The impact of COVID-19 on the
trade and business development prospects of
female-owned enterprises in the Republic of Moldova
NOTE
The designations employed and the presentation of the material in this
publication do not imply the expression of any opinion whatsoever on the
part of the Secretariat of the United Nations concerning the legal status
of any country, territory, city or area, or of its authorities, or concerning the
delimitation of its frontiers or boundaries.
This report is issued in English and Romanian.
I
Copyright © 2021 United Nations
All rights reserved worldwide
United Nations publication issued by the Economic Commission for Europe
PREFACE
As the coronavirus (COVID-19) pandemic continues to spread, its disruptive
impact is becoming more pronounced, posing unprecedented challenges for
all countries. Governments have seen their priorities shift overnight towards
upscaling public health preparedness and emergency support measures to
cater for the vulnerable segments of their populations. The challenges facing
Governments are further complicated by supply chain disruptions, which
have left enterprises struggling to survive. Pay cuts and furloughs have been
increasing, so that losses in lives are compounded by a livelihood crisis.
If anything, countries across the globe are suffering setbacks that are akin
to complex humanitarian emergencies associated with disasters. Businesses
and State agencies have been exhausting their coping strategies, with
lingering effects on productive capacities, institutional flexibility and business
confidence. It, therefore, stands to reason to avoid treating the pandemic as
a temporary shock whose impact can be swiftly reversed once normality is
attained.
The implication is that any attempt to assess the impact of COVID-19 must
proceed from a clear understanding of the development challenges that
occupied Governments’ agendas at the eve of the pandemic and ground the
analysis in the context of economic vulnerability. For if there is one lesson to
draw from development experiences, it would be that disasters aggravate
deep-seated structural weakness. Without an understanding of these
weaknesses, relief and development efforts might miss the target.
It is from this perspective that the impact of the pandemic on Moldovan
female-owned micro, small and medium-sized enterprises (MSMEs) is
assessed. Consistent with the UNECE Steering Committee on Trade Capacity
and Standards mandate,1 the assessment traces the way non-tariff measures
(NTMs) governing trade in goods combined with lockdown measures in the
Republic of Moldova and partner countries to influence these enterprises’
end-to-end supply chains and long-term development prospects.
The assessment is based on a survey of agricultural and manufacturing
female-owned MSMEs with active engagement in international trade. The
focus on MSMEs is consistent with their important contribution to income
generation. SMEs accounted for 98.6 per cent of active enterprises in 2019,
employed 61.6 per cent of the labour force and generated around 40 per cent
of the enterprise sector’s total output, while micro enterprises stood as an
important source of jobs, particularly in rural areas.2
II
1See https://www.unece.org/fileadmin/DAM/trade/documents/ToR_SCTCS_
Appendix5.pdf.
2National Bureau of Statistics of the Republic of Moldova, see https://sta-
tistica.gov.md/newsview.php?l=ro&idc=168&id=6716. The statistics do not
include data on the Region of Transnistria and the municipality of Bender.
However, despite the country’s progress in achieving gender equality,
female-owned enterprises constitute a limited segment (about 34 per cent
of registered enterprises in 2017), are concentrated in the services sector and
are dominated by micro enterprises.3
The assessment was carried out over the course of January-March 2021. It
used a comprehensive questionnaire that was developed by UNECE, with a
view to informing gender-responsive trade policies. The questionnaire drew
on the knowledge gained from the UNECE COVID-19 impact assessment, “The
impact of COVID-19 on trade and structural transformation in the Republic
of Moldova: Evidence from UNECE’s survey of micro, small and medium
enterprises” (2020)4, and was pilot-tested in December 2020. In total, 101
female-owned MSMEs from across the country participated in the survey, all
of which were actively engaged in trade.
UNECE shared the report with the United Nations Resident Coordinator
Office in the Republic of Moldova to inform the United Nations Country
Team planning processes. The findings of this assessment were reported to
UNECE member States during the 2022 session of the Steering Committee
on Trade Capacity and Standards and formed the basis for discussions over
future activities in the area of trade. In addition, the report will be shared
with United Nations Department of Economic and Social Affairs (UNDESA)
as part the UNECE contribution to the United Nations effort to address the
pandemic.
III
3National Bureau of Statistics of the Republic of Moldova (2020) “Analytical
Report on participation of women and men in entrepreneurship in the
Republic of Moldova”; available at: https://statistica.gov.md/public/files/
publicatii_electronice/Antreprenoriat_feminin/Antreprenoriat_Femei_Bar-
bati_2020.pdf.
4The studies are available at: https://unece.org/trade/studies-regulato-
ry-and-procedural-barriers-trade.
ACKNOWLEDGEMENTS
This report was prepared by Ms. Hana Daoudi (UNECE, Economic Affairs
Officer, Market Access Section, Economic Cooperation and Trade Division)
under the supervision of Mr. Mika Vepsäläinen (UNECE, Chief, Market Access
Section, Economic Cooperation and Trade Division).
UNECE would like to acknowledge the contribution of UNECE national
consultant, Mr. Veaceslav Sterbet, who supervised the implementation of
the phone interviews with the female-owned MSME and compiled the main
results in a background document that was used for preparing this report.
UNECE would also like to acknowledge the contribution of the international
polling institute SATISCAN Sàrl, which designed the electronic database
for compiling the results of the interviews, carried out data validation and
reconciled the survey results.
The report benefited from comments by Ms. Elisabeth Tuerk (UNECE, Director,
Economic Cooperation and Trade Division), Mr. Anders Jönsson (UNECE, Chief
Innovative Policies Development Section, Economic Cooperation and Trade
Division and Mr. José Palacín (UNECE, Senior Economic Affairs Officer, Office
of the Executive Secretary).
The report was edited by Mr. David Winch.
This assessment was funded by the United Nations Development Account
(UNDA) project “Global initiative towards post-COVID-19 resurgence of the
MSME sector”.
IV
CONTENTS
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II
Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV
Abbreviations and acronyms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VIII
Executive summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Trade disruptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. The impact of trade disruptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. The ripple effects of trade disruptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
4. Income fallout . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5. Growth bottlenecks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
6. Policy implications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section one Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.1 Reform achievements and pre-pandemic challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.2 Women’s participation in economic activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.3 COVID-19-induced economic crisis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.4 Scope of the assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
1.5 Report outline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section two Profile of the MSME owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.1 Opportunity driven but with limited engagement in exports . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.2 Highly educated but lack business skills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.3 Major contributors to their households’ income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.4 Occasional networkers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section three Trade disruptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
3.1 Transmission channels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
3.2 Impact on the female-owned MSMEs supply chains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section four The ripple effects of trade disruptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
4.1 Limited engagement in electronic commerce. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
4.2 Limited engagement in production repurposing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
4.3 Export development plans put on hold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section five Income fallout . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section six Growth bottlenecks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
6.1 Lack of adequate skills. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
6.2 High exploratory market access costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
V
VI
6.3 Insufficient business networks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
6.4 Weak production capacities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
6.5 Other factors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section seven Conclusion and recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Annexes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Annex 1 Country background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Annex 2 The Government of the Republic of Moldova’s relief and support measures . . . . 56
Annex 3 Profile of the female-owned MSMEs surveyed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Annex 4 Proposed measures for stronger and more resilient Moldovan MSMEs. . . . . . . . . . 61
TABLES
Table 1.1 Breakdown of the Republic of Moldova’s female labour force by sector
(percentage share) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Table 1.2 Moldovan entrepreneurs across MSMEs by ownership, 2017 (percentage shares). . . . . . . 10
Table 1.3 The national strategy for ensuring equality between women and men
in the Republic of Moldova for the years 2017–2021 (percentage shares) . . . . . . . . . . . . . . . . 12
Table 1.4 Percentage change in exports and imports of the Republic of Moldova
(value, year-over-year, 2020) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Table 1.5 Breakdown of the COVID-19 affected employed workforce by sex (percentage shares . . .17
Table 7.1 Proposed measures for increasing the resilience of the Republic
of Moldova’s female-owned MSMEs and boosting their exports . . . . . . . . . . . . . . . . . . . . . . . . 45
Table A1.1 The Republic of Moldova’s top 10 knowledge-intensive products, 2018 . . . . . . . . . . . . . . . . . 54
FIGURES
Figure 1.1 The Republic of Moldova's labour market: Urban-rural disparities. . . . . . . . . . . . . . . . . . . . . . . 7
Figure 1.2 The Republic of Moldova's human development index values,
key indicators (2000, 2019) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Figure 1.3 The Republic of Moldova's labour market: Gender gaps (percentage) . . . . . . . . . . . . . . . . . . . 9
Figure 1.4 Moldovan female entrepreneurs by sector, 2017 (percentage share) . . . . . . . . . . . . . . . . . . . . 10
Figure 1.5 The Republic of Moldova: Net FDI inflows, percentage of GDP . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Figure 1.6 The Republic of Moldova: Remittances, percentage of GDP . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Figure 1.7 Evolution of the Moldovan labour participation rate 2019–2021 (percentage) . . . . . . . . . . . 16
Figure 2.1 Breakdowm of the female MSME owners by establishment date
(number of respondents) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Figure 2.2 Breakdowm of the female MSME owners by age group (number of respondents). . . . . . 19
Figure 2.3 The female MSME owners' reasons for venturing into business
(percentage of respondents) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Figure 2.3 MSME owners' contribution to their households' income (percentage of respondents).. 22
Figure 3.1 The female-owned MSMEs' most affected export destinations
(percentage of responses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Figure 3.2 Percentage change in the female-owned MSMEs' export earnings, 2020
(year over year, percentage of respondents) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Figure 4.1 The female-owned MSMEs' pre-pendmeic export expansion plans by destination
(percentage of respondents) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Figure 5.1 Changes in female-owned MSMEs' domestic sales and total income, 2020
(year over year, percentage of respondents) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Figure 5.2 The female-owned MSMEs' deferred business payments, January 2020-March 2021
(percentage of respondents) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Figure 5.3 The female-owned MSMEs' deferred household payments, January 2020–March 2021
(percentage of respondents) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Figure 5.4 Government assistance received by the female-owned MSMEs,
January 2020–March 2021 (percentage of responses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Figure 5.5 The female-owned MSMEs' urgent needs to maintaining operations, March 2021
(percentage of respondents) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Figure 5.6 Changes in the female MSME owners' perceptions of living conditions
(percentage of respondents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Figure 6.1 MSME owners' use of time (% of responses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Figure A1.1 Breakdown of GDP and labor force by sector (2019) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Figure A1.2 The Republic of Moldova's main exports by sector, 2005–2020 . . . . . . . . . . . . . . . . . . . . . . . . . 52
Figure A1.3 The Republic of Moldova's main export markets (percentage share) . . . . . . . . . . . . . . . . . . . 53
Figure A1.4 Moldova's exports to CIS and the Russian Federation (USD thousand) . . . . . . . . . . . . . . . . . 54
Figure A1.5 Moldova's exports to Romania and the EU (USD thousand) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Figure A1.6 The Moldovan economy's position in the ECI (2008-2018) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Figure A1.7 Top 10 comparative exports (RCA Index. 2018) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Figure A3.1 The female-owned MSMEs surveyed by ownership (percentage of respondents) . . . . . . . 57
Figure A3.2 The female-owned MSMEs by geographic location (percentage of responses) . . . . . . . . . 58
Figure A3.3 The female-owned MSMEs by size (percentage of responses) . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Figure A3.4 The female-owned MSMEs by sector (percentage of responses) . . . . . . . . . . . . . . . . . . . . . . . . 60
BOXES
Box 3.1 Non-tariff barriers caused by incomplete trade-related reforms . . . . . . . . . . . . . . . . . . . . . . . 17
Box 7.1 Empretec programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
VII
ABBREVIATIONS
AA Association Agreement
BCP Border crossing point
CEFTA Central European Free Trade Agreement
CIS Commonwealth of Independent States
DCFTA Deep and Comprehensive Free Trade Agreement
EN European harmonized standards
EU European Union
GDP Gross domestic product
GFCF Gross fixed capital formation
ICT Information and communication technology
MCS Moldovan Customs Service
MDL Moldovan leu
MSMEs Micro, small and medium-sized enterprises
NTM Non-tariff measure
ODIMM Organization for Small and Medium Enterprises Sector
Development
OEC Observatory of Economic Complexity
PCI Product Complexity Index
PPE Personal protective equipment
PPP Purchasing power parity
RCA Revealed comparative advantage
SDGs Sustainable development goals
VIII
UN/CEFACT United Nations Centre for Trade Facilitation and Electronic Business
UNCTAD United Nations Conference on Trade and Development
UNDESA United Nations Department of Economic and Social Affairs
UNECE United Nations Economic Commission for Europe
USD United States dollar
VAT Value-added tax
WHO World Health Organization
WTO World Trade Organization
IX
EXECUTIVE SUMMARY
This report assesses the impact of the COVID-19 pandemic on the development
prospects of female-owned MSMEs in the Republic of Moldova. It traces the
way that NTMs governing trade in goods combined with lockdown measures
in the Republic of Moldova and partner countries to influence the female-
owned MSMEs’ end-to-end supply chains and their long-term development
prospects.
The report is based on a survey of 101 female-owned MSMEs involved in
agriculture and manufacturing from across the country. The owners were
highly educated (with formal training up to the university level) and the
majority (79 per cent) were opportunity-driven, who ventured into business
to capitalize on emerging opportunities.
The female-owned MSMEs surveyed were hard hit by the pandemic, despite
the Government’s limited use of trade restrictions, upscaled trade-facilitation
measures and relief measures. The majority were operating at a loss and were
unsure as to their ability to maintain operations.
1. Trade disruptions
The female-owned MSMEs surveyed saw their supply chain operations
disrupted by lockdown measures as well as the special health and safety
arrangements at main border crossing points (BCPs) in the Republic of
Moldova and in partner countries. The impact of the resulting disruptions was
compounded by capacity shortfalls within State agencies, which manifested
themselves in the form of non-tariff barriers. These barriers acted as negative
transmission channels, which amplified supply chain disruptions by creating
the operational bottlenecks set out below:
• Lack of clarity over trade-related regulations and administrative
procedures being applied. Almost all the MSME female owners outsourced
the preparation of trade documents to freight forwarders to cut down on
their workload. However, with supply chain disruptions causing many of
their traditional freight either forced to suspend activities or shut down,
the female-MSME owners were struggling to familiarize themselves with
applied trade-related regulations and procedures. The owners noted that
published information is not sufficiently detailed, is fragmented across
different websites and, in most cases, is difficult to understand.
• Extended wait time for obtaining trade documents. The issuance of trade
documents was slowed down by continued reliance on paper-based
procedures as the Government has yet to fully transition to a paperless
trading environment.
1
• High product-certification costs. For products that should be
accompanied by conformity assessment certificates for demonstrating
compliance with regulatory requirements in export markets, delays in
obtaining the required trade documents were compounded by high
product testing costs. The female-owned MSMEs reported having to ship
samples for testing in neighbouring European countries, given the lack of
internationally recognized testing laboratories.
The above supply chain bottlenecks are not specific to the female-owned
MSMEs surveyed. They are faced by all the enterprises operating in the country
and were reported by male-owned MSMEs surveyed as part of the UNECE
previous COVID-19 impact assessment. However, the female-owned MSMEs
surveyed seem to be less resilient, as they are faced with gender specific
challenges. These bottlenecks have also been acting as growth bottlenecks,
evidenced by the MSMEs’ limited engagement in exports. While the majority
of the female MSME owners emphasized exports as a pre-requisite for
growing their business, only 46 per cent sold their products abroad.
2. The impact of trade disruptions
Around 26 per cent of the exporting female-owned MSMEs lost all their export
earnings in 2020, having been forced to suspend exports. Another 19 per cent
saw their export earnings decrease by up to 19 per cent in 2020 in relation
to the pre-pandemic period and another 13 per cent lost up to 50 per cent
of these earnings. This declining trend continued, with many reporting that
they were operating at a loss in March 2021. These losses were triggered by:
• Loss of traditional partners. Many of the export-oriented lost their
traditional international buyers, who were forced to suspend production
or shut down altogether under the weight of the pandemic-induced
economic crisis.
• Supply shortages. These were caused by the closure of non-essential
businesses in partner countries, delayed deliveries and increased prices.
The owners reported experiencing difficulties in finding new international
suppliers. Agri- enterprises were particularly affected as the supply
shortages and inflated transport costs came on the heels of the severe
draught, which has already harmed their increasingly thin profit margins.
• Inflated transport costs. Transport by road became more expensive as
freight forwarders raised their fees to cover additional operating cost that
were out of their control. The higher fees, combined with the COVID-19
induced delivery delays, forced several female MSME owners to shift to air
transport at additional costs.
2
3
3. The ripple effects of trade disruptions
The impact of supply chain disruptions was compounded by the MSME
owners’ coping strategies. Only a limited segment used growth enabling
coping strategies, such as production repurposing and e-commerce, with
many held back by gender specific obstacles.
• Reduced productive capacity: The majority of the female-owned MSMEs
surveyed reduced production under the weight of dwindling demand
and supply shortages.
• Limited production repurposing: Production repurposing was pursued
by 22 of the female MSME owners surveyed. The majority belonged to
the clothing industry, and repurposed production to face cloth masks
and disposable gowns for health care workers and medical professionals
thanks to medium and large Moldovan enterprises. The latter
subcontracted the female-owned MSMEs during the early period of the
pandemic to fulfil large purchase orders by European buyers.
• Limited engagement in e-commerce: Only 10 of the female-owned
MSMEs surveyed reported using e-commerce. These were already
engaged in e-commerce before the outbreak of the pandemic for selling
domestically. The remainder were not engaged in e-commerce.
• Export expansion plans cancelled or put on hold: This was the case for
around 56 per cent of MSMEs, the majority of which were planning to
increase exports to traditional markets.
