Mr Kremer, you have been here, in Moldova, for more than one year. There has been a cycle, not only an economic one, but also a cultural one. Did you manage to form an opinion about our country’s potential and about its people?
I think my first impression of Moldova was very misleading. I listened to a lot of the self-criticism of Moldovans and I’ve read some books written by Moldovans which were very critical of the country. And I think it is very important not to take all of this negativity at face value. Because, after a year, now I’ve got to know the Moldovans better and discovered these enormous resources of humour, and philosophy, and culture which Moldovans use to deal with difficulties.
And now I think that there is a lot that other countries have to learn from Moldovans. When I look at how some other countries are now panicking and maybe even overreacting in the face of different crises, I realize how much I learned from the Moldovans about how to deal with the difficulties of life with philosophy and patience.
On the other hand, Moldovans take pride in their cuisine and wines. What do you think about them?
Now you’re asking the most important question. I think that Moldovan cuisine is incredibly rich because it’s incredibly diverse. When you shop in a supermarket or eat in a restaurant you’re getting the best of Slavic cuisine, Latin cuisine, Baltic cuisine, Turkish cuisine. Everything is there. In the same menu you can start with „red borsch” (Ukrainian soup) and “seld pod shuboi” (typical Russian herring salad) and then go on to have some very fine Italian pizza.
And people think, when I’m saying this, that I’m making a political point, but I’m not. I’m just saying that, when you are hungry, you get the best of East and West in Moldova. I know it’s a tradition for all the diplomats to say they’ve taken great pleasure in Moldovan wines. I’ll be honest. I don’t have much appetite for wine, I never did and I still don’t. But I’ve become very appreciative of some of the Moldovan cognacs.
Did you have a chance to travel?
I visited a lot of the monasteries. The first ones I visited with my wife in our first weeks were Căpriana, Curchi, and Orheiul Vechi. I think there are a few things that I want to do before I leave. I want to spend more time walking and exploring the countryside.
And if there is anybody who reads this article and who knowswhere I can get some maps on the footpaths that link the different villages I would like to be aware how to get that. Maybe the tourist board should create such a guide book, because this is something that is really necessary. The other thing I want tolearn more about is the Moldovan traditional music.
I remember a year ago when I went to the wine festival in Comrat, there was a show of folk music and, as soon as it started, I felt like I have been electrified. The rhythms were so thrilling and they were very new to me, but also very familiar. I’ve done some research and what I found out is that this Jewish music called Klezmer, which is very well known in the West, is actually basically Bessarabian folk music.
It’s the same. And the funny thing is that Moldovans say it’s Moldovan and the Jewish say it’s Jewish Klezmer. But actually it’s Turkish, Roma, Balkan, Bessarabian, Jewish, all mixed together. So it’s like with the food – Moldova is taking a lot of ingredients from different places and is putting them together.
Speaking about music, did you get to enjoy any Christmas Carol in particular?
I have not and I want to. Maybe I will learn to sing some of them here. This is a big defect in the World Bank, we don’t have any great singers in our office. They’re very good at lots of other things, but I’m afraid it’s after 20 years we’re only just beginning to sing “Happy Birthday” properly.
After the winter holidays, what should we expect in 2016? You have often said that the World Bank’s programmes concentrate on hospitals, schools, agriculture, etc. - projects that focus on common people.
I can just give you some examples of things and activities I’ve seen that have been financed by the World Bank. Last winter I visited a primary healthcare centre, near Edineț, financed by the World Bank. As soon as you step into that Center you feel like you are stepping into the 21st century – everything is clean, bright, modern, well equipped. The level of material infrastructure is as good as everything you will find anywhere.
I talked to some of the villagers there and I think it really made a difference, especially to the old people, who had the confidence that there was this place into the village where they could go and talk to the medical staff or just socialize with other people. Another project that I have visited a few times is financing improvements in schools, so that children with disabilities can use them in the same way as any other child.
Things like ramps for wheelchairs or special toilets. I remember meeting a Roma mother of a young girl with disabilities. It was really clear, when I listened to her, that she was absolutely determined that her daughter, even if she has disabilities, should have exactly the same education as all the other children. You could see that the schoolteachers were just as committed to that as the girl’s mother.
Our big project, which we are waiting for the Government and the Parliament to finish the paperwork for, will be improving rural roads. And I hope the work will start in 2016, if all the paperwork gets done. The roads which are being selected for improvement will connect villages to these new hub-schools, where the Ministry of Education is bringing different schools together into one location to which children can travel quickly and safely.
We’re also going to top up the assistance for farmer groups through the Moldova Agricultural Competitiveness Project, which has been a great success. Farmers are using these resources for modernizing the production and processing, and the marketing techniques.
The forecast of the World Bank, and also that of the International Monetary Fund, showed that Moldova’s economy would resume growth, in 2016, even if such growth would be small. Has this forecast been updated?
We still think that there will be either a flat economy or a very small amount of growth in 2016. This is because we think that the adjustment to the downturn in Russia will be complete in about 18 months or 2 years. Also, after a bad year in agriculture, it’s reasonable to expect that things will not necessarily be as bad again next year
But a lot, I think, will depend on agriculture and what happens to the climate next year. We think that Moldova will resume a solid growth in 2017 and that some of the pressures that the country has experienced in 2015 and 2016 will begin to get a bit easier. The Bank’s analysts have said that Moldova is in a favourable position as compared to other countries in the region.
Do they only refer to the fact that we are at the border of the European Union, in view of the economic dependence on Russia?
It’s true. A quarter of Moldova’s economy in 2014 depended on Russia. That is definitively falling, because remittances from Moldovans working in Russia have gone down by about 30%, since 2014, which is a very dramatic fall. There are signs of increased exports to the European Union. Looking inside the numbers, it really depends upon a very small number – not even a handful – of larger exporters; we can’t really say there is an economic trend.
It is more to do with the commercial plans of a small number of the individual companies. I think in order for Moldova’s exports to the EU to become more of a confirmed long term trend this is a long call, it’s a marathon, not a sprint. It’s not an instant adjustment. Even for very successful exporters like Morocco, this is a process which is achieved over decades, not over months. It’s very important for Moldova to understand that the DCFTA with the EU has a tremendous long term potential.
But they must not grumble if they don’t see instant results after a few months or a few years, because it requires a process of improved competitiveness and regulatory reform at home, which can’t be achieved from one day to the next. Moldova has an opportunity from its location. People keep on reminding me we’re 90 minutes away from the biggest market in the world.
And we have labour costs here that are a tiny fraction of the labour costs in the EU. So, Moldova should be a workshop for exporting and re-exporting to the EU. So the real question is why is this not happening. And I think the answer is not that the regulations are bad, because we measure them – they’re not so bad and every year they are getting better.
The answer is that the regulations are being implemented corruptly and investors are afraid that they will not be treated in accordance with the law and that they will constantly have to negotiate with the authorities how they are treated by state institutions. And then they think: “Well, this is too complicated”.
The World Bank is well known for its clear recommendations regarding the state economic administration. But what would you recommend to Moldovan people who invest or who intend to invest in business?
Moldovans know Moldova much better than we do. What we do is listen to Moldovan citizens and we listen to Moldovan businesses. And they tell us first thing they want is a clean economy, they want to be able to send their kids to school and get a modern education. They want modern, and effective, and affordable healthcare. And our job is to listen to all of that and help any government that wants to provide it.
This interview was orginally published in Altitude Magazine (January 2016): http://issuu.com/altitudemgz/docs/janfeb2016