ANNUAL REPORT 2011 - IFAD

Story from the field
Growing rural businesses in the Republic of Moldova
The dissolution of the Soviet Union brought
independence, but it also dealt a devastating blow to
living standards across the region as countries
struggled to adapt to a market-oriented economy.
The Republic of Moldova, the poorest country in
Europe, managed to slash poverty rates from
73 per cent in 1999 to 30 per cent in 2010. Yet the
country still faces deep poverty, particularly in rural
areas, where about 60 per cent of Moldovans live.
Since 1999, we have invested a total of
US$69 million in five programmes and projects,
reaching over 100,000 households. Funding for rural
enterprises supports the government’s priority of
reducing poverty through agriculture and rural
development. IFAD’s focus is on financial services.
“Credit in rural areas is hard to come by and
businesses cannot grow without finance,” points out
Abdelkarim Sma, IFAD country programme manager.
IFAD has issued over 1,000 loans to small and
medium-sized rural businesses through commercial
banks and microfinance institutions in the Republic
of Moldova. Unlike most banks, we make credit
available for up to eight years. This gives farmers and
entrepreneurs the possibility to draw up longer-term
business development plans.
Andrei Iuri-Apostol, 63, is one recipient. A former
mathematics professor, he is joint owner of
Cap’s Ltd, a profitable small business in Ceadir-Lunga
in the autonomous region of Gagauzia. The company
makes Cap’s branded egg noodles – a key ingredient
in the traditional Moldovan chicken broth. It also
operates a flour mill and produces forage for rabbits.
“We started with 4 employees, and we now have
20,” says Iuri-Apostol. “We have a good standard of
living thanks to this business.”
Cap’s Ltd took its first IFAD-financed loan in 2003
to buy pasta-processing equipment from Italy. Today,
the company produces around 100,000 kilograms of
noodles a year. The flour mill was funded by a
second IFAD loan in 2006. It ensures the supply of
top-quality flour for noodle production and sells
Grade 1 flour to local bakeries.
Reflecting on his career change from professor of
mathematics to small business owner, Iuri-Apostol
smiles ruefully. “That was the fate of my generation,”
he says.
Andrei Iuri-Apostol runs a profitable small business with
20 employees in a country struggling with deep poverty
Republic of Moldova: Rural Finance and Small Enterprise
Development Project
©IFAD/S. Beccio
PROGRAMME OF WORK FOR 2011
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