4. Income fallout
In March 2021, many of the exporting female-owned MSMEs had stopped
selling their products abroad and were operating at a loss. The impact of these
losses was compounded by the MSME owners’ erosive coping strategies,
which are outlined below. These strategies increased the enterprises’
economic vulnerability and undermined the welfare of owners’ families.
• MSMEs that saw their exports rebound were unsure as to their ability
to maintain exports: This was the case for 35 per cent of the female-
owned MSMEs surveyed that regained their pre-pandemic earning levels
in 2020. Another 7 per cent registered up to 50 per cent increases in
export earnings in relation to 2019. MSMEs belonging to this group were
occasional exporters who sold small volumes and were able to find new
international buyers with the support of family and friends. However, the
majority were operating at a loss in March 2021. They were unsure of their
ability to maintain exports, with the inflated transport costs placing a
strain on their budgets and aggravating supply shortages.
• Sharp increase in the MSMEs’ debt burden: Some of the female MSME
owners and managers were able to mitigate the stress on their wage
bill and other operating costs by borrowing from relatives or using their
spouses’ income. These coping measures appear to be insufficient, with
around 45 per cent of the owners surveyed postponing business payments
over the period January 2020-March 2021, particularly salaries and loan
repayments.
• Marked deterioration in the living conditions of the MSMEs’ households:
Around 66 per cent of the owners also used personal savings to maintain
operations over the period January 2020-March 2021. This came at the
expense of their families’ welfare.
• Dire need of government support: In March 2021. around 92 per cent of
the MSMEs emphasized the need for government assistance to maintain
operations. Of this group, 72 per cent struggled to maintain operations for
more than six months, having effectively depleted their personal savings.
Beyond the above, the assessment suggests that more needs to be done to
facilitate the female-owned MSMEs’ access to relief measures. As of March 2021,
around 17 per cent of the female-owned MSMEs surveyed received government
support in the form of grants and about 40 per cent said that they were not
familiar with available support schemes. In addition, many noted that they
were unable to benefit from government support, owing to the cumbersome
application procedures or because they did not meet the eligibility criteria.
5. Growth bottlenecks
The assessment shows female-owned MSMEs as being challenged by
ongoing, deep-seated growth bottlenecks:
• Lack of skilled staff
• High market access exploratory costs
• Insufficient business networks
• Weak production capacities
• Lack of extended hour childcare at a reasonable cost.
These bottlenecks, which are specific to female-owned MSMEs, have
translated into high production costs, which, combined with the prevalence
of counterfeits, have been undermining female-owned MSMEs’ ability
to compete in domestic markets, let alone to boost exports. The current
conditions have aggravated these bottlenecks with adverse consequences
for the MSMEs’ development prospects and the welfare of their families and
communities.
4
6. Policy implications
The assessment shows that the course of the female-owned MSMEs’
recovery depends on addressing the lingering effects of the pandemic.
Section 7 provides action-oriented recommendations for the Government’s
consideration as it forges ahead in rebuilding stronger and more resilient
female-owned MSMEs. The recommendations aim at:
• Addressing the female-owned MSMEs’ financial crisis
• Reducing the female-owned MSMEs’ trade-related exploratory costs
• Bolstering the female MSME owners’ participation in trade policymaking
processes
• Supporting the female-owned MSMEs’ business growth
• Further enabling the MSME owners to strike a work-family balance
• Supporting knowledge generation for gender-responsive trade policies
The recommendations comprise emergency-support measures for
improving the MSMEs’ resilience and strategic measures for addressing the
enterprises’ structural weaknesses. The emphasis is on expanding the range
of support services available to female-owned MSMEs through leveraging
existing women’s and enterprise support organizations. This will enable the
Government to ensure a high level of outreach and create dynamic synergies
between relief and long-term development objectives.
The proposed recommendations support ongoing efforts to bridge the gender
gap in economic activities. They provide action-oriented recommendations
clustered under thematic action areas that can be mainstreamed into the
new strategy for gender equality as well as the MSME post-COVID-19 strategy.
The recommendations directly contribute to the achievement of Sustainable
Development Goal (SDG) 5 (gender equality) and stimulate spill over effects
in support of SDGs 4 (quality education), 8 (decent work and economic
growth), 9 (industry, innovation and infrastructure), 16 (peace, justice and
strong institutions) and 17 (partnerships for the Goals).
UNECE stands ready to assist the Government in implementing the
recommendations in collaboration with the United Nations Resident
Coordinator Office in the Republic of Moldova, United Nations agencies and
international development partners.
5
1. INTRODUCTION
Situated between Ukraine and Romania, the Republic of Moldova is a small
landlocked country,5 which belongs to the lower-middle-income group.6 The
Government has been pursuing a trade-led development strategy, anchored
in the multilateral trading system7 and regional trade agreements.8 These
agreements have been complemented with reduced or duty-free access to,
among others, Canada, Japan, Norway, Switzerland, Turkey, and the United
States of America within the context of the generalized system of preferences
schemes.9
The Government’s development efforts entered a new phase in 2014 following
the implementation of the Deep and Comprehensive Free Trade Area
(DCFTA) with the European Union (EU). The DCFTA, which crowned a series
of integration arrangements between the EU and the Republic of Moldova,10
provided new impetus for trade reforms. The agreement, which came into full
force in June 2016, sets out detailed provisions for achieving full and complete
compliance with the requirements of the EU Acquis communautaire relating
to, among other things, tariffs and NTMs.11
1.1 Reform achievements and pre-pandemic challenges
Despite progress in bringing the trade system up to the requirements of the
Acquis Communautaire,12 the Republic of Moldova has yet to realize the full
potential of the DCFTA, other free trade agreements and economic reforms.
As shown in Annex 1, exports continue to be dominated by a narrow range
of products, with Romania standing as the main outlet. Moreover, trade has
yet to stimulate the much-needed structural transformation, evidenced by
the economy’s continued reliance on low-value-added manufacturing and
agriculture for income generation.
5The Republic of Moldova covers 33,851 square kilometres of land area and
is located 50 kilometres from the Black Sea. The country’s distance from
the seacoast is relatively short compared to other landlocked countries.
Kazakhstan has the longest distance from the nearest seacoast (3,750 km),
followed by Afghanistan, Chad, Niger, Zambia and Zimbabwe, where the
distance from the nearest seacoast is in excess of 2,000 km. A brief over-
view of landlocked countries and their profiles is available at the United Na-
tions Office of the High Representative for the Least Developed Countries,
Landlocked Developing Countries and the Small Island Developing States
website /http://unohrlls.org/about-lldcs/country-profiles/).
6The World Bank’s income classification system assigns countries with a
GNI per capita between USD 1,036 and USD 4,045 to the lower middle-in-
come countries group. Updated country income classifications are availa-
ble at: https://datahelpdesk.worldbank.org/knowledgebase/articles/906519-
world-bank-country-and-lending-groups.
7The Republic of Moldova joined World Trade Organization on 26 July 2001.
8As of 2015, the latest WTO Trade Policy Review, the Republic of Moldova
had 14 regional trade agreements with 45 partners, including: Albania,
Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, the EU-28, Georgia,
Kazakhstan, Kyrgyzstan, Montenegro, North Macedonia, the Russian Feder-
ation, Serbia, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan. WTO (2015)
Trade Policy Review: Republic of Moldova (https://www.wto.org/english/
tratop_e/tpr_e/s323_e.pdf).
9WTO (2015) Trade Policy Review: Republic of Moldova (https://www.wto.org/eng-
lish/tratop_e/tpr_e/s323_e.pdf).
10In 2006, the EU granted preferential treatment for Moldovan exports within the
context of the EU GSP scheme, which was extended in 2007 through the GSP
“plus” scheme before being replaced by the comprehensive Autonomous Trade
Preferences (ATP) in 2008. The ATP was replaced by the DCFTA in September
2014, which marked the provisional implementation of the Association Agree-
ment between the Republic of Moldova and the EU. The AA was signed in June
2014 and entered into full force in June 2016. A detailed overview of the Republic
of Moldova’s trade relations with the EU is available at: https://ec.europa.eu/trade/
policy/countries-and-regions/countries/moldova/. The text of the AA between the
Republic of Moldova and the EU is available at: https://eur-lex.europa.eu/legal-con-
tent/EN/TXT/?uri=uriserv%3AOJ.L_.2014.260.01.0004.01.ENG.
11For a detailed overview of NTM reforms, see UNECE study on regulatory and
procedural barriers to trade in the Republic of Moldova; https://www.unece.org/
fileadmin/DAM/trade/Publications/ECE_TRADE_433E.pdf.
12The Government of the Republic of Moldova (http://dcfta.md/eng).
Section 1
Introduction
6
Section 1
Introduction
Hence, the situation whereby the economy remains incapable of generating
enough jobs for its labour force. This is manifested in the continued reliance
on remittances, which accounted for 15.97 per cent of gross domestic product
(GDP) in 2019.13 With many Moldovans seeking jobs abroad, around 27 per
cent of the labour force in 2019,14 unemployment remained below 10 per
cent over the past decade. These rates masked a persistent rural-urban gap.
The rural areas, home to around 60 per cent of the population, have been
lagging the urban areas in terms of labour participation and exhibiting higher
unemployment rates (Figure 1.1).
13World Bank Database; https://data.worldbank.org/indicator/BX.TRF.PWKR.
DT.GD.ZS?locations=MD).
14National Bureau of Statistics of the Republic of Moldova, Labour force in
the Republic of Moldova: employment and unemployment in 2019; https://
statistica.gov.md/newsview.php?l=ro&idc=168&id=6617.
15World Bank Database.
16The highest paying jobs in the Republic of Moldova are in the country’s
capital of Chisinau and the lowest pay is in the southern regions. National
Bureau of Statistics of the Republic of Moldova; https://statistica.gov.md/
category.php?l=en&idc=107&.
17In 2019, the Republic of Moldova ranked at 90th out of the 189 countries
and territories covered. In 2018, the country ranked 112 among the 189
countries and territories covered. See, the United Nations Development
Programme, Human Development Index Report (http://hdr.undp.org/en/
data).
Figure 1.1 - The Republic of Moldova's labour market: Urban-rural disparities (pecentage)
Source: National Bureau of Statistics of the Republic of Moldova
7
Furthermore, poverty remains a challenge, with 12.8 per cent of the population
living below the upper middle-income poverty line of USD 5.50 per day
(2011 purchasing power parity, PPP),15 amidst persisting income disparities
between urban and rural areas16 and, as shown below, a gender gap in
economic activities.
1.2 Women’s participation in economic activities
The Republic of Moldova has been registering continued progress in achieving
gender equality. As shown in Figure 1.2, female as well as male human
development index (HDI) scores have registered continued improvement.
This enabled the country to maintain its position in the high HDI category in
2019,17 and resulted in higher scores on the gender development and gender
inequality indexes.
Section 1
Introduction
8
Figure 1.2 - The Republic of Moldova's human development index values, key indicators (2000, 2019)
Source: United Nations Development Programme, Human Development Data
However, these improvements proved to be insufficient for bridging
the persistent gender gap in economic activity. Female labour market
participation rates lagged behind those of men and have been declining over
the past few years (Figure 1.3). Furthermore, the female labour force exhibits
a marked concentration in a limited range of activities; namely, in public
administration, education, health, social work, domestic wholesale and retail
trade, and tourism, where women have been consistently more present than
men (Table 1.1).
Breakdown of the Republic of Moldova’s
female labour force by sector (percentage share)
Sector 2017
Agriculture, forestry, and fishing
Industry
Mining and quarrying
Manufacturing
Electricity, gas, steam and air conditioning supply
Water supply; sewerage, waste management and
remediation
Construction
Services
Wholesale and retail trade; repair of motor vehicles and
motorcycles
Table 1.1
2018 2019
28.4
49.7
11.4
55.1
24.8
26.5
14.0
50.6
29.0
50.0
13.0
55.1
24.8
26.2
14.1
49.7
28.6
49.2
11.6
54.3
24.8
26.0
14.5
50.1
2016
29.7
50.1
12.9
55.9
25.0
26.7
15.7
50.5
Breakdown of the Republic of Moldova’s
female labour force by sector (percentage share)
Sector 2017
Transportation and storage
Accommodation and food service activities
Information and communication
Sector
Financial and insurance activities
Real estate activities
Professional, scientific and technical activities
Administrative and support service activities
Public administration and defence; compulsory social security
Education
Health and social work
Arts, entertainment, and recreation
Other service activities
Total
Table 1.1
2018 2019
30.3
64.1
47.3
69.0
42.4
53.7
35.5
44.3
75.5
80.8
58.1
61.7
53.0
30.4
62.6
47.9
68.9
42.5
52.4
36.9
43.6
75.4
80.1
57.6
63.9
52.7
30.2
64.2
47.2
70.1
41.6
50.9
39.1
44.8
75.4
80.6
56.7
62.2
52.7
2016
30.4
64.8
47.0
68.4
43.1
54.2
36.1
44.8
75.7
80.6
59.7
61.4
53.4
Moldovan women also accept lower pay than men. Women earn about 14 per
cent less than men on a monthly average basis, even though around 33 per
cent of employed women are educated up to the university level, compared
to 24 per cent, the corresponding figure for employed men.18 Women’s lower
participation rates and willingness to accept lower pay means they are less
likely to be unemployed than men (Figure 1.3).
Source: National Bureau of Statistics of the Republic of Moldova
9
18According to the National Bureau of Statistics, in the Republic of
Moldova, the salary of men was 14.4 per cent higher than the average
salary of women in 2018. The pay gap decreased slightly in 2019, with
men earning 14 per cent more than women on a monthly average
basis; https://statistica.gov.md/public/files/publicatii_electronice/Anu-
ar_Statistic/2020/Anuar_statistic_editia_2020.pdf.
Figure 1.3 - The Republic of Moldova's labour market: Gender gaps (percentage)
Source: National Bureau of Statistics of the Republic of Moldova
Figure 1.4 – Moldovan female entrepreneurs by sector, 2017 (percentage share)
Source: National Bureau of Statistics of the Republic of Moldova
Moldovan entrepreneurs across MSMEs
by ownership, 2017
Size
Micro (0–9
employees)
Table 1.2
Male-owned enterprises
64
Female-owned enterprises
Total Owner Co-Owner Manager Total Owner Co-Owner Manager
63.3 72 58.9 36
36.7 28 41.1
Small (10–49
employees)
77 76 81.7 73.8 23 24 18.3 26.2
Large (250
employees and
above)
82.2 92.3 76.7 82.3 17.8 7.7 23.3 17.7
Total 66.1 64.8 74.4 62.9 33.9 35.2 25.6 37.1
Source: National Bureau of Statistics of the Republic of Moldova
Women are also less likely to venture into business. While the share of
registered female-owned enterprises (including sole proprietorships and
enterprises co-owned by women) increased by 6.4 per cent over the period
2009–2017 to 33.9 per cent, this share remains modest.19 Moreover, female-
owned enterprises are concentrated in retail trade (Figure 1.4) and are
dominated by micro enterprises (Table 1.2). These salient features have meant
a limited engagement in exports.20
19National Bureau of Statistics of the Republic of Moldova (2020) “Analytical Report on participation of women and men in entrepreneurship in the Re-
public of Moldova”; available at: https://statistica.gov.md/public/files/publicatii_electronice/Antreprenoriat_feminin/Antreprenoriat_Femei_Barbati_2020.
pdf.
20Official statistics shows a positive correlation between the enterprises’ size and engagement in trade, and this applies to both male and fe-
male-owned businesses. Only 6 per cent of micro-enterprises and about 18 per cent of small enterprises were engaged in exports in 2017 compared to
47 per cent, the corresponding figure for large enterprises. This positive correlation between the enterprises’ size and engagement in trade applies to
both male and female-owned businesses. National Bureau of Statistics of the Republic of Moldova (2020) “Analytical Report on participation of women
and men in entrepreneurship in the Republic of Moldova”; available at: https://statistica.gov.md/public/files/publicatii_electronice/Antreprenoriat_femi-
nin/Antreprenoriat_Femei_Barbati_2020.pdf.
10
Section 1
Introduction
21The gender gap is much more pronounced and important to address when you look at female-owned innovative entrepreneurs by different measures. Inno-
vative entrepreneurship is far too low anyway, and women, even if they have the right degrees often more than men, make up around 1 per cent. See UNECE
(2021) Sub-regional Innovation Policy Outlook 2020: Eastern Europe and the South Caucasus; https://unece.org/sites/default/files/2021-06/UNECE_Sub-region-
al_IPO_2020_Publication.pdf.
22The Moldovan Government has ratified the Convention on the Elimination of All Forms of Discrimination against Women and various ILO Conventions, in addi-
tion to passing laws for promoting gender equality. Most recently, through Law No. 71 (2016), the Government amended 15 national laws, including the Electoral
Code, the Law on Government and the Labour Code, which, among other things, provide for 14 calendar days of paid paternity leave; ban sexist advertising; and
introduce 40 per cent quota for women in political party and cabinet nominees’ lists. These amendments, along with the Law on Equality of Opportunities for
Men and Women (2006) and the Law on Equality (2012), laid the ground for equal opportunities with protection of victims of gender-based violence strength-
ened through Law No. 196 (2016). The Government also adopted the National Program for implementation of the United Nations Security Council Resolution 1325
on Women, Peace and Security for 2018–2021 and the Action Plan for its implementation. In addition, the Government signed the Council of Europe Conven-
tion on Preventing and Combatting Violence against Women and Domestic Violence as part of its commitments under the Association Agreement with the
European Union (EU) and several EU directives to national law, including Directive 2006/54/EC (which provides for equal treatment in labour law) and Directive
2004/113/EC (which provide to equal treatment in access to and supply of goods and services). A detailed review of progress made towards the achievement
of gender equality till 2020 is provided in the Government’s report to the 25th anniversary commemoration of the Beijing Declaration and Platform for Action;
https://unece.org/fileadmin/DAM/Gender/Beijing_20/Moldova.pdf.
