Opinion of the European Economic and Social Committee – Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: Communication on the Moldova Growth Plan
Date: 2025-03-26
Institutions: European Economic and Social Committee
Subjects: Moldova, accession to the European Union, economic convergence, economic growth, economic integration, economic reform, financial aid, investment, regional integration, single market








C_202502965EN.000101.fmx.xml












Official Journal of the European Union


EN
C series













C/2025/2965


16.6.2025






Opinion of the European Economic and Social Committee

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: Communication on the Moldova Growth Plan



(COM(2024) 470 final)


(C/2025/2965)


Rapporteur: 
Dumitru FORNEA






Advisor


Adrian LUPUŞOR, rapporteur’s advisor, Group II




Referral


European Commission, 9.10.2024




Legal basis


Article 304 of the Treaty on the Functioning of the European Union




Section responsible


External Relations




Adopted in section


10.3.2025




Adopted at plenary session


26.3.2025




Plenary session No


595




Outcome of vote
(for/against/abstentions)


142/0/1




1.   Conclusions and recommendations









1.1.


The European and Economic and Social Committee (EESC) welcomes the European Commission’s initiative and the European Parliament’s report on the Moldova Growth Plan – the largest financial support package the EU has ever granted to Moldova, consisting of EUR 1,5 billion in concessional loans, EUR 285 million in non-repayable financial support (grants) and EUR 135 million set aside to provision the loans (9 % provision on the total volume of concessional loans), planned for 2025-2027.












1.2.


The EESC supports the position of the European Commission and the European Parliament to engage the social partners, civil society organisations (CSOs), the expert community, academia and local public authorities in the development, monitoring and implementation of the reform agenda, as well as in the formulation and monitoring of specific indicators and intermediate indicators to measure progress. The important part is the involvement of organised civil society representatives in developing the Plan’s scoreboard and independent monitoring of the implementation of the reform agenda.












1.3.


The EESC recommends that funding be allocated from the grant component of the Growth Plan to support the activity of CSOs that contribute to the implementation of the Plan and realisation of the reform agenda.












1.4.


The EESC recommends two conceptual adjustments to the above-mentioned parameters of this support:






—


increasing the share of grants from the current proportion of 16 % to 35 %, followed by a proportional decrease in the share of concessional loans;










—


increasing the minimum share of the total loan amount to be allocated to investments from 25 % to 35 %.
















1.5.


The EESC endorses the three pillars of the Moldova Growth Plan (hereafter ‘the Plan’), as they will accelerate the country’s economic and legal convergence with EU standards.












1.6.


The EESC considers that the Plan should be the main tool for transitioning to a new economic growth model based on higher competitiveness, value added and a sustainable trade balance. Moldova should improve the efficiency of the sector of state-owned enterprises. A key source for unlocking private investment and economic growth is the development of capital market.












1.7.


The EESC believes that the Plan should support Moldova in developing its energy sector, with a primary focus on electricity infrastructure, renewables and energy efficiency, to eliminate its exposure to Russian energy blackmail and promote the decarbonisation agenda. Particular attention should be paid to the electricity interconnection with neighbouring EU countries, in order to facilitate the country’s integration into the European energy market.












1.8.


The EESC recommends that the Plan should allocate enough investment (private and public) in research and development (R&D), in order to support the transition to the new model of economic growth based on higher value added and productivity. Moreover, the Plan must capitalise on government programmes aimed at reskilling and upskilling unemployed people that would support workers’ mobility and capacity to adapt to changing economic and technological conditions and increase labour productivity, with a special focus on the needs of people with disabilities. However, a crucial element in addressing this challenge is the need for significant investment in reforming the education and training system in Moldova.












1.9.


The EESC draws attention to the importance of calibrating the Plan to Moldova’s local and regional development needs as an indispensable condition for balanced and sustainable development across the entire country and, in this regard, at least 20 % of all investments should be directed towards local and regional development;












1.10.


The EESC is convinced that capacity-building for CSOs should be prioritised so that these organisations can be competent partners throughout the EU accession process, particularly in relation to socio-economic and fundamental reforms. Civil society should play a pivotal role in keeping the government accountable in general and in ensuring that the reform agenda is properly implemented and the Plan’s resources assimilated.












