Strengthening Trust, Integrity and Compliance in and between Small and Medium Enterprises and Public Sector in Moldova (STIC)

Extensive stakeholder consultations in the Republic of Moldova (thereafter “Moldova”) indicate that the relationship between Small and Medium Enterprises (SMEs)1 and public sector is still driven by mistrust and fear, bureaucratic complexity and organisational cultures that tolerates corruption. Against this background, reforms to the anticorruption laws in line with European Union (EU) accession conditionalities are underway, while incentives to enhance the competitiveness of Moldovan products have increased given the Free Trade Agreement between Moldova and various economic spaces, including the European Free Trade Association, of which Switzerland is one of the four members. However, well-intentioned reforms will not be successful unless conflicting power dynamics, red-tape2 and existing social norms are acknowledged and change initiated.

This project will address these challenges and is fully in line with the Swiss working approach to tackle corruption, improve inclusive governance, foster resilience and strengthen country systems.

• SMEs of the agri-food and construction sector
• Associations of agri-food and construction sector
• Ministry of Economic Development and Digitalization, Ministry of Agriculture and Food Industry, Ministry of Infrastructure and Regional Development, Ministry of Justice, Ministry of Internal Affairs and State Chancellery
• Regional authorities
• Anticorruption / integrity enforcement agencies
• Parliament

Outcome 1: SMEs and their associations and public stakeholders of the agri-food and construction sectors implement simplified integrity and compliance mechanisms. 

Outcome 2: Public institutions, anticorruption, integrity and enforcement agencies act with increased political independence, implement their mandate with ethics and integrity and ensure their enforcement and oversight function.

Resultados previstos:  

1.1 SMEs have established effective communication channels with public stakeholders

1.2 SMEs have knowledge and tools to comply with simplified regulatory requirements

1.3 SMEs have knowledge and competencies on how to move from informal to formal sector

2.1 Public institutions have skills to engage with SMEs and coordinate actions towards revising and simplifying regulations and integrity standards for SMEs

2.2 Public institutions, anticorruption, integrity and enforcement agencies have established effective platforms and feedback systems to address areas critical for SMEs to grow or to move from informal to formal economy

2.3 Public institutions, anticorruption, integrity and enforcement agencies have improved internal governance and compliance mechanisms within central and local government bodies.

Resultados de las fases anteriores:   Based on the results from the Political Economy Analyses (PEAs) conducted during the opening phase, the agri-food and construction sectors were selected as areas of focus for phase 1. In both sectors red-tape, bribery and informality are widespread. Considering their relevance for Moldova’s Gross Domestic Product (GDP) and employment rate, the Government is committed to promote the development of these sectors. The project complements the Swiss portfolio in addressing corruption as a key development barrier for reducing poverty. The PEAs provided in-depth information on where and how corruption happens in these sectors and how to improve integrity and compliance between and among SMEs and public sector stakeholders.