23Government Decision No. 281 of 3 April 2018 “The National Strategy for prevention and combating violence against women and domestic violence for the years
2018–2023”; http://lex.justice.md/.
24National Bureau of Statistics of the Republic of Moldova; https://statistica.gov.md/public/files/publicatii_electronice/Violenta/Raport_violen_fem_eng.pdf
25See Law No. 5-XVI “On ensuring equal opportunities for women and men in the Republic of Moldova”.
26The Ministry of Labour and Social Protection was established in August 2021 as part of the Government reform to act as the centralized line Ministry for de-
veloping and implementing labour, social and demographic policies. These policy areas were previously under the Ministry of Health, Labour, Social Protection,
which was divided into two ministries: the Ministry of Health and the Ministry of Labour and Social Protection.
27Government Decision No. 259 of 28 March 2017; http://lex.justice.md/md/370442/.
28https://www.euneighbours.eu/en/east/stay-informed/cards/you-can-too-how-eu-supports-women-entrepreneurs-moldova.
Bridging the gender gap in economic activities21 has been ranking high on
the national development agenda, and the period since 2006 has seen the
Government ratify numerous international conventions on gender equality.22
The Government also adopted its first national plan for preventing and
addressing violence against women,23 an important milestone since violence
affected about 63 per cent of women in 2016.24
Efforts to ensure gender equality supported by a dedicated coordination
body, the Committee for Gender Equality between Men and Women, which
was established in 2006 to scale up reforms in this area.25 The Committee
is responsible for developing and coordinating the implementation of the
national gender equality strategy, based on sector-specific plans set out
by line ministries and, since August 2021, is supported by the Ministry of
Labour and Social Protection.26 The ministry, which serves as the lead agency
for overseeing the implementation of the national strategy on gender
equality, is responsible for approving the sectoral plans and ensuring proper
mainstreaming of gender dimensions.
The previous “Strategy for ensuring equality between women and men in
the Republic of Moldova for the years 2017–2021 and of the Action Plan on
its implementation” provided for a sound basis for accelerating reforms. It
covered a range of policy areas, including, among others, health, education,
social services, labour market, women, peace and security, climate change
and disaster management, political participation.27 Implementation is
supported by the donor community, particularly the EU, which is financing a
range of initiatives for promoting female entrepreneurship.28
However, efforts have been undermined by recurrent Government
restructuring, which has been slowing delivery and complicating the task
of building on achievements. These conditions have rendered it difficult
to address the systemic challenges to increasing women’s participation in
economic activities. Most notable among these challenges are:
11
Section 1
Introduction
29For example, a study by the Women’s Law Center and Center for Investi-
gation and Consultation, Sociopolis (2015) “Men and gender equality in the
Republic of Moldova”, showed that 90.5 per cent of men and 81.5 per cent
of women consider women’s most important priority to be domestic work;
https://menengage.unfpa.org/en/resources/men-and-gender-equality-re-
public-moldova.
30A joint study by the United Nations and the National Bureau of Statistics
of the Republic of Moldova (2011), “Violence against women in the family in
the Republic of Moldova”, shows that about 63 per cent of women suffered
from at least one form of violence perpetrated by their partners; https://
statistica.gov.md/public/files/publicatii_electronice/Violenta/Raport_vio-
len_fem_eng.pdf.
31International Finance Corporation (2018) “Supporting women’s entrepre-
neurship in Moldova: Review, assessment, and recommendations”.
32International Finance Corporation (2018) “Supporting women’s entrepre-
neurship in Moldova: Review, assessment, and recommendations”.
33International Finance Corporation (2018) “Supporting women’s entrepre-
neurship in Moldova: Review, assessment, and recommendations”.
• Stereotypes and social perceptions of gender roles.29
• Gender-based violence.30
• Lack of female entrepreneurial role models. This tends to discourage
women from venturing into business.31
• Lack of early childhood education services.32
• Limited access to external finance at reasonable costs, with evidence
pointing to unequal treatment of women by banks. The percentage
of female entrepreneurs pledging fixed assets and land as collateral is
higher than their male counterparts, and evidence shows that female
entrepreneurs are charged higher interests.33
At the same time, there is a need to mainstream enterprise development and
export promotion into the gender strategy. As shown in Table 1.3, while the
previous strategy provided for consolidating a conducive environment for
bridging the gender gap in economic activities, it did not feature a focus on
enterprise development. As the Government proceeds in developing a new
strategy for the coming years, it is important to integrate targeted efforts for
increasing the share of female-owned enterprises and equipping existing
ones with the necessary support to compete in global markets.
The national strategy for ensuring equality between women
and men in the Republic of Moldova for the years 2017–2021
General Objectives
Table 1.3
Policy areas
1: Ensure a comprehensive approach
to promoting gender equality
Specific objectives
Women’s participation in deci-
sion-making
Labour market and gender wage
gaps
Social protection and family policies
Health care
Education
Climate change
1.1: Strengthen institutional and legal
mechanisms for the advancement
of women in decision-making
1.2: Harmonize national legislation
with European standards on equal
pay for work of equal value
1.3: Amend laws to ensure equitable
representation of the needs of wom-
en and men in social policies
1.4: Improve social policies on child-
care families to ensure equitable in-
volvement of both parents in child-
care
12
Section 1
Introduction
The national strategy for ensuring equality between women
and men in the Republic of Moldova for the years 2017–2021
General Objectives
Table 1.3
Policy areas
1: Ensure a comprehensive approach
to promoting gender equality
Specific objectives
Education
Climate change
1.5: Improve social assistance policies
and services through integrating
the gender dimension
1.6: Incorporate the gender dimen-
sion in medical staff training
1.7: Promote healthy behaviours dur-
ing life cycles for men and women
aiming at increased accessibility to
health care services
1.8: Integrate gender dimension into
teacher’s training aiming to over-
come gender stereotypes and in-
crease awareness on gender-related
issues
1.9: Incorporate the gender dimen-
sion in career consulting services to
facilitate access to less conventional
professions.
1.10: Integrate the gender dimension
into in sectoral strategies for ad-
dressing climate change
2: Strengthen national institutional
mechanisms for promoting on gen-
der equality
Institutional mechanisms 2.1: Strengthen human resources
within existing institutional mecha-
nisms at the level of ministries and
central administrative authorities
2.2: Increase the efficiency of the
Government Committee on Gender
Equality
2.3: Strengthen human resources
within existing institutional mecha-
nism at the local level
3: Combat gender stereotypes and
advancing non-violent communica-
tion
Stereotypes in society and nonvio-
lent communication
3.1: Promote gender-balanced con-
tent in media and publicity indus-
tries
3.2: Raise public awareness of gen-
der stereotypes and non-violent
communication
13
The national strategy for ensuring equality between women
and men in the Republic of Moldova for the years 2017–2021
General Objectives
Table 1.3
Policy areas
4: Ensure gender equality in security
and defence
Specific objectives
Gender equality in the security and
defence sector
4.1 Ensure equal participation of
women and men
4.2 Integrate the gender dimension
into security and defence policies
: Integrate gender sensitive budget-
ing in budgetary planning processes
Gender sensitive budgets 5.1: Promoting gender mainstream-
ing in budget programs by estab-
lishing gender-sensitive indicators
5.2: Strengthen the capacity of min-
istries and other central and local
public authorities to ensure gen-
der-sensitive budgeting.
Source: Government of the Republic of Moldova Decision No. 259 of 28 March 2017
1.3 COVID-19-induced economic crisis
The outbreak of the COVID-19 pandemic dealt a strong blow to the Moldovan
economy, causing GDP to plummet by 7 per cent year-over-year in 2020.34
The economy appears to have bounced back, with GDP growing by 10.3 per
cent year-over-year in January-September of 2021.35 This growth was driven
by gross fixed capital formation (GFCF),which reached around USD 1.024
billion in the third quarter of 2021 up from about USD 623.1 million in the first
quarter of 2021.36 While modest compared to the same period in 2020 (2.1
per cent growth), the increase in GFCF cannot be understood in isolation of,
among other things, the rise in net foreign direct investment (FDI) as shown
Figure 1.5).
34National Bureau of Statistics of the Republic of Moldova; https://statistica.
gov.md/newsview.php?l=en&idc=30&id=6765&parent=0. The Statistics do
not include data on the Region of Transnistria and the municipality of
Bender.
35National Bureau of Statistics of the Republic of Moldova, preliminary data;
https://statistica.gov.md/newsview.php?l=en&idc=168&id=7215.
36National Bureau of Statistics of the Republic of Moldova, preliminary
data; https://www.bnm.md/ro/content/conturile-internationale-ale-repub-
licii-moldova-trimestrul-iii-2021-date-provizorii.
Figure 1.5 – The Republic of Moldova: Net FDI inflows, percentage of GDP
Source: National Bank of Moldova
14
Also contributing to GDP growth was the rise in consumer spending, which
following a 2.49 per cent decline year-over-year in 2020, recorded positive
growth in 2021. Consumer spending increased by 11.5 per cent in the first nine
months of 2021 and reached around USD 3.06 billion in the third quarter up
from USD 2.33 billion in the previous quarter,37 fuelled by the Government’s
relief measures (Annex 2), higher wages and remittances. Monthly wages
increased to 9,176 MDL (Moldovan leu) in the third quarter of 2021 up from
MDL 8,469 in the first quarter.38 Remittances showed resilience in the face of
the pandemic and continued to grow to account for 15.1 per cent of GDP in
January-September 2021 on average (Figure 1.6).
The labour market, which appeared to be more immune to the economic
crisis in 2020, also registered a positive performance record in 2021. Influenced
by the Government’s relief measures, unemployment stood at 3.6 per cent in
the second quarter of 2021 down from 4.2 per cent in the previous quarter, so
that it remained below the pre-pandemic rate of 5 per cent in 2019.39
Given the above positive trends, GDP growth is projected at around 4 per
cent in the medium term.40 However, evidence suggests that the Moldovan
economy’s recovery remains fragile. The improved employment rates were
underscored by low labour participation rates, which despite improvements
remain a challenge (Figure 1.7).
37National Bureau of Statistics of the Republic of Moldova, preliminary
data; https://www.bnm.md/ro/content/conturile-internationale-ale-repub-
licii-moldova-trimestrul-iii-2021-date-provizorii; and, https://statistica.gov.
md/category.php?l=en&idc=191.
38National Bureau of Statistics of the Republic of Moldova, Earnings Statis-
tics; https://statistica.gov.md/category.php?l=en&idc=452.
39National Bureau of Statistics of the Republic of Moldova; https://statistica.
gov.md//newsview.php?l=ro&idc=168&id=7115.
40Word Bank (2021); https://www.worldbank.org/en/country/moldova/over-
view#3.
Figure 1.6 – The Republic of Moldova: Remittances, percentage of GDP
Source: National Bank of Moldova
15
Section 1
Introduction
Furthermore, poverty has worsened, with the percentage of population living
below USD 5.50 PPP/day increasing by 3.6 percentage point year-over-year to
reach 14.2 per cent in 2020.41 At the same time, the Government appears to be
struggling to curb inflation, which reached 13.94 per cent in October 2021,42
as the prices of food and fuel, particularly gas,43 increased. These pressures
come in addition to those resulting from the sweeping relief measures, which
are placing a strain on the public purse, with the public debt’s share of GDP
accounting for 33.4 per cent in November 2021.44
Another challenge relates to the trade deficit, as imports continued to
outstrip exports. As shown in Table 1.4, following a sharp contraction during
the lockdown period, imports picked up steam as of June 2020 as enterprises
restocked their inventories. In contrast, exports registered a slow rebound
under the weight of the enterprises’ weakened production capacities and
dwindling international demand and remained below pre-pandemic levels.
41https://www.worldbank.org/en/country/moldova/brief/moldova-econom-
ic-update.
42See National Bank of Moldova; https://www.bnm.md/en/content/inflation.
43https://balkaninsight.com/2021/11/03/government-promises-aid-as-moldo-
vans-anxiously-await-higher-gas-bills/.
44Government of the Republic of Moldova; https://mf.gov.md/sites/default/
files/Buletin%20statistic%2011.2021.pdf.
Percentage change in exports and imports of the
Republic of Moldova (value, year-over-year, 2020)
JAN
Table 1.4
Imports
Exports
FEB MAR APR MAJ JUN JUL AVG SEP OKT NOV DEC
-6.3 1.6 -18.3 -30.5 -26.0 -6.2 -13.2 -20.4 -11.1 -7.1 -1.7 0.00
JAN - DEC
2020
-11.2
2.0 5.6 -6.2 -44.6 -31.6 -7.2 -0.5 -6.6 1.3 -6.0 3.7 5.1 -7.3
Source: Source: National Bureau of Statistics of the Republic of Moldova
Figure 1.7 – Evolution of the Moldovan labour participation rate 2019–2021 (percentage)
Source: National Bureau of Statsitics of the Republic of Moldova
16
Section 1
Introduction
This trend persisted in 2021, with exports increasing by 25.4 per cent year-
over-year in January-November in relation to the same period in 2020.
Imports increased by 32.4 per cent year over year over the same period under
the weight of the rising prices of gas imports.45 This has increased trade
deficit, which accounted for 27.2 per cent of GDP in the third quarter of 2021,
compared to 25.2 per cent the corresponding figure in 2022.46
In addition, the pandemic has aggravated the country’s systemic inequalities.
Available statistics show unemployment affecting 4.6 per cent of the
population in rural areas in the first quarter of 2021, compared with 3.9 per
cent in urban areas,47 suggesting higher layoffs and job cuts. Moreover,
labour participation in urban areas stood at 46.5 per cent in 2020 down from
49.4 per cent in 2019, compared to 36 and 37.6 per cent, the corresponding
figures in rural areas.
The pandemic has also rendered the task of bridging the gender gap in
economic activities more challenging. Working women were more affected
than men, as lockdown measures exacerbated inequalities in the division of
care responsibilities.48 This caused greater withdrawal of women from the
labour market in 2020, causing female participation rate to worsen. It stood at
36.1 per cent in 2020 down from 38 per cent in 2019, compared to 45.1 per cent
and 47 per cent the corresponding figures for male labour force.
Women with at least one pre-school-age child were particularly affected.
They registered a participation rate of 37 per cent in 2020 compared to 65.3
per cent, the corresponding figure for men. In contrast, women without
pre-school-age children exhibited higher participation rates, which also
exceeded those registered by men (58 per cent compared to 53.6 per cent).50
This trend continued in 2021, with statistics showing worsening female labour
participation rates (Table 1.5).
45National Bureau of Statistics of the Republic of Moldova, preliminary
data; https://www.bnm.md/ro/content/conturile-internationale-ale-repub-
licii-moldova-trimestrul-iii-2021-date-provizorii.
46National Bureau of Statistics of the Republic of Moldova, preliminary
data; https://www.bnm.md/ro/content/conturile-internationale-ale-repub-
licii-moldova-trimestrul-iii-2021-date-provizorii.
47National Bureau of Statistics of the Republic of Moldova; https://statistica.
gov.md/category.php?l=en&idc=107.
48National Center for Studies and Information on Women's Issues Partner-
ship for Development and UN-Women (2021) “The impact of the pandemic
on gender equality”; https://progen.md/despre-centrul-parteneriat-pent-
ru-dezvoltare/.
49National Bureau of Statistics of the Republic of Moldova, Statistical Year-
book of the Republic of Moldova, 2020; https://statistica.gov.md/pageview.
php?l=en&idc=263&id=2193.
50National Bureau of Statistics of the Republic of Moldova, labour force
statistics, 2020; https://statistica.gov.md/category.php?l=en&idc=107&.
Breakdown of the COVID-19 affected employed
workforce by sex (percentage shares)
Men
Woman
Table 1.5
2020
46.3
53.7
I II III IV
39.5
60.5
34.4
65.6
46.1
53.9
38.7
61.3
44.7
55.3
2021
I II
Source: National Bureau of Statistics of the Republic of Moldova
17
Section 1
Introduction
1.4 Scope of the assessment
This assessment draws on a survey of 101 female-owned manufacturing and
agricultural MSMEs with active engagement in international trade from
across the Republic of Moldova, with a view to capturing:
1. The transmission channels of the COVID-19 pandemic effects and the
influence of NTMs governing trade in goods therein.
2. Supply chain disruptions and their impact on trade activities.
3. The MSMEs’ coping strategies, understood in terms of the way they used
their assets to maintain operations.51
4. The ripple effects of the pandemic on the development prospects of
female-owned MSMEs, particularly those generated by the owners’
coping strategies.
1.5 Report outline
This report is organized in seven sections. The introduction is followed, in
section 2, by the profile of the female-owned enterprises surveyed. Section 3
describes the transmission channels of the pandemic’s effects. It shows how
NTMs, combined with lockdown measures deployed by the Government of the
Republic of Moldova and partner countries, created supply chain disruptions
Section 4 traces the ripple effects of these disruptions on the female-owned
MSMEs surveyed and highlights the aggravating impact of the owners’ coping
strategies. This sets the context, in section 5, for a discussion on the MSMEs’
income losses and the resulting impact on the welfare of their families.
Section 6 highlights the MSMEs’ growth bottlenecks. Section 7 provides
recommendations for addressing the female-owned MSMEs’ emergency
and long-term development needs, with a view to bolstering their exports
and supporting an increased and wider participation of women in economic
activities.
2. PROFILE OF THE MSME OWNERS
The assessment saw the participation of 101 female-owned MSMEs with active
engagement in international trade, which belonged to the manufacturing
and agricultural sectors (Annex 3). As shown in Figure 2.1, the majority
were established between 2013 and 2018, reflecting the optimism that was
generated by the DCFTA (Section 1). Only three MSMEs were still in the start-
up phase, all of which were established in early 2020 after the outbreak of the
pandemic.
18
Section 2
Profile of the MSME owners
As shown in Figure 2.2, owners between 28 and 36 years old constituted the
largest segment of the female-owned MSMEs surveyed. About 88 per cent
were married with at least once child, while remaining female MSME owners
were either single (5 per cent) or divorced (6 per cent) with no children.
