WINE SECTOR RESTRUCTURING PROGRAM FILIERE DU VIN FOR PERIOD JULY 01 SEPTEMBER 30, 2013

Transcription

1 Ministry of Agriculture and Food Industry of the Republic of Moldova Consolidated Unit for Implementing and Monitoring the Wine Sector Restructuring Program WINE SECTOR RESTRUCTURING PROGRAM FILIERE DU VIN FOR PERIOD JULY 01 SEPTEMBER 30, 2013 Date of submission to EIB: October 2013 The contents of this publication are the sole responsibility of Consolidated Unit for Implementing and Monitoring the Wine Sector Restructuring Program and can in no way be taken to reflect the views of the European Union. 1

2 The information contained herein in this report was sent to the EIB under the responsibility of: Company Contact person Title Address Consolidated Unit for Implementing and Monitoring the Wine Sector Restructuring Program (PIU) Iurie BRUMAREL Executive Director of Moldovan Wine Sector Restructuring Program 18, Calea Basarabiei str.,2 nd floor, Chisinau, Republic of Moldova, MD-2023 Contact Phones Cell: Office: s iurie.brumarel@winemoldova.md iurie.brumarel@yahoo.com office@winemoldova.md

3 Table of Contents INTRODUCTION... 5 PROGRAM PERFORMANCE EVOLUTION... 6 A. CREDIT LINE INSTRUMENT B. LEASING INSTRUMENT C. LABORATORIES, TRAINING, EDUCATION AND DEVELOPMENT OF FOOD SECURITY D. PROSPECTS FOR ALLOCATIONS IN THE COMING QUARTER E. PROGRAM MANAGEMENT Program PR actions Procurement activities Reporting and Budgeting Annex 1. Total Program Expenditures cumulative data, EUR Annex 2. Sub-sector distribution of EIB Allocations cumulative data, Eur Annex 3. Pre-financing Monitoring Report on Mold-Nord JSC Annex 5. Planned activities for the 4 th quarter

4 Abbreviations CLD EIB EUR FB GRM LPAs LLC LTEDFS M&E MIS MoAFI MoF MDL OM PB PDO PED PFI PGI PIU USAID WSRP Credit Line Directorate European Investment Bank EU currency Final Beneficiary Government of Republic of Moldova Local Public Authorities Limited Liability Company Laboratories, training, education and development of food security Monitoring and Evaluation Management Information System Ministry of Agriculture and Food Industry Ministry of Finance Moldovan Lei Operations Manual of the Program Potential Beneficiary Protected Designation of Origin Program Executive Director Participating Financial Institution Protected Geographical Indication Program Implementation Unit United States Agency for International Development Wine Sector Restructuring Program

5 INTRODUCTION The Wine Sector Restructuring Program (WSRP) has been launched on the 23rd of November, 2010 and is expected to be finalized on the 31 st of March From EIB sources EUR 75 million has been allocated for the implementation of activities envisaged under the Program being operational for almost 4 years. The WSRP aims to contribute to wine sector recovery and develop the production of bottled wines of Protected Designation of Origin (PDO) and/or Protected Geographical Indication (PGI), by (i) restructuring the wine industry, (ii) improving the quality and consistency of wine produced in Moldova from the quality of vineyards to the final packaging and dispatch of products, and (iii) diversifying the country s export markets. In order to achieve the Program s goal and objectives Program Implementation Unit (PIU) will act through 5 Program components: i. Winemaking enterprises development - upgrade the equipment and facilities, establish new winemaking enterprises, or expand the activities of the existing ones; ii. Viticulture sector development - restructure and revitalize the old and un-productive vineyards, introduce new growing technologies (drip irrigation, other protection systems) and upgrade the viticulture equipment at the farm level; iii. Associated industries enterprises development - upgrade the equipment and facilities; iv. Laboratories, training, education and development of food security- acting through: a. National Laboratories Network Development establishment / development of the relevant control bodies and testing wine quality at national level; b. Education and Research Institutions support the introduction of the system of PDO and PGI for Moldovan wines; organize trainings for students; create working laboratories or update the equipment in the existing laboratories in four affiliated educational institutions. v. Program management PIU operations undertaken for the Program implementation. The Program Components will be financed through four financial instruments, which are the Credit line, Leasing, Loan guarantees, and Capital investments. This Report has been elaborated by the PIU in accordance with Article 12.06, Schedule A (Reporting), point 3 of the Finance Contract Serapis , and reflects the evolution of Program s performance during the third quarter of 2013 and cumulative for

6 PROGRAM PERFORMANCE EVOLUTION In the reported period, PIU activities were based on continuing implementing and developing the Credit Line and Leasing financial instruments. PIU worked with MoF representatives, in order to agree and finalize the Annex F to the Operational Manual on Education and research institutions, and to send it to EIB for No objections in order to launch the implementation of Laboratories, training, education and development of food security component of the Program. The total amount of expenditures related to all activities implemented under the Program till September 30, 2013 represent 44,300, EUR, including 20,783, EUR approved from the EIB loan and 22,873, EUR is beneficiaries co-financing amount, 625, EUR is financing obtained from the Republic of Moldova Government and 18, from Italian Grant, as indicated in the table below: Table 1. Total Program Expenditures cumulative for , EUR Program Component Component 1: Winemaking enterprises development Component 2: Viticulture enterprises development Component 3: Associated industries enterprises development Component 4: Laboratories, training, education and development of food security Program Management Total Requested loan amount from EIB sources Beneficiaries co-financing GRM Italian Grant Total Weight, % , ,05 0,00 0, ,13 74, , ,50 0,00 0, ,30 18, , ,36 0,00 0, ,36 5,47 0,00 0,00 0,00 0,00 0,00 0,00 0,00 0, , , ,12 1, , , , , ,90 100

