Moldova & IMF IMF Activities Publications Press Releases

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"ECO" Weekly Economic Magazine, 9 May 2007

The IMF and Chisinau authorities share different opinions on the increase of salaries in public sector
Thomas Richardson, the head of the IMF staff mission visiting Chisinau asserts that increase of salaries in public sector could create pressures onto the state budget while Igor Dodon, the minister of Economy and Trade suggests that increase of salaries is imperative at the moment.

"I understand that the salaries are small. My wife works as a school teacher at a public school and she will not forgive me for the actions leading to decrease of salaries. But I believe it is very important that the number of employees is rationalized as well as their work”, - stated Thomas Richardson during press conference held Thursday (cited by BASA-press).

The IMF official, upon completion of a review mission to Moldova, stated that increase of salaries in addition to recently announced tax amnesty and reduction of income tax rates could generate short term negative effects onto collection of revenues.

In his reply, Igor Dodon, the minister of Economy and Trade highlighted the necessity of raising salaries. “My mother is also a teacher and her salary is very small. There will be increase of salaries”, - said minister Dodon. He also said it is premature to estimate the size of salaries increase in public sector.

"We believe thay possible underperformances in some of the categories of revenues could be compensated by the increase in other categories”, - added Dodon.

Despite these concerns, the IMF staff mission stated that the state budget execution for the first quarter is in full conformity with prior agreement while the outlook “seems to be in line with the provisions set forth by the Memorandum of Understanding between the IMF and Republic of Moldova”.

The IMF staff mission visited Chisinau during 25 April – 8 May with the scope of reviewing performances of the Government and National Bank on implementation of commitments stipulated by the Program with the IMF. The mission prepared a new draft Memorandum for the remainder of 2007.