Page 49 - BNE_magazine_06_2019

bne June 2019 Eastern Europe I 49
Moldova’s banking sector turning the corner
Moldova has long been a money-laundering black hole. Then in 2014
they had a shock when more than $1bn was stolen from the bank sector – equivalent to 15% of GDP.
Belatedly the government is now responding. Stakes in three of the country's biggest banks, which together account for about 80% of the sector’s assets, have been sold to the European Bank for Reconstruction and Development (EBRD) and private investors and the central bank has been given real teeth to enforce regulations.
bne IntelliNews editor-in-chief Ben Aris talks to special advisor to the president and head of strategic planning at Moldova-Agroindbank (MAIB) Corneliu Munteanu and asks if Moldova’s banking sector has turned the corner.
Corneliu Munteanu
special advisor to the president of Moldova, head of strategic planning at MAIB
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seriously expect any of the May Decree goals to be met: the point of setting such ambitious targets was to light a fire under the bureaucracy and the goal is to get the reforms moving rather than actually achieve any of the targets.
However, Brookings argues that even with less than 4.4% growth poverty can be halved by 2024.
“This can be done via additional redis- tribution, for example, in terms of social assistance and transfers. We estimate such additional redistribution to amount to around 0.27% of GDP per year. Of course, accelerating economic growth would make the task of poverty reduc- tion easier. If Russia were to grow at 3.2% (slightly above the global growth rate of 3%), under perfect targeting, we estimate such additional redistribution to be only around 0.10% of GDP,” say Samuel Freije-Rodriguez, Aleksandra Posarac and Apurva Sanghi, the authors of the report.
And the authors echo other analysts
by pointing out that any progress is welcome progress. The goal of 6.6% is arbitrary, but any reduction in poverty will change millions of lives for the better.
“As Russian policymakers tackle the goal of halving poverty, it is heartening to know, that at least based on our analysis, accomplishing this laudable goal is now within reach,” the authors conclude.
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