ANNUAL PROGRESS REPORT, 2016

Transcription

1 MINISTERUL AGRICULTURII ŞI INDUSTRIEI ALIMENTARE AL REPUBLICII MOLDOVA UNITATEA CONSOLIDATĂ PENTRU IMPLEMENTAREA ŞI MONITORIZAREA PROGRAMULUI DE RESTRUCTURARE A SECTORULUI VITIVINICOL WINE SECTOR RESTRUCTURING PROGRAM FILIERE DU VIN ANNUAL PROGRESS REPORT, 2016 Date of submission to EIB: January 2017 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.

2 INTRODUCTION... 4 PROGRAM PERFORMANCE EVOLUTION: FINANCIAL AND PHYSICAL PROGRESS... 5 I. FINANCIAL PROGRESS SUMMARY... 9 II. PHYSICAL PROGRESS SUMMARY A. CREDIT LINE INSTRUMENT B. LEASING INSTRUMENT Consulting and Monitoring of Beneficiaries within financial instruments C. EDUCATIONAL COMPONENT Procurement & Monitoring Activities under the Educational Component: D. PROGRAM MANAGEMENT III. ANNEXES Annex 1. Sub-sector distribution of EIB Loan cumulative data Annex 2. Cumulative Program performance indicators Annex 3. Cumulative sub-sector distribution of EIB Allocations breakdown by Beneficiaries51 Annex 4. Sub-sector distribution of EIB Allocations by Beneficiaries in Annex 5. Value of EIB allocation subjected to tax incentives per FB, cumulative data Annex 6. Monitoring activities in 2016 year

3 Abbreviations ACSA CLD NCVWC EIB EUR FB GRM LPAs LLC LTEDFS M&E MIS MoAFI MoF MDL OM PB PDO PED PFI PGI PSIHFT PIU USAID TUM WSRP National Agency for Rural Development Credit Line Directorate National College of Viticulture and Winemaking from Chisinau 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 Practical Scientific Institute of Horticulture and Food Technology Program Implementation Unit United States Agency for International Development Technical University of Republic of Moldova Wine Sector Restructuring Program 3

4 INTRODUCTION This Report has been developed 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 first semester of year 2016 and the cumulative progress from the launching of the Program in January The Wine Sector Restructuring Program (WSRP) Filiere du Vin became effective in January 2012 and is scheduled to be completed in March 2019, with the last disbursement in December EIB allocated EUR 75 million for the implementation of activities initially envisaged to be implemented under the Program during 4 years with further extension for 3 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) acts through 5 Program components, including the Program management: 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. Support 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 are financed through 2 financial instruments, which are the Credit line and Leasing, Loan guarantees being under discussion stage yet and Capital investments being practically postponed from the Program. 4

5 PROGRAM PERFORMANCE EVOLUTION: FINANCIAL AND PHYSICAL PROGRESS In 2016, the 6 th year of implementation, the Program continued through its activities to contribute to the recovery of the wine sector, mainly to upgrading the equipment and facilities of the winemaking enterprises and the equipment and facilities of support industries enterprises, to restructure and revitalize the vineyards and to mechanize the viticulture processes. Under the Program were made several significant steps towards improving the laboratory equipment of the affiliated educational institutions having as a result a more qualified specialized working force. From the Program start and till the end of 2016 was allocated 42,680,758 Euro or 56,91% from the total amount of EIB loan amount of 75 million Euros, from which was disbursed by EIB 39,084,221 Euro or 91,57 % from the total allocated amount by EIB. During within the Program were approved the investment sub-projects in total amount of 90,497,191 Euro, from which 42,680,758 euro from EIB loan and 47,816,432 euro from Final Beneficiaries own contributions, this amount including sub-projects in the Moldovan winemaking and viticulture sectors, support industry, as well as in the education and research institutions. Table 1. EIB disbursed amount vs. allocated amount per sub-sector, cumulative data (euro) Description of subproject No of FB No of alloc ated SP Total amount of sub-project, EUR Value of FB co financing, EUR Value of EIB allocations, EUR % of allocati ons by sector The outstanding amount remains to be allocated by EIB, euro Value of EIB disbursed amount, EUR Disbursed amount by PIU to PFI, euro Winemaking ,785,259 29,190,171 30,595, % 6,904,912 26,360,271 25,148,771 Vineyards ,652,360 9,577,780 4,074, % 22,175,420 3,711,934 3,711,934 Support industries 7 7 8,930,691 4,859,870 4,070, % 10,929,179 4,070,821 4,070,821 LTEDFS 6 8 8,128,880 4,188,611 3,940, % 0 4,941,195 3,277,924 Total ,497,191 47,816,432 42,680, % 32,319,242 39,084,221 36,209,449 The outstanding amount 32,319, Euro from the total Loan remains to be allocated in the remaining 1 year of extended period , requested by the GoM and approved by EIB for the good implementation of the Program. (Annex 1. Sub-sector distribution of EIB Loan cumulative data, ). Thus all stakeholders of the Program agree that it is important to work hardly all together in order to give access to larger number of potential beneficiaries from the sector to the financial sources offered by the EIB to the GoM. 5

