that enables enterprises to start up, expand and sustain themselves. As part of its mandate to created decent work, the International Labour Organization (ILO) focusses on job creation, social protection, social dialogue and rights at work. This includes the promotion of economies that generate more and better jobs in sustainable enterprises. Against this background, the ILO has developed the Enabling Environment for Sustainable Enterprises (EESE) methodology as a way to provide evidence-based rec- ommendations on how to improve the business environment for sustainable enterprises. This tool focusses on the political, economic, social and environmental aspects of doing business and has been applied in more than 40 countries.

    In 2013, the ILO assisted the National Confederation of Employers of the Republic of Moldova (CNPM) to conduct an EESE assessment. The consultations between government and the employers on the results of the assessment led to reforms simplifying the registration and licensing proce- dures, reducing the number of state inspections and control bodies, improving tax policies and administration, approving a new law on public procurement, making labour law more flexible and developing the legislative framework for dual training and apprenticeship.

    As a follow up the ILO has been requested to support a new tripartite assessment of the enabling environment and identify priority areas in which further reforms are needed. The new assessment is based on a desk review of new findings on the business environment in Moldova, interviews with officials from government, employers, and trade unions, and a perception survey among 400 busi- ness owners and 107 workers. ILO tripartite constituents validated the report during a workshop in September 2019.

    Based on the identified business environment constraints, the tripartite partners have also developed an action plan on (i) the enabling legal and regulatory environment; (ii) education, training and life- long learning, and (ii) social dialogue. This action plan proposes concrete measures to improve the enabling environment for sustainable enterprise development in Moldova.

    The EESE assessment was carried out under the technical supervision of Judith van Doorn from the Small and Medium Enterprises (SME) Unit, of the ILO headquarters in Geneva, in collaboration with Iulia Drumea, Employers’ Specialist (ACT/EMP) from the ILO Decent Work Technical Support Team and Country Office for Central and Eastern Europe in Budapest and Ala Lipciu, the ILO National Coordinator in Moldova.

    Special appreciation is due to Axa Management Consulting for conducting the perception survey, to Shusuke Oyobe for his technical inputs and to Saumya Premchander for drafting the final report.

    We hope that, with this information, the government and social partners will be encouraged to make further progress in addressing some of the key constraints, with the ILO support.

    Markus Pilgrim, Director, ILO DWT/CO Budapest

    Dragan Radic, Head SME Unit, ILO Geneva

  • Kishinev

    MOLDOVA

  • v

    Table of Contents Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .iii

    Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii

    Abbreviations and Acronyms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .xi

    1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1 .1 Survey Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

    1 .2 Limitations of the Survey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

    2. Political Elements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 2 .1 Peace and Political Stability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

    2 .2 Good Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

    2 .3 Social Dialogue and Industrial Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

    2 .4 Respect for Universal Human Rights and International Labour Standards . . . . . . . . . . . . . . 25

    3. Economic Elements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 3 .1 Sound and Stable Macroeconomic Policy and Good Management of the Economy . . . . . . . 34

    3 .2 Trade and sustainable economic integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

    3 .3 Enabling legal and regulatory environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

    3 .4 Rule of law and secure property rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

    3 .5 Fair competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62

    3 .6 Information and communication technologies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

    3.7 Access to financial services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74

    3 .8 Physical infrastructure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81

    4. Social Elements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87 4 .1 Entrepreneurial culture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88

    4 .2 Education, training and lifelong learning . . . . . . . . . . . .