regional development strategy (short)

8/6/2019 Regional Development Strategy (short)

http://slidepdf.com/reader/full/regional-development-strategy-short 1/25

2010

NORTH

DEVELOPMENT

REGION

Regional

Development Strategy

< Short version >



Regional Development Strategy North Development Region

2

Strategic context

This Regional Development Strategy (RDS) is a public policy document aimed

at outlining the medium-term development priorities of the region.

Macro and sectoral policies tend to have a spatial impact thus it is important

that public authorities develop complementary regional policies in order to

ensure balanced development in the country. To achieve this, the RDS is

aligned with national-level development policies and strategies.

The National Development Strategy (NDS) for 2008–11, approved by Law No.

295 of 21 December 2007, identifies regional development as one of the five

national priorities with the general aim of achieving ’balanced and sustainable

social-economic development in the entire territory of the Republic of Moldovathrough co-ordination of efforts within the development regions’. The NDS is a

cross-sectoral document that includes measures in the area of regional

development undertaken by a number of central public authorities, and which

represents the responsibility undertaken by Government for implementing

state policies in the priority area of regional development.

Law No. 438-XVI on Regional Development of the Republic of Moldova, dated

28 December 2006, defines the main objectives and principles, and sets out

the institutional framework and planning tools for regional development. Underthat Law, the National Strategy for Regional Development (NSRD) is developed

at national level, while the RDSs are developed at regional level. These

documents identify priorities and implementation measures for regional

development policy within the development regions.

The NSRD is a framework document for the establishment of institutional

arrangements for regional development. Its scope is limited to establishing and

maintaining a framework for the management, implementation, funding,

monitoring, and evaluation of regional development, without going into detail

on the content of the RDSs or the ways in which regions will conceive their

development.

The RDS represents a medium-term policy document at regional level, and a

strategic framework for facilitating and promoting integrated spatial, economic,

and social development at the level of the development region, and for

contributing to achieving regional sustainable development objectives.

The RDSs provide a wider ’horizontal’ context to development, which should

allow more efficient coordination and concentration of sectoral expenditures bythe ministries and donors in the regions. The strategies will also seek to




3

enhance regional capacity for the efficient absorption of investment funds.

Moreover, the Republic of Moldova, in conformity with European practices, will

move towards more integrated government to achieve greater synergy

between national (’vertical’) and regional (’horizontal’) programmes. Thus, the

RDS becomes an important mechanism for linking actions at national, regional,and local levels.

The RDS should help mobilise the development of regional partnerships to

develop a viable project pipeline to be included in the regional operational plan

(ROP). The ROP governs the implementation of the RDS, and covers a three-

year period, comprising of programmes, projects, and priority activities.

Projects, programmes, and specific regional development activities contained

in the ROP should be based on the main RDS priorities for that period. In

accordance with the RDC’s decision, the ROP will be periodically updated –

generally, on an annual basis.

A national Single Programming Document (SPD) will be developed on the basis

of these RDSs and ROPs, whereby priorities and areas supported by financial

resources will be established. The SPD will be submitted for approval to the

National Coordinating Council for Regional Development (NCCRD) and to the

Government.




4

Situation analysis

The situation analysis provides an overview of the North Development Region’s

(NDR) social and economic development trends. This chapter includes sectionscovering the following topics:

infrastructure – including information on the inter- and intra-regionalroads network, water supply and sewage systems, gas and heatingsupply;

economic development - including sectoral profiles and private sectordevelopment trends in the NDR; and,

social conditions - focusing on poverty levels and the deprivation index

assessment based on SADI indexes.

Infrastructure

Connectivity and accessibility

Network of intra-regional roads Distances from the farthest points areabout 170 km from north to south, and about 130 km from east to west. Onaverage, district centres in the NDR are 55.3 km from Balti.

Connections between NDR1 cities are made through a dense network of

national roads. The main urban centres have direct connections (Balti–Edinet–

Briceni; Soroca–Drochia–Rascani–Costesti; and Soroca–Floresti–Balti–Falesti)

or through the regional centre of Balti, which has connections between the

north and the south of the region.