6 Table 2. EIB disbursed amount vs. allocated amount per sub-sector, cumulative data (euro) Sub-sector distribution Maximum amount to be allocate Value of EIB allocations Received amount from EIB Disbursed amount by PIU to PFI The outstanding amount remains to be allocated by EIB, euro winemaking 37,500, ,595,088 26,360,271 25,148,771 6,904,912 vineyards 26,250, ,074,580 3,711,934 3,711,934 22,175,420 support industry 15,000, ,070,821 4,070,821 4,070,821 10,929,179 LTEDFS 3,750, ,940,270 4,941,195 3,277,924 0 Total 75,000, ,680,758 39,084,221 36,209,449 32,319,242 During from the amount of 42,680,758 Euro allocated by the EIB based on Allocation letters issued, the PIU received from EIB loan the amount of 39,084,221 Euro, from which the amount of 36,209,449 Euro was disbursed by the PIU to FBs. The indicated amount of 39,084,221 Euro was received by PIU from the EIB loan in 12 tranches and has been disbursed to Final Beneficiaries from different sub-sectors as follows: for winemaking the amount of 26,360,271 Euro, for vineyards sub-sector the amount of 3,711,934 Euro, for support industry the amount of 4,070,821 Euro and for LTEDFS the amount of 4,941,195 Euro. Cumulative amount disbursed by EIB per each tranche is presented in the table below: Table 3. Sub-projects amount by tranches, cumulative , Euro Period No of tranches Value of EIB allocations Received amount from EIB Disbursed amount by PIU to PFI I 4,872,347 2,930,000 2,858, II 2,517,395 3,934,582 4,005, III 6,286,791 2,929,970 2,929, IV 2,162,270 3,663,935 3,663, V 4,944,462 2,254,481 2,254, VI 3,929,054 2,689,391 2,097, VII 2,966,853 4,882, ,743, VIII 8,004,767 5,729, ,046, IX 2,714,957 2,244,957 1,152, X 2,819,600 2,819,600 2,219, Remaining balance of PIU Euro bank account Diff. between EIB allocated and received amount 6

7 2015 XI 2,585,000 2,673,581 2,050, rejected -1,000, XII 3,130,926 2,331,766 2,936, rejected -3,502, XIII 250, , Total 42,680,758 39,084,221 36,209,449 2,874, ,596,537 During reporting period of within the Program was approved the investment subprojects in total amount of 90,497,190 Euro, from which 42,680,758 euro are requested from EIB loan and 47,816,431 euro are covered from Final Beneficiaries own contributions, as is presented in the table below: Table 4. EIB disbursed amount vs. allocated amount per each year, (euro) year total No of FB No of allocated subproject Total amount of sub-project, EUR Value of EIB allocations, EUR Value of FB co financing, EUR Value of EIB disbursed amount, EUR % of allocations by year (1,174,516) (121,812) (1,052,705) 2,331, % ,434,138 7,118,631 8,315,507 7,738, % ,230,308 10,971,620 13,258,686 10,611, % ,720,279 11,035,785 11,684,494 8,607, % ,286,982 13,676,533 15,610,449 9,794, % ,497,190 42,680,758 47,816,431 39,084, % During the reporting period of 2016 within the Program was approved the investment sub-projects under Credit line in the total amount of 7,311,864 Euro, from which 3,380,926 euro from EIB loan and 3,930,937 from Final Beneficiary own contribution, and one sub-project under Laboratories, training, education and development of food security Component in amount of 8,486, euro was rejected by EIB, as is presented in the table below: Table 5. EIB disbursed amount vs. allocated amount per sub-sector in 2016 (euro) Sub-sector Component 1: Winemaking enterprises development of which purchase of grape No of FB No of allocated subprojects Total amount of sub-project Value of EIB allocations Value of FB co financing EIB loan disbursed in ,182,241 3,345,066 3,837,175 2,310, ,876,427 2,322,269 2,554,158 1,611, PIU loan disbursed in ,216, ,500,

8 Component 2: Viticulture enterprises ,623 35,860 93,762 21, , development Component 3: Associated industries enterprises development Sub-total 7,311,864 3,380,926 3,930,937 2,331,766 2,270,291 Component 4: LTEDFS TOTAL (8,486,380) (3,502,738) (4,983,642) - 916, (1,174,516) (121,812) (1,052,705) 2,331,766 3,186,833 8

9 I. FINANCIAL PROGRESS SUMMARY The total amount of expenditures related to all activities implemented by PIU under the Program during the reporting period of 2016 represents thousands Euro. The planned amount of total Program expenditures for the reporting period of 2016 was 7,391 thousand Euros. Thus, the total amount of Program actual expenditures compared to the planned amount has a negative balance as emphasized in the table below: Table 6. Total Program Expenditures in 2016 (plan vs. actual year) as of 31 December 2016, euro 2016 EIB allocations GRM Total Plan ('000 Euro) 7, ,391 Credit line 6,413-6,413 LTEDFS Leasing operations Program Management Actual ('000 Euro) (122) Credit line 2, ,783 LTEDFS (3,503) - (3,502.74) Leasing operations Program Management Actual/Plan ('000 Euro) (7,128) (10) (7,138) Credit line (3,630) - (3,630) LTEDFS (3,721) - (3,721) Leasing operations Program Management - (10) (10) This situation resulted from the synergy of several factors that had a negative impact on the wine sector in general and on Program FB in particular. From the negative factors can be mentioned the following: (i) (ii) (iii) The Russian embargo. Limited number of Commercial banks that participate in the Program. Instead of the initially accepted 6 PFI s, at the moment only 4 remains as Partners of the Program and were not so active during Limited access to loans of SMEs from the sector, due to the high level of the minimum amount established by the EIB within the Program, which is eligible within the Program (min 25, euro). 9

