FDI enterprises create jobs for 16.3% of employees in Moldova and form at least 23% of gross value added in the country's economy.
This is stated in a study on the impact of foreign direct investment (FDI) on the Moldovan economy, which was prepared by the consulting company Business Intelligent Services (BIS) along with the National Institute for Economic Research (INCE), commissioned by the Foreign Investors Association (FIA). The study showed that FDI enterprises make a significant contribution to the socio-economic development of Moldova. Occupying a relatively small share in the total number of enterprises (7.5% of the total number of enterprises), they demonstrate high efficiency and produce a significant amount of high-quality goods and services. At the same time, they play an important role in the formation of the country's budget – as of late 2019, enterprises with FDI accounted for 29.4% of income tax receipts, 24.1% of compulsory medical insurance contributions and 23.9% of state social insurance contributions. FDI enterprises account for 27.4% of long-term assets. Enterprises foreign investments contribute to the creation of gross value added in the amount of 23% in the economy as a whole, while their share in some activities exceeds 50%. FDI enterprises create jobs for 16.3% of wage earners in the country, and their contribution to total sales income is 28.4%, which indicates high labor productivity at these enterprises. It is noted that in 2010-2019 the number of employees of FDI enterprises increased from 66 thousand to 90 thousand people. The wages of workers at these enterprises are 2 times higher than at local private enterprises, and 1.5 times higher than the average level of wages in the country. FDI companies often act as a reference business model, a conductor of advanced management and production technologies, quality standards and are of systemic importance for the national economy. In general, according to the National Bank, in 2010-2019 the contribution of FDI to the formation of the country's GDP ranged from 1.1% (in 2016) to 4.3% (in 2011), in 2019 this figure was 4.2%. At the same time, according to the study, Moldova lags significantly behind many countries in the region in attracting foreign direct investment, showing the weakest results. Thus, according to the presented data, in Moldova, the inflow of FDI per capita in 2010-2019 amounted to $694, which is 3.2 times less than the average in Eastern Europe ($2233) and 2.8 times less than in transition economies ($1941). The main factors of investment attractiveness are improving the business environment, regulatory framework and human development, and in this context, the study notes that the key tasks for the authorities are to reduce the level of corruption, maintain fair competition, ensure a stable framework environment, and ensure the protection of private property and the rule of law in Moldova. It is planned that after a wide expert discussion, the Foreign Investors Association (FIA) will present conclusions and proposals to the government and parliament of Moldova to improve the investment climate. // 16.09.2021 - InfoMarket.
