[Source: official government's web server at www.moldova.md]

I. Social and Economic Conditions of the Republic of Moldova

II. Political and Legal Prerequisites for Overcoming the Crisis

Ensuring Sovereignty and Integrity of the Republic of Moldova
Authorities’ Responsibility to the People
Regional Policies
Interethnic Relations
Fight Against Crime and Corruption

III. Economic Line of Reform Policies

Strengthening the Role of the State in Ensuring Sustainable Social and Economic Development
Increasing the Role and Efficiency of State Property Use
Investment Policy
Enterprise Development and Creating Market Infrastructure
Foreign Economic Policy

IV. Real Sector Development

Government Policy of Structural Adjustment for the Real Sector of Economy

- Industry
- Agriculture
- Energy Sector
- Capital Construction
- Transport and Roads
- Communications
- Information Science and Information Technologies
- Trade

V. Nature Management. Environmental Policy

VI. Macroeconomic Policy

Fiscal Policy
Lending Policy
Relations with International Financial Organizations

VII. Social Policy

- Health
- Education
- Science
- Culture
- Labor Relations and Labor Protection
- Labor Compensation and Protection of People’s Income
- Labor Use Optimization. Labor Migration
- Social Partnership
- Social Insurance
- Social Security
- Family, Motherhood, and Childhood Protection

VIII. Youth Policy

IX. Foreign Policy

 

Over the last ten years, development of the Republic of Moldova has been marked by continuous deepening of the crisis processes in all spheres of life of society and Moldova’s gradual transformation into one of the poorest countries in Europe.

Social and economic policies have been largely reduced to the concept of monetary governance of the state. Large-scale destatization, undertaken during the period, failed to increase production efficiency or boost economic and investment activity of new owners.

National economic development during 1991-2000 resulted in the three-fold contraction of the gross domestic product. Goods and services import growth exceeded their export growth and, as a result, reduced the import capacity of exports.

Restructuring of industrial enterprises was accompanied by the liquidation of the most important technological types and sectors of production and reduction in the number of their employees. The role of industry in the national economy diminished drastically due to a three-fold decrease in output. Its weight in the gross domestic product reduced by more than a two-fold. Beginning from 1995, the share of industry in the gross domestic product has been less than that of the agriculture, which attests to the country’s de-industrialization.

Due to destructive reforms of the recent decade, agriculture and agro-industrial complex as a whole were thrown back 35-40 years in their development.

Cost of fixed productive assets in the agro-industrial complex fell sharply. From an exporter of livestock products, the country turned into their importer. Twice as many as planted orchards and three times as many as planted vineyards were stumped. Significant areas of arable land remain uncultivated every year. Land fertility deteriorated drastically due to a failure to observe crop rotation and 10- to 20-fold reduction in the volume of used organic and mineral fertilizers. Irrigated land areas went down from 200 thousand to 20 thousand hectares.

Research-and-production associations in agriculture wound up their activities.

Most processing enterprises ceased to exist or operate at 25-30 percent of their capacity.

Government investments in agriculture declined by seventeen-fold.

Legal regulation of business activities in agriculture remain incomplete.

Relations among landowners and property owners, managers and landowners, as well as the owners’ responsibility for land use have not been adequately regulated.

Tax reform has not completely resolved either the issue of increase in the budget receipts or the issue of creating conducive environment for operation of domestic commodity producers.

Attempts to solve the issue of domestic inputs shortage by attracting foreign inputs proved inefficient. Most credits and loans obtained were not investments by nature. A sweeping increase in the country’s foreign debt, which reached US$ 781 mln as of January 1, 2001, was coupled by expanding large-scale investment crisis.

Economic policy drawbacks predetermined the failure of measures and actions aimed at smoothing the social aftermath of the economic crisis and easing social pressure.

Implementing reforms for reforms’ sake lowered the living standards and living quality of the overwhelming majority of the population.

People’s income in real terms fell by approximately ten-fold.

Decline in the living standards was accompanied by incessant increase in unemployment.

Due to worsening material conditions of majority of the population, in the late 1990s, the depopulation process began, caused by both natural and migrational loss of the population.

The situation extremely exacerbated by the common fact that beginning from the early 1990s the authorities have developed neglect of the crucial issues of economic and social development of the country. Legal framework for the social and economic development was formulated solely in view of the idea of market reform implementation at all costs, without government control over its consequences.