Local road network The total length of public roads in the NDR is about

3,400 km (36% of the total length of country’s roads). Of these roads, 31%

are national roads with a metalled surface. The proportion of local roads is

39%, with 94% having metalled surfaces. The density of public roads in the

NDR is 33.6 km/100 km2.

Railway transport The density of the railway network in the NDR is the

lowest in the country and amounts to 2.1 km/100 km2, which is less than the

national average of 3.3 km/100 km2. The main railway junctions in the NDR

are in the city of Balti and the town of Ocnita.

River transportation There are two river border-crossing points in the NDR:

the floating bridges connecting Soroca with Tekinovka and Cosauti with

Yampol. These are used at minimal capacity both for cargo and passenger

1For a map of the communities network, please see Annex A.




5

transportation. Due to the limited depth of the Nistru and Prut rivers, only light

cargo and small passenger vessels are used on its navigable sections.

Communal and public services

The water supply in the NDR is provided mainly by underground water, and

by the Prut and Nistru rivers. Early in 2008, the proportion of communities

with potable water supply networks was 35%, construction of the networks

having slowed in comparison with the rate of progress up to 2006. Artesian

wells provide 70% of the water consumed. However, 80% of water resources

do not comply with quality standards for potable water. According to statistical

data, the density of water supply networks in 2008 was 39.2 km/km2.

Sewage Sewage systems are poor in the NDR, as in the rest of the country.

Sewage systems operate mostly in urban communities. The density of sewagenetworks is approximately 20 km/100 km2, which is less than the national

average by 22.6%. In Balti, this indicator is 9 times higher, amounting to 185

km/100 km2.

Waste management In the NDR, the infrastructure and management of solid

domestic waste is underdeveloped. At the regional level, soil, water, and air

are heavily polluted, mainly due to lack of systems for integrated waste

management and an underdeveloped system for the collection of solid and

liquid waste, including toxic waste. Except for Balti, the region lacks wasteenterprises, and a lack of advanced recycling technologies and practices. In the

NDR, thousands of tons of solid domestic waste is produced every day. This is

collected and stored in over 350 small warehouses, located, as a rule, at the

periphery of communities. Most of these warehouses are unauthorised and are

not properly equipped.

Supply of natural gas

It is envisaged that the provision of a natural gas supply to communities in the

NDR will be made from high pressure main gas pipelines that come from theUkraine: Ananiev–Kotovsk–Floresti–Drochia–Edinet–Alexeevka (Ukraine), and

Moghiliov–Podolski–Ocnita–Bogorodceni. In 2007, 28% of the region’s

communities were connected to gas pipelines, which is a lower proportion than

the national average of 35%. The largest share of communities connected to

the gas network is in the city of Balti and the districts of Ocnita and Briceni.

Supply of heat

Heating supply is a common problem in all regions. Of all the NDRcommunities, only Balti receives heat from the North Electricity Networks heat




6

producing station. In the other communities, municipal heat stations are not

operational. Thus, the residents of apartment blocks that have been connected

to gas networks have built their own boiler houses. Some residents have

installed stoves in apartments, while others still use electricity for heating

during the cold season of the year.

Economic development

Region’s Gross Added Value2

The Gross Added Value (GAV) for the NDR in 2008 was estimated at MDL 7.22

billion (21% of the national allocated GAV).3 Compared with 2006, GAV has

not changed significantly. GAV per capita was slightly less than €500 (76% of

the national average).

Sectoral profile

The economic sectors contribute to regional GAV in different ways. Over recent

years, a trend has been seen in the changing sectoral structure of the regional

economy. Thus, in 2008, the share of agriculture in regional GAV was 25%,

having decreased by 6–11% compared with previous years. At the same time,

the contribution of services has grown by the same amount and reached 47%.

The region has a relatively well-developed industrial potential. The mainindustrial activities are: (a) extractive industry; (b) production of clothing,

processing, and dyeing furs; (c) production and distribution of electricity and

heat, gas, and hot water; (d) the food and beverages industry; and, (e) the

production of medical, precision, and optical devices and equipment. Over 50%

of industrial potential is concentrated in the city of Balti. However, there are

several industrial centres with potential for development in the region: Edinet–

Cupcini, Floresti–Soroca, Ocnita–Otaci.