7 The structure of Total Program Expenditures cumulative for is emphasized in the below diagram, that confirms that PIU respects the OM prerequisite envisaged at the point 1.6 which states that the requested loan from EIB will cover a maximum of 50% of the costs of the Sub-Project and the remaining 50% of the cost of the Sub-Project would be beneficiaries co-financing. Detailed information on Total Program Expenditures planed versus implemented is presented in Annex 1. Total Program Expenditures cumulative data. Figure 1. Structure of Total Program Expenditures cumulative The cumulative total amount of sub-projects represents 43,657, Eur, out of which from EIB loan were approved 20,783, Eur and 15,712, Eur were disbursed to FB, as indicated in the table below: Table 2. Sub-projects amount status, cumulative , Eur Year Total amount of subproject Value of EIB loan approved Value of FB co financing EIB loan disbursed to FB Total , , , , , , , , , , , ,46 PIU received the EIB loan in 5 tranches and disbursed the whole amount to Final Beneficiaries as presented in table 3 (Detailed information on EIB allocation is presented in Annex 2. Sub-sector distribution of EIB Allocations, cumulative data): 7

8 Table 3. Sub-projects amount by tranches, cumulative , Eur Period Number Value of EIB allocated amount Total received from EIB allocated amount Disbursed amount by PIU to PFI PIU Euro account remaining balance Diff. between approved/allocated amount by EIB and received amount on PIU account 2012 I tranche II tranche III tranche IV tranche V tranche Total During PIU worked with 14 final beneficiaries from whom 88% activate in the winemaking sub-sector, 7 % in the viticulture sub-sector, and 5 % in supported industries. The cumulative sub-projects amount distributed by sub-sectors are emphasised in the table below: Table 4. Sub-projects amount per Program components, cumulative , Eur Sub-sector Total amount of sub-projects Value of FB co financing Value of EIB allocated amount TOTAL value of EIB loan disbursed to PFI weight, % Winemaking Vineyards Support industries Loan guarantees, mezzanine and equity activities Laboratories, training, education and development of food security TOTAL

9 Figure 2. Value of EIB allocated amount per sub-sector, cumulative From the total amount of EIB allocations 66 % were solicited by the FB from the viticulture zone Codru and 23 % by FB from the viticulture zone Valul lui Traian. For viticulture zone Stefan Voda and support industry were allocated 6 % and respectively 5%, as shown in the table below: Table 5. EIB allocation per viticulture zone cumulative , Eur Viticulture zone Allocated amount weight, % viticulture zone Codru ,0 66 viticulture zone Stefan Voda ,0 6 viticulture zone Valul Traian ,0 23 support industry ,0 5 Total ,0 100 EIB allocations are distributed to FB through 4 PFIs, emphasized in the table below. The biggest amount of Eur was solicited through Moldova Agroindbank by 3 FB. Moldindconbank detain 23 % of solicited EIB allocations and works with 6 FB. Banca Sociala and Energbank detain 14 % and 6 % respectively from the allocated amount, as indicated below: Table 6. EIB allocation per PFI cumulative , Eur PFI Cumulative allocated amount number of subprojects financed weight, % from number from amount Moldova Agroindbank Moldindconbank Banca Sociala Energbank Total

10 From the EIB loan were approved for financing 15 sub-projects of 14 Beneficiaries. Alianta Vin LLC elaborated and presented 2 distinctive sub-projects and received financing on both. The cumulative list of FB is presented below: Table 7. Sub-projects amount per FB cumulative , Eur Final Beneficiary Total subproject amount FB own contribution Allocation amount of which for winemaking of which for vineyards of which for support industry DK-Intertrade LLC Alianta Vin LLC Asconi LLC API Orhei JSC Suvorov-Vin LLC Migdal-P JSC Fautor Firstline LLC JSC Cricova Alianta Vin LLC Papfin LLC Vinaria Tiganca LLC Tomai-Vinex JSC Vinaria Zimbreni Vinaria din Vale Total , , , Eight FB intend to plant during the investment period of the sub-project 789, 92 ha of vineyards, as presented in the table 8. Table 8. Planting vineyards during sub-projects investment period based on presented BPs, ha No Final Beneficiary Intermediary Planting vineyards, ha 1 Asconi LLC Agroindbank API Orhei JSC Banca Sociala 30 3 Suvorov-Vin LLC Moldindconbank JSC Fautor Moldindconbank 19,67 5 JSC Cricova Agroindbank 456 Sub Total 660,67 6 Vinaria Tiganca LLC Moldinconbank 20 7 Tomai-Vinex JSC Moldinconbank Vinaria din Vale Agroindbank 58,25 Sub Total 129,25 TOTAL 789,92

11 During the reported period through the Credit Line, PIU consulted 11 Potential Beneficiaries, registered 3 Applications from Potential Beneficiary, as well as provided assistance in the development of 7 business plans for winemaking, viticulture and support industries companies, issued PIU eligibility notice for 6 sub-projects and allocated EIB funds to 3 Final Beneficiaries. Table 9. Summary on Program performance evolution as of Consulted Registered Developed PIU PFI / CLD EIB NO EIB PB applications Business eligibility approval Objection financed Plans notice Credit Line Cumulative as of During During I quarter II quarter III quarter Laboratories, training, education and development of food security Cumulative as of Education Institutions For defining the Leasing instrument PIU finalised the elaboration of the whole package of required documents that accompany the draft version of PIU Regulation, submitted to Government for approval. For launching the Laboratories, training, education and development of food security component PIU finalized Annex F to the OM Education and Research Institutions and sent it to EIB for No-Objections. 11