10 The total amount of cumulative expenditures during related to all activities implemented under the Program represents 92,428,002 Euro, including: 42,680, EUR amount approved for financing from the EIB loan (EIB Allocations). 47,816, EUR represents beneficiaries co-financing amount. as co-financing of Program management costs were expended 1,883, EUR from Government of the Republic of Moldova, as indicated in the table below: Table 7. Total Program Expenditures cumulative for (as of ), 000 Euro Program Component Component 1: Winemaking enterprises development Component 2: Viticulture enterprises development Component 3: Support industries development EIB allocations Beneficiaries co-financing GRM Italian Grant Total Weight, % 30,595, ,190, ,785, % 4,074, ,577, ,652, % 4,070, ,859, ,930, % Component 4: LTEDFS 3,940, ,188, ,128, % Program Management ,883, , ,930, % Total 42,680, ,816, ,883, , ,428, % During the reported period (year 2016) the total amount of Program expenditures related to all activities implemented under the Program represents 7,687, Euro, including: 3,380, EUR amount approved for financing from the EIB loan (EIB Allocations), 3,930, represents beneficiaries co-financing amount, as co-financing of Program management costs were expended 375, EUR from Government of the Republic of Moldova state budget. and 0.00 EUR from Italian Grant, as indicated in the table below: 10

11 Table 8. Total Program Expenditures during the first semester 2016 (as of ), 000 Euro Program Component EIB allocations Beneficiaries GRM Italian Total co-financing Grant Component 1: Winemaking enterprises 3,345, ,837, ,182, development Component 2: Viticulture enterprises development 35, , , Component 3: Support industries development Component 4: LTEDFS (3,502,738.00) (4,983,642.00) (8,486,380.00) Program Management , , Total (121,811.67) (1,052,704.78) 375, (799,161.45) The largest share of cumulative amount of EIB allocations approved in the reporting period of 2016 goes for Winemaking sector in the amount of 7,182, Euro, followed by Viticulture sector with approx. 129, Euro and for Laboratories, training education and development of food safety, for which EIB has rejected an Allocation in amount of 3,502,740.0 Euro, the total amount of the sub-project being of 8,486, euro, as is presented in the table above. 11

12 II. PHYSICAL PROGRESS SUMMARY The below presented data reflects the output indicators per financial components achieved during the reported Program implementation period of 2016 (for detailed information on indicators evolution per each year please see Annex 2. Cumulative Program performance indicators): During the reporting period of 2016 PIU has conducted several actions in order to promote the Credit Line and Leasing operations in order to help Potential Beneficiaries to access EIB sources more easily, as follows: Informed by electronic mail potential beneficiaries, including wineries and vine growing companies, professional associations and companies of related industries, informing all of them about the opportunity to access EIB funds within the Filiere du Vin Upgrading Program and general eligibility criteria for investments planned by potential beneficiaries. Organized direct meetings with potential beneficiaries on EIB requirements and procedures, procurement rules and other issues in order to access the Credit Line sources; Registered 48 Participation forms from Potential Beneficiaries. Table 9. Performances Indicators during the 12 months of 2016: PHYSICAL PROGRESS INDICATORS 2016 Number of consulted beneficiaries through: organised seminars in geographical Wine Region association Valul Traian, Codru, Bălți, ACSA company Informed potential beneficiaries by post Posta Moldovei and by e- mail Organised direct meetings with potential beneficiaries Q1 Q2 Q3 Q4 Total Number of applications registered Number of business plan developed Number of PIU Eligibility Notice issued within Credit Line -Working Capital within Education component within Credit Line component within Leasing component Business plan under development at , from which within Credit Line component within Credit Line -Working Capital within Leasing component

13 within Education component Number of Final Beneficiaries Total value of sub-projects under development, mln. EUR 73,800 2,693, ,475 3,554,889 7,311,864 Value of EIB allocations, mln. EUR 25, ,239, , ,661, ,380,926 w Value of FB co financing, mln. EUR 48, ,453, , ,893, ,930,937 Table 10. Summary of EIB financing per Program components as of (cumulative data for period ), Euro ( Annex 3. Summary Sub-sector distribution of EIB Allocations breakdown by amount and Beneficiaries). year Program Component No of allocated subprojects Total amount of subprojects, EUR Value of EIB allocations, euro Value of FB co financing, EUR Value of EIB loan disbursed, EUR Value of loan disbursed by PIU, EUR 2016 Credit Line 10 5,877,354 2,782,601 3,094,753 1,912,088 1,850,613 Leasing operations 5 1,434, , , , ,678 LTEDFS - -8,486,380-3,502,738-4,983, , Credit Line 17 13,230,539 6,024,600 7,205,939 5,643,181 4,543,181 LTEDFS 4 2,203,599 1,094,031 1,109,568 2,094, , Credit Line 9 16,209,650 7,776,396 8,433,254 8,358,066 8,358,066 LTEDFS 2 8,020,660 3,195,224 4,825,436 2,253,891 1,431, Credit Line 10 16,329,277 7,882,033 8,447,245 8,015,460 8,015,460 LTEDFS 2 6,391,002 3,153,753 3,237, , Credit Line 9 29,286,982 13,676,533 15,610,449 9,794,552 9,794,553 TOTAL 68 90,497,193 42,680,758 47,816,435 39,084,221 36,209,449 Credit Line 55 80,933,802 38,142,163 42,791,639 33,723, ,561,873 Leasing operations 5 1,434, , , , ,678 LTEDFS 8 8,128,881 3,940,270 4,188,611 4,941, ,227,898 Table 11. Cumulative EIB Allocations by sub-sector (as of ), Euro Description of sub-project Total amount of sub-project Value of EIB allocations Value of EIB disbursed amount Value of FB co financing I Winemaking 59,785,258 30,595,088 26,360,271 29,190,171 1 Winemaking equipment 26,378,777 15,055,644 13,917,359 11,323,134 2 Constructing/renovating production buildings 3 Tracks for bottled wine transportation 11,331,863 4,926,336 2,610,519 6,405,526 23, ,600 4 Working capital for 5,681,908 3,136,239 3,101,294 2,545,669 production process 5 Intangible assets 49, ,353 6 Grapes acquisition 16,319,758 7,476,869 6,731,100 8,842,889 13