Of the total territory in the NDR, 70% comprises agricultural land and this

region contributes approximately 40% of the total agricultural production of

the country. The main agricultural products are cereals, forage, and

horticultural crops. The agricultural-industrial potential of the region consists of

2Data on GAV by region is taken from calculations by Matthew Powell [1].

3 It was not possible to allocate the entire added value registered on national accounts to the region (seePowell (2009), annex B). Particularly, there is neither an effective method to allocate financial servicescalculated indirectly to the field, nor the data required to allocate the revenues of state and not-for-profitorganisations from services delivered to households. Thus, unallocated value added represents about

12.5% of value added for 2006 in 2006 prices and about 14.5% of value added for 2008 in 2006 prices.The estimations for national GAV and GAV per capita used for comparison in this section represent valueadded allocable for all regions and do not include unallocable value added.




7

51 production cooperatives, 25 joint stock companies, over 530 limited liability

companies, and over 90,000 farms registered as individual companies. The

location of production capacities is shown in Annex B. The entire sugar industry

of the country (five sugar factories) is located in the region, together with four

high-capacity enterprises for processing fruit and vegetables, five factories forprocessing animal produce, three poultry enterprises, and other companies

specialised in processing activities. The greatest contribution is made by trade,

telecommunications, and financial services. The regional hotel industry

comprises of 18 hotels and other types of accommodation facilities, have a

total capacity of 2,415 beds. The tourist sector of the NDR comprises 102

state-protected areas with a total area of about 16,600 ha, two beaches of

national-level quality (at Soroca and Costesti), 20 museums, five monasteries

and four hermitages, and 178 ecclesiastical buildings of national and regional

importance.

Entrepreneurship

Entrepreneurial development is an important driver of the regional economy.

Between 2004 and 2008, the number of enterprises increased by 30%.

However, the number of jobs has decreased by 16%. While the number of

enterprises is steadily growing, their density is low, with 53 companies per

10,000 inhabitants in 2008, which is 25% of the national average. The SME

sector comprises 97% of total enterprises and accounts for 57% of

employment. Micro-enterprises represent two-thirds of the total number of

enterprises, and account for 10% of total employment, accounting for 5% of

total revenues.

Social situation

Living standards in Moldova are relatively low, especially in the areas outside

the capital city. One-third of the region’s population is under the threshold of

absolute poverty, 20% in relative poverty, and 4–6% in conditions of extreme

poverty.4 The welfare level of the population in the areas surrounding the city

of Chisinau stands out, being twice as high as that of the regions.

4 Absolute poverty is represented by a lack of minimal conditions for life: food, clothing, andaccommodation needed for simple survival in the conditions of the relevant society. From a long-termperspective, absolute poverty generates irreversible biological degradation.

Relative poverty is defined as the inexistence of a minimal level of resources to insure the normal

functioning of a person in the relevant socio-cultural context. One may be under the relative povertythreshold with no long-term change of capacities for normal social operation, but only for a limitedperiod.




8

Deprivation levels, by area, show that access to education in NDR

communities is higher than in the CDR and SDR. However, the level of

economic deprivation is lower than in the SDR and higher than in the CDR, and

the NDR has the lowest indicator of the three regions in terms of health care.

Lack of income leads to extension of poverty in all areas of life. This final state in the poverty chain is

what is known as extreme poverty.




9

SWOT Analysis of NDR

SWOT analysis is a strategic planning method used in the RDS to evaluate the

region’s strengths, weaknesses, opportunities, and threats. The main

purpose of the SWOT analysis is to develop a structured, comprehensive

understanding of all the factors that determine the development of the North

Region.