Corruption and bribery thrive at all levels of power.

The process of restoring territorial integrity of the country has practically frozen.

All of the above serves as a ground for a claim that the country turned out to be on the threshold of the national disaster.

 

Ensuring Sovereignty and Integrity of the Republic of Moldova

With a view to strengthening statehood, economic independence and restoring the territorial integrity of the Republic of Moldova, the government intends to:

· develop domestic and foreign policy strategy of the Republic of Moldova based on public consolidation, national dignity and pride of citizens for their country, its increasing authority in the international arena, and pursuit of foreign policy exclusively in the interest of the Republic of Moldova and its people;

· develop and implement the country’s economic security program;

· seek definitive peaceful resolution of the issue of Transnistria within the limits of a single Republic of Moldova, economic reintegration of both banks of the Dniester River, and restoration of common cultural space and spiritual unity of society.

Authorities’ Responsibility to the People

Seeking to create an efficient mechanism of interaction among central and local government authorities, the government will ensure:

· pursuit of open and transparent decision-making and decision-implementation policies;

· creation of an activity supervision facility for elective and appointed executive officers of all levels;

· increasing the workers’ and labor unions’ role in managerial decision-making through comprehensive consideration of their stand on the issues of economic, social, and spiritual development of the country.


Regional Policies. Interethnic Relations

The government considers the following to be key issues in these areas:

· creation and implementation of a drastically new system of mutual relations among central and local governments and not only vesting the latter with responsibility for local developments, but also enabling them to efficiently affect the social and economic conditions;

· transfer into the local governments’ terms of reference public property the operation of which will enhance economic potential of the region;

· re-establishment of status quo of the former administrative territorial units;

· enforcement of the Law on special legal status of Gagauzia (Gagauz Eri);

· development of interethnic relations based on truly democratic ideas and values, which completely exclude discrimination on the basis of ethnic background or language and ensure equal rights to the representatives of all ethnic groups inhabiting the republic; acknowledgment of ethnic and cultural variety and interethnic peace as the main national asset;

· bringing language policy in all government agencies, spheres of education and culture, and mass media into line with the Constitution and the Law on languages functioning in the territory of the Republic of Moldova, creating optimum conditions for broad study of the Moldovan language by all national minorities, and not admitting artificial reduction of the Russian language’s functions in society.


Fight Against Crime and Corruption

In its uncompromising fight against these phenomena, the government intends to:

· develop a national offence prevention and counteraction program;

· develop and implement a strategy of fight against organized crime, shadow economy, corruption, and protectionism, and have it reflect the fundamental principles of human rights and all individuals’ equality before law;

· implement capital repatriation and legalization mechanism for the capital brought out of the country, ensuring safety and securing lawful economic interests of economic entities and individuals;

· initiate cancellation of immunity for some categories of public servants;

· introduce income declaration requirement for all individuals before they take offices as public servants;

· provide law enforcement agencies’ services and divisions with the most advanced strategic technical devices, means of communication, arms, transport, and office equipment;

· stabilize law enforcement agencies’ staffing by ensuring adequate legal and social protection of their employees, together with tightening performance and law-compliance requirements on these agencies’ employees;

· implement a set of measures for efficient interaction of the country’s law enforcement agencies with appropriate international organizations;

· revive people’s patrols and other efficient public forms of the general public’s involvement in maintaining legal order.

 

Strengthening the Role of the State in Ensuring Sustainable Social and Economic Development

The need to increase state influence on the economic developments in the country is due to the following circumstances:

· furthering of reforms underway and taking into account their social implications;

· openness of the economy, absence of own energy resources, large setback in production in all sectors of the national economy, and import surplus;

· extremely irrational system of property corporate governance caused by ill-considered approach to reforms implementation;

· absence of real security for property rights or proactive government support for small businesses;

· poor efficacy of the macroeconomic stabilization tools.

At this stage, state regulation of economic developments will focus on:

· determining and maintaining macroeconomic ratios during budgeting and budget execution;

· taking measures to regulate money circulation, individual incomes, control pricing for certain essential goods and services rendered to the public;

· creating an environment encouraging banks to extend funds, in particular, on a long-term basis, to the real sector of economy;

· strict control over goods import and export in order to protect domestic commodity producers;

· eliminating conditions conducive to the smuggling of goods and inputs into the territory of the country, which destabilize the market and inhibit competitiveness of domestic economic entities;

· developing efficient agro-industrial complex infrastructure;

· employing social economic forecasting and planning of the economy;

· clearly defining the government sector as an important and objectively necessary element of the social structure.