14 II Vineyards 13,652,360 4,074,580 3,711,934 9,577,780 1 Viticulture machinery 2,336, , ,515 1,816,310 2 Vineyards establishment 11,360,104 3,598,633 3,145,540 7,761,471 3 Irrigation system 125, , ,878-4 cancellations 2014 (169,709) (169,709) - - III Support industries 8,930,693 4,070,821 4,070,821 4,859,870 1 Equipment 7,134,241 3,576,158 3,576,158 3,558,083 2 Constructing/renovating production buildings 1,646, , ,663 1,301,787 3 Working capital for 150, , ,000 - production process Total for Credit Line 82,368,311 38,740,488 34,143,026 43,627,822 IV Laboratories, training, education and development of food security Equipment for Laboratories of Education Institutions 8,128,881 3,940,270 4,941,195 4,188,611 20,192,942 9,221,770 4,941,195 10,971,172 cancellation in (12,064,061) (5,281,500) - (6,782,561) Total investment projects amount, EUR 90,497, ,680, ,084, ,816, Table 12. EIB Allocations in the reporting period of 2016 by financial instruments (as of ), Euro Description of sub-project Total amount of sub-project, EUR Value of EIB allocations, EUR Value of EIB disbursed amount, EUR Value of FB co financing, EUR Value of PIU disbursed amount, EUR Credit Line 5,757,592 2,746,740 1,891,060 3,010,852 1,850,613 Winemaking 4,876,427 2,322,269 1,611,500 2,554,158 1,797,279 of which purchase of grape 119,762 35,860 21,027 83,901 1,500,000 Vineyards ,333 Support industries Sub-total 5,877,354 2,782,601 1,912,088 3,094,753 1,850,613 Leasing operations 419,678 Winemaking 1,424, , , , ,678 Vineyards 9, ,861 - Support industries Sub-total 1,434, , , , ,678 LTEDFS 916, Total 7,311,864 3,380,926 2,331,766 3,930,937 3,186,833.2

15 A. Credit Line Instrument During the reporting period of 2016, under this instrument were approved for financing sub-projects in the total amount of 7,311,864 euro, from which 3,380,926 euro is the total amount of EIB allocations and 3,930,937 euro is the total amount of FB co-financing. Sub-sector Table 13. Disbursed amount by PIU within Credit Line during 2016, Euro No of FB No of allocat ed subproject Total amount of subproject, EUR Value of EIB allocations, EUR Value of FB co financing, EUR EIB loan disbursed in 2016, EUR PIU loan disbursed in 2016, EUR Component 1: Winemaking enterprises development ,182,241 3,345,066 3,837,175 2,310, ,216, of which purchase of grape 6 6 4,876,427 2,322,269 2,554,158 1,611, ,500, Component 2: Viticulture enterprises development ,623 35,860 93,762 21, , Component 3: Associated industries enterprises development Sub-total 7,311,864 3,380,926 3,930,937 2,331,766 2,270,291 Component 4: LTEDFS (8,486,380) (3,502,738) (4,983,642) - 916, TOTAL (1,174,516) (121,812) (1,052,705) 2,331,766 3,186,833 From the amount of 7,311,864 Euro, in winemaking sub-sector was invested 7,182,241 Euro and 129,623 Euro in viticulture sub-sector. No investments in support industry were accomplished during the reported period. Table 14. EIB Allocations by sub-sectors during 2016 within Credit Line component, Euro Description of subproject Total amount of sub-project, EUR Value of EIB allocations, EUR Value of EIB disbursed amount, EUR Value of FB co financing, EUR from which (EUR): in-kind contribution cash contribution Value of PIU disbursed amount, EUR Credit Line ,850,613 Winemaking 5,757,592 2,746,740 1,891,060 3,010, ,694 2,554,158 1,797,279 of which purchase of grape 4,876,427 2,322,269 1,611,500 2,554,158-2,554,158 1,500,000 Vineyards 119,762 35,860 21,027 83,901 83,901-53,333 Support industries Sub-total 5,877,354 2,782,601 1,912,088 3,094, ,595 2,554,158 1,850,613 Leasing operations 419,678 Winemaking 1,424, , , , , , ,678 Vineyards 9, ,861-9,861 - Support industries Sub-total 1,434, , , , , , ,678 LTEDFS 916,542 Total 7,311,864 3,380,926 2,331,766 3,930,937 1,182,627 2,748,310 3,186,