12 A. Credit Line Instrument During the I-III quarters of 2013 through this instrument to Final Beneficiaries were disbursed 5,918,416 Eur, out of which 5,618,416 Eur were disbursed for development of the winemaking subsector and 300,000 Eur went to support industries sector, as presented in the table below: Table 10. Sub-projects amount by sub-sectors for I-III quarters of 2013, Eur Description of sub-project Total amount of subproject Value of EIB loan approved Value of EIB loan disbursed Value of FB co financing from which: in-kind cash contributi contributi on on I Winemaking Winemaking equipment Constructing/renovating production buildings Tracks for bottled wine transportation 4 Working capital for production process Intangible assets II Vineyards Viticulture machinery Vineyards establishment (30ha) III Support industries Equipment Constructing/renovating production buildings Working capital for production process IV Laboratories, training, education and development of food security Equipment for Laboratories of Education Institutions Total investment projects amount, EUR The detailed information regarding specific investments proposed by final beneficiaries, who received financing from EIB in the 3 rd quarter, is presented below:

13 Table 11. Vinaria Tiganca sub-project, Eur Description of subproject Total Value of Sub-Project Value of EIB loan approved Value of EIB loan disbursed Value of FB co financing from which: in-kind contribution cash contributi on Winemaking Winemaking equipment Constructing/renovating production buildings Working capital for production process Vineyards Viticulture machinery Vineyards establishment Total Table 12. Vinaria Zimbreni sub-project, Eur 1 2 Description of subproject Total Value of Sub- Project Winemaking Winemaking equipment Constructing/renovat ing production buildings Value of EIB loan approved ,88 Value of EIB loan disbursed Value of FB co financing from which: in-kind contributi on cash contr ibuti on , Total Table 13. Vinaria din Vale sub-project, Eur Description of subproject Total Value of Sub- Project Value of EIB loan approved Value of EIB loan disbursed Value of FB co financing from which: in-kind contributio n cash contributi on Winemaking Winemaking equipment Constructing/renovat ing production buildings Vineyards Viticulture machinery Vineyards establishment Total

14 During the reported period PIU has conducted several actions in order to promote the Credit Line and to help Potential Beneficiaries to access EIB sources more easily, as follows: Informed 6 potential beneficiaries at their request by on EIB requirements and procedures, procurement rules and other issues in order to access the Credit Line sources, received and registered their applications ; Registered 3 Applications from Final Beneficiary ; Analysed and reviewed 7 business-plans of potential beneficiaries ; Conducted 1 pre-financing visit to Mold-Nord with the scope to inspect the FB own contribution and to see the actual condition of the factory from Falesti village, especially production buildings that will be renovated from EIB funds (Annex 3. Pre-financing Monitoring Report); Signed and submitted the PIU Eligibility Notice for the following 6 sub-projects: Agrosudresurs, Divib Media, Nova - Imprim, National College of Viticulture and Winemaking, Technical University of Moldova and Practical Scientific Institute of Horticulture and Food Technology. All above mentioned beneficiaries from PIU point of view are eligible for financing and their sub-projects correspond to all eligibility criteria mentioned in the OM and Side-Letter; Reviewed procurement documentation of Credit Line Final Beneficiaries, including: Monitor implementation of procurement contracts by FBs under Credit Line Component; Provided support (as requested) to Credit Line Final Beneficiaries in organizing their procurements according to EIB procurement requirements, as emphasized in the table below: Table 14. Consultancy and monitoring offered by PIU on procurement aspects Date Q3 04 July, 2013 Final Beneficiary Wine International Project SRL Consultancy/Reviewing undertaken by PIU on procurements organized by FB: The FB intends to request and use the EIB loan to procure winemaking equipment for its existing wine factory: 1) Pneumatic press with accessories; 2) Refrigerating unit with accessories; 3) Heat exchanger (pipe in pie) with accessories; 4) 250hl Tanks (40 pcs). As requested, the FB sent to PIU for review (via ) the following documents with ref. to winemaking equipment supplier selection process: Copies of price quotations received; copy of the quotations evaluation report, signed by FB; copy of the signed contract. The FB intends to procure all of the above mentioned equipment from a single company, that was selected as follows:

15 22 July July 2013 Agrosudresurs LLC DIVIB MEDIA SRL Contract for procurement of winemaking equipment. Six price quotations have been received - Technofood Group Italy 405,900 Eur - Berhord SRL MOLDOVA 440,280 Eur - Fabbri Inox (did not propose press) MOLDOVA 262,000 Eur - PIM Bulgaria 427,980 Eur - Biomashin (proposed tanks only) Bulgaria 210,000 Eur - Bemas Grup MOLDOVA 301,850 Eur FB has selected the price offer from Technofood Group, Italy 405,900 Eur. FB argumented its selection with the fact that its factory already uses equipment from Technofood, is satisfied with its quality, and the employees know/have been trained how to use and maintain equipment from this manufacturer. In conclusion, it is stated that procurements were made by FB based on EIB agreed procurement requirements under Credit Line Component and the PIU elaborated Guide on Procurements for Credit Line Component. The FB intends to use EIB Credit Funds for purchasing and installation of sandwich panels for the roof of the wine storage warehouse. Taking into consideration that the amount requested from EIB resources is less than 100 thousand euros per contract, FB directly contracted the company IM "Europanel Group" SRL, Moldova for the amount of 35,760 Eur. PIU requested and received the copy of this contract. In conclusion, it is stated that procurements were made by FB based on EIB agreed procurement requirements under Credit Line Component and the PIU elaborated Guide on Procurements for Credit Line Component. The FB intends to request and use EIB credit proceeds to procure winemaking equipment for primary processing, fermentation and maturation of red and white wines. Taking into account that the solicited amount from EIB is less that 100 thousands Eur per contract, the FB organized procurements on the base of shopping procedures from S.C. "BERHORD" S.R.L., Moldova, in amount of 29,3250 Eur. PIU solicited and received a copy of this contract in order to check the delivery and payment conditions of goods. In conclusion, it is stated that procurements were made by FB based on EIB agreed procurement requirements under Credit Line Component and the PIU elaborated Guide on Procurements for Credit Line Component. 15