Increasing the Role and Efficiency of State Property Use

The state becomes a full participant in the market and market relations and makes the implemented reforms socially oriented. Enterprises with prevailing state shareholdings will participate in the economic developments on a par with other economic entities.

The issue of introducing state monopoly on production and sale of certain goods will be considered as necessary.

With the aim of increasing the efficiency of state property use, it is envisioned to:

· take stock of state assets, analyze their operational efficiency, and consider changing the management form of some enterprises;

· take appropriate measures to ensure enterprise re-tooling and introduction of high technologies as a prerequisite for their financial rehabilitation;

· modify and delegate some of the Department of Privatization and State Property Management’s functions to sectoral ministries, and focus the Department’s efforts on privatization contracts’ enforcement and elimination of operational problems faced by the privatized enterprises. Enterprise privatization will be carried out as proposed by sectoral ministries.


Investment Policy

Major thrusts and elements of state support for investments in the real sector of economy are:

· providing a rationale for, and selection of, priority productions, which will enjoy investment support;

· concluding investment activity state support agreements with commodity producers, defining efficiency of expected investments, their payback periods, size, and resources required;

· developing a resource base for investment-support activities funding;

· setting up a specialized entity, which will organize, govern, and enforce the industrial investments state support program.


Enterprise Development and Creating Market Infrastructure

State support for entrepreneurship presumes:

· streamlining the tax administration;

· effective protection of entrepreneurial activities against criminal intrusions of criminal entities and officials’ unlawful actions;

· involving businesses in fulfillment of state orders and implementation of government projects and programs supported by appropriate resources;

· encouraging businesses’ self-organization into various unions, associations, and societies;

· improving the legal framework encouraging entrepreneurial potential of the population, streamlining registration and licensing procedures for enterprises;

· developing a centralized marketing information system for business sector, which will facilitate sale of goods, products, and services;

· enterprise development in agro-processing, traditional handicraft industries, and folk creative arts, especially in rural areas;

· formulating and implementing a policy aimed at protecting domestic entrepreneurship.
Foreign Economic Policy

Government strategy of foreign economic activities improvement presumes that its efforts will focus on:

· development of state infrastructure for foreign trade transactions;

· improvement of the organizational system of foreign economic cooperation;

· modernization of foreign borrowing and foreign investment policies;

· negotiation with the international organizations of phased foreign debt repayment.

Foreign economic ties will be restructured in the following directions:

· improvement of export and import commodity composition;

· investment and innovation development of industrial production, and increase in goods and services’ competitiveness in the domestic and foreign markets;

· certification of all imported products;

· creation of an information system on world commodity markets;

· creation of a competitive environment for economic entities seeking entrance to foreign markets.

Implementation of the foreign economic policy presumes consistent decrease in the trade balance deficit, and in the future – foreign trade surplus and surplus of the balance of payments as a whole.

Priority steps in export/import development presume:

· developing and ensuring legal support for, state export promotion system;

· establishing a government entity for domestic goods export promotion;

· lending to export-oriented productions with long production cycles;

· insurance of foreign markets development transactions;

· increasing resident exporters’ responsibility for currency repatriation.
 

The government’s strategy objective regarding the real sector of the economy consists in:

· measured reform implementation;

· stopping the setback in production and reviving the real sector;

· solving the issue of the country provision with energy;

· demonopolization of, and encouragement of competition in, all spheres.


Government Policy of Structural Adjustment for the Real Sector of Economy

Government policy in industry envisions in essence:

· development and support of economic entities engaged in the production of competitive products;

· revival of agricultural engineering sector by means of setting up joint-ventures based on existing facilities to provide the agro-industrial complex with machine and tractor fleet and technological equipment;

· restoration of competitive instrument making and household equipment production;

· revival of microbioproducts production;

· encouraging domestic and foreign investors investing in production, especially, in high-technology production.

In agricultural development, the government aims at increasing output and achieving the development level of the agro-industrial complex which will ensure scientifically-grounded dietary standards for the population.

Recognizing peasants’ rights to land received in accordance with law, and diversity and full freedom of all forms of economic activities on land, the state will encourage the peasants’ voluntary cooperation with a view to developing large-scale commodity production in the legal forms envisioned by law.