16 During the reported period under the Credit Line instrument were approved sub-projects in total amount of 5,877,354 Euro, from which 4,876, Euro of which for purchase of grapes, 119,762 euro for financing of vineyards plantations and for vineyard establishment. ( Annex 4. Summary Sub-sector distribution of EIB Allocations breakdown by amount and Beneficiaries). Table 15. Disbursed amount by PIU within Credit Line Component by FB during 2016, Euro FB PFI Sub-sector viticulture zone Total project cost in EUR Allocation amount in EUR FB own contribution, Eur Disbursed by PIU in 2016, Eur Credit lineinvestment loan 1 Divib Media LLC -II project Energbank winemaking Codru 114,967 54,200 60,767 54,200 Colina Viilor LLC Energbank viticulture Valul Traian 2 CGL-Prim LLC Energbank winemaking Valul Traian 73,887 25,000 48,887 25,025 17,473 3 Poiana Codrilor LLC Comertbank winemaking Codru 669, , , ,000 4 Unicorn Estate LLC Mobiasbanca winemaking Codru 142,655 49,915 92,740 49,915 Sub total 1,000, , , , Component: Leasing operations 1 Asconi LLC Raiffeisen Leasing LLC 2 Vinaria Hincesti LLC 3 Vinuri de Comrat LLC 4 Basarabia Lwin Invest LLC Raiffeisen Leasing LLC Mobiasbanca Group Societe Generale Raiffeisen Leasing LLC winemaking Codru 453, , ,467 0 winemaking Codru 653, , , ,512 winemaking Valul Traian 150,912 70,865 80,047 70,865 winemaking Stefan Voda 59, ,001 34,661 25,001 5 JC Euro Alco LLC Raiffeisen Leasing LLC winemaking Codru 117, ,300 69,441 48,300 Sub total 1,434, , , , Credit linefinancing of grape acquisition Vinaria Milestii Mici LLC MoF winemaking Codru 416, , , Univers Vin LLC MoF winemaking Codru 905, , , , Vinaria Purcari LLC MoF winemaking Ștefan Vodă Vonaria Bostovan Vinaria din Vale MoF winemaking 600, Valul Traian 1,200, , , , MoF winemaking Valul Traian 1,200, , , ,

17 Fabrica de vin MoF winemaking Slobozia Mare Valul Traian 423, , , , Basarabia Lwin MoF winemaking Stefan Invest Voda 731, , , Sub total 4,876, ,322, ,554, ,611,500.0 TOTAL 7,311, ,380, ,930, ,331,766.2 Laboratories, training, education and development of food security 1 Vocational School from Leova 2 Vocational School from Nisporeni MoF Education x MoF Education x 3 National Quality Verification Center of Alcohol Production (CNVCPA) MoF Education x 4 TUM MoF Education x Sub total x x x 593, , , , ,500, , , , , , , , ,115, , , , ,205, ,094, ,110, , TOTAL x x x 7,311, ,380, ,930, ,331, The detailed data regarding the EIB allocations by viticulture zones and sub-sectors of the Program are reflected in the table below: Table 16. Cumulative EIB allocations breakdown by viticulture zone during within Credit Line component, Euro viticulture zone Value of EIB allocations, EUR during weight, % , Eur viticulture zone Codru 15,643, % Winemaking 14,460,825.9 Vineyards 1,182,973.0 viticulture zone Stefan Voda 4,775, % Winemaking 4,760,661.1 Vineyards 14,500.0 viticulture zone Valul Traian 14,250, % Winemaking 11,733,394.9 Vineyards 2,517,312.6 Total 34,669,667.5 support 4,070, % labs 8,443, % reject labs -4,503, % Total 42,680, % 17

18 As to refer to the distribution of funds allocated by EIB under the Program by viticulture zone presented in the above table, during the largest share of the investments were done by FB from viticulture zone Codru and Valul lui Traian, approx % and 33.39% respectively. As for the viticulture zone Stefan Voda here were invested only 4,7 mln euro or 11,19% and again with the largest part in winemaking equipment modernization. From the table below we can see that during 2016 the major amount of funds in vineyard establishment and mechanization of viticulture processes were allocated in viticulture zone Codru with 47.28%. Table 17. EIB allocations breakdown by viticulture zone in 2016 within Credit Line component, Euro viticulture zone Value of EIB allocations in 2016 weight, % viticulture zone Codru 1,598, % Winemaking 1,566,254.0 Vineyards 32,306.0 viticulture zone Stefan Voda 275, % Winemaking 275,001.1 Vineyards 0.0 viticulture zone Valul Traian 1,507, % Winemaking 1,503,810.7 Vineyards 3,554.5 Total 3,380, % During PIU collaborated with 6 Intermediary banks: 1. Moldindconbank, 2. Moldova-Agroindbank, 3. Energbank, 4. Banca Sociala, 5. Mobias Banca and 6. Procredit bank. Unfortunately by the end of 2014 from the number of 6 PFIs the collaboration with 3 of them was postponed for time being (EIB informed about not considering of Moldova-Agroindbank as eligible PFI for the Program anymore, as well as Moldinconbank, but with the chance of changing this status in future. At the same time CLD postponed collaboration with Banca Sociala because of non-compliance with CLD eligibility criteria. Thus at the moment the financial intermediaries eligible within the Program are 4 commercial banks: 1. Energbank, 2. Comertbank, 3. Mobias Banca GSG and 4. Procredit bank. 18