Figure 2.1 – Breakdowm of the female MSME owners by establishment date (Number of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
Figure 2.2 – Breakdowm of the female MSME owners by age group (number of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
19
Section 2
Profile of the MSME owners
As shown below, the majority were opportunity driven and ventured into
business to realize personal ambitions with the support and encouragement
of their families. They were major contributors to their households’ income,
highly educated and many were active networkers, keen on integrating
their businesses into global value chains. Their experiences provide valuable
insights into the factors undermining the development prospects of female-
owned enterprises and women’s increased participation in economic
activities.
2.1 Opportunity driven but with limited engagement in exports
Only 21 per cent of the female MSME owners surveyed were necessity-driven,
who ventured into business to supplement their households’ income.52 These
belonged to households at-risk-of-poverty, with many drawing attention to
their families’ struggle to make ends meet. The remaining female MSME
owners surveyed (79 per cent) were opportunity-driven, who sought and
embraced business opportunities and change.53
As shown in Figure 2.3, about 53 per cent of the opportunity-driven owners
ventured into business to achieve financial independence. Another 28 per
cent described their businesses as a means for realizing their personal
ambitions. In most cases, these related to turning hobbies into businesses,
become their “own bosses” or to a desire to establish roots in the country
after spending several years abroad.
Figure 2.3 - The female MSME owners' reasons for venturing into business
(percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
52For an informative discussion of opportunity and necessity entrepreneurs, see, for example, Robert W. F., and Fossen, M.F (2018) “Opportunity versus Necessity Entrepreneur-
ship: Two Components of Business Creation”, IZA – Institute of Labour Economics Discussion Paper No. 11258; available at: http://ftp.iza.org/dp11258.pdf.
53The definition of opportunity-driven entrepreneurs was coined by Peter Drucker, who argued that “entrepreneurs see change as the norm and as healthy. Usually, they do
not bring about the change themselves. But – and this defines entrepreneur and entrepreneurship – the entrepreneur always searches for change, responds to it, and exploits
it as an opportunity”. Drucker, P. (1985) Innovation and Entrepreneurship: Practice and Principles. New York: Harper & Row, p. 28. The concept of entrepreneurship has taken
on several meanings under the weight of the various definitions, with each bringing forward certain attributes and traits that characterize successful entrepreneurs. Drucker’s
definition stresses management skills, foresight, discipline and hard work and considers entrepreneurship as the bedrock for innovation. These traits were also highlighted by
Joseph Schumpeter who attached more importance to the role of entrepreneurs as driving the “creative-destructive” process of modernity through venturing into innovative
activities. The literature on entrepreneurship points to learning by doing, with entrepreneurs evolving through successes. This is the view taken in the review, which, following
Lall, S. (1992), sees entrepreneurs as graduating into entrepreneurs in the Schumpeterian sense and transforming their enterprises into centres of innovation. For further details
on Schumpeter’s views on entrepreneurship, see, for example, Becker, C.M., Thorbjørn, K. and Richard, S. (eds.) (2011) The Entrepreneur: Classic Texts by Joseph A. Schumpeter.
Stanford, California: Stanford University Press.
20
Section 2
Profile of the MSME owners
The remaining 20 per cent of the opportunity-driven female MSME owners
ventured into business to meet domestic demand, and this was particularly
the case of those engaged in the food and textiles industries. Several textile
manufacturing MSME owners responded to the lack of cloths at reasonable
prices during the lockdown period, while those engaged in the food industry
wanted to be among the suppliers of healthy food products at competitive,
affordable prices. Furthermore, for 11 per cent of the opportunity and necessity
driven female MSME owners, the desire to create jobs for their communities
was a priority, reflecting a strong sense of social responsibility.
However, the female MSME owners surveyed showed limited engagement
in exports. The necessity-driven owners (21 per cent of the female MSME
owners surveyed) considered exporting as a tremendous challenge given
their modest production volumes. On their part, the opportunity-driven
owners (the remaining 79 per cent) were eager to boost their exports. Yet
only 46 per cent of the opportunity-driven female MSME owners sold their
products abroad. They were predominantly occasional exporters, who sold
small volumes on a sporadic basis, and the majority were heavily dependent
on Romania as the main outlet for their products (Section 3).
2.2 Highly educated but lack business skills
Both the opportunity and necessity-driven female MSME owners were highly
educated, with about 91 per cent educated up to the university level. Another
6 per cent were yet to obtain their university degrees, and the remaining 3
per cent were educated up to the primary or secondary levels.
While the owners said that they drew on the skills acquired through their
formal training, it was their family support that drove their enterprises’ growth,
especially during the start-up phase. The importance of family support for
the surveyed MSME owners is further evidenced by the fact that about 81
per cent managed their businesses jointly with a family member; in most
cases their spouses, who assisted in the day-to-day business operations in
their personal capacity (i.e., not as unpaid employees). Only 5 per cent of the
female MSME owners surveyed reported recruiting family members on a full-
time basis as unpaid staff.
This marked reliance on family support cannot be understood in isolation
of the female MSME owners’ lack of prior business experience in the start-
up phase. Around 37 per cent launched their businesses without any prior
business experience, and this group comprised former teachers, bankers,
journalists, lawyers, engineers, information technology experts, students a
handful of former civil servants and housewives.
21
Section 2
Profile of the MSME owners
While the remaining 63 per cent had prior business experience, only 36
per cent had work experience in their respective industries and these were
mainly engaged in the textile industry. The remaining 27 per cent had prior
experience in other industries, namely in the fields of sales, accounting,
marketing/promotion.
The lack of prior business experience in the start-up phase meant that the
female MSME owners did not have business networks, management skills,
and knowledge of the development opportunities and competitive threats
facing their enterprises when they started their businesses,54 rendering
reliance on family support a natural path to follow. While this support was
critical during the early start-up phase, it proved to be insufficient during
subsequent years as competitive pressures and the demands of the day-to-
day business increased (Section 6).
2.3 Major contributors to their households’ income
The female MSME owners surveyed were instrumental to improving the
welfare of their households. As shown in Figure 2.4, the majority were the sole
breadwinners, and this was particularly the case of those engaged in textiles
and food manufacturing.
Figure 2.4 - MSME owners' contribution to their households' income
(percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
54For a brief discussion of the importance of prior business experience for
start-up activities, see, for example, Politis, D. (2008) “Does prior start-up
experience matter for entrepreneurs' learning?: A comparison between
novice and habitual entrepreneurs”. Journal of Small Business and Enter-
prise Development. 15 (3): 472–489.
22
Section 2
Profile of the MSME owners
2.4 Occasional networkers
Only 44 per cent of the female MSME owners surveyed reported having
business networks, which they forged through memberships in market
support institutions, including sectoral associations, enterprise support
organizations and agricultural cooperatives. The female MSME owners
cited multiple memberships, and five held leadership positions as part of
the board of directors. However, over 50 per cent of those belonging to the
textile industry, reflecting the limited networking capabilities of the owners
operating in the remaining sectors covered in the survey.
The female MSME owners reported that their memberships in market support
institutions enabled the owners to:
• Improve their marketing and promotional skills.
• Learn from the experiences of other enterprises.
• Participant in joint promotional campaigns domestically and abroad.
• Pool resources in the form of combined purchase orders for sourcing raw
material and equipment domestically and from abroad.
• Establish common storage and sorting facilities (agri-MSMEs).
• Access external sources of funds, including bank loans as well as public
and donor-funded grants.
3. TRADE DISRUPTIONS
The period since the outbreak of COVID-19 has seen Governments across
the globe introduce nationwide lockdown measures and special health and
safety control arrangements at border crossing points (BCPs)55 to contain
the spread of the pandemic in line with the World Health Organization
(WHO) safety guidelines.56 These measures were implemented in parallel
with restrictive NTMs, mainly temporary export restrictions, to hedge against
supply shortages. In addition, many Governments introduced temporary
customs duties and value-added tax (VAT) exemptions to ease the financial
burden on enterprises.57
The Government of the Republic of Moldova adopted similar measures. It
introduced a nationwide lockdown from 17 March till 15 May 2020,58 which
also saw the closure of the Chișinău International Airport and 30 per cent of
the country’s BCPs (or 12 out of 40).59
55See https://wiki.unece.org/display/CTRBSBC/Observatory+on+Bor-
der+Crossings+Status+due+to+COVID-19+Home.
56See https://wiki.unece.org/display/CTRBSBC/Moldova.
57See https://www.macmap.org/COVID19.
58Parliament of the Republic of Moldova (http://parlament.md/Actualitate/
Noutati/tabid/89/NewsId/2374/language/ro-RO/Default.aspx).
59Updates on lockdown measures are published at https://gov.md/ro.
https://wiki.unece.org/display/CTRBSBC/Moldova; and Government’s report
on cross-border trade measures of 2 September 2020 at: https://www.itf-
oecd.org/sites/default/files/docs/md-measures-COVID19_10.pdf.
23
Section 3
Trade Disruptions
The lockdown measures were gradually lifted as of June 2020 with the
opening of the Chișinău International Airport (on 15 June 2020);60 the easing
of restrictions on non-essential businesses (as of 12 June 2020);61 and, the re-
opening of BCPs (July 2020).62 The Government also kept NTM restrictions to
the minimum and upscaled trade facilitation measures, as advanced under
the World Trade Organization (WTO) Agreement on Trade Facilitation,63 to
mitigate supply chain disruptions.
3.1 Transmission channels
The Government of the Republic of Moldova used restrictive NTMs on a
limited basis to address shortages in pharmaceutical and personal protective
equipment (PPE).64 Otherwise, the Government focused on generating
financial savings for supply chain actors through tax exemptions on imports
of certain medical equipment and pharmaceutical products,65 and reinforced
trade facilitation measures:
1. Transparency in trade was ensured through online publication of health
protection measures.66 Enterprises were also kept abreast of applicable
trade-related rules and customs procedures through the Customs Service
Trade Information Portal,67 and could submit their enquires online through
the Customs Call Centre.68 In addition, trade partners were kept abreast
of changes in NTMs and special health and safety arrangements at border
crossing points through prompt submission of notifications to the WTO69
and the UNECE Observatory on Border Crossings,70 respectively.
60The Chisinau International Airport was closed on 17 March 2020 and
reopened on 15 June 2000. Commercial airlines were to make independ-
ent decisions as to the resumption of their services. Government of the
Republic of Moldova (https://www.COVID19healthsystem.org/countries/
moldova/livinghit.aspx?Section=6.%20Measures%20in%20other%20sec-
tors&Type=Chapter).
61The restrictions on non-essential businesses were imposed till 30 June
2020. The Government started easing these restrictions on 12 June 2020
by permitting shopping centres and nonessential businesses to reopen
provided they implement social distancing and health safety measures
established by law. Government of the Republic of Moldova (https://www.
covid19healthsystem.org/countries/moldova/livinghit.aspx?Section=6.%20
Measures%20in%20other%20sectors&Type=Chapter#37Transitionmeas-
ures:Measuresinothersectors).
62https://wiki.unece.org/display/CTRBSBC/Moldova; and Government’s re-
port on cross-border trade measures of 2 September 2020 at: https://www.
itf-oecd.org/sites/default/files/docs/md-measures-COVID19_10.pdf.
63The Agreement on Trade Facilitation clarifies and improves the General
Agreement on Tariffs and Trade articles V (Freedom of Transit), VIII (Fees
and Formalities connected with Importation and Exportation), and X (Pub-
lication and Administration of Trade Regulations. These articles correspond
to the following chapters of United Nations Multiagency Support Team
(UN/MAST) NTM classification system (https://unctad.org/en/Pages/DITC/
Trade-Analysis/Non-Tariff-Measures/NTMs-Classification.aspx): Sanitary and
phytosanitary measures (Chapter A); technical barriers to trade (Chap-
ter B); pre-shipment inspection and other formalities (Chapter C); price
control measures, including additional taxes and charges (Chapter F);
finance measures (Chapter G); measures affecting competition (Chapter H);
distribution restrictions (Chapter J); government procurement restrictions
(Chapter M); rules of Origin (Chapter O); and, export-related measures
(Chapter P).
64The Republic of Moldova introduced temporary export ban on masks,
gloves, and disinfectants over the period 25 July till 31 August 2020 (https://
www.macmap.org/COVID19).
65Imports of undistorted ethyl alcohol have been subjected to a temporary
exemption of excise duties since 26 March 2020 (https://www.macmap.org/
COVID19).
66https://customs.gov.md/ro. Moreover, enterprises could receive alerts on
change in applied legislation by registering with the unified alert system
(http://officialalert.md/#/).
67www.trade.gov.md. The Information Point for External Trade provides
reliable authoritative information on applied customs legislation and pro-
cedures and border crossing concerning goods and transportation units.
68https://customs.gov.md/ro.
69https://www.wto.org/english/tratop_e/COVID19_e/trade_related_goods_
measure_e.htm.
70https://wiki.unece.org/display/CTRBSBC.
24
Section 3
Trade Disruptions
2. Documentary requirements were further streamlined. Customs declarations
continued to be submitted electronically,71 and the Government started
issuing electronic transport authorizations in July 2020.72 The Government
also simplified the issuance of preferential certificates of origin for goods
destined to the EU, the Central European Free Trade Agreement (CEFTA)
countries, and Turkey. Enterprises can submit copies of the certificates with
the provision that they would provide the Customs Service with the original
documents at a later stage.
3. Border control continued to proceed within the context of an integrated
border management system and was risk-based,73 with inbound shipments
of food, sanitary products and medical equipment receiving priority clearance.
In addition, the shifts at customs offices were adjusted to ensure continuous
24/7 operations, as per established (pre-pandemic) practices.74
4. Customs and tax payments continued to be made online through the
Government’s online payment platform.75
5. Transit traffic continued to be facilitated by cooperation arrangements
anchored in regional agreements and UNECE international transport
conventions and protocols.76
6. The reconstruction and further development of the Moldovan customs
offices at BCPs continued with the support of the EU, focusing on shared
BCPs with Romania (Leuseni-Albita, Sculeni-Sculeni, Giurgiulesti-Galiti) and
Ukraine (Giurgiulesti-Reni).
However, as shown below, the female-owned MSMEs’ supply chain activities
were severely disrupted by lockdown measures and the special arrangements
at BCPs in the Republic of Moldova and partner countries. The Government’s
incomplete trade reforms was another complicating factor.
These shortfalls manifested themselves in the form of continued reliance on
paper-based procedures, overreliance on physical inspection at BCPs and
weaknesses in the conformity assessment system, so that trade disruptions
were complicated by non-tariff barriers (Box 3.1). Coupled with weaknesses in
the national railway network, these barriers acted as negative transmission
channels, which amplified supply chain disruptions with harmful effects on
the female-owned MSMEs’ resilience and business development prospects.
71https://trade.gov.md/ro.
72www.eat.anta.gov.md.
73For a detailed overview of this system, see UNECE study on regulatory
and procedural barriers to trade in the Republic of Moldova, Chapter 2.
74https://wiki.unece.org/display/CTRBSBC/Moldova.
75www.mpay.gov.md.
76For a detailed overview of this system, see UNECE study on regulatory
and procedural barriers to trade in the Republic of Moldova, Chapter 2.
25
Section 3
Trade Disruptions
Box 3.1 Non-tariff barriers caused by
incomplete trade-related reforms
• Delayed issuance of trade documents, as the Government has yet to fully transition to a paperless trading
environment.
• Continued reliance on physical inspection of inbound cargo during customs clearance, which caused unnec-
essary delays.
• Lack of adequate infrastructure facilities at customs terminals, which created long queues and congestion on
the Moldovan side of the BCPs.
• Lack of internationally recognized conformity assessment bodies, so that MSMEs assumed additional costs
to prove compliance with regulatory requirements in export markets as they had to ship products abroad for
certification.
Source: UNECE (2020) “The impact of COVID-19 on trade and structural transformation in the Republic of Moldova:
Evidence from UNECE’s survey of micro, small and medium enterprises”
3.2 Impact on the female-owned MSMEs supply chains
The above-mentioned transmission channels created serious operational
bottlenecks throughout the female-owned MSMEs’ supply chains. These
bottlenecks manifested themselves in the form of lack of clarity over
applied trade-related regulations and procedures and delays in obtaining
documentary requirements; the impact of which was compounded by
inflated transport costs.
3.2.1 Lack of clarity over applicable trade-related regulations and procedures
Most of the export-oriented MSMEs lacked clarity over applicable trade-related
regulations and procedures, having consistently outsourced the preparation
trade documents and shipment activities to freight forwarders and, in a few
cases, to family members so as to reduce their workload.
However, the transport disruptions caused by lockdown measures and the
special health and safety arrangements at BCPs in the Republic of Moldova
and in partner countries dealt a blow to the freight forwarding industry,
particularly the small and medium freight forwarders who, for obvious
reasons, constitute the female MSME owners’ partners of choice. Almost all
the MSME female owners surveyed reported that their traditional freight
forwarders were either forced to suspend activities or shut down. Indeed,
evidence shows that Moldovan freight forwarders were struggling to maintain
operations, and many had to cease servicing countries with strict BCP safety
measures.77
Having lost their traditional freight forwarders, the owners were struggling to
familiarize themselves with applied trade-related regulations and procedures.
The female MSME owners said that they were unable to navigate online
information, because it is not sufficiently detailed, is fragmented across
different websites and, in most cases, is difficult to understand.
77For further details on this see, UNECE (2020) The impact of COVID-19 on
trade and structural transformation in the Republic of Moldova: Evidence
from UNECE’s survey of micro, small and medium enterprises”; https://un-
ece.org/trade/studies-regulatory-and-procedural-barriers-trade.
26
This renders it difficult to identify dated information and to discern the
practical implications of applied rules for their operations. In addition, many
reported that they were unfamiliar with the DCFTA and associated reforms.
