Republic of Moldova:

geo economically advantageous position

Republic of Moldova, overview

Government

Population

Literate Population

Working-age

Population

Unemployment rate

Annual Inflation

Rate

GDP in current prices

GDP annual growth rate

Republic, Declaration of Independence

August 27, 1991

3.56 million people

96%

2.37 million people

5.1% (2013)

4.9% (2013)

7.65 billion USD (2013)

8.9% (2013)

7%

24%

17%

52%

Services

constroction

trade & vehicles' reparation

transport & communication

other services

Other services include: hotels &

restaurants, financial services, real

estate, public administration;

education, health, other social &

personal services

Priority industries

Food and Beverage

Industry

Manufacture of packing from glass

and a cardboard

Light industry

Manufacture of machinery and

equipment

Chemical industry

Information Technology Industry

45,5%

6,7%

9,3%

2,8%

1,7%

0,9%

The structure of the sector

Light industry

Manufacture of textiles and wearing

apparel

Manufacture of

textiles

Manufacture of

wearingapparel

Manufacture of leather, leather products and

footwear The share of exports

Trade Partners (2013, mil. $)

Export: 2399 mil. $ EU: 1141.9 (47.6%)CIS: 923.6 (38.5%)

Import: 5492.7 mil. $ EU: 2471.7 (45%)CIS: 1669.8 (30.4%)

843.81020.2 1258.3 1843.7 2566.6 2649.6 2837.5

3111.5 3270.7

3668.3

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Foreign Direct Investment in Moldova

0

200

400

600

800

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

146.2 190.7 239.7

533.6

712.8

127.8198.9

274159.2

231.3

Cumulative FDI stock (mil. $)

Annually FDI net inflow (mil. $)

FDI Origin

Netherlands 17,6%

Cyprus 11,2%

Italy 7,7%

Germany 8,7%

Russia 19,7%

Romania 6,4%

UK 3,4%France 2,9%

USA 3,2%

Others 19,2%

FDI Structure

Financial Services;

20,4%

Wholesale and

retail trade; 17,1%

Manufacturing

Industry; 14,0%Real-estate

transactions; 16,8%

Transport and

Communications 7,4%

Electricity, Water

and Gas; 19,3%

Hotel and

Reastaurants; 1,1%

Construction; 1,1%

Agriculture; 0,9% Others; 1,9%

Speech by the President of theEuropean Council Herman VanRompuy at the Republic Palace,Chisinau, Moldova:

• “Our bilateral trade, despite theglobal economic crisis, has goneup by a third. In the World Bankranking for "Ease of doingbusiness", Moldova has moved upten places; and seven places inthe corruption index ofTransparency International.”

• “Due to EU financial support Moldovan economy has grown four times. The European Union willcontinue to help with financial and technical support. More foreign investment will flow inMoldova.”

• “Moldovan products are already popular on the European market. Yourwine is doing marvels, even in France! The Association

Agreement will be like the wine maturing in Cricova: getting even betterwith time!”

Fiscal incentives

A. Incentives when starting a business

VAT refund for capital expenses on long-term investments, except for housing and vehicles

VAT and customs tax exemption for assets to be included in the share capital of the company

B. Benefits when operating

12% Corporate Income Tax – since 2012, with incentives for investors

Farming enterprises – 7% CIT rate

Double Taxation Avoidance Agreements (DTAA) with 44 countries

Corporate Income Tax in the Region

Romania 16% flat rate

Ukraine 30% for non-residents

Bulgaria 10%

International Collaboration Benefits of the RM

EU

501 mil. people

CEFTA

31 mil. people

CIS

276 mil. people

Member of

WTO

Member of

CEFTA

EU

Autonomous

Trade

Preferences

Member of

CIS

EU

Free Trade &

Association

Agreement

2014

Free Economic Zones

50% corporate

income tax rate

VAT exemption

Exemption from excise

duties

Developed transport

infrastructure

Availability of

necessary resources

Industrial Parks

13 projects of industrial parks creation

3 Parks under construction

Support on central

and local level

Free change of land use

Free transfer of state land to the

company administrator

Favourable geographical position and equal rights for all investors

Proximity to large world markets (European Union and Community of Independent States)

Platform for manufacturing and exporting to both the CIS and the EU

Competitive general corporate income tax rate in the region – 12%

Tax and customs framework similar to that of the EU

Tax incentives for large investments and a decreasing tax burden. Companies investing in

excess of $ 250,000 can get a reduction in corporate income tax payable for up to five years.

Considerable network of Investment Protection Agreements and improved legal

framework regulating entrepreneurial activity

Investment opportunities via privatisation of public property and public-private partnership

Market access through 4+1 FTA: WTO members (worldwide); Autonomous Trade Preferences

(EU countries); CEFTA members (most Balkan countries); CIS members; Free Trade

Agreement with all EU countries after the 27th of June, 2014 (plus Association Agreement)

Free Economic Zones incentives and Industrial Parks opportunities

Well-skilled multilingual workforce and relatively low employment costs

Favourable visa regime for 91 countries (NO VISA for EU countries, CIS, Turkey, Israel,

Dominica, Malaysia, Togo, Kenya visa on arrival only, Bangladesh visa on arrival, etc.)

Logistical, transport and communication infrastructure

Access to the Black Sea through Giurgiulesti International Free Port

Stable Economy: the exchange rate of the Moldovan Leu, the national currency of Moldova,

against the US Dollar has oscillated mainly between 10 - 13 MDL during the past 10 years.

THE WORLD FAMOUS

Milestii Mici

Largest wine cellar by number of bottles

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The cellars of the Milestii Mici wine-making plant in Moldova contain over 1.5 million

bottles of wine. The bottles are stored in 55 km (34 miles) of underground galleries

excavated in lime mining operations. The first bottle was stored in 1968, and new

vintages are added each year.

Cricova – Moldova’s underground treasure

In just 15 km North of Chisinau, lays a of subterran city, a labyrinth of avenues and

streets, named after wine types. Cricova’s museum stores the country’s national

collection of 1.3 millions of bottles, the oldest one being from 1902.

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