16 29 July August 2013 Cioc-Maidan- Vin Mold-Nord SA The FB intends to request and use EIB credit proceeds to procure accessories necessary for planted in year hectares of vines and for additionally to be planted 300 hectares of new vines (during the next 2-3 years) and procurement of winemaking equipment, all consisting of: 1) Wire (and wiring accessories) with intermediary metal pillars for vine planting (for 400 hectares of vine); 2) Wooden pillars for vine planting; 3) Stainless steel tanks and equipment for wine storage; Taking into consideration that all 3 above mentioned procurements exceeded 100 thousand euros per 1 contract, in line with the PIU Guide on Procurements for Credit Line Component, the FB sent to PIU for review (via ) the following documents with ref. to suppliers selection process: Copies of price quotations received; copies of the quotations evaluation reports - signed by FB; copies of signed contracts. a) Contract for procurement of Wire (and wiring accessories) with intermediary metal pillars for vine planting: Three price quotations have been received, all from Moldovan companies: Metalica-Zuev SRL Niverant and AMPELOS-PLUS SRL. The FB has established that the best combination of price/quality/quantity is of the price quotation from company Ampelos-Plus SRL with whom was signed a contract in amount of ~ 1.14 mln euros (VAT 0%). b) Contract for procurement of Wooden pillars for vine planting: Three price quotations have been received, all from Moldovan companies: SA Betacon SRL Niverant SA and Avantaj- AV. The FB has established that the best combination of price/quality is of the price quotation from company Avantaj- AV with whom was signed a contract in amount of ~ 957 thousand euros (VAT 0%). c) Contract for procurement of Stainless steel tanks and equipment for wine storage: Three price quotations have been received: CN. MIM-COM SRL (Moldova), PIM (Bulgaria) and BERHORD SRL (Moldova). The FB has established that the best combination of price/quality is of the price quotation from company BERHORD SRL with whom was signed a contract in amount of 800 thousand euros. In conclusion, it is stated that procurements were made by FB based on EIB agreed procurement requirements under Credit Line Component and the PIU elaborated Guide on Procurements for Credit Line Component. The FB intends to request and use EIB credit line proceeds to procure: 1) cooling units for treating the wine with cooling before bottling; water treatment/filtration unit; vertical wine tanks on feet;

17 2) capital construction/reconstruction services of a wine bottling hall and of a wine maturing hall (including a cellar for wine maturation)). 3) lab equipment for wine production needs. 4) forklifts for warehouse needs (2 pcs) For procurements that exceed 100 thousand euros per 1 contract, in line with the PIU Guide on Procurements for EIB Credit Line Component, the FB sent to PIU for review the following documents with ref. to suppliers selection process: Copies of price quotations received; copies of quotations evaluation reports - signed by FB; copies of signed contracts. a) Cooling units for treating the wine with cooling before bottling; water treatment/filtration unit; vertical wine tanks on feet: Three price quotations have been received from the following companies: - Della Toffola Spa (Italy) 174,100 Eur - R.K.B. Service SRL (Romania) 190,560 Eur - TM Inox SRL (Romania) 149,200 Eur In its Evaluation Report, the FB has established that the best combination of price/quality/performance is of the price quotation from company TM Inox SRL (Romania), with whom was signed a contract in amount of 242,380 Eur (the amount included also the price quotation for water treatment/filtration unit; vertical wine tanks on feet). b) Contract for procurement of Capital construction/reconstruction services of a wine bottling hall and of a wine maturing hall (including a cellar for wine maturation)): Three price quotations have been received from the following companies (all Moldovan companies): SC Alivic Com SRL; Inconex-Com Production SRL; Albecar Prim SRL; In its Evaluation Report, the FB has established that the best combination of price/quality/recommendation from clients/previous satisfactory performance is of the price quotation from company Inconex-Com Production SRL. The estimated contract amount to be signed is ~ 1,68 mln Euros. Other small procurements (that did not exceed 100 thousand euros per 1 contract) were done as follows: - lab equipment for wine production needs: the FB has consulted 2 price quotations from Uta Impex SRL and Spectroteh SRL (all Moldovan Companies). The FB has decided to contract company Spectroteh SRL in the total amount of 50 thousand Euros. - forklifts for warehouse needs (2 pcs): the FB has consulted 3 price quotations from: Microcell SRL, Neocar SC and STS 17