Furthermore, the female MSME owners interviewed lamented the ad hoc
nature of public-private sector consultations, noting that these are usually
organized within the context of donor-funded projects. Several were of the
view that the recommendations and issues raised by the female-owned
enterprises are not properly addressed.
3.2.2 Delays in obtaining trade documents
The Republic of Moldova’s continued reliance on paper-based procedures
meant that the female MSME owners, just like all Moldovan exporters, were
faced with extensive documentary requirements. For products that should
be accompanied by conformity assessment certificates to prove compliance
with regulatory requirements in export markets, the resulting delays
were compounded by high testing costs, given the lack of internationally
recognized product testing laboratories in the country.
This concern was raised by female exporters of honey and PPE products.
The female MSME owners usually arrange for testing their products in
neighbouring European countries at additional cost, given the higher testing
fees. These costs have increased following the outbreak of the pandemic, as
shipment by air became more expensive.
The lack of internationally recognized product testing laboratories was also
raised by a saffron producer. The owner noted that she was still struggling to
find a product testing laboratory, and, as such, remained unable of exporting
to Europe as planned.78
3.2.3 Inflated transport costs
All the female MSME owners surveyed were experiencing difficulties in
organizing the transport of their imports and exports by road, under the weight
of the special safety and health arrangements at BCPs. These arrangements
forced freight forwarders to increase their fees to cover additional operating
cost that were out of their control, in addition to causing delayed deliveries.
These challenges were also reported by male-owned MSMEs surveyed as
part of the UNECE assessment of 2020 “The impact of COVID-19 on trade
and structural transformation in the Republic of Moldova: Evidence from
UNECE’s survey of micro, small and medium enterprises” and, as such, are
not particular to the female-owned MSMEs.
78For further details on this see, UNECE (2020) The impact of COVID-19 on
trade and structural transformation in the Republic of Moldova: Evidence
from UNECE’s survey of micro, small and medium enterprises”; https://un-
ece.org/trade/studies-regulatory-and-procedural-barriers-trade.
27
Section 3
Trade Disruptions
To avoid delays, many of the established exporters with modest export
volumes shifted to shipment by air at additional cost. However, shifting to
air transport was not an option was not an option for occasional exporters.
To maintain exports, the occasional exporters, many of which have lost their
traditional freight forwarders, engaged directly with truck companies, which
they identified with the help of family and friends. Those who were unable to
do so, reported reducing or suspending export activities.
3.2.4 Export losses
Over 58 per cent of the exporting female-owned MSMEs surveyed lost their
traditional buyers, especially in Romania and Italy (Figure 3.1), who were
forced to suspend production or shut down altogether under the weight of
the COVID-19 induced economic crisis.
Figure 3.1 - The female-owned MSMEs' most affected export destinations
(percentage of responses)
Source: UNECE survey of Moldovan female-owned MSMEs
Under such conditions of dwindling demand, many exporting MSMEs saw
their export earnings plummet. The female-owned MSME owners also cited
supply shortages (caused by delayed deliveries, inflated transport costs and
the significant increase in the price of raw materials) as the main reasons
for suspending exports. Agri-enterprises were particularly affected as the
supply shortages and inflated transport costs came on the heels of the severe
draught, which has already harmed their increasingly thin profit margins.79
79For further details, see, the World Bank, Special Focus Note;
https://thedocs.worldbank.org/en/doc/7bf12b95f10a3daf7b-
570718b2100e15-0080012021/related/MEU-DRM-Special-Topic-May-2021-FI-
NAL-eng-Copy.pdf.
28
Section 3
Trade Disruptions
As shown in Figure 3.2, around 26 per cent lost all their export earnings in 2020
(exports decreased by 100 per cent), having suspended exports altogether.
Another 19 per cent saw their export earnings decrease by up to 19 per cent in
2020 in relation to the pre-pandemic period and another 13 per cent lost up to
50 per cent of these earnings. This declining trend continued into 2022, with
many of these enterprises operating at a loss.
Female-owned MSMEs that managed to maintain pre-pandemic export
earnings levels (35 per cent) or exceed their pre-export earnings level (7 per
cent) were occasional exporters, who found new buyers with the help of
family and friends.
Figure 3.2 - Percentage change in the female-owned MSMEs' export earnings, 2020
(year over year, percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
4. THE RIPPLE EFFECTS OF TRADE DISRUPTIONS
The impact of trade disruptions was amplified by the female MSMEs
owners’ coping strategies. Most notable was the scaling-down of production
activities, which increased their debt burden so that they are ill-equipped
to recover once normality is attained. As shown below owners who resorted
to growth-enabling strategies, particularly upscaling e-commerce activities
and repurposing production, constituted a minority. This section discusses
the new realities created by the owners’ coping strategies, while the next
section looks into the ripple effects of these strategies.
29
Section 4
The ripple effects
of trade disruption
4.1 Limited engagement in electronic commerce
Out of the 101 female-owned MSMEs surveyed, only 10 were engaged in
e-commerce, and the majority were already selling online before the outbreak
of the pandemic. Moreover, the owners’ engagement in e-commerce
was limited. Many used social media platforms to promote their products
domestically and then proceeded to process purchase orders manually.
Specifically, the owners took orders by phone or by email and negotiated the
delivery terms with buyers, who chose between receiving the goods by mail
or collecting them personally (e.g., from the MSMEs production facilities or
from an agreed collection point).
The assessment shows that while a major concern, the female-owned MSMEs’
weak information and communications technology (ICT) capacity is not the
main obstacle to upscaling e-commerce activities. The owners noted that
even if they had the required ICT capacities, engaging in e-commerce would
remain a challenge owing to the below factors:
• The high e-payments fees and the demanding deposit requirements
imposed by banks for e-payments. The e-payment fees eat away up to
3.5 per cent of sales revenues, while the deposit requirements create
cashflow problems.
• The high costs associated with obtaining the special software for
processing online payments (many said that the software is expensive).
• The high annual taxes for operating online stores (10,000 Moldovan leu).
• The inflated transport costs.
• The cumbersome documentary requirements for passing customs.
• The cumbersome customs clearance procedures for imports and the
resulting delays, which makes it difficult to meet delivery deadlines.
• The lack of internationally recognized product testing laboratories.
• The lack of clarity over applicable e-commerce laws.
• The demanding regulatory requirements in export markets, particularly
the EU.
• The international buyers’ distrust in Moldovan suppliers, including female-
owned enterprises.
The owners explained that above challenges undermine their competitiveness
in global markets.
30
Section 4
The ripple effects
of trade disruption
Addressing these challenges will also enable the Republic of Moldova to
further improve its e-commerce readiness. The country is among the 10
highest-ranking transition economies against the United Nations Conference
on Trade and Development (UNCTAD) Business-to-Consumer E-commerce
Index (2020), which assesses countries in terms of internet connectivity,
financial inclusion, ICT and logistics infrastructure.80
4.2 Limited engagement in production repurposing
Production repurposing was a coping strategy for 22 of the female MSME
owners surveyed. These were engaged in the clothing industry (17 enterprises)
and the production of handicrafts, honey, and hygiene products (5 enterprises).
The clothing manufacturers repurposed part or all of their production lines
during the first few months of the pandemic to make cloth face masks and
disposable gowns for health care workers and medical professionals.
While some repurposed in the hope of landing purchase orders from hospitals,
the majority of the owners were triggered by a rise in demand from European
buyers. These placed large purchase orders with their traditional Moldovan
suppliers. These suppliers, predominately medium and large enterprises,
subcontracted part or all of the production to micro and small enterprises.
This resulted in a small cluster of vertically integrated enterprises, with the
medium and large enterprises acting as the buyers. The medium and large
enterprises furnished the micro and small enterprises with raw material
provided by the European buyers and, to a lesser extent, from their own
stocks. The medium and large enterprises also ensured compliance with the
EU regulatory requirements. They shipped samples for testing by accredited
European laboratories and, in some cases, the testing costs were assumed by
the European buyers.
While those who repurposed to cloth face masks were well supported, the
remaining female MSME owners surveyed repurposed production without
any support. Some repurposed in response to shortages hand sanitizers.
Others repurposed to make baby clothes during the lockdown period in
response to supply shortages. Still others repurposed to maintain operations.
This was the case of a honey producer who reoriented operations from bulk
exports to domestic retail by selling the product in small jar containers. This
was also the case of a small farmer who started growing goji berries.
Only a handful of the female MSME owners purchased new machinery.
The amounts invested were modest (below EUR 10,000) and were financed
using personal savings. Only one owner invested a higher amount (over EUR
20,000), which she covered using retained business earnings and personal
savings.
80UNCTAD Business-to-Consumer (B2C) E-commerce Index (2020); https://
unctad.org/system/files/official-document/tn_unctad_ict4d17_en.pdf. For a
more detailed discussion of the role e-commerce in influencing domestic
and cross-border trader during the pandemic and beyond, see UNECE
(2022) COVID-19 impact on e-commerce post-pandemic COVID-19 econom-
ic recovery: Harnessing e-commerce for the UNECE transition economies;
https://unece.org/sites/default/files/2022-01/ECE_TRADE_468E_1.pdf.
31
Section 4
The ripple effects
of trade disruption
The owners’ repurposing efforts were met with success. They were able to sell
their new products and acquire new skills. However, many were unsure as to
whether they would be able to maintain the new production lines. Those who
repurposed to cloth face masks noted that they have fulfilled their obligations
under the existing contracts and, as such, are unlikely to maintain the new
production lines.
The remaining female MSME owners noted the lack of funds for financing
investments in additional machinery, fierce import competition and
counterfeit trade. The lack of raw materials at reasonable costs was also a
major concern raised by all the female MSME owners, including those who
were considering repurposing. At issue is not only the inflated transport costs,
but also the traditional suppliers’ decision to hike the prices of raw material.
The owners lamented that they were unable to find alternative suppliers,
and several noted that negotiations fell through because they were met with
distrust.
4.3 Export development plans put on hold
The above-mentioned conditions forced many of the female MSME owners
surveyed to cancel or suspend pre-pandemic export development plans. This
was the case of around 56 per cent of owners; the majority of which were
planning to increase exports to traditional markets, particularly to Romania
(Figure 4.1).
Figure 4.1 - The female-owned MSMEs' pre-pandemic export expansion plans by destination
(percetnage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
32
Section 4
The ripple effects
of trade disruption
5. INCOME FALLOUT
The current conditions of dwindling international demand have increased
the importance of domestic markets for the female-owned MSMEs that
export. However, many saw their domestic sales plummet in the face of
cheaper imports and counterfeit; the two systemic challenges that have been
siphoning away the female-owned MSMEs’ livelihoods before the pandemic.
Figure 5.1 compares losses in export sales earnings with domestic losses in
2020 in relation to 2019. It shows that almost all the female-owned MSMEs
surveyed experienced losses in domestic sales earnings. About 50 per cent
saw their domestic sales plummet, of which 34 per cent lost up to 50 per
cent of their pre-pandemic levels. Another 12 per cent lost up to 90 per cent
of their domestic earnings, and 4 per cent did not register any earnings (100
per cent loss).
Female-owned MSMEs that managed to maintain or exceed their pre-
pandemic domestic earning levels (33 and 15 per cent of total MSMEs
surveyed, respectively) belonged to the food industry or were engaged in the
manufacturing of disinfectants and sanitizers. It is worth noting that MSMEs
that repurposed to cloth face masks and disposable gowns were not among
this group, since these products are cheaper than clothes.
Figure 5.1 - Changes in female-owned MSMEs' domestic sales and total income, 2020
(year over year, percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
33
Section 5
Income fallout
Figure 5.1 also highlights the strong blow dealt to the exporting female-
owned MSMEs. These registered a significant deceleration in revenues, with
the losses in export sales earnings exceeding domestic sales losses. As a
result, about 39 per cent reported losing up to 50 per cent of total income
in 2020 in relation to 2019. Another 20 per cent lost up to 90 per cent of their
total income, and about 3 per cent lost their entire income (100 per cent).
To mitigate income losses, the owners resorted to erosive coping strategies.
About 12 per cent terminated contracts over the period January 2020-March
2021 and another 14 per cent introduced salary cuts, which they kept below 50
per cent. Yet another 25 per cent put their staff on furlough (unpaid or semi-
paid leave). Most laid-off and furloughed staff were women, who were quick
to resign or request unpaid leave to take care of their children. In all cases, the
production departments bore the brunt of these measures, lending further
evidence to the female-owned MSMEs’ stunted production capacity.
The female MSME owners drew attention that the above were last resort
measures, which they had to implement after running out of options. These
options involved the deferment of business payments, a measure reported
by 45 per cent of the owners, who postponed rents, loan repayments, salaries
and utility bills (Figure 5.2).
Figure 5.2 - The female-owned MSMEs' deferred business payments, January 2020-March 2021
(percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
Moreover, around 66 per cent of the female MSME owners used personal
savings to cover business expenses. As shown in Figure 5.3, this came at the
expense of their households’ welfare, as they cut back on food and other
expenditures and cancelled home improvements plans (reported under
other).
34
Section 5
Income fallout
Moreover, around 66 per cent of the female MSME owners used personal
savings to cover business expenses. As shown in Figure 5.3, this came at the
expense of their households’ welfare, as they cut back on food and other
expenditures and cancelled home improvements plans (reported under
other).
Figure 5.3 - The female-owned MSMEs' deferred household payments, January 2020–March 2021
(percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
The owners resorted to these erosive coping strategies because they were
unable to obtain bank loans, in view of the high interest rates and demanding
collateral requirements. Only two female-owned MSMEs managed to obtain
small bank loans, which they used for covering salaries and utility bills.
Moreover, the majority reported that their efforts to reschedule loan payments
were met with failure, as the banks conditioned their approval to lowering
the MSMEs’ credit ratings; something that would only lead to higher interest
rates and, thereof, higher debt levels.
Beyond the considerations above, the assessment suggests that more needs
to be done to facilitate the female-owned MSMEs’ access to relief measures.
As of March 2021, around 17 per cent of the female-owned MSMEs surveyed
received government support in the form of grants (Figure 5.4). About 40
per cent said that they were not familiar with available support schemes. In
addition, many noted that they were unable to benefit from government
support, owing to the cumbersome application procedures or because they
did not meet the eligibility criteria.
35
Section 5
Income fallout
Figure 5.4 - Government assistance received by the female-owned MSMEs,
January 2020–March 2021 (percentage of responses)
Source: UNECE survey of Moldovan female-owned MSMEs
The assessment also shows around 30 per cent of the female-owned MSMEs
as receiving support through donor funded initiatives, including those
launched in partnership with Organization for Small and Medium Enterprises
Sector Development (ODIMM), the United Nations Development Programme
and UN-Women. This support came in the form of grants for the acquisition
of equipment and e-commerce funding, in addition to training and advisory
services and explanatory brochures for bringing production facilities and
workplaces up to COVID-19 safety requirements.
However, the support received was limited to the duration of the funding
cycle and seemed to be insufficient to mitigate the economic impact of
the pandemic; something which cannot be understood in isolation of these
enterprises’ growth bottlenecks (Section 6). In March 2021, about 92 per
cent of the owners said that their survival hinges on continued government
support. Of these 72 per cent needed “a lot of support” to cover, among other
things, business debts and taxes (Figure 5.5).
36
Section 5
Income fallout
Figure 5.5 – The female-owned MSMEs' urgent needs to maintaining operations, March 2021
(percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
As most of the female MSME owners surveyed were the sole breadwinners
for their households, their businesses’ fallout had reverberating effect on
their families’ welfare. This is reflected in the owners’ worsened perceptions
of their living conditions in March 2021 compared to the pre-pandemic period
(Figure 5.6).
37
Section 5
Income fallout
6. GROWTH BOTTLENECKS
The results of the survey show the female-owned MSMEs’ development
prospects as undermined by not only non-tariff trade barriers and transport
connectivity problems, but also by deep-seated internal growth bottlenecks.
As shown below, combined with the prevalence of counterfeit and import
competition, these bottlenecks have meant that MSMEs will remain unable
to pick up steam even as the economy has been showing signs of recovery.
6.1 Lack of adequate skills
All the female MSME owners surveyed reported being held back by the lack
of the required skills. To begin with, as mentioned in section 2, only a limited
segment ventured into business without prior business experience in their
respective industries. The remaining either lacked prior business experience
or gave gained only a limited set of business skills in the areas of business
services (marketing, accounting and advertising). The owners also lamented
the lack of skilled staff, particularly in the area of production; something
which reflects at once their limited financial resources and the skill mismatch
in the Moldovan labour market.81
The owners explained that while important, the support of their families is
insufficient to attend to daily operations and facing competitive pressures.
Family members do not necessarily have the required skill set. Moreover, they
are gainfully employed, so that they have only limited time to spare.
81See, for example, the World Bank (2017) “Missing skills: Results of the
Skills Module of the Moldovan Labour Market Forecast Survey”; https://
documents1.worldbank.org/curated/en/524971511793797679/pdf/121666-WP-
P154573-PUBLIC-Missing-Skills-Moldova-Rutkowski-Bargu-2017-09-21.pdf.
Figure 5.6 – Changes in the female MSME owners' perceptions of living conditions
(percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
38
Section 6
Growth bottlenecks
Under such conditions, the female MSME owners find themselves consistently
absorbed by the day-to-day business operations. As shown in Figure 6.1,
finding and concluding negotiations with potential suppliers and buyers
is the most time consuming. Many of the female MSME owners surveyed
described stressful and slow-moving negotiations, because buyers have a
“high level of distrust” in Moldovan suppliers.
This means that the owners have limited time for strategic management
decisions, including setting out plans for, among other things, optimizing
operations, improving existing production processes, and launching new
product lines.
Figure 6.1 – MSME owners' use of time (% of responses)
Source: UNECE Survey of Moldovan female-owned MSMEs
6.2 High exploratory market access costs
The female MSME owners’ use of time reflects high exploratory costs. These
costs pose a significant strain on the owners, which is compounded by the
considerable time invested in piecing together published information on
applicable trade-related rules and procedures from different sources. Many
were of the view that building working relations of trust with customs would
go a long way in addressing this constraint and in ensuring compliance with
applicable regulations.