In view of significance of individual sectors, at the initial stage, major efforts will focus on development of strategically important segments of the agro-industrial complex: viticulture and wine-making, fruit and vegetable growing, tobacco-growing, grain production, oil and fat production, sugar-beet growing, and livestock farming.

As a whole, the following is envisioned to revitalize the agro-industrial complex:

· better territorial location and specialization of agro-industrial production by natural and economic zone and micro-zone of the country, including with the aim of producing environmentally-clean products. It is envisaged that agro systems will be established encompassing the entire process: agricultural production, procurement, processing, and sale of agricultural products;

· implementation of government program of technical, agrochemical, veterinary, and other assistance to economic entities in the sphere of agricultural production;

· setting up technical machine stations, as well as agro service associations and cooperatives designed to perform work related to crops-growing on a contractual basis;

· re-establishing, to a required extent, livestock farms and complexes with domestic and foreign participation of state and private capital;

· introduction of advanced scientifically-grounded crop rotations, soil-protective land cultivation, and comprehensive plant protection;

· formulation of a state land hydro-reclamation program, restoration of irrigation systems, and creation of water-user associations;

· development of a state concessional lending program for agricultural producers;

· state participation in the agricultural market creation through a commodity exchange;

· creating an environment for attracting foreign investments, promoting the process of setting up joint-ventures for sale of fresh and processed fruits and vegetables in the foreign markets;

· re-introducing forecasting and planning in the agro-industrial complex, re-introducing the system of state orders and other guaranteed orders and contracts for production and procurement of agricultural products;

· analysis of compliance with law during privatization of agro-industrial enterprises and agricultural land and implementation of concluded contracts;

· restructuring agricultural enterprises’ historical debts;

· paying priority attention to domestic agricultural science, encouraging activities of research-and-production associations, development of seed-growing, nurseries, breeding, and veterinary science;

· considering introduction of a single tax in agriculture.

In the energy sector, priorities will include consistent implementation of measures to secure the country with energy, ensuring energy complex operation as a whole, and transition to energy-saving consumption.

Government actions in this sphere will aim at:

· formulating the energy complex development program;

· ensuring post-privatization forms of management in the energy complex adequate to the existing situation;

· restoring a single electric power system in the country;

· taking advantage of the country’s geographical location in the implementation of electric power transit project to the Balkans;

· ensuring the country’s energy safety through restoration and expansion of operational facilities at the existing central heating plants and construction of new central heating plants with private participation;

· creating a single fuel and energy complex of the country;

· implementation of the country’s gasification program, using both domestic resources and credits from international financial organizations;

· analysis of energy complex privatization results, contract implementation, and considering possible transfer of energy distribution networks into trust management;

· introduction of energy-saving measures, energy re-use, and subsequent reduction in the energy costs’ share in the final product;

· setting up within the government a permanent inter-departmental agency for energy safety activities coordination;

· developing legal and organizational framework for uniting state-owned and private economic entities in the country’s fuel and energy concern.

It is expected that the government policy of capital construction revival and development will be based on:

· encouraging introduction of resources, energy-saving technologies, and use of advanced materials;

· completing housing construction in progress at the expense of long-term lending;

· create legal and normative framework for rapid construction of housing, especially individual housing;

· mobilize extra-budgetary sources of funding of the housing sector, form the mechanism of mortgage credit.

The government policy of the development of transport and roads is essentially the following:

· to widen international cooperation in the area of renovation of the country’s communication system, in particular, by modernizing the infrastructure and services and adjusting them to European standards and connecting to European networks, systems and transport corridors;

· to form a competitive – both internationally and domestically - transport system;

· to modernize the infrastructure of the national transport corridors, which serve the European transport flows;

· to develop the logistic support for transport and organize mixed transportation of goods;

· to renovate and modernize the rolling stock; to develop air transport; to improve the national structure of transport administration;

· to improve the tariff and price-setting system in the sector of transport services, carry out anti-monopoly regulation;

· to restore and expand the road network of the Republic of Moldova, with regard of taking modern requirements.

The development of the communications system will focus on the extension and improvement of the local telephone network, the creation of modern radio and telephone communication complex in the cities and on the main transportation thoroughfares, the introduction of new, up-to-date services.

In the sector of information science and information technologies, it is planned to implement the exchange of electronic data and the access of national network subscribers to global information systems. Rapid development of information technologies will ensure access to the secure sources of information and a high level of data processing both in the production and social sectors.