1.11.


The EESC insists that human rights issues, including a gender balance, inclusion of people with disabilities and ‘no one left behind’ principles, should be considered horizontal priorities in all the projects implemented under the Plan.












1.12.


The EESC considers that the proper funding should be provided for creating and ensuring the proper functioning of the economic and social committee in the Republic of Moldova, in line with the formal request from the National Trade Union Confederation of Moldova, the Confederation of Employers of Moldova and civil society organisations (EU-Moldova civil society platform under the Association Agreement and the National Platform of the Eastern Partnership Civil Society Forum).












1.13.


The EESC also recommends that a considerable part of the investments funded by the Plan should be directed towards modernising public institutions to increase their capacities in the context of the membership negotiations and implementation of the EU acquis.













1.14.


The EESC also points out other important aspects to take into account in implementing the Plan: the environmental perspective; digitalisation; social investments; decentralisation and local autonomy consolidation reforms; information campaigns and the creation of a dedicated information centre; implementing EU quality and food safety standards at company level; modernising quality infrastructure laboratories; education and training in the area of quality infrastructure; the domestic market supervision framework; the consumer protection framework; instruments for credit acceleration; the capitalisation of the Credit Guarantee Fund (CGF) and of the Moldovan Entrepreneurship and Economic Growth Fund (FACEM).












1.15.


The EESC considers that it is absolutely necessary to establish a mechanism for coordination between the various governmental programmes, creating a register that consolidates financing options and prevents the allocation of financial support from different programmes for the same investment projects. At the same time, it is essential to move from the mechanical and formalistic evaluation of funding to an evaluation based on factors such as risk, added value generated and impact on the national economy, in order to ensure that the Growth Plan has a tangible contribution to raising the potential of the national economy (1).




2.   General comments









2.1.


The Moldova Economic Growth Plan provides the first and most important tangible support to Moldova’s European integration aspirations, following the granting of EU candidacy status. It confirms the EU’s commitment to supporting Moldova and its people, who have expressed their desire for a European future through democratic means, even as they face significant economic, social and energy crises. This support is particularly vital amid ongoing Russian hybrid threats that endanger the country’s social stability and democratic institutions.












2.2.


The impact of these resources on boosting economic potential, fostering economic and social resiliency and advancing convergence to the EU will depend on integrity, inclusiveness and professionalism in planning, implementing and monitoring the projects under the Moldova Growth Plan.




3.   Specific comments









3.1.


The Moldova Growth Plan is the largest financial support package the EU has ever granted to Moldova, consisting of EUR 1.5 billion in concessional loans, EUR 285 million in non-repayable financial support (grants) and EUR 135 million set aside to provision the loans (9 % provision on the total volume of concessional loans), planned for 2025-2027. While this is an impressive support package, which is expected to have a significant impact, the EESC recommends two conceptual adjustments to the above-mentioned parameters of this support.












3.2.



The EESC suggests increasing the share of grants from the current proportion of 16 % to 35 %, followed by a proportional decrease in the share of concessional loans, given the difficult economic and social conditions in Moldova: slow economic growth or even stagnation, a high poverty rate, persistent budgetary deficits and inflationary risks stemming from the unfolding energy crisis and the Russian aggression in Ukraine.












3.3.


Given the fact that about two thirds of the total external financial support provided to Moldova is usually allocated to budgetary support, with one third allocated to investment projects, the EESC recommends increasing the minimum share of the total loan amount to be allocated to investments from 25 % to 35 %. This will increase the Plan’s ability to help unleash Moldova’s economic potential, speeding up economic growth and accelerating the country’s convergence with EU Member States.












3.4.


The EESC endorses the three pillars of the Plan, as they will accelerate the country’s economic and legal convergence with EU standards, and suggests the following priorities for each pillar:




3.5.   Pillar 1: Accelerating socio-economic and fundamental reforms, through a dedicated reform agenda









3.5.1.