39
Section 6
Growth bottlenecks
6.3 Insufficient business networks
The majority of the female-owned MSMEs surveyed lacked adequate business
networks. Memberships in market support institutions, which constitutes an
important vehicle for establishing such networks, was pursued by only 44 per
cent of the owners and most of these were engaged in the textile industry.
Female MSME owners operating in other sectors said that they were hesitant
to join market support institutions. Some cancelled memberships, citing the
limited benefits received. Others lamented the short duration of support
services, as most of these tend to be linked to donor-funded projects or are
dependent on government support.82 Still others complained about the
strict eligibility criteria of enterprise support initiatives. For example, owners
of micro agri-enterprises registered as peasant households said that they
were unable to benefit from business development initiatives, because they
do meet the eligibility criteria.
Not only do the surveyed female MSME owners exhibit limited participation in
market support institutions, but they also show limited appetite for entering
sub-contracting arrangements. Barring some of those involved in the textile
industry, none of the owners were engaged in sub-contracting arrangements
with international enterprises.
6.4 Weak production capacities
Almost all the owners interviewed drew attention to their weak productive
capacity as a main impediment to engaging in exports, and singled out the
lack of technical knowhow and modern machinery as major impediments to
improving product quality and achieving scale economies.
For micro and small agri-enterprises, at issue is also the lack of quality farm
equipment, including tractors, ploughs, harrows, broadcast spreaders and
harvesters. Many also reported lacking on-the-farm sorting and packaging
facilities. In addition, several were unable to enlarge their farms because they
cannot afford the rents charged by land lease holders.
Beyond the above, the female MSME owners surveyed emphasized that
while important, improving their access to bank loans remains insufficient
for developing their businesses. In this respect, the inward-looing enterprises
were of the view that efforts should focus on improving their competitiveness
in domestic markets, as a pre-condition for engaging in exports. Specifically,
they emphasized the need for:
82The limited duration of SME support services resulting from aid dependence has been highlighted as a major concern by Moldovan female entrepreneurs.
Evidence also shows a limited awareness of enterprise support initiatives among Moldovan female entrepreneurs. For further details, see the National Bureau of
Statistics of the Republic of Moldova (2020) “Analytical Report on participation of women and men in entrepreneurship in the Republic of Moldova”, which draws
on a survey that was conducted in 2018; https://statistica.gov.md/public/files/publicatii_electronice/Antreprenoriat_feminin/Antreprenoriat_Femei_Barbati_2020.
pdf. See, also, the International Finance Corporation (2018) “Supporting women’s entrepreneurship in Moldova: Review, assessment, and recommendations”.
40
Section 6
Growth bottlenecks
• Targeted financial incentives, e.g., tax exemptions and reduced social
security benefit payments.83
• Sector focused domestic promotional campaigns, e.g., exhibitions, for
improving their visibility and providing them with an opportunity to
compete with large domestic enterprises and imports.
• Targeted support to enable them to use e-commerce for boosting
domestic sales.
• Increased emphasis on market surveillance to curb counterfeits and low-
quality products. The owners noted the need for regular inspections of
production facilities and products placed on the market.
The above-mentioned needs were echoed by the exporting female MSME
owners. Furthermore, many highlighted the need for practical support
to bring their products up to regulatory requirements in export countries.
Specifically, the owners stressed the need for assistance in implementing
international standards, particularly the EU harmonized standards; obtaining
the CE mark; and, in improving their businesses’ online presence.
For their part, the inward-looing female MSME owners said that they were
hesitant to implement international standards. They cited the lack of support
programmes and the prevalence of counterfeits as disincentives to standards
implementation, which requires new investments that could only increase
their debt burden. Several said that they were still repaying start-up bank
loans and are, as such, were in no position to acquire new loans.
6.5 Other factors
Female MSME owners with pre-school-age children cited the lack of adequate
childcare services as a disincentive to further developing their businesses.
Childcare options for children under 3 years in public kindergartens are scarce,
while private childcare is only accessible to higher-income households.
In addition, many owners reported experiencing difficulties in obtaining
reasonably priced export insurance policies against political and commercial
risks. Many noted that their efforts to obtain these policies have been met with
failure, even before the onset of the pandemic, because insurance companies
consider them as risky clients.
83The social security rate for companies increased from 22.50 per cent in
2020 to 24 per cent in 2021. National Social Insurance House of the Republic
of Moldova (https://cnas.gov.md/).
41
Section 6
Growth bottlenecks
7. CONCLUSION AND RECOMMENDATIONS
This assessment traced the way NTMs deployed by the Government of
the Republic of Moldova and its trade partners combined with health
protection measures to influence female-owned MSMEs export activities
and development prospects. In so doing, it brought into focus the growth
dynamics driving these enterprises.
It showed that the impact of the pandemic was aggravated by capacity
shortfalls within State agencies in the areas of trade facilitation and
conformity assessment. These resulted in non-tariff barriers, which, coupled
with weaknesses in the national railway network, aggravated the impact
of the COVID-19 induced supply chain destructions. They acted as negative
transmission channels, which amplified supply chain disruptions by inflating
trade costs.
The female-owned MSMEs’ resilience was further undermined by their limited
production capacity. The female MSME owners do not have the required
business skills set to properly manage and grow their enterprises. They also
lack competent staff, something which at one reflect the weaknesses in the
county’s labour market and the MSMEs’ limited financial resources. Combined
with the female MSME owners’ difficult access to bank loans and high tax
burden, these conditions meant that the MSMEs’ are inherently incapable
of improving their competitiveness. Moreover, owners with pre-school-age
children were further burdened by the lack of affordable childcare services.
These growth bottlenecks find their strongest expression in the female-
owned MSMEs’ limited engagement in exports. The majority of the female-
owned MSMEs were occasional exporters. Those with established exporting
records experienced difficulties in identifying and earning the trust of
potential international buyers. They also experienced difficulties in insuring
their shipments against political and commercial risks.
These growth bottlenecks meant that the female-owned MSMEs were not
well placed to resort to growth enabling coping strategies, such as production
repurposing and e-commerce. Rather, the majority postponed business
payments and used personal savings to keep their businesses afloat at the
expense of their families’ welfare.
This section provides action-oriented recommendations for the Government’s
consideration. The recommendations, provided in Table 7.1, comprise
emergency support measures for improving the MSMEs’ resilience and
strategic measures for addressing the enterprises’ structural weaknesses. The
emphasis is on expanding the range of support services available to female-
owned MSMEs, through leveraging on existing women’s and enterprise
support organizations with the support of donors.
42
Section 7
Conclusion and
reccomendations
This will enable the Government to ensure a high level of outreach and
create dynamic synergies between relief measures and long-term efforts for
increasing the participation of women in economic activities.
The proposed recommendations support ongoing efforts to bridge the gender
gap in economic activities. They provide action-oriented recommendations
clustered under thematic action areas that can be mainstreamed into
the new strategy for gender equality as well as the MSME post-COVID-19
strategy. The recommendations directly contribute to the achievement of
SDG 5 (gender equality) and stimulate spill over effects in support of SDGs
4 (quality education), 8 (decent work and economic growth), 9 (industry,
innovation and infrastructure), 16 (peace, justice and strong institutions) and
17 (partnerships for the Goals).
The recommendations could only yield the expected results if complemented
by targeted efforts to address capacity shortfalls within State agencies in
the areas of trade facilitation and quality infrastructure. The Government is
committed to addressing these shortfalls following UNECE recommendations,
which were developed in consultation with the relevant agencies in 2020 as part
of the COVID-19 impact assessment “The impact of COVID-19 on trade and
structural transformation in the Republic of Moldova: Evidence from UNECE’s
survey of micro, small and medium enterprises”. These recommendations,
reproduced in Annex 4, involve targeted measures for:
• Bolstering transparency in trade
• Supporting a transition to a paperless trading environment
• Improving the national system of conformity assessment
• Strengthening regional cooperation
• Developing the transport sector
Efforts to boost the female-owned MSMEs’ export competitiveness need to
be complemented by concerted efforts to promote female entrepreneurship.
The female MSMEs owners surveyed exhibited a marked entrepreneurial
spirit and the majority were opportunity driven. However, evidence points to
shortage of female entrepreneurs, which has been attributed t0 the lack of
female entrepreneurial role models. An example of international support in
expanding and strengthening the entrepreneurial spirit within a country is
UNCTAD’s Empretec programme (Box 7.1).
43
Section 7
Conclusion and
reccomendations
Box 7.1 Empretec programme
Continuous training and support will be necessary to enhance entrepreneurial skills, financial literacy and to help
to bridge the gender gap among SMEs and entrepreneurs. UNCTAD offers the Empretec programme to support
capacity-building to promote entrepreneurship, especially among MSMEs in developing and transition economies.
It facilitates business expansion towards sustainable and inclusive development, including small supplier devel-
opment, and social and green entrepreneurship. Consisting of a network of national centres in 40 countries, the
programme offers core products that include the Entrepreneurship Training Workshop, which promotes entrepre-
neurial development, specifically through efforts targeted towards vulnerable groups such as women and youth.
According to the 2020 report of the United Nations Secretary-General reviewing progress in the implementation
of General Assembly resolution 73/225 on entrepreneurship for sustainable development, an impact assessment
of Empretec in the Russian Federation found that 87 per cent of participants found Empretec training “helpful in
overcoming their current business challenges”.84
Source: UNECE, based on UNCTAD, https://empretec.unctad.org
UNECE stands ready to assist the Government in implementing the
recommendations in collaboration with the United Nations Resident
Coordinator Office in the Republic of Moldova, United Nations agencies and
international development partners.
84United Nations Secretary General (2020), Entrepreneurship for sustaina-
ble development: report of the Secretary-General, A/75/275, 27 July 2020.
44
Proposed measures for increasing the resilience of the Republic
of Moldova’s female-owned MSMEs and boosting their exports
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Financial
support
Female-owned
MSMEs are experi-
encing shortages in
working capital
Scale up efforts to familiarize fe-
male-owned MSMEs with available
government support schemes through
partnering with women’s and enter-
prise support organizations targeting
female-owned enterprises.
Scale up micro loans to enable fe-
male-owned enterprises to address
shortages in working capital (especial-
ly, raw materials and shipping costs)
and publish detailed information on
eligibility criteria and application pro-
cedures. To facilitating the owners’,
consider providing these loans within
the context of guarantee schemes in
collaboration with women’s and enter-
prise support organizations targeting
female-owned enterprises.
SDG 5.c: Undertake reforms to give women
equal rights to economic resources, as well
as access to ownership and control over
land and other forms of property, financial
services, inheritance and natural resources,
in accordance with national laws
SDG 9.3: Increase the access of small-scale
industrial and other enterprises, in particu-
lar in developing countries, to financial ser-
vices, including affordable credit, and their
integration into value chains and markets
Emergency Measures
Trade-related
exploratory
costs
Female-owned
MSMEs are not famil-
iar with trade-related
rules and administra-
tive procedures
In addition to upscaling online pub-
lication of up-to-date information on
trade-related regulations and admin-
istrative procedures (Annex 7), priority
should be given to familiarizing female
MSME owners with these regulations
and procedures.
Special emphasis should be accorded
to familiarizing the owners with the
implications of applicable rules and
procedures for supply chain operations
and business development. This will
also put the owners in a better position
to contribute to trade policymaking
processes.
Support could take the form of not only
user-friendly explanatory material, but
also online training courses and tai-
lored in-person training programmes.
In this respect, it is important to
strengthen existing women’s organiza-
tions and relevant enterprise support
organizations with additional capacity
(e.g., experts and training facilities) so
that they could host and maintain such
training facilities beyond the interna-
tional funding cycle.
SDG 5.c: Adopt and strengthen sound poli-
cies and enforceable legislation for the pro-
motion of gender equality and the empow-
erment of all women and girls at all levels
SDG: 16.10 Ensure public access to informa-
tion and protect fundamental freedoms, in
accordance with national legislation and
international agreements
SDG 17.10: Promote a universal, rules-
based, open, non-discriminatory and eq-
uitable multilateral trading system under
the World Trade Organization, including
through the conclusion of negotiations un-
der its Doha Development Agenda
Table 7.1
68The Republic of Moldova and Romania acceded to this Convention in
2008 and 2000, respectively (https://www.unece.org/trans/maps/number-
of-un-transport-conventions-and-agreements-per-country.html).
45
Proposed measures for increasing the resilience of the Republic
of Moldova’s female-owned MSMEs and boosting their exports
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Female-owned
MSMEs’ participation
in trade policymaking
processes tends to be
erratic
Strengthen existing mechanisms with
a view to ensuring the continuous par-
ticipation of female-owned MSMEs in
public/private-sector consultations on
trade and economic policy.
In this respect, there is a need to
strengthen the Committee for Gender
Equality between Men and Women
with additional resources and assist it
in developing a new policy document
that takes into account the impact of
the pandemic as well as the opportuni-
ties and challenges emerging from the
DCFTA. This policy document needs to:
Elaborate a clear vision of the respec-
tive roles of central, regional and
local authorities in supporting fe-
male-owned enterprises.
Define mechanisms for co-ordinating
donor and government funded initia-
tives.
Accord a clear role for women’s and
enterprise support organizations tar-
geting female-owned MSMEs, so as
to ensure effective integration of the
enterprises’ needs into policymaking
processes. This would not only enable
policymakers to gain clarity over the
specific needs of this segment of the
enterprise sector but would also help
build up knowledge on success stories
and, thereof, good practices in support-
ing female-owned MSMEs.
SDG 5.5: Ensure women’s full and effective
participation and equal opportunities for
leadership at all levels of decision-making
in political, economic and public life
SDG 17.10: Promote a universal, rules-
based, open, non-discriminatory and eq-
uitable multilateral trading system under
the World Trade Organization, including
through the conclusion of negotiations un-
der its Doha Development Agenda
Emergency Measures
Table 7.1
Structural Measures for Supporting the MSMEs’ Development
Participation
in trade
policymaking
processes
Female-owned
MSMEs are experienc-
ing difficulties in find-
ing new international
buyers and suppliers
Equip women’s and enterprise support
organizations targeting female-owned
enterprises with the required capaci-
ty to establish sector-specific market
intelligence services, aimed at help-
ing female MSME owners identify ex-
port opportunities and efficient sup-
ply sources. As a starting point, these
organizations could focus on sectors
exhibiting a significant presence of fe-
male-owned MSMEs.
SDG 5.c: Adopt and strengthen sound poli-
cies and enforceable legislation for the pro-
motion of gender equality and the empow-
erment of all women and girls at all levels
Enterprise
support
46
85The UNECE review is available at; https://unece.org/innovation-sustaina-
ble-development-reviews-i4sdrs.
Proposed measures for increasing the resilience of the Republic
of Moldova’s female-owned MSMEs and boosting their exports
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Structural Measures
Table 7.1
Enterprise
support
Female-owned
MSMEs are experienc-
ing difficulties in find-
ing new international
buyers and suppliers
Support women’s, as well as enter-
prise support organizations targeting
female-owned enterprises, in their ef-
forts to scale up networking initiatives.
Such initiatives should be sector fo-
cused and aim at:
(i) Fostering inter-firm collaboration
through supporting joint action. The
emphasis should be on promoting pur-
poseful joint actions, whereby owners
are assisted in, for example, pooing re-
sources (e.g., machinery); outsourcing
part of their production to other do-
mestic enterprises; and obtaining raw
material at competitive prices.
(ii) Linking female-owned enterprises
with international buyers through, for
example, financing their participation
in international fairs and study tours,
with a special emphasis on helping
owners negotiate and obtain favour-
able growth enabling terms under
sub-contracting arrangements
(iii) Leveraging the diaspora for innova-
tion-led development following UNECE
recommendations provided in the “In-
novation for sustainable development
review of Moldova” (2021).85
SDG 9.3: Increase the access of small-scale
industrial and other enterprises, in particu-
lar in developing countries, to financial ser-
vices, including affordable credit, and their
integration into value chains and markets
SDG 8.2: Achieve higher levels of econom-
ic productivity through diversification,
technological upgrading and innovation,
including through a focus on high value
added and labour-intensive sectors
Female-owned
agri-MSMEs lack the
required equipment
and facilities for mod-
ernizing production
As part of the networking initiatives
(see above), launch programmes for
helping female-owned agri-MSMEs
establish joint sorting and packaging
facilities. This will enable enterprises,
particularly those faced with low de-
mand, to gradually increase produc-
tion. Such programmes should provide
financial support and professional on
the choice of equipment as well as on
legal and financial matters.
As part of the micro finance schemes
(see above), consider launching spe-
cial credit lines to enable the female
MSME owners to purchase high quality
tractors, ploughs, harrows, broadcast
spreaders and harvesters.
Scale up efforts to familiarize fe-
male-owned agri-MSMEs with modern
farming methods
SDG 5.c: Adopt and strengthen sound poli-
cies and enforceable legislation for the pro-
motion of gender equality and the empow-
erment of all women and girls at all levels
SDG 8.2: Achieve higher levels of econom-
ic productivity through diversification,
technological upgrading and innovation,
including through a focus on high value
added and labour-intensive sectors
47
Female-owned
agri-MSMEs lack the
required equipment
and facilities for mod-
ernizing production
Launch targeted training and mentor-
ship programmes to help female-head-
ed peasant households acquire the re-
quired business skills.
Launch training and advisory support
services to help female-owned MSMEs
implement Good Manufacturing Prac-
tices (GMP) principles.
Proposed measures for increasing the resilience of the Republic
of Moldova’s female-owned MSMEs and boosting their exports
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Structural Measures
Table 7.1
Female-owned
MSMEs are ill-
equipped to meet
regulatory require-
ments in destination
countries
Develop training programmes on
standards implementation as part of
the support services for female-owned
MSMEs.