In the sector of domestic trade and services, government regulation will aim at:

· regulating the trade margins with a view to deterring the growth of prices and making internal demand more active;

· regulating the government-approved list of socially important goods and services with tariffs and prices directly regulated by the government.
 

In the area of environmental protection and utilization of natural resources, the main task of the government is to both prevent and reduce the negative impact of economic activity on the environment, natural resources and human health.

The priorities in this area are as follows:

· to halt the deterioration of the land fertility and implement anti-erosion measures;

· to provide good-quality drinking water for the population;

· to protect the landscape and biological diversity, to increase the forest area and improve the quality of forests;

· to protect towns and villages from floods and land-slide;

· to ensure due consideration of environment policy in the decision-making by the sectors of national economy;

· to conduct education of the population in environmental problems;

· to undertake international cooperation in environmental issues.

 

The government intends - in cooperation with the National Bank of Moldova - to implement the macroeconomic policy, which ensures stability, sustainable development and efficiency of the pursued structural reform. The main macroeconomic assumptions are:

a) annual gross domestic growth rate of 5 percent;

b) reducing annual inflation rate to 10 percent (year-end);

c) reducing fiscal deficit to 1.5 percent of gross domestic product;

d) containing current account deficit at 6 percent of gross domestic product due to lower deficit of foreign trade balance.


Fiscal Policy

The main points of the government tax policy are:

· improvement of tax legislation;

· gradual reduction of the level of tax levy and implementation of tax burden ceiling;

· reduction in the number of taxes and charges, streamlining the calculation and collection procedure, ensuring stability of the legal framework of taxation;

· forming a system of strictly targeted and motivating tax benefits consistent with the overall goals of economic development;

· gradual transition from the predominantly indirect taxation to the taxation of income;

· ensuring the stability and transparency of the tax policy;

· higher taxpayers’ liability for tax evasion, and higher liability of tax and fiscal officers for inadequate fulfillment of their duties;

· decisive fight against abuse of power by the government officials of various levels and departments engaged in extortion;

· improvement of the system of tax and fiscal control over economic entities, barring duplication and parallel work; reduction of both the number of public control agencies and audits at the expense of quality;

· considering the issue of eliminating double taxation by value-added tax with Transnistria.

The government’s fiscal policy will aim at the most efficient use of government funds, adjusting expenditures to the actual capacity of the national economy, and cost optimization through their reduction and elimination of duplicated functions of central and local governments.

On the public expenditure side, it is intended to ensure:

· efficient and streamlined utilization of public funds through their tight control;

· transparency of all public revenues and expenditures, informing the public of the nature of revenues and expenditures;

· guarantee of budgeted public payments;

· the most realistic projection of budget revenues; elimination of the practice of projecting revenues on the basis of required public expenditures;

· reform of central and local governments with a view to reducing expenditures and increasing efficiency of public administration;

· parliamentary and government approval of the laws and regulations, which are secured with funds;

· elimination of extra-budgetary funds within ministries and departments, and channeling these funds directly to the budget;

· elimination of netting-out operations between the general budget and enterprises.

The government shall abandon the practice of issuing government guarantees for commercial credits.


Lending Policy

In the projection of social and economic development of the country, the government will cooperate with the National Bank of Moldova in the area of monetary policy.

The credit policy will aim at ensuring the inflow of investment, non-admission of the growth of public debt, priority channeling of credits to the real sector, maximum monitoring of the efficient use of credit, and wide dissemination of this information to the general public.


Relations with International Financial Organizations

In its relations with the international financial organizations, the government will focus its efforts on strengthening cooperation with the International Monetary Fund, World Bank, European Bank for Reconstruction and Development, International Finance Corporation, International Fund for Agricultural Development, Social Development Fund, and other financial organizations, including those within CIS, with thorough consideration of the national interests. The government will fulfill all its international obligations; at the same time, with a view to alleviating fiscal burden it intends to negotiate with the external creditors the rescheduling of repayment of the stock of debt, to ensure strict inventory of the utilization of previous credits and disseminate the relevant information to the general public.