The Plan should be the main tool for transitioning to a new economic growth model based on higher productivity and value added, as the country is gradually exhausting its current competitiveness model based on inputs/resources (mostly cheap labour), leading to the deceleration of economic growth over recent years and the erosion of the country’s potential. In this regard, Moldova should focus on channelling policies and resources into supporting the private sector, which generates added value, by processing local raw materials, streamlining production processes and implementing technological innovations.












3.5.2.


Analyses show that a major source of economic inefficiencies and, as a result, an area with significant economic potential, is the sector of state-owned enterprises (SOEs). Therefore, Moldova should improve the efficiency of this sector by streamlining the legal and regulatory framework for SOEs’ activity, as well as fostering the corporate governance of these entities (professionalisation of boards, increasing transparency in the sector and the effective implementation of the State Ownership Strategy approved by the government in 2022 and devised based on the OECD principles of SOE corporate governance).












3.5.3.


Given the fact that Moldova has one of the lowest levels of financial intermediation in Europe while having a well-capitalised banking system, a key source for unlocking private investment and economic growth is the development of capital market. Hence, the Plan should support the development of the domestic market of corporate and municipal bonds, private pension funds and the domestic stock exchange and its integration with Romania’s.












3.5.4.


The Plan should support Moldova in developing its energy sector, with a primary focus on electricity infrastructure, renewables and energy efficiency, to eliminate its exposure to Russian energy blackmail and promote the decarbonisation agenda. Specifically, the Plan should support programmes implemented through the National Centre for Sustainable Energy, created in 2024 to implement government policies on boosting energy efficiency and renewables.












3.5.5.


Particular attention should be paid to the residential sector, where there is significant untapped potential for energy savings and generation. Another priority should be electricity interconnection with neighbouring EU countries, in order to facilitate the country’s integration into the European energy market. It is also important to support the development of power stations across the country, in order to develop energy generation and co-generation facilities inside the country.












3.5.6.


The Plan should prioritise investment (private and public) in research and development (R&D), in order to support the transition to the new model of economic growth based on higher value-added and productivity. Namely, a dedicated programme could be developed that would subsidise part of the investment in R&D in the private sector.












3.5.7.


Given the increasing labour market deficit, it is necessary to capitalise on government programmes aimed at reskilling and upskilling unemployed people that would support workers’ mobility and capacity to adapt to changing economic and technological conditions and increase labour productivity. Also, it is important to create active employment measures to support the integration of people with disabilities on the labour market. A comprehensive overhaul of the education and vocational training systems is vital to ensure they are aligned with the needs of a modern, dynamic labour market. This reform should focus on equipping individuals with the skills necessary for the current and future demands of the workforce, while also fostering lifelong learning and adaptability.












3.5.8.


The acceleration of economic growth with the support of the Plan should be sustainable from an environmental perspective. In this regard, it is necessary to support strategic environmental evaluations of all relevant public policies, improve environmental, social and governance (ESG) reporting in the private sector, connect Moldova to international carbon loan markets, implement financial mechanisms in the areas of waste management and energy efficiency, increase the capacities of Moldova’s Ministry of Environment and establish biodiversity targets in line with EU principles.












3.5.9.



Decentralisation and local autonomy consolidation reforms should be a major policy priority in order to facilitate the regional and local development of the country and ensure that the population has proper access to adequate infrastructure and public services.




3.6.   Pillar 2: Enhancing Moldova’s access to the EU single market









3.6.1.


Given how poorly informed small and medium-enterprises (SMEs) are about the conditions required to penetrate the EU single market and their limited capacity to do so, it is necessary to launch information campaigns, create a dedicated information centre, support the capacity-building of SMEs and provide consultancy services in this regard.












3.6.2.


SMEs should be provided with the tools and knowledge required to improve their digital capabilities and infrastructure and adapt to EU digital standards.












3.6.3.


The Plan should support a programme aimed at implementing EU quality and food safety standards at company level.












3.6.4.


Another major priority should be modernising quality infrastructure laboratories and creating additional laboratories to properly enforce EU quality and safety standards.












3.6.5.