18 29 August 2013 Nova Imprim SRL (printing house) company. The FB has decided to contract company Microcell SRL in the total amount of 20 thousand Euros. In conclusion, it is stated that procurements were made by FB based on EIB agreed procurement requirements under Credit Line Component and the PIU elaborated Guide on Procurements for Credit Line Component. The FB is part of wine-related industry (printing house). It intends to request and use EIB credit line proceeds to procure the following: 1) Set of flexographic printing machine. 2) WJ-320 Reel Type Silk Screen Printing Machine (the unwinding unit, screen printing machine, Rewinding) with UV dry (UV LIGHT, 5KW SINGLE LAMP) and 2 additional UV-lamp. 3) Hot foil printing machine. 4) Add-ons for the Hot foil printing machine NEW FOIL model For procurements exceeding 100 thousand euros per 1 contract, in line with the PIU Guide on Procurements for EIB Credit Line Component; the FB sent to PIU for review the following documents with ref. to suppliers selection process: Copies of price quotations received; copies of quotations evaluation reports - signed by FB; copies of signed contracts. 1) Procurement of a complete Set of flexographic printing machine. Three price quotations have been received from the following companies: - Gallus Group (Austria) 822,460 Eur - R.K.B. Service SRL (Ukraine) 932,461 Eur - Omest SRL (Italy) 561,936 Eur In its Evaluation Report, the FB has established that the best combination of price/quality/performance is of the price quotation from company Omest SRL (Italy), with whom was signed a contract in amount of 561,936 Eur. 2) Procurement of a new Hot foil printing machine. Three price quotations have been received from the following companies: - Terra Print (Russia) 157,600 Eur - Cartes SRL (Italy) 197,000 Eur - Itraco GmbH (Germany) 120,075 Eur In its Evaluation Report, the FB has established that the best combination of price/quality/performance is of the price quotation from company Itraco GmbH (Germany), with whom was signed a contract in amount of 125,075 Eur. The rest were small procurements (<100 thousand euros per 1 contract): 1) WJ-320 Reel Type Silk Screen Printing Machine (the unwinding unit, screen printing machine, Rewinding) with UV dry (UV

19 12-25 Sept., 2013 Cricova S.A. LIGHT, 5KW SINGLE LAMP) and 2 additional UV-lamp the FB has decided to contract company Tangshan Wanjie Machinery Equipment Co. Ltd. (China), in the total amount of 23, Eur 2) Add-ons for the Hot Foil printing machine NEW FOIL model The FB has decided to contract company Itraco GmbH (Germany), in the total amount of 35, Eur. In addition, the FB has informed PIU that taking into consideration the technical configuration of the Hot foil and OMET machines, it is 90% oriented in printing of labels for the wine sector. Major NOVA Imprim customers are: Wines CRICOVA SA, IM Winery Bostovan, Purcari, Chateau Vartely etc., These wine companies have automatic labelling machines for bottles, which work with labels printed on flexo-materials. In conclusion, it is stated that procurements were made by FB based on EIB agreed procurement requirements under Credit Line Component and the PIU elaborated Guide on Procurements for Credit Line Component. As agreed in the PIU eligibility notice on the investment project of Cricova SA, this FB further provided for PIU review documentation on the way the construction services suppliers were selected / copies of respective contracts. PIU has received and reviewed the following: 1) Contract for procurement of wine bottles warehouse construction services. Three price quotations have been received: Consocivil SA, Moldova Eur; Acmia-Con SRL, Moldova 100,989 Eur; Urban Terra SRL, Moldova 141,848 Eur. FB has selected the smallest price offer from Acmia-Con SRL, Moldova 100,989 Eur and provided for PIU review the copy of signed contract, copies of price quotations and signed minutes of price quotations evaluation. For the above mentioned construction needs, the FB will import directly from the producer sandwich panels. The selected company is Topanel Production Panels SA, Romania, with whom a contract was signed in amount of 23, Eur. For transporting the mentioned goods, a contract was signed with company Brovicenco Trans SRL in amount of 1800 Eur. 2) Contract for procurement of electrical, security, water, fire alarm systems installation at the main production hall: Three price quotations have been collected: Novaemcom SRL, Moldova Eur; DACIA-90 SRL, Moldova Eur; Montelectromprim SRL Eur. In its evaluation report the FB has awarded the contract to the lowest evaluated and compliant offer from Novaemcom SRL, 19

20 13 Sept., 2013 Vinaria din Vale Moldova Eur; Copy of the signed contract was provided for PIU s review. 3) Contract for procurement of ventilation/heating system installation at the main production hall: Only Two price quotations have been collected: SRL Di&Trade, Moldova Eur; SRL Vent sistem, Moldova Eur. In its evaluation report the FB has awarded the contract to the lowest evaluated and compliant offer from SRL Di&Trade, Moldova 134,606 Eur; Copy of the signed contract was provided for PIU s review. In conclusion, it is stated that procurements were made by FB based on EIB agreed procurement requirements under Credit Line Component and the PIU elaborated Guide on Procurements for Credit Line Component. As previously requested by the FB, further approved by PIU and EIB, the FB intended to use the 1st Tranche (1mln Euros requested from EIB) for retroactive financing of production buildings located in Balti city. On August 28, 2913, PIU was informed by FB that it covered the financing of production buildings from its own funds and thus, intends to use 1mln Euros for procurement of construction and winemaking equipment. At the moment, the following procurements were organized: 1) Procurement of winemaking equipment: Due to the fact that this procurment exceeded 100 thousand Euros per contract, a formal selection processshould have been was organized. Up to this date the FB still did not and provide for PIU review the copy of signed contract, copies of price quotations and signed minutes of price quotations evaluation. 2) Other procurements were <100k Euros and the FB selected suppliers via direct contracting: a) Procurement of Sandwich panels for construction a wine production hall in v.burlacu, Cahul district: the contract was signed with company Isopan Est SRL, Romania in amount of 79,769 Eur. b) Procurement of pipes for wine production hall in v.burlacu, Cahul district: the contract was signed with company SC Politub SA, Romania in amount of 27, Eur. *Final Beneficiaries were receiving continuous support/communication with PIU on procurement issues by means of /phone/meetings.