To ensure sustainability beyond the
international funding cycle, these
programmes need to be housed in
women’s and enterprise support or-
ganizations targeting women and com-
plemented by mentoring and coaching
programmes to complement training
on standards implementation.
The below UNECE standards are of
particular relevance for enabling fe-
male-owned MSMEs, and all the Moldo-
van enterprises, comply with regulato-
ry requirements in export countries:
(i) UNECE free of charge online self-
paced training programme of stud-
ies on standards implementation for
MSMEs, also available in Russian, pro-
vides enterprise support organizations
and associations with a practical tool
for familiarizing MSMEs with interna-
tional standards with practical guide-
lines and case studies to help MSMEs
choose and prepare plans for the im-
plementation of standards, which often
involve significant investments.
(ii) UNECE agricultural quality stand-
ards, which cover a wide spectrum
of products belonging to: fresh fruit
and vegetables; dry and dried pro-
duce; seed potatoes; meat, eggs and
egg; and cut flowers. The standards
are intended for adoption as national
standards. To date over 100 commercial
quality standards have been adopted,
providing a common terminology and
harmonized regulatory requirements.86
SDG 5.c: Adopt and strengthen sound poli-
cies and enforceable legislation for the pro-
motion of gender equality and the empow-
erment of all women and girls at all levels
SDG 8.2: Achieve higher levels of econom-
ic productivity through diversification,
technological upgrading and innovation,
including through a focus on high value
added and labour-intensive sectors
SDG 9.4: By 2030, upgrade infrastructure
and retrofit industries to make them sus-
tainable, with increased resource-use effi-
ciency and greater adoption of clean and
environmentally sound technologies and
industrial processes, with all countries tak-
ing action in accordance with their respec-
tive capabilities
86 UNECE agricultural quality standards are available at: https://unece.org/
trade/working-party-agricultural-quality-standards-wp7.
48
Proposed measures for increasing the resilience of the Republic
of Moldova’s female-owned MSMEs and boosting their exports
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Structural Measures
Table 7.1
Female-owned
MSMEs lack experi-
ence in supply chain
management
Equip existing women’s organizations,
as well as enterprise support organiza-
tions targeting female-owned MSMEs,
with the required capacities to diver-
sify their services. This includes addi-
tional expertise skills and training ma-
terials, so that they could offer training
services in the areas of entrepreneur-
ship, modern ICT management infor-
mation systems, marketing, strategic
planning, and supply chain manage-
ment. This will help the female-owned
MSMEs grow and facilitate their access
to bank loans.
Establish mentoring and coaching pro-
grammes to complement training ser-
vices in the above-mentioned areas.
SDG 5.b: Enhance the use of enabling tech-
nology, in particular information and com-
munications technology, to promote the
empowerment of women
SDG 5.c: Adopt and strengthen sound poli-
cies and enforceable legislation for the pro-
motion of gender equality and the empow-
erment of all women and girls at all levels
SDG 8.2: Achieve higher levels of econom-
ic productivity through diversification,
technological upgrading and innovation,
including through a focus on high value
added and labour-intensive sectors
Female-owned
MSMEs are unable to
participate in e-com-
merce
Consider distinguishing between ma-
jor and occasional exporters. Given the
female-owned MSMEs’ modest export
volumes, it would be more effective to
help occasional exporters sell products
on regional and international online
marketplaces. Major exporters could
be assisted through targeted financial
support. For example, as part of the
loan schemes (see above), a special
credit line could be established to help
MSME owners to obtain the required
equipment and IT systems for bolster
their online presence.
Equip women’s and enterprise support
organizations targeting female-owned
MSMEs with the required capacity to
help owners navigate e-commerce
laws.
For placing products on global online
marketplaces
SDG 5.b: Enhance the use of enabling tech-
nology, in particular information and com-
munications technology, to promote the
empowerment of women
Female-owned
MSMEs experience
difficulties in ac-
cessing bank loans
to finance business
development plans
Scale up lending schemes targeting
female-owned MSMEs, so as to enable
them to invest in modernizing their
production facilities. To facilitate the
owners’ access, consider providing
these loans within the context of guar-
antee schemes in collaboration with
women’s organizations.
SDG 5.a: Undertake reforms to give women
equal rights to economic resources, as well
as access to ownership and control over
land and other forms of property, financial
services, inheritance and natural resources,
in accordance with national laws
SDG 9.3: Increase the access of small-scale
industrial and other enterprises, in particu-
lar in developing countries, to financial ser-
vices, including affordable credit, and their
integration into value chains and markets
49
Proposed measures for increasing the resilience of the Republic
of Moldova’s female-owned MSMEs and boosting their exports
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Structural Measures
Table 7.1
Work-family
balance
Owners with pre-
school-age children
are struggling with
the limited supply of
childcare services
SDG 4.2: By 2030 ensure that all girls and
boys have access to quality early childhood
development, care and pre-primary edu-
cation so that they are ready for primary
education
Knowledge
generation
for gender-
responsive
trade policies
Bridging the gender
gap in economic ac-
tivities is undermined
by the lack of statisti-
cal and nonstatistical
systems for capturing
and monitoring the
specific challenges
facing female-owned
enterprises
Strengthen the National Bureau of Sta-
tistics of the Republic of Moldova with
the required capacity to generate gen-
der-disaggregated data on enterprises.
Develop mechanisms for building up
knowledge on the successful expe-
riences of female-owned enterprises
and on good practices for supporting
female-owned enterprises in the Re-
public of Moldova. These mechanisms
could include, among others, quali-
tative surveys and case studies, with
data gathering and analysis assigned
to research institutions working closely
with women’s and enterprise support
organizations targeting female-owned
enterprises.
Establish monitoring and evaluation
systems for capturing the growth ob-
stacles facing female-owned enterpris-
es and tracking progress in addressing
the identified obstacles. These systems
could be based on periodical surveys by
the National Bureau of Statistics of the
Republic of Moldova.
SDG 5.c: Adopt and strengthen sound poli-
cies and enforceable legislation for the pro-
motion of gender equality and the empow-
erment of all women and girls at all levels
50
ANNEX 1 - COUNTRY BACKGROUND
A.1.1 Economic structure
The Moldovan economy has historically been service-based, and the past
two decades has seen this sector register steady growth. As shown in Figures
A1.1, services generated 53.5 per cent of gross domestic product (GDP) and
employed 57 per cent of the labour force in 2019.87 The industrial sector
(including mining, quarrying and manufacturing) stood as the second biggest
source of income generation and job creation, followed by agriculture and
construction.
87National Bureau of Statistics of the Republic of Moldova (https://statistica.
gov.md/public/files/publicatii_electronice/Anuar_Statistic/2020/Anuar_sta-
tistic_editia_2020.pdf). The Statistics do not include data on the Region of
Transnistria and the municipality of Bender.
Figure A1.1 - Breakdown of GDP and labor force by sector (2019)
Source: National Bureau of Statistics of the Republic of Moldova
The services sector continues to be driven by wholesale and retail trade,
along with real estate.88 Moreover, the move away from industrial and
agricultural activities has not been accompanied by improved productivity
levels. The enterprises belonging to these sectors continue to be held back
by weak technological capabilities, lacking the skills and resources for
efficient specialization in technology-intensive activities, for extending and
deepening these activities, and for drawing selectively on other technologies
to complement existing capabilities.89
These structural weaknesses find their strongest expression in the country’s
limited export mix. As shown in the next section, exports continue to be
dominated by products with low value-added, as enterprises are awkwardly
placed to adapt to consumer preferences and to meet the regulatory
requirements in destination countries, particularly the EU.
Annex 1
Country background
88Ibid.
89For a concise discussion of this concept, see Lall, S. (1992) Technologi-
cal Capabilities and Industrialization, World Development, Vol. 20, No. 2:
165–186.
51
A1.2 The trade sector
The Republic of Moldova boasts an impressive trade diversification record,
with the export product concentration index carrying a value of 0.190 and the
import product concentration index well below the threshold of 1.91
However, as shown in Figure A1.2, exports continue to be driven by relatively
low value-added manufactured goods and primary products. Combined with
Moldovan enterprises’ heavy reliance on international markets for sourcing
raw material, this narrow export mix has meant that imports continued to
outstrip exports, causing a fiscal leakage of USD 2.95 billion in its 2020 trade
deficit.92
90Calculated using United Nations Comtrade data. The value of the export
concentration index ranges between zero and one. An index with a value
closer to 1 point to a heavy concentration in a limited number of sectors,
with one indicating that only a single product is exported. UNECE (2017)
Regulatory and Procedural Barriers to Trade in the Republic of Moldova:
Needs Assessment, Chapter 4 (https://www.unece.org/fileadmin/DAM/
trade/Publications/ECE_TRADE_433E.pdf).
Annex 1
Country background
Figure A1.2 - Republic of Moldova's main exports by sector, 2005–2020 (Share in total exports-SITC Rev.4)
Source: National Bureau of Statistics of the Republic of Moldova
91Calculated using United Nations Comtrade data. The value of the import
product concentration index ranges between zero and one. An index with
a value closer to zero signifies that imports are distributed among many
types of products. UNECE (2017) Regulatory and Procedural Barriers to
Trade in the Republic of Moldova: Needs Assessment, Chapter 4.
92National Bureau of Statistics of the Republic of Moldova.
52
As regards trade partners, the past two decades have seen a re-orientation
of exports of the Republic of Moldova away from the Commonwealth of
Independent States (CIS) towards the EU. By 2019, the share of the EU in
exports of the Republic of Moldova stood at 67 per cent, up from 51 in 2007,
while the share of CIS dropped from 41 per cent 16 per cent during the same
period.93
This shift has been mainly driven by Romania, which joined the EU in 2007.94
As shown in Figure A1.3, Romania accounted for the largest share of exports
of the Republic of Moldova in 2019 (27.5 per cent), followed by followed by
Italy (9.6 per cent), the Russian Federation (8.9 per cent), and Germany (8.5
per cent).
93National Bureau of Statistics of the Republic of Moldova.
94Romania joined the EU on 1 January 2007.
Annex 1
Country background
Figure A1.3 - The Republic of Moldova's main export markets
(Percentage share)
Source: National Bureau of Statistics of the Republic of Moldova
Romania, along with the Russian Federation, has also been driving regional
trade patterns of the Republic of Moldova. This is demonstrated in Figures
A1.4 and A1.5, which show Moldovan exports to the Commonwealth of
Independent States (CIS) and EU, as mirroring the evolution of exports to
Romania and the Russian Federation.
Turkey
Romania
Italy
Germany
Ukraine
Russian Federation
Belarus
0% 5% 10%1 5% 20%2 5% 30% 35% 40% 45%
2020
2015
2010
2005
2000
53
Figure A1.4 - Moldova's exports to CIS and
the Russian Federation (USD thousand)
Source: National Bureau of Statistics of
the Republic of Moldova
A1.3 Modest steps towards structural transformation
The above figures mask modest steps towards structural transformation. As
shown in Table A1.1, the Republic of Moldova’s highest complexity exports, as
measured by the product complexity index (PCI), are in machines for testing
mechanical properties, machinery equipment for non-domestic heating or
cooling systems and copper foil manufacturing.
The Republic of Moldova’s top 10 knowledge-intensive products, 2018
Products (Harmonized System) HS4 PCI
Machines for testing mechanical properties of material 1.63
Table A1.1
Machinery, non-domestic, involving heating or cooling 1.43
Copper foil, thickness (except any backing) < 0.15mm 1.25
Binoculars, monoculars, telescopes, etc. 0.96
Slag wool, rock wool, insulating minerals not asbestos 0.81
Nickel tubes, pipes and tube or pipe fittings 0.79
Electric transformers, static converters and rectifiers 0.77
Derivatives of cyclic alcohols 0.68
Bar, rod, hot-rolled alloy steel, irregular coils 0.67
Signals etc. for rail, tram, waterway, port, airfield 0.6
Source: Observatory of Economic Complexity96
96The PCI ranks the diversity and sophistication of the productive know-
how that went into manufacturing of individual product. It is used as a
proxy for measuring the technical and knowledge intensity of products.
82Observatory of Economic Complexity (https://oec.world/en/profile/country/
mda)
Figure A1.5 - Moldova's exports to Romania
and the EU (USD thousand)
Source: National Bureau of Statistics of
the Republic of Moldova
Annex 1
Country background
54
However, these successes seem to fall short of sustaining a continuous move
towards increased specialization in technology-intensive/knowledge-based
activities with high value-added, with its position in the economic complexity
index (ECI) fluctuating over the past 11 years (Figure A1.6).
Figure A1.6 - The Moldovan economy's position in the ECI
(2008-2018)
Source: Obsevatory of Economic Complexity
Moreover, except for hot-rolled iron bars, the Republic of Moldova does not
have export advantages, measured in terms 0f the revealed comparative
advantage (RCA) index,97 in any of its top products of complexity index.
As shown in Figure A1.7, the country’s export advantages are mainly in
agricultural products.
Figure A1.7 -Top 10 comprtitve exports (RCA Index. 2018)
Source: Atlas of Economic Complexity (2008-2017); Onservatory of Economic Complexity (2018)
Annex 1
Country background
55
97The RCA indicates whether a country is specializing in products with trade potential. It is based on the idea that if a country exports more than the global
average exports of a specific product, then the country has a comparative advantage in that product. If the RCA is higher than 1, then the producer is said
to have an RCA in producing a certain good.
ANNEX 2 - THE GOVERNMENT OF THE REPUBLIC OF
MOLDOVA’S RELIEF AND SUPPORT MEASURES
Area Measures
Tax relief Deferment of tax payments until 25 June 2020.
Suspension of tax audits until 1 June 2020.
Suspension of the 2019 audit obligations for enterprises that were hard-
hit by lockdown measures.
Reduction of value added tax (VAT) from 20 to 15 per cent as of 1 May
2020 (Only for enterprises involved in the food industry and hospitality
sector).
VAT Refund Program (1 May-31 December 2020) of MDL 1 billion (USD 56
million).
Enterprise support State subsidies for enterprises that were forced to suspend operations
during the lockdown period (state of emergency), with a view to ena-
bling them to cover social and health insurance contributions. The sub-
sidies involved financing interest rates on bank loans taken out by the
enterprises over the period March-May 2020 (for up to three months).
Exemptions from patent payments for patent holding enterprises that
were forced to suspend operations during the lockdown period.
Interest Grant Programme facilitating businesses’ access to credit: Co-fi-
nancing interest rates on bank loans taken out by the enterprises as of
1 May 2020 (the programme was launched in April 2020 with duration
until end 2020).
Grants in the amount of LEU 100 million (approx. USD 5.6 million) to sup-
port entrepreneurs, with a special emphasis on female entrepreneurs.
Employment The amount of unemployment benefits was increased by 55 per cent
and eligibility criteria were expanded to cover returning migrant work-
ers.
The minimum amount of “guaranteed monthly income” for low-income
families was increased by almost 20 per cent.
Reimbursement of 43 per cent of the monthly salaries of employees sent
into technical unemployment during the lockdown period.
Economic stimulus Base rate applicable to short-term monetary policy operations reduced
by 2.25 percentage points to 3.25 per cent.
Reserve ratio in local currency decrease by 6.5 percentage points to 34
per cent.
Reserves ratio in freely convertible currencies increased by 1.0 percent-
age point to 21 per cent.
Deferral of payments under banks loans till 30 June 2020.
Other Mortgage guarantee programme.
Source: International Monetary Fund (https://www.imf.org/external/index.htm); Government of the Republic
of Moldova (https://www.covid19healthsystem.org/countries/moldova/livinghit.aspx?Section=6.%20
Measures%20in%20other%20sectors&Type=Chapter#37Transitionmeasures:Measuresinothersectors; https://
www.legis.md/cautare/getResults?doc_id=121284&lang=ro)
Annex 2
The government of the Republic of
Moldova's relief and support measures
56
ANNEX 3 – PROFILE OF THE FEMALE-OWNED
MSMES SURVEYED
The assessment draws on a survey of 101 female-owned MSMEs from across
the Republic of Moldova. This annex provides a breakdown of these enterprises
by location, size and economic activity.
A3.1 Ownership
The Republic of Moldova does not have a definition of female-owned
enterprises. Official reports follow international definitions and criteria,
whereby female-owned enterprises are defined as being majority controlled
(i.e., at least 51 per cent ownership) or managed by women (i.e., enterprises
with women in senior management roles).98
As shown in Figure A3.1, around 69 per cent were fully controlled by women
(100 per cent ownership). Another 24 per cent were jointly owned by women,
with women holding equal shares, 50-50, or majority control (over 50 per
cent of the shares) and assuming senior roles. The remaining 7 per cent were
jointly owned, with women controlling less than 50 per cent of the enterprises’
shares.
Figure A3.1 - The female-owned MSMEs surveyed by ownership
(percentage of respondents)
Source: UNECE survey of Moldovan female-owned MSMEs
98National Bureau of Statistics of the Republic of Moldova (2020) “Analytical
Report on participation of women and men in entrepreneurship in the
Republic of Moldova”; available at: https://statistica.gov.md/public/files/
publicatii_electronice/Antreprenoriat_feminin/Antreprenoriat_Femei_Bar-
bati_2020.pdf.
Annex 3
Profile of the female-owned
MSMEs surveyed
57
A3.2 Location
Mirroring the countrywide spatial distribution of enterprises, Chișinău was
home for the largest segment of the female-owned MSMEs surveyed (38,61 per
cent).99 As shown in Figure A3.2, the Centre districts of Șoldanesti, Ungheni,
Calarasi, Orhei, Dubasari, Straseni, Criuleni, Nisporeni, Hancesti, Ialoveni and
Anenii Noi accounted for the second-largest segment.
