Doing business in Moldova
Moldova is a small, landlocked country located in Eastern Europe with a developing economy and a strategic location. The country has a relatively low cost of living and a well-educated workforce, with industries such as agriculture, manufacturing, and information technology making it an attractive location for businesses looking to expand their operations.
One of the key advantages of doing business in Moldova is its strategic location between the European Union and the Commonwealth of Independent States (CIS). The country has excellent transportation links, including major highways, railways, and airports, which make it an ideal location for businesses looking to access markets across the region.
Moldova also offers a favorable tax system, with a flat corporate tax rate of 12%, one of the lowest in the region. The country has a well-developed infrastructure, with modern facilities and a reliable power grid.
In recent years, Moldova has taken steps to improve its business environment, with a range of reforms designed to encourage entrepreneurship and foreign investment. The country has simplified its procedures for starting a business, reduced bureaucracy, and improved its legal and regulatory environment.
However, it's important to note that Moldova also faces some challenges for businesses looking to operate there. The country has a relatively small domestic market and limited natural resources, which can limit the potential customer base and increase the costs of doing business. Additionally, corruption and organized crime remain concerns in the country.
Overall, doing business in Moldova offers a range of opportunities for businesses looking to expand into Eastern Europe, with a strategic location, favorable tax system, and improving business environment. However, businesses should also be prepared to navigate the country's unique challenges and carefully evaluate the risks and opportunities associated with operating in Moldova.
Advantages of Doing Business in Moldova
✔ Strategic location: Moldova is strategically located between the European Union and the Commonwealth of Independent States (CIS), making it an ideal location for businesses looking to access markets across the region.
✔ Skilled workforce: Moldova has a highly skilled and educated workforce, with a well-developed education system producing graduates with skills in science, technology, engineering, and mathematics (STEM) fields.
✔ Favorable tax system: Moldova has a flat corporate tax rate of 12%, one of the lowest in the region, making it an attractive location for businesses looking to reduce their operating costs.
✔ Well-developed infrastructure: Moldova has a well-developed infrastructure, with modern facilities and a reliable power grid, making it an attractive location for businesses looking to establish operations in the country.
✔ Improving business environment: In recent years, Moldova has taken steps to improve its business environment, with a range of reforms designed to encourage entrepreneurship and foreign investment. This includes simplifying procedures for starting a business, reducing bureaucracy, and improving the legal and regulatory environment.
Disadvantages of Doing Business in Moldova
✖ Small domestic market: Moldova has a relatively small domestic market compared to other European countries, which can limit the potential customer base for businesses operating solely within Moldova.
✖ Limited natural resources: Moldova has limited natural resources, which can increase the costs of doing business in the country.
✖ Limited access to financing: Moldova has a relatively underdeveloped financial sector, which can make it challenging for businesses to access financing.
✖ Corruption: Corruption is a concern in Moldova, particularly in the public sector. Businesses may face challenges in dealing with government officials or obtaining necessary permits or licenses.
✖ Language barriers: Romanian and Russian are the official languages of Moldova, and while English is widely spoken, it can be a challenge for businesses that do not have fluency in Romanian or Russian, particularly when it comes to navigating the legal and regulatory environment.
There are several types of business organizations in Moldova, each with its own advantages and disadvantages. Some of the most common types of business organizations in Moldova include:
► Sole proprietorship: A sole proprietorship is a business owned and operated by a single person. The owner is personally liable for all the debts and obligations of the business.
► Partnership: A partnership is a business owned and operated by two or more individuals who share profits and losses. There are two types of partnerships in Moldova: general partnership and limited partnership.
► Limited liability company (LLC): A limited liability company is a private limited liability company, which is the most common type of company in Moldova. It requires a minimum of one shareholder and has a minimum share capital of just MDL 1, but there is no maximum limit. The shareholders are liable only to the extent of their contributions.
► Joint-stock company (JSC): A joint-stock company is a public limited liability company that can issue shares to the public. It requires a minimum of two shareholders and has a minimum share capital of MDL 600,000 (from 01.01.2024). The shareholders are liable only to the extent of their contributions.