21 During the reporting period the PFI s (after receiving the PIU Eligibility Notice for the above mentioned sub-projects) examined the potential beneficiary s business plans, evaluated their payment capacity, estimated credit risk exposure level on each sub-project, made a positive credit decision and submitted to CLD the PFI request for Sub-financing, as follows: Table 15. Beneficiary dossiers approval schedules Beneficiary Name Date of submission PIU Eligibility Notice CLD approval 1 Agrosudresurs LLC Divib Media LLC Nova-Imprim LLC National College of Viticulture and Winemaking Technical University of Moldova Practical Scientific Institute of Horticulture and Food Technology

22 B. Leasing Instrument During the 3 rd quarter of 2013 PIU continued to develop leasing procedures, policies and regulations and to elaborate supporting documents for launching the Leasing instrument. In this scope PIU have done the following activities: PIU finalized the draft version of PIU Regulation, which was adjusted to received comments and suggestions of MoF, Ministry of Economy, National Anti-Corruption Centre, and National Commission for Financial Markets and the Ministry of Justice. Comments and suggestions received from the above mentioned institutions were argued and explained by PIU in the "Table of divergences" document; On 12 th of July, 2013 PIU participated at the public debates together with MoAFI and related institutions, as well as representatives of the civil society such as representative of the France Chamber of Commerce and Industry and the representative of the Association of Producers and Exporters of Wines and Grapes from RM. During the debates were discussed the identified divergences (comments and suggestions) and the mutual opinion was related in the Minutes of meeting which was signed by all participants; PIU prepared all required documents that accompany the draft version of PIU Regulation submitted for approval, as follows: the informative note that contain financial and economic justification of the need for the proposed amendments to PIU Regulation, the final draft version of PIU Regulation in Romanian, Russian translation of the draft version of PIU Regulation, the "Table of divergences" document with the respective arguments; PIU sent all the documents to the State Chancellery which, in line with established procedures will prepare the entire package of documents for Government approval; PIU participated at the meeting organized by EIB with Raiffeisen Leasing Moldova representatives. During the meeting were discussed several aspects The procedure of conducting leasing through PIU and actions undertook by PIU for launching the Leasing Instrument; The possibilities of cooperation and collaboration in implementation process of leasing component; Following to EIB recommendations, PIU continued to prepare basis for discussions with MoF regarding their point of view on the implementation procedure of leasing component

23 elaborated and described by PIU in the Attachment D to Operation Manual Leasing Operations ; PIU continued to develop the chapter Monitoring from the Attachment D to Operation Manual Leasing Operations. During the third quarter 2013, PIU, within this component, worked on the elaboration of the documents that accompany the draft version of PIU Regulation and submitted it for the Government approval. 23

24 C. Laboratories, Training, Education and Development of Food Security In the reported third quarter, PIU in order to develop this Program Component, mainly Education and Research Institutions sub-component has undertaken several actions, as follows: 1) PIU prepared and submitted to EIB PIU opinion on the approved Educational Institutions and sub-project eligibility, including a detailed Presentation report on Educational Institutions; 2) At the same time, taking into account the provisions of Finance Contract and Side Letter issued by EIB, as well as provisions of the Operational Manual referring on this component of the Program, PIU submitted to EIB for No objection: a. the draft of the Attachment F to the Operational Manual of the Program; b. procurement plan divided per type of procurement activity and estimated costs elaborated by PIU jointly with beneficiary institutions. The prospective allocation for the above mentioned institutions is presented in the table below as follows: Table 16. Total amount of Education and Research Institutions sub-projects, EUR Education and Research Institution Total amount of subproject The amount of EIB loan Value of FB co financing Tehnical University of Moldova National College of Viticulture and Winemaking Chisinau The Institute of Viticulture and Food Technology Total

25 B. Prospects for allocations in the coming quarter In the fourth quarter of 2013 it is planned to disburse from EIB the amount of 8,550,797 Eur in two tranches. Through the Credit Line instrument is planned to disburse the amount of 5,397,044 Eur and for Laboratories, trainings, education and development of food security component is planned the amount of 3,153,753 Eur. The funds solicited through Credit Line will be used for financing 3 new sub-projects and 3 sub-projects from previous allocations. Within the Laboratories, training, education and development of food security component will be financed 2 educational institutions and 1 research institution. Detailed information is emphasized in the table below: Table 17. Prospects for allocations for the 4 th quarter 2013, Eur PFI Final beneficiary Total subprojects amount Total amount of EIB loan FB contribution Expected amount of 6th tranche th tranche 2013 Total amount, Q Credit Line Moldindconbank Divib Moldova Agroindbank Bravo Wine Moldindconbank Nova-Imprim Subtotal 3 new FB Moldindconbank Vinăria Țiganca (III tranche)

26 Moldova Agroindbank Moldova Agroindbank Vinăria din Vale (II tranche) Cricova (III tranche) Subtotal from previous allocations Subtotal Credit Line Laboratories, training, education and development of food security Ministry of Finance Technical University of Moldova Ministry of Finance National College of Viticulture and Winemaking Chisinau Ministry of Finance The Institute of the viticulture and Wine-marking and the alimentation technologies Subtotal for LTEDFS Total