STRENGTHS WEAKNESSES

Relatively diversified industrial potential

Growth of the number of private

enterprises and existence of important

foreign investors Role of Balti municipality as regional growth

pole with relatively high urbanisation

Extensive transport network

Capacity and potential of Balti and

Marculesti airports

Capacity for power and heat generation,

opportunities for gas storage

Growth of labour productivity and relatively

low labour costs

Relatively developed network of educationalinstitutions

Favourable weather conditions for

agriculture

Relatively rich and diverse natural

resources, including mineral ores and high-

quality water resources

Use of outdated technologies and equipment

in the production process

High cost of capital and limited access to

funds for businesses Weak representation of businesses

Limited own local public authority revenues

and dependence on transfers from national

bodies

Degradation of small towns and public utility

infrastructure

Low quality of roads and railways

Inadequate connection of communities to gas

Low quality of potable water

Negative demographic trends and populationageing

Qualified labour force deficit

Degradation of the environment, excessive

soil pollution, and increased frequency of soil

erosion and landslides

OPPORTUNITIES THREATS

Proximity to EU, with two operational Euro-

regions and eligibility for EU cross-border

cooperation programmes (Moldova–Ukraine–Romania, 2007–13; Black Sea

Cooperation, Eastern Partnership)

High priority allocated by the government

to regional development reforms and

decentralisation

Establishment of clusters, industrial parks,

and technological incubators

Negative effects of the world financial crisis

and extended economic recession

Political instability at national level expressedthrough inconsistent regional development

policies and/or frequent amendment of legal

framework

Limited connections with the EU through

Romania

Dependence on energy resources and

fluctuating energy prices

Continuing migration of the labour force

More frequent natural hazards and extreme

weather events as a consequence of climatechange




10

The socio-economic and SWOT analyses of the NDR reveal the

existence of some fundamental internal and external factors that

affect the development of the region. The NDR is the second largest

development region. The NDR also ranks second in terms of GAV and GAV per

capita, with only Chisinau ranking higher. This is due to the industrial andagro-industrial capacities in the region, both by a growing number of local

companies and by recognised foreign investors.

Balti municipality, the second largest city in the country in terms of

size and importance, serves as a genuine growth pole for communities

of the region, economically, educationally and culturally . The relatively

high urbanisation, together with access to a relatively strong educational

network, favours growth of labour productivity and generates a higher human

development index in the NDR.

Historically, the NDR has inherited a diversified transport network,

including airports with significant commercial capacities. These systems

facilitate the movement of goods, services, and human resources, and could

serve as a solid basis for future commercial development. Moreover, the NDR

has capacity for energy production, which is crucial for further industrial

development.

The economic performance of the region shows that the advantages

are not fully utilised . During the period between 2006 and 2008, GrossRegional Product (GRP) did not change significantly, while GRP per capita was

a little over €600 (79% of the national average). Heavy depreciation of fixed

assets and the use of outdated technologies are not conducive to the positive

development of the economy, high productivity, and competitive high quality

products. At the same time, the high cost of capital and limited access to

finance, accompanied by regulatory constraints, do not favour investment in

modern equipment and technology, which limits the expansion of businesses

and the creation of new jobs.

Continuing lack of public investment has resulted in significant

degradation of the network of roads and public utility infrastructure .

This situation creates growing transportation costs, and limits the movement of

goods, services, and human resources. It not only reduces economic activity,

but also limits human development. Only about one-third of the region’s

population has access to potable water supply networks, while the quality of

water consumed from artesian wells does not comply with quality standards.

There are discrepancies between livelihoods in the region and in Chisinau, as

well as within the region, especially between urban and rural areas. As aresult, migration flows have increased, which, in combination with a negative




11

demographic growth and population ageing, reduces the size of the qualified

labour force.

Promotion of regional development policy and the renewed focus of

the government on decentralisation could result in more regional-level

projects. Proximity to the EU opens up new opportunities, both for companies

in the region and for public authorities, that have obtained direct access to

cross-border cooperation programmes funded by the EU. The use of national

and external funds for regeneration of regional infrastructure, implementation

of business support programmes, and improvement of the environment will

eliminate constraints to economic growth and will accelerate the NDR’s

development.




12

Strategic vision, objectives and priorities

Vision

The strategic vision for the NDR supports a realistic, credible and attractive

future for the region. The strategic vision describes a set of basic ideals,

priorities, principles, and values on which the development of the region is

based, as well as the elements that differentiate the region from other parts of

Moldova.

The strategic vision of the NDR is consistent with the strategic vision of the

country set out in the Constitution and the NDS for 2008–11, and envisages

the establishment of the necessary conditions for improving living standards.