 

The government’s social policy presumes the following:

Health:

· provide sufficient funding to the health sector to ensure the minimum level of healthcare;

· implement mandatory medical insurance;

· develop primary medical care to the population;

· ensuring strict control over prices on additional health services rendered by the public healthcare institutions, and account for the generated revenues;

· ensure the implementation of the government programs in the public health sector;

· create conditions for improving the basic training, specialization, and continuous education of healthcare workers;

· provide pharmaceuticals, medical equipment and tools for public healthcare institutions;

· complete public medical institutions with pharmacies to supply the population and hospitals with pharmaceuticals at accessible prices; ban private pharmacies from the buildings and premises of public medical institutions;


Education:

· create institutional, didactic and material conditions to ensure the right of each child to free primary education;

· widen the possibility of getting free higher education at public institutions and initial professional training in the professions, necessary for the national economy;

· ensure quality education by developing and implementing educational and professional standards, by applying new information and communication technologies, by creating the national system of knowledge evaluation and education documentation and a system of continuous education of teaching and administrative staff;


· ensure continuous growth of budget allocations for the educational sector, in particular for support of the teaching staff and development of the materiel of educational institutions;

· increase the responsibility of local governments for ensuring equal conditions of obtaining education to all children of pre-school age, for preparing every child for school;

· implement a system of vocational guidance and vocational training of 16-year-old individuals;

· create a legal framework of bank credit for education;

· develop legislative amendments providing for increased liability of parents for up-bringing of children; curb the growth of juvenile delinquency by more active out-of-school work; support the coverage by education of the children, requiring special teaching methods;

· create necessary conditions for developing sports and tourism.


Science:

· prioritize areas of research in the context of the social and economic priorities of the Republic of Moldova; gradually transfer organization of research to the basis of government programs;

· improve the quality of implementation of research results in the economy; set up innovation infrastructure and support funds;

· improve the legal and regulatory framework of research;

· conduct evaluation and accreditation of educational institutions;

· modify the system of funding of research, gradually increase the share of budget allocations for the development of research, expand sources of funding;

· deepen cooperation in the area of academic research and higher education;

· create conditions for active involvement of the researchers and specialists in international research projects.


Culture:

· restore cultural institutions step-by-step;

· preserve and protect national cultural heritage and possessions;
· establish the guaranteed minimum of services to be provided by cultural institutions on a per capita basis to ensure real access of the citizens to the cultural life of the society;

· establish renewed standards of the materiel of educational and cultural institutions;

· provide assistance in restoring and enlivening the activity of professional and amateur creative groups, handicrafts; in expanding the exhibition activity of museums; in publishing books for children; in promoting folk arts; in expanding cultural relations with other countries;

· provide financial support to creative unions with view to enlivening their activity.


Labor Relations and Labor Protection:

· develop and improve the legal framework of labor and social protection; as a priority, approve the Labor code and the laws on labor compensation; provide job placement, social insurance and social assistance for the population;

· ensure protection of workers from risks of job-related illnesses and injuries, and implement measures to improve labor safety and labor hygiene;


Labor Compensation and Protection of People’s Income:

· ensure timely payment of wages, pensions, unemployment benefits, grants, other welfare benefits; ensure higher degree of liability of officials and administrators for the untimely payment;

· develop a mechanism of indexation of wages, pensions and other monetary income of population;

· gradually reduce the gap between the minimum wage, minimum pension and the subsistence level;

· define a mechanism of indexation of citizens’ deposits with the Savings Bank.


Labor Use Optimization and Labor Migration:

· develop and implement national programs of employment of the working-age population, with special attention to women and youth;

· promote and implement active social policy in the labor market by providing tax support to job-creating businesses; provide financial support to the unemployed and young specialists for organizing businesses;


· regulate labor migration processes by concluding inter-governmental agreements with those countries, where large numbers of the citizens of the Republic of Moldova work.


Social Partnership:

· Establish structures that ensure development of social partnership;

· Involve social partners (employers and trade unions) in the process of drafting laws and regulations for social and economic areas.


Social Insurance:

· Improve the legal framework with a view to ensuring the implementation of the social insurance system reform;

· Complete the implementation of individual accounts of social insurance contributions;

· Implement the optimization of age standards for establishing pensions and make relevant changes and amendments in the legislation;

· Unify the pension system on the uniform principles for establishing pensions;

· Increase pensions annually at a rate at least equaling the inflation rate.