19 Table 18 Cumulative EIB allocations breakdown by PFI and MoF during , Euro PFI Ministry of Finance MoldovaAgroindbank Moldindconbank Banca Sociala Procredit bank Mobias Banca Energbank Total amount of sub-projects, EUR Value of EIB allocations, EUR number of subprojects allocated from number weight, % from amount 16,319,758 7,476, % 18% 26,267,249 12,778, % 30% 17,675,924 8,541, % 20% 15,157,563 6,817, % 16% 546, , % 1% 694, , % 1% 3,754,028 1,696, % 4% Comertbank 669, , % 1% Raiffeisen Leasing SRL Education component Total amount 1,283, , % 1% 8,128,881 3,940, % 9% 90,497,193 42,680, % 100% Table 19 Cumulative EIB allocations breakdown by PFI and MoF during 2016, Euro PFI Total amount of subprojects, EUR Value of EIB allocations, EUR number of subprojects financed weight, % from number from amount Ministry of Finance 4,876,427 2,322, % 69% MoldovaAgroindbank % 0% Moldindconbank % 0% Banca Sociala % 0% Procredit bank % 0% Mobias Banca 293, , % 4% Energbank 188,854 79, % 2% Comertbank 669, , % 10% Education component -8,486,380-3,502, % 0% Raiffeisen Leasing SRL 1,283, , % 16% Total amount 7,311,864 3,380, % 100% 19

20 Thus, as it is indicated in the table below during 2016, 2 beneficiaries were financed through Energbank, 1 beneficiary through Comertbank, 6 received Allocation Letter from EIB in order to be financed through the Ministry of Finance, 2 beneficiaries received Allocation Letter from EIB in order to be financed through the Mobias Banca and 4 beneficiaries from Raiffeisen Leasing : The interest rate for the sub-loans denominated in Euro is floating, based on 6-month EURIBOR rate + 68 bps (before ) and 0.92 bps from by now and the MoF s and CLD s margins. The CLD interest rate for the Credit Line s resources for Euro for PFI s for the interest rates periods described below include MoF margin of 0.3 % for administrative and operating costs and margin for covering the exchange rate risk and the CLD margin of 0,3 %. Thus, the semiannual interest rates for the PFIs are the following: Table 20. Semi-annual interest rates per disbursed EIB tranches during As of USD EUR MDL Filiere du Vin Filiera Vinului Transa I , , , , , , , , ,062 Transa II , , , , , , ,087 Transa III , , , , , , , , ,063 Transa IV , , , , , , ,120 20

21 ,063 Transa V , , , , , , ,092 Transa VI , , , , , , ,063 Transa VII , , , , , ,069 Transa VIII , , ,316 For the transparency of the resource s costs, the information regarding the CLD interest rates for PFIs are posted periodically on the Ministry of Finance web page ( The average commercial interest rate applied by PFIs for financing Filiere du Vin Program s final beneficiaries in Euro besides of the Ministry of Finance margin and the Credit Line Directorate margin includes the banks commercial margin and it is determined for each FB separately, usually max 4% (the max level of margin recommended by the CLD to all PFI participating in intermediary operations of funds offered by the GoM from external credit lines). Table 21. Prospective allocations from EIB loan for 2017 estimated by PIU, EURO PFI Final beneficiary Sub-sector Total amount of investment project Mobiasbancă- GSG ProcreditBank Mobiasbancă- GSG Mobiasbancă- GSG Glass Container Company IS CVC Milestii Mici related industry Total amount of EIB loan FB contribution 17,000, ,000, ,000,000.0 winemaking 7,000, ,500,000 3,500,000 Bravo Wine winemaking 1,400, , ,000.0 Dolna Vin winemaking 1,600, , ,000.0 Total 27,000,000 10,000,000 17,000,000 21

22 During the 2016, PIU issued 19 Letters for tax exemptions, at request of 5 Final Beneficiaries. The total amount requested to tax exemptions constitutes 304, Euro. Cumulatively for the period PIU have issued 176 letters of tax exemptions for 18 FB in total amount of Euro (Annex 5. Sub-projects amounts requested to tax incentives); 22

23 Working capital financing within Credit Line Component: In consequence of the EIB approval of the allocation of EUR 10 million under Winemaking subsector of the FdV Program in order to support Moldovan winemakers purchase of grapes from local producers, during the in parallel with Credit line financing of investment sub-projects through PFIs, PIU was able to propose to Program potential beneficiaries (winemakers) a new kind of financial opportunity named Working capital financing of grape purchase (technical varieties) through the Ministry of Finance. In order to make the procedure as simple as it is possible, PIU have consulted all potential beneficiaries about 2 basic stages of the examination process: Work with PIU - PB has to submit to PIU only Grape purchase contracts signed with the local grapes producers (all made due to the standardized model elaborated by TA team and approved by EIB). Based on the Contracts submitted PIU, the PIU is issuing the Eligibility Notice, confirming that the contracts are made due to the model approved by EIB and 50 % of the cumulative amount of the contracts submitted is eligible for financing under the credit offered through the MoF. Further, PB has to prepare the set of documents requested by MoF under the provisions of the GoM Decision on specific rules for on-lending operations from GoM funds and to submit it to MoF in order to be considered from creditworthy point of view i.e.: Business plan, balance sheet, collateral issues). The terms applied by the MoF for this kind of financing are 5 years repayment period, including 2 years grace period and 3,73 % interest rate (floating interest rate). As the result of large dissemination of this financial opportunity for Moldovan winemakers made by PIU together with MoAFI and NOVV, PIU during the reported period have received 35 Application forms from the winemaking sector potential beneficiaries in the total amount of 10,4 mln Euro requested in order to finance winemakers stringent needs (purchase of grapes of technical varieties). Table 23. Information regarding Working Capital financing form EIB loan breakdown by final beneficiaries within X EIB loan tranche, euro Beneficiary name Migdal-P Naturvins Kazayak-Vin Vinăria Țiganca Grape Valley Vindicum Vinaria Purcari PIU Eligibility Notice 70 din din din din din din din EIB loan, MDL FB own contribution, MDL Total amount of subproject, MDL EIB loan, Euro EIB disbursed amount PIU transferred amount 2,750,800 3,463,200 6,214, , , ,600 5,279,000 5,279,000 10,558, , , ,000 12,688,080 17,844,420 30,532, , , ,000 6,303,420 6,374,780 12,678, , , ,000 12,836,100 12,836,100 25,672, , , ,000 7,952,125 7,952,125 15,904, , , ,000 12,915,120 19,784,880 32,700, , , ,000 Total 60,724,645 73,534, ,259,150 2,819,600 2,819,600 2,819,600 23