It is also necessary to invest in education and training in the area of quality infrastructure and improving the capacity of local auditors, quality control personnel and certification bodies to evaluate products according to EU norms.












3.6.6.


The domestic market supervision framework should be enhanced, so that products placed on the market comply with EU quality and safety standards. Additionally, the consumer protection framework should be significantly improved by implementing proper digital tools to facilitate the submission and management of consumer petitions, strengthening the institutional setting and fully aligning with the EU acquis.




3.7.   Pillar 3: Increasing financial assistance to support socio-economic and fundamental reforms and attract investment









3.7.1.


In order to increase Moldova’s capacity to assimilate this support in the most effective way, the EESC stresses the critical importance of substantially improving the quality of governance in the public sector, especially in the public institutions that are and will be managing EU financial resources.












3.7.2.


More specifically, it is important that critical elements of governance be implemented on a wide scale in these public institutions, namely: (i) the separation of evaluation, implementation and monitoring functions; (ii) the independence of financing decisions; (iii) the quality of management bodies (boards and executive bodies); and (iv) distribution and spending of the financial resources based on the principles of transparency and sustainability.












3.7.3.


This is specifically related to the institutions that are managing financial support for the agricultural sector, the environment and road infrastructure, where governance issues appear to be most critical. Furthermore, it is necessary to consolidate the capacities of public institutions and project implementation units in order to ensure that the Plan’s resources are assimilated in a professional manner.












3.7.4.


Financial support instruments – above all, agricultural subsidies and the programmes of the Entrepreneurship Development Organisation – must give clear priority to economic activities that contribute to the value chain and generate added value. This includes prioritising sectors and activities that focus on: processing local raw materials, technologising production processes, implementing innovations at company level and fostering export orientation with potential integration into global supply chains.












3.7.5.


At the same time, it is important to establish a mechanism for coordinating between various programmes by creating a register that consolidates funding options and prevents financial support from different programmes from being allocated to the same investment projects. It is also important to focus on making the mechanisms for allocating financial resources more efficient. In this sense, it is crucial to move from the mechanical and formalistic evaluation of funding to an evaluation based on factors such as risk, the added value generated and the broader impact of the business on the relevant sector and the national economy (2).












3.7.6.


There should be a focus on credit acceleration instruments. To help the private sector access bank loans, especially from the perspective of credit risk, the government can increase the capitalisation of the Credit Guarantee Fund (CGF), whose capacity to multiply is much greater when it comes to stimulating investments than when it comes to grants or subsidies: MDL 1 spent by the state through the CGF (when a guarantee is executed and there is no more chance of recovery) supports at least MDL 60 granted in the form of credits (3).












3.7.7.



The Moldovan Entrepreneurship and Economic Growth Fund (FACEM) should be further capitalised. Moldova continues to experience major and permanent fluctuations in its interest rates. In response to this, FACEM supports long-term loans at fixed interest rates. In addition, the possibility of applying interest rates below the market cost can encourage private long-term investment and complement the efforts made through the Credit Guarantee Fund. The results already demonstrate that national entrepreneurs need predictability, especially in terms of interest rates, to implement their investment plans under the forecasted conditions.












3.7.8.


In order to increase competitiveness in the agricultural sector, it is necessary to develop a programme aimed at supporting the diversification of agricultural crops, with a focus on those with higher potential for added value generation and greater resilience to droughts. Technological advancement in agriculture, land rotation strategies, the responsible use of fertilisers and pesticides and sustainable agricultural management should be major priorities of this programme.












3.7.9.


The Plan should clearly prioritise local and regional development as an indispensable condition for balanced and sustainable development across the entire country. In this regard:






—


at least 20 % (4) of all investments should be directed towards local and regional development;










—


support should be provided to enable the private sector to access key infrastructure: electricity connectivity, road infrastructure, water supply, sewage system, natural gas supply, etc.;










—


municipal bonds should be developed to help local public authorities (LPAs) access financing opportunities;










—


LPA associations and inter-municipal cooperation should be supported;










—


the local fiscal base should be extended and opportunities for local development diversified;










—


proper funding should be provided to local action groups (LAGs) that have already been established (there are currently 54 LAGs in Moldova, which cover more than 850 localities) and are currently underfunded (LAGs in Moldova drive economic growth in rural areas; they apply EU LEADER principles and represent public-civic-entrepreneurial partnerships that facilitate long-term community development and respect local priorities by using and appreciating the cross-sectoral contribution of each partner).
