Figure A3.2 - The female-owned MSMEs by geographic location
(percentage of responses)
Source: UNECE survey of Moldovan female-owned MSMEs
Annex 3
Profile of the female-owned
MSMEs surveyed
A3.3 Size
Micro enterprises, employing fewer than 10 persons represented the largest
segment of the female-owned MSMEs surveyed (59 per cent). As shown
in Figure A3.3., small enterprises, employing between 10 and 49 persons
accounted for the second largest segment (39 per cent), with medium-sized
enterprises, employing between 50 and 249 persons, accounting for the
remaining balance (8 per cent).100
99Chișinău accounted for 62 per cent of total registered enterprises in 2019
(statistica.gov.md).
100The classification of MSMEs follows the EU Commission Recommen-
dation 2003/361/EC “Concerning the Definition of Micro, Small and Medi-
um-sized Enterprises”.
58
Figure A3.3 - The female-owned MSMEs by size
(percentage of responses)
Source: UNECE survey of Moldovan female-owned MSMEs
A3.4 Economic activities
As shown in Figure A3.4, the majority of the female-owned MSMEs belonged to
the manufacturing sector. These accounted for 65 per cent of the enterprises
surveyed, followed by those involved in agricultural activities, including
harvesting and animal husbandry (29 per cent).
The manufacturing MSMEs represented strategic sectors, including food
and beverages; metals and fabricated metals; textiles and apparel; transport
machinery and equipment; and chemicals. Enterprises engaged in textiles,
leather and apparel manufacturing accounted for the largest segment, or 29
per cent of the enterprises surveyed, followed by those belonging to the food
and beverages industry.
59
Annex 3
Profile of the female-owned
MSMEs surveyed
Figure A3.4 - The female-owned MSMEs by sector
(percentage of responses)
Source: UNECE survey of Moldovan female-owned MSMEs
60
Annex 3
Profile of the female-owned
MSMEs surveyed
Proposed measures for stronger and more resilient Moldovan MSMEs
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Financial
support
MSMEs are experienc-
ing shortages in work-
ing capital
Expand the scope of emergency credit
schemes to cover all sectors and pub-
lish detailed information on application
procedures.
SDG 9.3: Increase the access of small-scale
industrial and other enterprises, in particu-
lar in developing countries, to financial ser-
vices, including affordable credit, and their
integration into value chains and markets
Emergency Measures
Freight forwarders are
experiencing shortag-
es in working capital
Establish emergency credit schemes
to support forwarders and publish de-
tailed information on application pro-
cedures.
SDG 9.3: Increase the access of small-scale
industrial and other enterprises, in particu-
lar in developing countries, to financial ser-
vices, including affordable credit, and their
integration into value chains and markets
Legal
support
MSMEs are ill-
equipped to resolve
commercial disputes
with international
buyers and buyers
Establish legal advisory facilities to
help MSMEs resolve commercial dis-
putes with international suppliers and
buyers. Such facilities can be hosted by
enterprise support organizations.
SDG 9.3: Increase the access of small-scale
industrial and other enterprises, in particu-
lar in developing countries, to financial ser-
vices, including affordable credit, and their
integration into value chains and markets
Regional
cooperation
Outbound cargo
destined to/transiting
through Romania is
delayed by conges-
tions at the Romanian
side of the Leușeni -
Albița BCP
Strengthen cross-border cooperation
through joint control arrangements
guided by, among others, the World
Customs Organization Revised Kyoto
Convention and the UNECE Internation-
al Convention on the Harmonization of
Frontier Controls of Goods.101 Such ar-
rangements could involve, among oth-
ers things, joint processing (e.g., single
stops), common facilities (e.g., adminis-
trative buildings, road and parking are-
as and utilities) and common technical
equipment (e.g., scanners).
SDG 17.6: Enhance the Global Partnership
for Sustainable Development, comple-
mented by multi-stakeholder partnerships
that mobilize and share knowledge, exper-
tise, technology and financial resources, to
support the achievement of the Sustaina-
ble Development Goals in all countries, in
particular in developing countries
Outbound cargo
destined to/transiting
through Turkey is
delayed by the lack
of clarity over applied
safety and health pro-
tection arrangements
at the Turkish side of
BCPs
Intensify the exchange of informa-
tion with relevant Turkish authorities
on situational awareness and applied
safety and health protection measures
at BCPs, inter alia, through online ex-
change of information using electronic
data interchange (EDI).
SDG: 16.10 Ensure public access to informa-
tion and protect fundamental freedoms, in
accordance with national legislation and
international agreements
101The Republic of Moldova and Romania acceded to this Convention in
2008 and 2000, respectively (https://www.unece.org/trans/maps/number-
of-un-transport-conventions-and-agreements-per-country.html).
61
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Outbound cargo to/
through countries
with which the
Republic of Moldova
has quota-based road
transport arrange-
ments is constrained
by the existing per-
mits-issuance system
Revise the existing road freight per-
mits issuance system. The permits
should be issued based on the forward-
ers’ actual cargo traffic (volume and
direction).
SDG 11.2: By 2030, provide access to safe, af-
fordable, accessible and sustainable trans-
port systems for all, improving road safety,
notably by expanding public transport,
with special attention to the needs of those
in vulnerable situations, women, children,
persons with disabilities and older persons
Emergency Measures
Customs
clearance
Customs clearance
procedures are still
paper-based
Establish the Single Window facility,
following UN/CEFACT Recommenda-
tion 33 on establishing a single window
as envisaged in national trade facilita-
tion plans.
Establish the legal framework for an
international single window, following
UN/CEFACT Recommendation 35 on
establishing a legal framework for an
international trade single window.102
Link the ASYCUDA World system to the
EU New Computerized Transit System,
since ASYCUDA World is fully opera-
tional nationwide, and has a built-in
transit module.103
SDG 17.10: Promote a universal, rules-
based, open, non-discriminatory and eq-
uitable multilateral trading system under
the World Trade Organization, including
through the conclusion of negotiations un-
der its Doha Development Agenda
SDG 17.6: Enhance the Global Partnership
for Sustainable Development, comple-
mented by multi-stakeholder partnerships
that mobilize and share knowledge, exper-
tise, technology and financial resources, to
support the achievement of the Sustaina-
ble Development Goals in all countries, in
particular developing countries
Structural Measures
Moldova’s Authorized
Economic Operator
(AEO) audits, controls
and authorizations
are not recognized
internationally
Establish mutual recognition arrange-
ments/agreements of AEO audits,
controls and authorizations between
MCS and its counterparts in the Cen-
tral European Free Trade Agreement,
EU, Turkey and other trade partners in
accordance with the World Customs
Organization Framework of Standards
to Secure and Facilitate Global Trade
(SAFE).
SDG 17.6: Enhance the Global Partnership
for Sustainable Development, comple-
mented by multi-stakeholder partnerships
that mobilize and share knowledge, exper-
tise, technology and financial resources, to
support the achievement of the Sustaina-
ble Development Goals in all countries, in
particular developing countries
At the border, Cus-
toms terminals lack
the required infra-
structure
Equip border Customs terminals with:
• Parking and waiting areas for
trucks and other vehicles.
• Facilities for vehicle and goods in-
spection.
• Modern traffic management for
segregating commercial and pri-
vate traffic; transit consignments;
and “fast track” consignments.
• Non-intrusive inspection equip-
ment (e.g., X-ray and gamma-ray
scanners).
SDG 9.1: Develop quality, reliable, sustain-
able and resilient infrastructure, including
regional and transborder infrastructure, to
support economic development and hu-
man well-being, with a focus on affordable
and equitable access for all
Proposed measures for stronger and more resilient Moldovan MSMEs
102https://www.unece.org/fileadmin/DAM/trade/Publications/ECE-TRADE-
401E_Rec35.pdf.
103Regulation (EC) No 837/2005 and Decision No 4/2005 of the EC/EFTA
Joint Committee on Common Transit make the use of the NCTS compulso-
ry for all EU/ common transit declarations
62
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Structural Measures
Conformity
assessment
MSMEs assume addi-
tional costs to prove
compliance with reg-
ulatory requirements
in export markets due
to the lack of interna-
tionally recognized
conformity assess-
ment bodies
Support the National Accreditation
Centre of Republic of Moldova (MOL-
DAC) in its efforts to develop compe-
tence in new areas, including certifica-
tion of persons and verification bodies,
and further improve existing compe-
tences in accordance with internation-
al and regional standards (including
the International Organization for
Standardization, ISO; the International
Electrotechnical Commission, IEC, and
the European harmonised standards,
ENs) as follows:
• Implement the national accredita-
tion scheme for verification bod-
ies according to ISO14065:2013.
Specifically, equip MOLDAC ex-
perts and assessors with the nec-
essary expertise knowledge and
skills through advanced training
courses and practical experience
(advanced training courses and
study tours and participation in
assessments undertaken by oth-
er EA recognized national assess-
ment bodies).
• Further develop the national ac-
creditation scheme for inspection
according to ISO/IEC 17020:2012.
Specifically, equip MOLDAC ex-
perts and assessors with the nec-
essary expertise knowledge and
skills through advanced training
courses on the different aspects
and applications of this scheme,
with a special emphasis on the EU
New Approach Directive.
• Further develop the national ac-
creditation scheme for product
certification according to ISO/
IEC 17065:2012. Specifically, equip
MOLDAC experts and assessors
with the necessary expertise,
knowledge and skills through ad-
vanced training courses on the
different aspects and applications
of this scheme, with a special em-
phasis on the EU New Approach
Directive and Moldova’s strategic
export and imports.
SDG 9.4: By 2030 upgrade infrastructure
and retrofit industries to make them sus-
tainable, with increased resource use effi-
ciency and greater adoption of clean and
environmentally sound technologies and
industrial processes, all countries taking
action in accordance with their respective
capabilities
Proposed measures for stronger and more resilient Moldovan MSMEs
63
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Structural Measures
Conformity
assessment
MSMEs assume addi-
tional costs to prove
compliance with reg-
ulatory requirements
in export markets due
to the lack of interna-
tionally recognized
conformity assess-
ment bodies
• Develop a national accredita-
tion scheme for the certification
of persons according to ISO/IEC
17024. Specifically, equip MOLDAC
experts and assessors with the
necessary expertise, knowledge
and skills through advanced train-
ing courses and practical experi-
ence (advanced training courses
and study tours and participation
in assessments undertaken by
other EA recognized national as-
sessment bodies).
• Further develop national testing
laboratories. Specifically, equip
testing laboratories with modern
equipment and expertise skills
through advanced training cours-
es and study tours.
SDG 9.4: By 2030 upgrade infrastructure
and retrofit industries to make them sus-
tainable, with increased resource use effi-
ciency and greater adoption of clean and
environmentally sound technologies and
industrial processes, all countries taking
action in accordance with their respective
capabilities
Transport
development
The national railway
system is underdevel-
oped
Accord priority to ensuring full imple-
mentation of the concept note and Ac-
tion Plan for 2018-2021 on the restruc-
turing of the Moldovan railway sector.
104
SDG 11.2: By 2030, provide access to safe, af-
fordable, accessible and sustainable trans-
port systems for all, improving road safety,
notably by expanding public transport,
with special attention to the needs of those
in vulnerable situations, women, children,
persons with disabilities and older persons
Enterprise
development
MSMEs are facing
unfair competition
from counterfeit
products105
Strengthen the Agency for Consum-
er Protection and Market Surveillance
with expertise skills and additional re-
sources to enable it to conduct checks
of products placed on the market on a
more regular basis.
Further develop the existing informa-
tion sharing mechanisms between the
Agency for Consumer Protection and
Market Surveillance and MCS. This will
help the agency in preparing its annual
plans as decide on activities related to
sampling, testing and destroying dan-
gerous counterfeit products.
SDG 8.2: Achieve higher levels of econom-
ic productivity through diversification,
technological upgrading and innovation,
including through a focus on high value
added and labour-intensive sectors
SDG 3.9d Strengthen the capacity of all
countries, in particular developing coun-
tries, for early warning, risk reduction and
management of national and global health
risks
Proposed measures for stronger and more resilient Moldovan MSMEs
104https://gov.md/sites/default/files/document/attachments/intr13_122.pdf.
105The Republic of Moldova ratified most of international conventions in the field of intellectual property, including the WTO Agreement on Trade-Related
Aspects of Intellectual Property Rights Agreement, and its legislation is harmonized with the European Directives. These include the law on market surveillance,
the law on general product safety (transposing EU Directive 2001/95) and the civil code (transposing Directive 85/374/EEC on liability for defective products),
which together provide the legislative basis for bringing the national market surveillance system up to the EU rules. MCS ensures intellectual property rights
protection through its electronic risk profiling system, which has been effective in curbing the inflow of counterfeit products (https://customs.gov.md/ro/
articles?tag=news&tag=customs-fraud&page=1). Efforts are underway to establish a Rapid Alert System for dangerous non-food products (RAPEX) based
system to facilitate the exchange of information on dangerous non-food consumer products (https://eu4business.eu/programme/support-quality-infrastruc-
ture-framework-within-dcfta-context-republic-moldova). For an overview of the MCS risk-based clearance module and the Republic of Moldova’s conformity
assessment system, see UNECE Study on Regulatory and Procedural Barriers to Trade, Chapter two (https://www.unece.org/fileadmin/DAM/trade/Publications/
ECE_TRADE_433E.pdf).
64
Proposed measures for stronger and more resilient Moldovan MSMEs
Area Challenges Recommendations Contribution to sustainable
development goals (SDGs)
Structural Measures
Enterprise
support
MSMEs are ill-
equipped to meet
regulatory require-
ments in destination
countries
Develop training programmes on in-
ternational standards implementa-
tion, particularly the European Union
(EU) harmonized standards, to enable
MSMEs to achieve compliance with
health, safety, and environmental regu-
latory requirements in destination mar-
kets, particularly the EU. Implementing
international and EU standards also en-
able MSMEs to benefit from the DCFTA
and engage in e-commerce.
Launch targeted technical assistance
programmes for food producers to en-
able them to implement the Hazard
Analysis and Critical Control Points
(HACCP).
SDG 9.4: By 2030, upgrade infrastructure
and retrofit industries to make them sus-
tainable, with increased resource-use effi-
ciency and greater adoption of clean and
environmentally sound technologies and
industrial processes, with all countries tak-
ing action in accordance with their respec-
tive capabilities
Farmers are ill-
equipped to with-
stand droughts
Strengthen vocational training insti-
tutions with resources to develop tar-
geted training for: (a) existing MSMEs’
employees to improve their skill sets
within their areas of work; and (b) un-
employed individuals whose skills
could be upgraded to the specific re-
quirements of the demanding jobs
within their areas of work. The empha-
sis should be on enabling the individu-
als on acquiring the necessary skills for
engaging in production activities with
high value added.
Develop advanced, forward-looking
curricula and programmes within the
higher education institutions, which
tailor both the content and approaches
to industry needs.
Establish a national skills-matching
strategy (or sectoral/ field-specific
matching strategies) for guiding the
above.
SDG 8.2: Achieve higher levels of economic
productivity through diversification, tech-
nological upgrading and innovation, in-
cluding through a focus on high value-add-
ed and labour-intensive sectors.
SDG 9.4: By 2030, upgrade infrastructure
and retrofit industries to make them sus-
tainable, with increased resource-use effi-
ciency and greater adoption of clean and
environmentally sound technologies and
industrial processes, with all countries tak-
ing action in accordance with their respec-
tive capabilities.
MSMEs are ill
equipped to engage
in e-commerce
In addition to the above training pro-
grammes:
• Launch credit schemes for ena-
bling the MSMEs’ to procure the
necessary ICT equipment and
skills.
• Launch linkages programmes
to integrate MSMEs with region-
al and global value chains. Such
programmes should target both
labour-intensive industries and
those with technology intensive
activities and could be tailored
to create: (a) horizontal collabora-
tion, such as sharing the costs of
expensive equipment or research
and development; (b) vertical col-
laboration through facilitating the
decentralization of the produc-
tion process; and/or (c) exchange
of information on technology and
common problems.
SDG 9.3: Increase the access of small-scale
industrial and other enterprises, in particu-
lar in developing countries, to financial ser-
vices, including affordable credit, and their
integration into value chains and markets
Proposed measures for stronger and more resilient Moldovan MSMEs
Source: UNECE (2020) “The impact
of COVID-19 on trade and structural
transformation in the Republic of Moldova:
Evidence from UNECE’s survey of micro,
small and medium enterprises”
65
Im
pa
ct
o
f C
O
V
ID
-1
9
on
s
tr
uc
tu
ra
l
tr
an
sf
or
m
at
io
n
in
th
e
Re
pu
bl
ic
o
f M
ol
do
va
The disruptive impact of the corona virus disease (COVID-19) on all aspects of everyday
life poses unprecedented challenges for all countries. Governments have seen their
priorities shift towards upscaling public health preparedness to contain the spread
of the highly infectious disease and, later, to mitigate the effects of those measures
on the economy and on vulnerable segments of the population. The challenges are
further complicated by supply chain disruptions that have left enterprises struggling
to survive. Pay cuts and furloughs have become the norm, and some of the steepest
drops in output of the past century indicate that an economic crisis is compounding
this public health emergency.
This review traces how non-tariff measures (NTMs) governing trade in goods influence
end-to-end supply chains in Republic of Moldova and highlights the lingering effects
of the pandemic. Undertaken in the context of UNECE’s Studies on Regulatory and
Procedural Barriers to Trade under the Steering Committee on Trade Capacity and
Standards, the assessment uses UNECE’s evaluation methodology for designing
targeted interventions for rebuilding stronger and more resilient post-COVID-19
economies.
UNECE supports closer economic relations among its 56 member States in the pursuit
of the UN Sustainable Development Goals (SDGs) and the 2030 Agenda. Its Trade and
Economic Cooperation and Integration programmes assist member States in better
integrating their economies into the world economy and in promoting enabling
and promoting a better policy, financial and regulatory environment conducive to
inclusive economic growth, innovative and sustainable development and higher
competitiveness in the UNECE region.
Information Service
United Nations Economic Commission for Europe
Palais des Nations
CH - 1211 Geneva 10, Switzerland
Telephone: +41(0)22 917 12 34
E-mail: [email protected]
Website: http://www.unece.org
