Moldova BRITE Year 3 Annual Report October 2014 – September 2015

The program has been focusing on three main areas: tax administration and trade facilitation, high-impact regulatory reforms, and strategic communications. Through its tax administration activities, BRITE has been assisting the State Tax Service (STS) to streamline its tax payment and tax administration systems. This has resulted in reduced compliance costs for the private sector and increased revenues for the public sector. In trade facilitation, the project has been supporting the Moldova Customs Service (MCS) and other Government of Moldova (GoM) trade-related agencies to optimize the trade regulatory framework for ease of doing business. BRITE has also been working on high-impact regulatory reforms by assessing critical reform needs and advancing them through institutionalized processes, capacity building, and technical assistance. The program has been facilitating public discourse on business-friendly reforms through its strategic communications program, which has been building the strategic communications capacity of its GoM counterparts. During Year 3, BRITE implemented most of its planned activities, despite heightened political uncertainty in Moldova. The program completed its planned enhancements to the Current Account, including the online e-certificate of no debts, which should eliminate the need for paper certificates in most cases. The single payment concept was approved by all stakeholders, and the technical solution is being reviewed by all parties. In trade facilitation, the Moldova Customs Service agreed to slash the official number of documents for import and export to three, from 11 documents previously required for import and 8 for export. The Blue Lane customs channel was introduced, leading to reductions in controls at the border. The Authorized Economic Operator (AEO) program was also introduced, and e-Import declarations were introduced this year, with numbers continuing to grow. BRITE expanded its support to the Moldova Customs Service in the area of customs valuation, an area of deep concern for the private sector. New valuation procedures are now pending Government approval, which should improve the situation and create more opportunity for BRITE support. To ensure streamlined processes are adhered to, BRITE developed internal procedure manuals with the Moldova Customs Service, which were then developed into online guides for businesses. The program's Year 3 was marked by heightened political uncertainty in Moldova, including the disappearance of 1/8 of Moldova's GDP through fraudulent bank loans. Despite these challenges, BRITE advanced many of its planned activities to the point where they only require a decision of the Government or Parliament to trigger implementation. Moldova's Ease of Doing Business ranking slipped to 52 in 2015 from 49 in 2014, but improvements were recognized in key areas. The "Starting a Business" indicator improved to 26 from 35, and Moldova ranked in the top 10% in "Trading Across Borders." Monetized benefits to the private sector exceeded USD 190 million to date.