3.7.10.



Civil society should play a pivotal role in increasing the degree of accountability of the government, as well as in advising and supporting the government authorities during the implementation of the reform agenda and participating in the decision-making process, so that the resources of the Plan are assimilated efficiently and with maximum impact. Therefore, it is necessary to strengthen the civil society consultation mechanism in the process of drafting and implementing public policies. At the same time, it is necessary to agree on adequate funding for civil society organisations, to support their core activities and to implement specific projects for independent and professional monitoring and evaluation of the use of the Plan’s resources in the Republic of Moldova.












3.7.11.


The EESC states that capacity-building for CSOs should be prioritised so that they can be competent partners throughout the EU accession process. In this context, it is essential to ensure collaboration between the government, the private sector, civil society and other stakeholders so that they can discuss needs and identify the barriers to Moldova’s EU integration, particularly in relation to socio-economic and fundamental reforms.












3.7.12.


The EESC emphasises that human rights issues, including a gender balance, inclusion of people with disabilities and ‘no one left behind’ principles, should be considered horizontal priorities in all the projects implemented under the Plan. A considerable part of the investments funded by the Plan should be directed towards strengthening the institutional capacities of national human rights institutions, including their role in implementing and monitoring the National Human Rights Plan. This would ensure a more robust framework for protecting and promoting human rights, fostering accountability and aligning national policies with international human rights standards.












3.8.


The EESC strongly recommends that proper funding should be provided for the creation of an economic and social committee in the Republic of Moldova, in line with the formal request from the National Trade Union Confederation of Moldova, the Confederation of Employers of Moldova and civil society (EU-Moldova civil society platform under the Association Agreement and the National Platform of the Eastern Partnership Civil Society Forum). This new institution should play a crucial role in monitoring and supporting the implementation of the reform agenda.












3.8.1.


A considerable part of the investments funded by the Plan should be directed towards modernising public institutions to increase their capacities in the context of the membership negotiations and implementation of the EU acquis.












3.8.2.


Last, but not least, the Plan should support social investments, along with economic investments. This includes government contracting of social services from non-governmental providers, as well as encouragement of private investments in social services, promotion of public-private partnerships in the social sector and social entrepreneurship. In this regard, it is also necessary to finish reforming the child protection and care system in Moldova, prioritising service development, especially services for children with disabilities, such as personal assistance services, mobile team services, rehabilitation services, early childhood intervention services, day care, inclusive education services and foster care. One of the essential objectives of Pillar 3 should be comprehensive anti-poverty measures, focusing on addressing child poverty in rural areas, where it is above 40 %.






Brussels, 26 March 2025.


The President


of the European Economic and Social Committee

Oliver RÖPKE
               





(1)  Expert-Grup, 2024, Raport de stare a țării 2024: Republica Moldova https://www.expert-grup.org/ro/biblioteca/item/2879-raportul-de-stare-a-%C8%9B%C4%83rii-2024/2879-raportul-de-stare-a-%C8%9B%C4%83rii-2024.

(2)  Expert-Grup, 2024, State of the Country Report: Republic of Moldova 2024: https://www.expert-grup.org/en/biblioteca/item/2879-raportul-de-stare-a-%C8%9B%C4%83rii-2024/2879-raportul-de-stare-a-%C8%9B%C4%83rii-2024.

(3)  Expert-Grup, 2024, State of the Country Report: Republic of Moldova 2024: https://www.expert-grup.org/en/biblioteca/item/2879-raportul-de-stare-a-%C8%9B%C4%83rii-2024/2879-raportul-de-stare-a-%C8%9B%C4%83rii-2024.

(4)  Similar to Ukraine Growth Plan.


ELI: http://data.europa.eu/eli/C/2025/2965/oj
ISSN 1977-091X (electronic edition)