24 Table 24. Information regarding Working Capital financing form EIB loan breakdown by final beneficiaries within XI EIB loan tranche, euro Beneficiary name SRL Valea Cislic Vintage Avenue Voitis Distillery SRL Vinia Denovi SRL Magnolia- 94 SRL Fautor SRL Basarabia Lwin Invest PIU Eligibility Notice 64 din din din din din din din EIB loan, MDL FB own contribution, MDL Total amount of sub-project, MDL EIB loan, Euro EIB disbursed amount 12,921,660 24,814,233 37,735, , ,000 PIU transferred amount Rejected by MoF 1,715,000 1,715,000 3,430,000 85,000 50,000 50,000 13,800,000 13,800,000 27,600, , , ,000 13,070,820 14,511,385 27,582, , ,000 6,974,000 6,974,000 13,948, , , ,000 3,282,225 3,282,225 6,564, , , ,000 4,649,300 4,649,300 9,298, , , ,000 Total 56,413,005 69,746, ,159,148 2,335,000 2,300,000 1,800,000 Table 25. Information regarding Working Capital financing form EIB loan breakdown by final beneficiaries within XII EIB loan tranche, euro Beneficiary name Vinaria Milestii Mici Univers Vin Vinaria Bostovan Vinaria din Vale Fabrica de vin Slobozia Mare PIU Eligibility Notice 76 din din din din din EIB Allocation letter No 57 from No 56 from No 65 from No 66 from No 67 from EIB loan, Euro FB own contribution, Euro Total amount of sub-project, Euro EIB disbursed amount PIU transferred amount 208, , , , , , , , , , ,000 1,200, , , ,000 1,200, , , , , ,500 Total 2,072,269 2,072,269 4,144,538 1,611, ,000 Table 26. Information regarding Working Capital financing from EIB loan breakdown by final beneficiaries within XIII EIB loan tranche, euro Beneficiary name Basarabia Lwin Invest PIU Eligibility Notice No 103 from EIB Allocation letter No 68 from EIB loan, Euro FB own contribution, Euro Total amount of sub-project, Euro EIB disbursed amount PIU transferred amount 250, , , ,000 Total 250, , , ,000 24

25 Further of examination of grape purchase contracts presented by potential beneficiaries to PIU, during PIU Eligibility Notices were issued, from which only 6 beneficiary was approved by the MoF for further On-lending in the amount of Euro. During the implementation period , within this component was disbursed by EIB the total amount of 6,731,100 euro, from which PIU disbursed to final beneficiaries the amount of 5,519,600 euro. Table 27. Information regarding disbursement within Working Capital financing from EIB loan, euro Beneficiary name EIB disbursed amount, euro PIU transferred amount, euro Diff, euro 1 Migdal-P 119, , Naturvins 250, , Kazayak-Vin 600, , Vinăria Țiganca 300, , Grape Valley 600, , Vindicum SRL 350, , Vinaria Purcari SRL 600, , SRL Valea Cislic 500, Vintage Avenue 50,000 50, Voitis Distillery SRL 600, , Vinia Denovi SRL 600, , Magnolia-94 SRL 200, , Fautor SRL 150, , Basarabia Lwin Invest 200, , Vinaria Milestii Mici 200, , Univers Vin - 450, Vinaria Bostovan 600, Vinaria din Vale 600, Fabrica de vin Slobozia Mare 211, Basarabia Lwin Invest - 250, Total 6,731,100 5,519,600 (1,211,500) The remaining balance of Euro was supposed to be allocated during 2017, the process of attracting new beneficiaries and dissemination of the information about this instrument was well done by the PIU from the beginning of the year Unfortunately during 2016 period the MoF postponed the consideration of submitted for financing dossiers under this instrument and as the result no On-lending agreements between the beneficiaries and the MoF were signed. 25

26 financing Table 28. Information regarding remaining balance of the EIB loan within Working Capital Amount, Euro EIB loan amount 10,000, Disbursements as of ,731, Remaining balance as of ,268, It worth to mention that under request of EIB experts the GFA consulting Group team performed an assessment of efficiency of this innovative instrument for winemaking and viticulture sub-sector beneficiaries of the Program. Nevertheless that Final Beneficiaries expressed the need to improve the standardized grapes supply contract, generally, all suppliers mentioned that this tool helped them to have a stronger relationship with the winery and they hope to make it even stronger with each year of cooperation. At the same time, based on the discussions with the FB as well as based on the TA team opinion, PIU could conclude that in general, the winemakers feedback on the working capital facility was a very positive one. Some of them reported to have increased the quantity of grapes purchased and one told to have doubled the grapes acquisition, compared to Hoping to allocate the remaining balance of Euro under Working capital facility during 2017, before and during the harvest period, PIU will be happy to share with the positive results of this financial instrument implementation and seems it reasonable to propose to EIB the extension of this facility in order to give to the sector beneficiaries the advantageous financial opportunity. Table 29. Prospective allocations for grape purchase financing from EIB loan for 2017 estimated by PIU, EURO Final beneficiary Sub-sector Sub-project description Total amount of sub- project Total amount of EIB loan FB contribution Barza Neagra Mold-Nord winemaking working capital Fautor II financing / grape purchase financing Euro-Alco Total