The approach includes a number of factors in addition to economic

development: freedom of the individual and access to education, health care,

and social services. The RDS also aligns with the goals of the NSRD, which, by

developing an efficient implementation mechanism to enable sustainable

growth in the development regions, supports the goals of the NDS.

The strategic vision for the NDR reflects a consensus on the aspirations

formulated by different stakeholders interested in the development of the

region, including representatives of the public authorities, the private sector,

and civil society.

Strategic vision: The NDR will become a dynamic and united region, where

the present and future generations will have a high standard of living, secured

by diversified economic activities, an open attitude towards technological

innovation, a healthy environment, and a distinct regional culture. Everyone

will have the opportunity to realise their potential to the fullest extent.

In this context, the objectives set out below have been formulated to supportthe realisation of the vision:

the Region will become competitive, with a dynamic and diversified

economy; the Region will become attractive for investment and, subsequently,

opportunities will arise for creation of new jobs; the spirit of entrepreneurship will be encouraged and supported;

the industrial potential of the Region will be optimally utilised; all means and resources will be oriented to ensuring a high quality of

life;




13

a combination of diversified intercultural values will ensure a harmonioussocial climate; and,

economic development will not damage the environment, making theRegion a healthy place in which to live and to enjoy recreationalactivities.

All the objectives listed above will be realised by local authorities, in close

cooperation with civil society, the private sector, and the wider population.

Identification of priorities

The economic analysis of the region, as well as the SWOT analysis, indicates a

number of factors that influence the development of the region. These factors

either act as constraints to growth or highlight certain advantages for the NDR

compared with other development regions, both inside the country and in theimmediate neighbourhood. The strategic vision offers a long-term perspective

for the development of the region. Combining the analysis of the situation at

present and the vision for its future, one can identify certain guidelines that

the region should seek to follow in its development.

The identification of priorities, however, should not only respond to the

multiple needs of the region. It is necessary to acknowledge that public

resources are limited compared with the possible projects that could be

implemented. Therefore, projects need to be focused on activities capable of

eliminating the most fundamental constraints and achieving the greatest

benefits across many sectors.

Analysis clearly reveals significant disparities between Chisinau and the

regions, and between the urban and rural settlements within the region. The

poor condition of physical infrastructure appears to be a fundamental factor,

which generates and deepens this disparity by increasing transportation costs

and limiting the movement of goods and people. At the same time, economic

potential is restricted by transportation costs, and is also limited by reduced

opportunities to initiate other economic activities, particularly in rural regions.

Therefore, increasing the efficiency of the agricultural and the agro-industrial

sectors, together with encouraging greater diversity of economic activities,

appears to be of critical importance.

Economic development, however, should not be allowed to damage the

environment. Environmental conditions can have a significant effect on living

standards and the attractiveness of the region, both for the local population

and for visitors.




14

Three priorities have been identified for the implementation of the RDS. These

are:

1. the rehabilitation of physical infrastructure;2. support for the development of the private sector and labour market; and,

3. the improvement of the environmental and its attractiveness to tourists.

These priorities are inter-connected, and their effective implementation will

accelerate the development of the region.

Regional partnerships

Achievement of the strategic vision of the NDR and implementation of these

priorities will not be possible without the active participation of the entire

population in the implementation of the RDS. The RDS has been developed in a

participatory way, with substantial participation by private enterprises, NGOs,

different levels of public authority, and other interested members of the public.

This needs to be followed by a transparent, equitable, and efficient

implementation of the programmes agreed in the RDS.

The culture of cooperation among different regional actors needs to be

promoted at all levels. The RDC is composed of local elected officials

representing different parties, business people, civil society representatives,

and experts in various areas. It is anticipated that such regional partnerships

will be also created during implementation of the RDS. The achievement of the

vision laid out in the RDS can only be attained through a combination of efforts

working within regional partnerships

Priorities

The regional working groups have discussed many programmes and measures

necessary for the dynamic development of the region. However, taking into

consideration the financing opportunities and the implementation term of the

Strategy, only a few areas have been identified as priorities. The rationale, themeasures, and the expected outcomes for each priority are described below.

Priority 1: Rehabilitation of physical infrastructure

Goal The goal of priority 1 is to improve the access to high quality

infrastructure, both for households and economic agents.

