This first Country ProcurementAssessment Report (CPAR) on Moldova comes at a time when thecountry has publicly committed itself to the signaldeparture of acceding to the WTO Agreement o n GovernmentProcurement (GPA). It will be the first developing countryin Eastern Europe t o do so. The CPAR's key findings,including risk assessment, the strengths and weaknesses ofthe public procurement system currently in place, and themain features of a proposed action plan are summarized here.Public procurement represents a substantial element of theexpenditure side of the Government's budget. Estimatesprepared for this assessment indicate that total expenditureon procurement amounted to approximately US$118 million.Procurement accounted for 17 percent of total expendituresby the State government and 42 percent of expenditure bylocal governments, with expenditure at all levels showingsubstantial increases over past years. Improving theefficiency of that expenditure can contribute to betterbudget management.Yet control of public procurementexpenditures in Moldova is weakand the overall procurementenvironment is high- risk.While the procurement lawprovides a reasonably sound basis for public procurement,and will need to be amended to align it with the WTOAgreement on Government Procurement.I t is furtherundermined by the absence of implementing regulations.Procurement practices are often inconsistent with theprocurement law, Primary among these is the heavy overuse ofthe Single Source Procurement method, whereby the procuringentity contracts directly with a single supplier, with n ocompetition.Weaknesses in the law permit other badpractices.Resources: While the NAGP is seen as providing avalued service to procuring entities and is progressivelyextending its coverage, its reach is limited at the localgovernment level. However, the Agency is not being heldaccountable for its performance of its regulatory andoversight functions and, because it is one of the bodieswhich makes the Government's decisions onprocurement,it cannot act independently when reviewing bid protests.Procuring entities lack the capacity to conduct procurementeffectively and in accordance with the procurement law, andthere is political interference in procurement decisionmaking. The report recommends thatThe current procurementlaw should be amended, and the Government should enact acomprehensive set of implementing regulations to underpinthe law. The position of Executive Director of the NAGPshould be filled immediately. The NAGP should be held moreaccountable for the performance of its functions.Newinstitutional arrangements should be made for theindependent review of bid protests It is necessary to buildpublic sector capacity to undertake public procurementAs ashort-term action, given the urgent need to train thededicated procurement staff of the 35 recently establishterritorial administrative units, the NAGP should conducttraining courses in public procurement for those units bythe end of 2003.
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