27 C. Program Management In the period of 15 to 17 of July PIU received an official delegation from European Investment Bank composed of the following representatives: Thomson Campbell, Adviser and Luca PONZELLINI, Senior Loan Manager. PIU organized all the logistics regarding the meetings/trainings conducted by EIB officials and facilitated the following activities: a) Meeting with PIU staff During the meeting European Investment Bank representatives and PIU approached practical aspects of good conduct of further continuation of the program, the effective implementation of the first component of the financial instrument Credit Line, and the promotion of the following financial instrument Leasing. Another aspect discussed was the distribution of the loan to the Educational Institutions designed for Laboratories, Training and Development of Food Security and the next stages to be performed after the approval of the Educational investment projects by the Working Group set up by the Ministry of Agriculture. b) Training with PFI s European Investment Bank representatives organized training to the Private Financial Institutions. The guests of this training were representatives of credit departments of both Commercial Banks participating in the Program as well as representatives of Credit Line Directorate. In the training session were addressed topics such as capitalisation and efficient use of resources received from the European Investment Bank, eligibility of the sub-projects, procurement and environmental case studies. c) Video shooting PIU has organized a video shooting interview with Mr. Luca Ponzellini that has provided information regarding the initial negotiations of the project. The shooting took place at the Ministry of Agriculture and Food Industry and at the Filiere du Vin stand. The purpose of this activity was to collect video material for Filiere Du Vin success story video spot. 1. Program PR actions In the third quarter of 2013, Program information was disseminated through different channels. In this period, it was continued to air the Russian version of the radio spot in the UTA Gagauzia region due to a big number of wine and grape producers in the region. PIU has aired the Russian radio spot at 27

28 the radio chain Albena 4 times per day for a period of 3 months starting with 20 of May 2013 till 20 of July. Radio chain Albena is broadcasted in the biggest towns from the region: Comrat and Taraclia. In the third quarter of 2013, PIU has prepared a distribution campaign of the program informative leaflets through the five Commercial banks that are participating to the program. PIU has collaborated with all the banks, including Moldova-Agroindbank, Social Bank, Energbank, Moldindconbank, Mobiasbank. PIU offered PFI s 1300 leaflets to be distributed through PFI s offices, including 63 territorial branches and 5 headquarters. In order to increase Program visibility, PIU collaborated with Grapes Producers and Exporters Association (GPEA). PIU placed promotion information on the Program in the Guide Protection Systems for the Viticulture elaborated by the GPEA. The Guide has a print run of 1000 pieces and is distributed by the GPEA to all the grape producers. On 8 th of September, PIU participated at Grapes Festival held in Cimislia town, Festival organized for the first time by the Ministry of Agriculture and Food Industry in association with Grapes Producers Association. At the Festival was organized a Forum gathering grape producers and exporters, event where PIU disseminated a number of 200 informative leaflets. During the mentioned period PIU created the page Filiere du Vin on the social network Facebook ( As well as, continued to constantly update and improve the website content with events and news in order to maintain transparency and a good visibility of Program s activity. In the reported quarter PIU finalized the elaboration of the Program video spot. In this sense, PIU hired a professional video company to elaborate a short video spot (40 sec) intended to be diffused at local television channels. Besides this, the company was contracted to elaborate a 10 min documentary video spot, which will include success stories and interviews with Final Beneficiaries, Minister of Agriculture and Food Industry and EIB representative. In September both video spots were finalised and presented to the PIU. In the same period another company was contracted to multiply both versions of the cd s Romanian and English. Also in September, PIU started preparations for the National Wine Day of Moldova which is held traditionally in the first weekend of October, gathering wine producers, wine professionals and wine lovers. In this context, PIU has collaborated with the company that organizes the Festival, contracted a company to rent a stand and other accessories related to the stand design. Additionally, PIU has

29 started to prepare the design for the promotional materials (leaflets, bags, cd-s in Romanian and English, wine glasses) in order to disseminate them at the festival. 2. Procurement activities During the 3 rd quarter of 2013 the PIU procurement operations for Program Management were oriented towards organizing procurements related to PIU; monitor implementation of PIU signed contracts with suppliers/consultants. PIU has organized a series of procurements/tenders and signed the following contracts/amendments to existing contracts*: Table 18. Program Management procurement activity for the 3rd quarter 2013 Activity start date Procurement method & subject of the contract Contracted company Contract implementation status Contract value (~ converted in Euro) 20 September, 2013 Contract amendment signed for procurement of additional services: synchronized translation into English of the Program video spot (Amendment no.1 to Contract no. # C6D from 12 June, 2013). Private entrepreneur Mr. Iurie Virlan Will be implemented by 31 January, Eur (value of the amendment) 15 July, 2013 Direct contracting for Program ICT system maintenance services (Contract no. #3 Comp.6C2013B from July 15, 2013). "NOI TI and Service" SRL Will be implemented by 31 January, Eur 01 September, 2013 Contract amendment signed for increasing contract budgeted price for 2013 for procurement of cell phone communication services for Program (Amendment no. 05 to Contract Nr.82 from 02 August, 2011). Moldcell SA Will be implemented by 31 January, Eur (value of the amendment) * Very small procurements (up to ~600 Euro) that did not require any contract signature were not reflected in this report. 29

