 | THE OPPOSITION is a majority in parliament. Now pro-government parties are taking to the streets to try to win back voter support. [more] |  | | |  | TOGETHER FOREVER? Transdniestria agreed to a 2003 plan for becoming part of a common state with Moldova. But Moldova surprisingly turned it down, for reasons that were never fully explained. [more] |
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Open economy and more free market reforms for Transdniestria in 2008
The Speaker of Transdniestria's Parliament says that to attract foreign investments, more free market reforms are needed. 39 year old Yevgeny Shevchuk is a native-born Transdniestrian from Rybnitsa and head of the country's largest opposition party, Renewal. Since opening up the economy in 2001, Transdniestria's GNP has increased four-fold.
Tiraspol-based clothing factory 'Odema' (shown) is a privatized company which today is 100% American-ownedRYBNITSA (Tiraspol Times) - The Speaker of the Parliament of the Pridnestrovskaia Moldavskaia Respublica (PMR, but informally better known under the name of Transdniestria) says that it is necessary for all branches of the unrecognized nation's government to work towards a more open economy, while also promoting more free market reforms this year.
Yevgeny Shevchuk, who is also the leader of opposition party Renewal, wants to work with the President and the rest of the executive branch to speed up the creation of favorable conditions that will attract more foreign investments.
Answering questions online at an Internet conference with voters, Shevchuk said that it was necessary "to reorient all public government agencies towards protecting and advancing the economic interests of companies both inside Pridnestrovie and beyond its borders." This will require a new series of market oriented reforms aimed at bringing more investments to the new and emerging country.
- Market reforms since 2001
Shortly after the turn of the millennium, Transdniestria embarked on an ambitious transformation of its economy to open and free market reforms, including large scale privatizations and market-based inflationary controls. Among the measures: The introduction of a flat tax of just 10% across the board. As a result, "the economy of Pridnestrovie has undergone changes in the past seven years," said Shevchuk.
A look at the numbers supports this statement. Thanks to open market reforms and a free laissez-faire economy, living standards in the new and emerging country have now increased markedly and new residents say that they live better in Transdniestria than in Moldova. As companies have been privatized, investment capital has flowed in from such places as Germany, Russia, Holland, Italy and the United States of America. Officials in the Finance Ministry point to Tiraspol-based clothing factory 'Odema' as an example of one of the newly privatized companies with 100% American ownership.
Overall, services provided to the citizens are in good shape. According to statistics cited by Yevgeny Shevchuk, the government's budgetary expenditure increased from $159.20 per person in 2001 to $555.60 per person in 2008. In the same seven years, the Transdniestria's GNP (Gross National Product) increased from $434.20 to $1,702.90 USD dollars.
Furthermore, said Shevchuk, after several hikes of the minimum wage several by parliamentary decree, average monthly wages throughout Transdniestria also went up. From a low of $44 in 2001, they are now more than four times as high, with the latest average clocking in at $181.50 per worker per month. This is higher than in nearby Moldova and in some of the neighboring regions of southern Ukraine.
- Lack of formal status hampers growth
Despite the four-fold increase in GNP, not all is peaches and cream in Transdniestria, admits Shevchuk. Increased growth is held back as a result of blockades and economic pressures from Moldova, but other reasons - such as the diplomatically unrecognized status of Transdniestria - also play a part. Taken together, they dampened the effect of the economic reforms of the last seven years:
" - Low levels of both domestic and foreign investments, significant inflation pressure, a worsening demographic situation [...] point to the fact that the reforms have not been as successful as expected."
Now, the Speaker of Transdniestria's Parliament want to deepen the level of free market reforms that he thinks the country needs, liberalizing the economy and reaffirming Transdniestria's openness to business. For this, he wants to enlist all branches of government and cut back on whatever bureaucratic red-tape that is still left over from the Communist era.
" - I consider it an urgent necessity to create the kind of working conditions for companies that will enable them to attract large scale investments. This can be done, and it is the responsibility of all branches of government," says Shevchuk.
Speaker Yevgeny Shevchuk, 39, is a native-born Transdniestrian from Rybnitsa, the third largest city of Transdniestria. Although fluent in both English and Russian, he is part of the ethnic Ukrainian minority which makes up 29% of the 550,000 inhabitants of the country and he speaks Ukrainian at home.
See also:
» Yevgeny Shevchuk: "Economic prosperity key to future recognition of Pridnestrovie"
» After freedom and reform, Pridnestrovie says it is no longer Communist
» As trade relations expand, international diplomatic relations are next
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Tiraspol, the capital of Pridnestrovie, is fast becoming Eastern Europe's largest exporter of long stemmed roses. A new plant has been built with Dutch assistance and it is now on track to produce a million roses per year. Soil consists of coconut pieces which have been specially imported from Sri Lanka for this purpose. . . 