Rationale Deficiencies in investment in public infrastructure over recent

decades has led to a significant deterioration of roads, water supply, sewage

systems, and the gas supply network. This fundamentally impacts




15

competitiveness, both at national and regional levels. Rehabilitation of

infrastructure will, on the other hand, boost the attractiveness of the region to

investors.

A good water supply is a particular requirement for the region, where 80% of

the water resources does not meet quality standards. This affects the health of

the population, and also the agro-industrial sector. The water supply and

sewage system are expected to be built, initially, in the districts characterised

by the most underdeveloped networks and also in the settlements that can be

connected to the Soroca–Balti water supply system.

Modernisation of roads is also an important objective, increasing access to

national and international highways and, subsequently, commercial flows.

Development of the airport infrastructure and creation of access points will

facilitate the attraction of foreign investors, and also increase tourism potentialin the region.

Measures Measures with the maximum impact on the rehabilitation and

development of physical infrastructure are:

the extension and rehabilitation of the water supply and sewagesystems;

the reconstruction, rehabilitation, and development of regional highways– in particular roads that connect with the national highways and other

renovated roads; development of the Balti and Marculesti airport infrastructure, and the

services provided by them; and, the encouragement of cross-border activities through increased

investment in the creation of border-crossing points in the NDR betweenMoldova and Romania.

Output indicators Implementation of projects focused on priority 1 will be

monitored based on the following output indicators:

the proportion of houses that do not benefit from piped water in relationto the total number of houses;

the proportion of reconstructed or newly constructed roads in relation tothe total number of roads;

extension of the runway at Marculesti airport; and,

setting up an additional border-crossing point between Moldova andRomania.

Outcome indicators Implementation of projects focused on priority 1 will be

monitored based on the following outcome indicators:

the number of persons with access to high quality drinking water; the number of start-up companies; and,




16

value of exports.

Impact indicators Implementation of projects focused on priority 1 will be

evaluated based on the following impact indicators:

the volume of production (regional GAV); and, the employment ratio.

Priority 2: Support for the development of the private sector

and labour market

Goal The goal of priority 2 is to facilitate the creation of jobs and to increase

the employment ratio.

Rationale The analysis of strengths suggests that the economic performance

and the human development in the region are lower than their potential level,when taking into consideration the fact that the NDR is relatively more

industrialised compared with other regions. The main challenge here is the

economic activity in the rural areas. More than 60% of the population of the

region is located in rural settlements.

Rehabilitation of infrastructure is expected to encourage migration to urban

areas in search of jobs. However, in the short and medium-term, there will

only be modest levels of migration. In this context, it is necessary to increase

agricultural productivity and to achieve economic diversity. Development of theprivate sector becomes imperative for the dynamic growth of the region and

the creation of employment.

Measures Measures with the maximum impact on the private sector

development are:

the development of continuing training; support for vocational trainingand retraining those employed in the rural areas;

incentives for SMEs through development of information and consulting

services for SMEs; support for the creation of technology incubators andthe application of innovative technologies (for example, coolingwarehouses, greenhouses, processing industry);

support to enterprises with the potential for export, provided theyobserve the international quality standards; and,

the encouragement of the association and cooperation of all actors in theagro-industrial sector, with the aim of ensuring equity in the relationsamong producers of raw material, processing entities, and tradesmen.






17

the number of vocational retraining programmes brought up to date incollaboration with private sector;

the number of SMEs that benefit from consultancy services; the number of companies that benefit from grants offered during a

transparent process of selection; and, the number of events organised with participation of all stakeholders.



the number of people who found employment after retraining; and, the number of jobs created in SMEs.

Impact indicators Implementation of projects focused on priority 2 will be

monitored based on the following impact indicators:

the volume of production (regional GAV); and,

employment ratio.

Priority 3: Improvement of the environment and

attractiveness to tourists

Goal The goal of priority 3 is to generate environmental protection initiatives

and increase the region’s attractiveness to the population and to visitors.

Rationale The state of the environment has a direct influence on the living

standards of the population and the attractiveness of the region. At present,

solid and liquid waste are managed in a non-sustainable way, which leads to

the degradation of resources and the deteriorating health of the population.