30 During the reported period PIU had several staff hiring activities: 1.) Contract extension amendment (after returning from maternity leave) was signed with Program M&E Expert. 2.) Contract extension amendment was signed with existing Program Legal Expert. 3.) Contract amendment for adjusting the fee for translation/proofreading with D. Boroda, previously contracted Program translator. As a result, PIU hires 11 full-time workers and 4 part-time workers as indicated in the organizational chart. In total, during the reported period (Q III: July 01 September 30, 2013) the PIU spent 106,874,08 Eur for goods, services, and consulting services (including salaries of PIU staff). This amount came mainly as contribution of RM Government. 3. Reporting and Budgeting During the reported period PIU prepared and submitted the Financial Reports due to deadlines and formats established by the national legislation to State Local Authorities (MoF, Fiscal Authority, social insurance authority, etc.). The program total expenditures for Program Management are emphasised below: Table 19. Total Program Management expenditures for I-III quarters 2013, EUR PIU Management GRM Grant Total 1 st quarter expenditures nd quarter expenditures rd quarter expenditures Cumulative amount of OPEX as of

31 Annex 1. Total Program Expenditures cumulative data, EUR Current quarter Cumulative to date from the beginning of 2013 Program component/activity EIB SOURCES: Planned Actual Variance Planned Actual Variance ( ) ( ) CREDIT LINE Component 1: Winemaking enterprises development Component 2: Viticulture enterprises development Component 3: Associated industries enterprises development TOTAL FOR CREDIT LINE LEASING Component 1: Winemaking enterprises development Component 2: Viticulture enterprises development Component 3: Associated industries enterprises development TOTAL FOR LEASING ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) LABORATORIES, TRAINING, EDUCATION AND DEVELOPMENT OF FOOD SECURITY Component 1: Education and Research Institutions Component 2: National Laboratory Network Development TOTAL FOR LTEDFS GOVERNMENT OF MOLDOVA SOURCES: Operational costs of PIU from GRM * (according to Working plan approved by BoD) ( ) ( ) (79 449) (81 903) TOTAL GRM (79 449) (81 903) Total Program Expenditures ( ) ( ) 31

32 Annex 2. Sub-sector distribution of EIB Allocations cumulative data, Eur Sub-sector maximum amount Winemaking % max 50 Allocations data I tranche II tranche III tranche IV tranche V tranche allocated under I Allocation letter received from EIB allocated under II Allocation letter received from EIB allocated under III Allocation letter received from EIB allocated under IV Allocation letter received from EIB allocated under V Allocation letter received from EIB Vineyards max Support industries max Loan guarantees, mezzanine and equity activities max Laboratories, training, education and development of food security min Total

33 Annex 2. Sub-sector distribution of EIB Allocations cumulative data, Eur (continuation) Sub-sector maximum amount Total approved/allocated under Allocation letter Total Received from EIB on PIU bank account Total tranferred by PIU to FB through PFI Difference from allocated and transferred by EIB Balance by sub-sector Winemaking 37,500, Vineyards 26,250, Support industries 15,000, Loan guarantees, mezzanine and equity activities 15,000, Laboratorie, training, education and development of food security 3,750, Total 75,000,

34 Annex 3. Pre-financing Monitoring Report on Mold-Nord JSC Filiere du Vin Upgrading Project, Credit Line Component Nr. PF Investment Project Eligibility Monitoring Report Beneficiary Name: Mold-Nord JSC Monitoring Place Visit: Fălești city (factory) Tomai village from Leova district (vineyards) Monitoring Visit Participants: Valeriu MORARU PIU Credit Specialist Radu COJOCARU PIU Driver/Courier Partners, Beneficiaries and other stakeholders met: Evgheni Șalari chief engineer Purpose of Visit: PIU has decided: To inspect the FB declared own contribution which represent the vineyards from Tomai village and to inspect the actual condition of the factory from Falesti, especially production buildings that will be renovated from EIB funds; To collect pictures from all above mentioned.

35 Part 1. Beneficiary Presentation Project short Description: Investment in winemaking process, including: (i) Modernization of winemaking equipment in the amount of 1,059,507 Eur, out of which 317,797 Eur is foreseen to be financed from EIB sources; (ii) Renovation of production buildings, includes renovation of the area for processing, bottling and fermentation in the amount of 1,800,374 Eur, out of which 1,682,203 Eur is foreseen to be financed from EIB sources; Investments in vine growing process, including: Project Amount, including : (i) Planting of vineyards needs funds in amount of 1,136,129 Eur which will be covered from future cash contribution of Mold-Nord JSC; (ii) Equipment for mechanization process needs funds in amount of 100,000 Eur which represents FB own future contribution. Total Amount: 4,096,010 EUR EIB Fund: 2,000,000 EUR Own Contribution: 2,096,010 EUR Part 2. Monitoring Beneficiary Contribution Moldnord JSC has several plantations of vineyards situated in Tomai village and were visited on the 10th of September: Description Picture The FB has a plantation of 81,05 ha with which SA Mold-Nord contributes to the sub-project 35

36 60 ha of vineyards planted in June 2013 (is not included in the Business plan) Land where vineyard will be planted in October 2013 from FB own future contribution Part 3. Monitoring the location/destination of Goods to be purchased from EIB funds The below presented buildings are situated in Falesti city and were visited on the 5 th of September. Description Picture Production buildings - The following buildings will be demolished and in their place will be constructed/ reconstructed new production and storage buildings

37 Part 4. Conclusion and future actions The own contribution of FB was confirmed. The sub-project for which the FB requests funds from EIB is very interesting and after its implementation, Moldova will have one more winery which will produce high quality wines. In order to confirm vineyards origin, PIU solicited from FB the vineyards cadastral number and land cadastral number. 37