PARLIAMENT REJECTS RESOLUTION ON VOTE OF NO CONFIDENCE IN FINANCE MINISTER

The Parliament rejected on Thursday the Resolution on vote of no confidence in Finance Minister Octavian Armasu. Only 28 MPs of 66, present in the meeting room, voted for the proposal.

The Party of Socialists, the Communist Party and the Liberal Democratic Party faction MPs stated that they will support the vote of no confidence.

Leader of the ruling Democratic Party ironically said that he has just watched the fourth episode of the serial movie with the name “Vote of no confidence”, the next episodes of which will be screened next week.

“The opposition gets political dividends from all this procedure of vote of no confidence”, he said.

The Finance Minister presented to the Parliament what he managed to do within 5 months of work.

He reminded deputies that in early 2016, the country borrowed money from banks by means of placing government securities, whose yield exceeded 26%, while currently this rate fell to 11%.

“Despite skeptical moods in the society, we managed to achieve understanding with the International Monetary Fund (IMF) and now we are waiting for the Fund’s mission to come to Moldova with mandate to conduct negotiations on cooperation program, which will help defrosting Moldova’s external financing”, the Minister said.

He recognized that over 10 billion lei in the 2016 budget account for external financing and only 46% are directly connected with the mandatory condition for signing the Cooperation Program with IMF.

Socialist Leader Igor Dodon wondered why in the Memorandum with the National Bank on issuing government securities for credits the bank provided to three problematic banks, the rate of 5% is mentioned, but not 0.5%, at which the NBM credited the banks?

Armasu said that such yield is due to the NBM’s capitalization, the macroeconomic balance and external partners’ recommendations.

Asked whether it is an IMF’s condition for signing the Cooperation Program with the Moldovan Government and the NBM, the Minister said the Fund did not impose such condition, but this does not cancel the necessity of adopting the draft on issuing government securities instead of the NBM credit to three problematic banks.

“In absence of this law we will get problems in negotiations with the IMF on new program with Moldova”, he said.

According to Dodon, the Ministry should have agreed with the 0.5% interest rate on government securities, which would allow saving about 540 million lei over the first year.

“While now Moldova will have to repay not 13.6 billion lei, but 21 billion, which will be laid on shoulders of taxpayers. 7 billion lei – is the annual budget of the pension fund”, the MP said.

The Minister pointed at the fact that the rate is not fixed and that it will be reduced depending on the situation on the currency market. A part of these securities will be repaid at the expense of the NBM.