Only the urban settlements in the region are equipped with purification

stations for processing waste water. However, even in the areas where they

exist, their operation is inefficient. The problem is extreme in Soroca, where

there is no purification station at all. Thus, daily, 2,040 tons of untreated waste

is discharged into the River Nistru. Chronic problems of this kind will be the

first to be addressed under this priority.

The increase in the frequency of extreme weather events demands the

development of a programme facilitating the adaptation of people and

organisations to climate change. Forecasting and prompt reaction to these

events acquires a special attention.

Measures Measures with the maximum impact on improvement of the

environment are as follows:

greater access to information on the environment and the promotion of ecological education;




18

development of integrated management systems for solid wasteprocessing, including the separate collection of waste, and the recyclingand creation of modern dump sites for the storage of non-recyclablewaste;

higher ecological security for the region through the promotion of actions

aimed at stopping soil degradation, and the development of earlywarning and response systems to extreme weather events; and,

the rehabilitation of tourist sites, and the promotion of actions ensuringthe integration of these locations in the international tourist circuit.



the development and implementation of awareness campaigns; the number of new polygons for waste storage;

the number of waste water treatment stations rehabilitated/constructed; the development of the forecasting of extreme weather events, and

development of an early-warning and response system; and, the number of tourist sites rehabilitated.



the number of social initiatives developed and implemented; and the decrease in erosion and the improvement of soil fertility.

Impact indicators Implementation of projects focused on priority 3 will beevaluated based on the following impact indicators:

the volume of production (regional GAV); and,

employment ratio.




19

Monitoring, reporting, and evaluation

Monitoring and evaluation will be carried out at the level of individual projects,

and at the level of the regional strategy as a whole.

The RDA will report on the projects funded through the National Fund for

Regional Development (NFRD) to both the Regional Development Council and

the Ministry for Construction and Regional Development (MCRD). The Quarterly

Reports will contain information on project implementation. Six-monthly

reports to the Regional Development Council will also address progress in the

implementation of the RDS. An annual report on the implementation of the

ROP will be prepared by the RDA at the end of each financial year.

Each project funded by the NFRD, and included in the SPD, will contain in theproject documentation:

the overall objectives of the project, in terms of national objectives forregional development as contained in the NDS;

the contribution of the project to the goals of the Strategy and thepriorities of the RDS;

the immediate outputs of the project; the activities to be carried out to achieve those outputs; and, the inputs required.

This information will form the basis for identification of relevant indicators for

monitoring and evaluation.

The RDA will track the progress of projects on a monthly basis. A Quarterly

Report on each project will be submitted to the RDA on overall implementation

and agreed output, outcome, and impact indicators. The aggregation of these

reports will form the basis for the six-monthly and annual reports both to the

Regional Development Councils and to the MCRD.

The RDA is responsible for reporting on the ROP of this Strategy. The ROPcontains both qualitative and quantitative indicators. Qualitative indicators –

which are largely process indicators (that is, whether an action has been

carried out or not) – will be monitored by the RDA. Quantitative indicators

tracking progress in the implementation of the ROP will be developed from the

information on projects collated by the RDA. The MCRD will report information

on trends in economic conditions in the region, based on data provided by the

National Bureau of Statistics. This information will be passed on to the RDA for

inclusion in the six-monthly reports made by the RDA.




20

In addition to regular reporting on progress, every project should submit a

detailed end-of-project report; this assesses the overall success of the project,

reports on specific outcome and impact indicators, and identifies the longer-

term impact of the project once implementation is completed. Evaluation

studies will be carried out for larger projects and could include a range of appropriate methodologies, including participatory surveys of beneficiaries on

the value of project outcomes. For a proportion of large projects, particularly

where benefits are anticipated to be both long-lasting and widespread, the

RDA will organise impact assessments at an appropriate period after the

project is completed. Funds to do this will be incorporated into the budget of

the project.

The RDA will also carry out periodic perception surveys for the Regional

Development Council, in order to assess how the activities of the Council itself

and the progress in the RDS are perceived by the local population. At the same

time, the questionnaires will assess the population’s perception of the impact

of the RDS. The results of these surveys will be reported as part of the

Quarterly Reports, and be presented as a stand-alone report to the Regional

Development Council.