Social Security:

· Further the social assistance reform;

· Optimize the procedure of social assistance to match the need for it;

· Set up a centralized computerized information system for recording the beneficiaries and the extent of social assistance;

· Review the categories of beneficiaries of targeted compensations with a view to increasing the number of beneficiaries;

· Design programs to improve the care of orphans and disabled children, disabled adults and single senior citizens, programs for placing them in the family care and gradual reduction of the number of such persons in institutional care;

· Implement medical and social rehabilitation of the disabled persons, and provide modern prosthetic and orthopedic appliances for them.


Family, Motherhood, and Childhood Protection:

· Approve a strategy of social protection of children and families with many children;

· Establish the size of family allowance correlated with the average wage in the economy;

· Increase assistance to children in low-income families, including the supply of free clothes, manuals and writing materials;

· Increase individual exemption bracket in the wage income of persons who have dependent children, including children in ward.

 

It the youth policy, it is intended to:

· Design individual programs of activities of youth organizations;

· Expand assistance to the families of the young by funding housing construction through special credit programs;

· Regulate the size of student hostel pay;

· Implement a national program of training and retraining with a view to job placement of the unemployed youth;

· Ensure the implementation of the program for training of experts in youth problems;

· Establish a national youth center;

· Design a mechanism to motivate young talents;

· Prevent youth delinquency and promote healthy lifestyle;

· Support interaction and cooperation of youth organization of the Republic of Moldova with the international counterparts.

 

The major thrusts of the foreign policy of the Republic of Moldova, formulated in the Foreign Policy Concept, proceeds from vital national interests and will further be pursued.

At the same time, in view of the on-going processes of globalization, regional consolidation and integration, which influence the system of international relations considerably, the foreign policy of the government shall be structured with due consideration of the such influence on the sovereignty and independence of this country, while creating conditions which ensure the construction of a democratic and prosperous state.

The main foreign policy goals are the following:

· strengthen the sovereignty, statehood and the integrity of the territory of the Republic of Moldova and increase its international authority;

· develop mutually beneficial relations with all the countries of the world;

· design and implement a national strategy of the integration of the Republic of Moldova into the European Union and other international communities;

· consider the issue of the Republic of Moldova’s accession to the Customs Union of Russia, Belarus, Kazakhstan and Kyrgyzstan, and subsequent possible integration into the economic structures of the Russia – Belarus Union;

· further strengthen mutually beneficial relations with other countries on the basis of specific current and long-term bilateral cooperation programs, which consider national interests of both parties;

· expand mutually beneficial relations with the United States of America;

· deepen comprehensive traditional relations with the neighboring countries – Romania and Ukraine. The relations will be founded on the striving for extension of inter-state cooperation, including the implementation of the inter-state agreement on creating a free-enterprise zone, which had been signed earlier. Effort of drawing-up an interstate agreement with Romania will continue;

· expand and deepen the relations with the Western European countries, especially with Germany, France, Great Britain, Italy, and Holland;

· carry out a more active policy of cooperation with the countries of the Black Sea region, countries of Central Europe and South-East Asia;

· active information of foreign countries about economic achievements and cultural heritage and possessions of the Republic of Moldova.

The following will be implemented within the framework of international cooperation:

· Protection of the interests of the Republic of Moldova in the international organizations, of which the Republic of Moldova is a member;

· More active participation of the Republic of Moldova in the activities of the United Nations, OSCE, and the Council of Europe;

· Deepening the participation of the Republic of Moldova in the activities of the regional organizations, which accelerate its integration with the European organizations.

The government is aware of all the seriousness of the country’s economic and social conditions, and considers the halting of negative processes in the said sector as major task.

The implementation of the priorities government activities, such as the rehabilitation of the real sector, decisive fight against crime and corruption, are only possible with the change in the state’s role in the society, namely, increasing its responsibility to the people and strengthening its regulatory role in the market transformations.

The acuteness of the problems, which have accumulated in the society during the last decade requires that the decisive - as well as nonstandard measures - be taken. The reform should not be carried out for the sake of reform, but as a means to rehabilitate the economy and improve the living standards of the people.

In order to solve the major fundamental problems, the following is required:

· Constructive work of the legislative and executive powers within their mandate;

· Support of the Government activity by political parties, trade unions, organizations of the public, and the entire population;

· Consolidation of the sound forces of the society to get the country out of crisis, which is possible only with the establishing of public consent, unification of interests of individuals, groups, political and social formations, and the state.

In order to ensure the implementation of its program, the Government is ready to cooperate with all who care for the interest of the people and the future of the country.