Moldova will improve the quality of public sector debt statistics and public debt management.
This is stipulated in the amendments to the Government Decision on some measures of implementation of the Law on debt of the public sector, state guarantees and state on-lending. According to Finance Minister Veronica Sireteanu, the decision will be in line with the amendments previously adapted to the above-mentioned law. Among other things, these amendments provide for changes in the current regulatory framework on issues related to cooperation with international rating agencies; issuance of securities in foreign financial markets and the intention to sell government securities (GS) directly to individuals through the electronic platform. According to the Ministry of Finance, the proposed amendments provide for: the sale of government securities directly to individuals through an electronic platform; improving the data quality of public sector debt statistics by consolidating data and reporting by state/municipal enterprises and companies with full or majority state capital on information on guarantees provided; establishment of the right of the Ministry of Finance to conduct on-site inspections of primary dealers to control and evaluate their activities; regulation of the process of authorizing borrowing and issuing guarantees by administrative-territorial units by clarifying the conditions and stages of borrowing and/or issuing guarantees by administrative-territorial units; improving the management of Moldova's public debt in accordance with international best practices in this area through the development by the Ministry of Finance of the Annual Plan of Loans, which will include the structure and volumes of financing the state budget deficit for the corresponding year. It should be noted that the Law on Public Sector Debt, State Guarantees and State On-Lending was supplemented with the new concept of "consolidation", which means the unification of statistical data of public sector debt components and exclusion of statistical data of public sector debt components to form a single whole. Also, the law clarifies the concepts of "public sector debt", "deposit" and introduces the concept of "guarantee of the state/municipal enterprise and commercial company with fully or predominantly public capital", which means the obligation assumed by the state/municipal enterprise and commercial company with fully or predominantly public capital as guarantor to pay the outstanding obligations of the guaranteed debtor when the payment date comes. It is also envisaged to develop an annual State Loan Program, which includes the structure and volume of financing of the state budget deficit for the relevant year. It is envisaged that transactions in the secondary market with government securities are carried out by individuals only outside the regulated market and outside the multilateral trading system, with the participation of primary dealers, and the procedure and conditions of admission to trading in government securities in the regulated market and multilateral trading system are established by the Ministry of Finance along with the National Financial Market Commission. It is stipulated that the Ministry of Finance monitors and evaluates the activity of primary dealers in accordance with the joint normative acts of the Ministry of Finance and the National Bank of Moldova, issued and approved to execute the mentioned law, and in order to evaluate the activity of primary dealers the Ministry of Finance has the right to conduct on-site controls of their activity. It was also stipulated that the decision of representative and authorized bodies of territorial-administrative units to conclude an agreement on assumption of debt obligations, on granting a loan guarantee, as well as on issuance of long-term securities shall be made based on the opinion of the Ministry of Finance, which is mandatory. Contracts on external public loans are ratified by the Parliament by organic law, but before the initiation of negotiations, the contracts on external public loans are mandatorily sent for consultation to the Ministry of Foreign Affairs and European Integration, which expresses its opinion on each case separately, if these contracts fall under the Moldovan Law on International Treaties. In the event of issuance of state securities for placement on foreign financial markets, the maximum amount of the issuance must be provided in the state budget law for the relevant year. // 15.03.2023 – InfoMarket