Reporting on the RDS is part of an overall monitoring and evaluation (M&E)

system that includes the NSRD and the NDS. The M&E system will be

developed in a way that is consistent with government reporting on the NDS.

As the national M&E system evolves, the elements of the monitoring system

for the RDS will evolve with it.

The ROP covers a three-year period. As the ROP evolves over time, the M&E

system will be updated in accordance with the ROP.




21

Resources and financing framework

The financing needs

Although the financing needs of potential development projects are enormous,

the public resources available for the implementation of such projects are

limited. The NDR RDS has restricted itself to three priorities with the greatest

impact on the social and economic development of the region. However, the

measures included in the RDS can be implemented on different scales,

depending on the volume of resources that can be directed towards the

implementation of regional projects and the capacity to utilise the available

funds. In this context, financing needs and expected sources of priorities’

funding will be calculated when specific projects are identified and included inROPs.

Sources of financing

The National Fund for Regional Development

According to the Law on Regional Development in the Republic of Moldova of 28 December 2006, the main source of financing for programmes and projectsfocused on the achievement of the regional development objectives is theNFRD. The NFRD is sourced from the annual allocations from the state budget,as a specific allocation to support regional development policy. The NFRDamounts to at least 1% of the state budget revenues. The NFRD can attractother financial resources from the public and private sectors at local, regional,national, and international levels, as well as the support offered by bi-lateraland multi-lateral donors, including European Union assistance programmes.

The NFRD includes funds for all development regions. According to Law No.

438-XVI, the distribution of the funds by region will be based on the principle

of priority allocation to the disadvantaged areas from the development regions.

At the same time, the allocation of resources will also depend on the quality of

the submitted projects.

Other public sources

There are, however, certain transfers available from the state budget; these

transfers represent about 15% of the total transfers and are normally directed

towards the implementation of construction/capital investment projects. These

transfers could be focused on financing regional development projects. Under

existing conditions, the allocation of these transfers has been based onprojects identified at the central level. Therefore, using these resources to




22

support regional development projects will require a certain degree of

decentralisation by the central authorities.

Additionally, local authorities could direct resources from the budgets of local

public administration (LPA) to the co-financing of projects. In particular, this

could apply to external assistance projects where such co-financing is

compulsory, or to supporting the preparation of priority projects (for example,

performance of feasibility studies, and the employment of certain consultants).

External assistance

An important source of financing for regional development projects can be

external donors, through cooperation programmes with the government and

also through programmes available to regional and local authorities. Together

with the creation of the institutional and strategic regional developmentframework, and the practical implementation of regional development policies,

external donors could contribute by providing assistance in the form of direct

budget support to the NFRD. The mobilisation of additional resources directly

into the NFRD will depend on the efficiency and effectiveness of the NRFD’s

implementation, and the quality of the identified regional development

projects.

In addition, many of the external assistance programmes and projects

implemented in cooperation with the government have a regional or localdimension. For example, projects focused on the rehabilitation of social

infrastructure, water and sanitation systems, roads, are implemented in many

localities and regions. The RDAs can play an important role in mapping the

external assistance projects, and in identifying the sectors and localities into

which external funds can be directed in future, according to the priorities

identified in the NDR RDS.

The regional authorities can also directly access funds from cross-border

cooperation programmes. Two major programmes can be accessed at the

moment:

the Joint Operational Programme Romania–Ukraine–Moldova, 2007–13(with a budget of €127 million, EU contribution);5 and,

the Black Sea Basin Programme (€17 million).6

5 Joint Operational Programme Romania-Ukraine-Moldova 2007-2013, http://www.ro-ua-

md.net/index.php?option=com_content&view=article&id=1&Itemid=57 6 Black Sea Basin Programme, http://www.blacksea-cbc.net/index.php?page=PROGRAMME_OVERVIEW




23

Cross-border cooperation programmes envisage the establishment of a

partnership with stakeholders in Romania, as well as co-financing 10% of the

cost of the selected project

Other sources

The regional and local authorities will undertake efforts for the mobilisation of

other sources, including private resources for the financing of regional

development projects.

regional development strategy (short)

Documents