27 B. Leasing Instrument After launching of the Leasing Operations component under Filiere du Vin Program, during the third and fourth quarter of 2016 PIU continued to collaborate with all stakeholders and partners involved, in order to implement the Leasing operations component in the most successful way and to inform them on specific conditions, provide consultancy to SPI staff and support them to prepare internal documents on this component. All activities after launching the Leasing instrument were based on the concept that Leasing operations are implemented by PIU through Specialized Partner Institutions (SPI) and can be structured in the following major activities: PIU continued to provide consultancy to Raiffeisen Leasing and Mobiasbanca staff and support them to prepare internal documents on this component; PIU continued to inform the potential beneficiaries from wine and vine sectors about the opportunity to obtain financing through Leasing operations instrument and to desire them to submit their requests to PIU in this sense; PIU provided consultancy to potential beneficiaries on lease terms and conditions and support them to fill in the leasing documents; PIU reviewed potential beneficiaries sub-projects submitted for financing through Leasing operations component; For Sub-projects approved by EIB, PIU submitted to the MoF the Disbursement request from EIB loan. As a result of actions undertaken at the reported period, PIU succeed to inform tens of potential beneficiaries, to review several sub-projects from potential beneficiaries and submit them to EIB for approval. During the reporting period, under this instrument were approved for financing sub-projects in the total amount of 1,434,510 euro, from which 598,325 euro is the total amount of EIB Allocations and 836,184 euro is the total amount of FB co-financing, the amount disbursed from EIB being 419, euro. During 2016 PIU collaborated with both Specialized Partner Institutions: Raiffeisen Leasing and Mobiasbanca. Through these SPIs were submitted and approved by EIB 5 sub-projects, as it is presented in table below: 27

28 Table 30. Allocated amount within Leasing Operations component by Financial Intermediaries during 2016, Euro PFI Raiffeisen Leasing, including sub-projects: Total amount of subprojects Value of EIB allocations Value of EIB disbursment s Value of PIU disbursme nts number of subprojects allocate d number of subprojects financed weight, % from number from amount 1,283, , , , % 88.16% Asconi 453, , % 28.03% Vinaria Hincesti 653, , , , % 47.87% Basarabia Lwin Invest 59, , , , % 4.18% IM Euro Alco SRL 117, , , , % 8.07% Mobiasbanca, including sub-project: 150, , , , % 11.84% Vinuri de Comrat 150, , , , % 11.84% Total 1,434, , , , % 100% This disbursed amount includes 4 sub-projects approved for financing by EIB through the SPI for Final Beneficiary from winemaking sub-sector. Table 31. Allocated amount within Leasing Operations component by sub-project components during 2016, Euro Sub-sector Component 1: Winemaking enterprises development Component 2: Viticulture enterprises development Component 3: Associated industries enterprises development No of allocated subprojects Total amount of sub-project Value of EIB allocations Value of FB co financing EIB loan disbursed in 2016 PIU loan disbursed in ,424, , , , , ,861-9, Total 5 1,434, , , , , As it is reflected in the table above from the amount of 1,434,510 Euro, in winemaking sub-sector will be invested the amount of 1,424,649 Euro, the scope being the acquisition of new modern winemaking equipment. At the same time in the viticulture sector were invested 9, Euro. No investments in support industry were accomplished during the reported period. 28

29 Table 32. Allocated amount by sub-sectors within Leasing Operations component during 2016, Euro Description of sub-project Total amount of subproject, EUR Value of EIB allocations, EUR Value of FB co financing, EUR EIB loan disbursed in 2016 PIU loan disbursed in 2016 I Winemaking 1,424, , , , , Production equipment 1,409, , , , , Winemaking machinery Transport Other goods Intangible assets 15,649-15,649 II Viticulture 9,861-9,861 Viticulture machinery 9,861-9,861 Vineyards establishment Other viticulture machinery Total 1,434, , , , , Due to the fact that during the reported period between MoF and SPIs were signed the Additional Contracts to On-lending Contract, PIU had basis to make the transfer of EIB funds to SPIs in favour of FB of the Filiere du Vin Program. Thus, under approved Allocations PIU transferred to SPI from EIB loan the following amounts: Table 33. Disbursed amount by PIU within Leasing Operations component by FB during 2016, Euro 1 Asconi FB SPIs viticulture zone Total project cost Allocation amount FB own contribution Received from EIB amount in 2016 Disbursed by PIU in 2016 Codru 453, , , Vinaria Hincesti Raiffeisen Cordu 653, , , , , Leasing 59, , , , , Basarabia Lwin Invest Stefan Voda 4 IM Euro Alco SRL Codru 117, , , , , Vinuri de Comrat Mobiasbanca Valul Traian 150, , , , , Sub total 1,434, , , , , The detailed data regarding the EIB allocations by viticulture zones and sub-sectors of the Program are reflected in the table below: 29