Investors opportunities at Chisinau

International Airport

Republic of Moldova: general info

Land boundaries:Total: 1,389 km International borders with: Romania 450 km, Ukraine 939 km.Coastline: Moldova has access to the Black Sea via Giurgiulesti port located on the maritime section of the river Danube.    Climate: Moderate winters, warm summers.Land use:Arable land: 54,2%, permanent crops: 8,8% other: 37,0% (2006).Population: 3 563.7 (2010).

External political policy of Moldova

• EU membership and the integration into European structures is the strategic objective of Moldova since 2003

• In 2010 started the negotiations of an Association Agreement with the EU.

• In 2012 it is going to be established visa free regime for Moldovan citizens

• WTO membership since 26 July 2001

• Preferential trade agreements with the European Union

• Preferential trade agreement with the Community of Independent States.

• Law on promotion of foreign investments.

External economical policy of Moldova• Moldova has a central world-wide geographical position

• Moldova may become an effective low-cost cargo bridge between East and West

Doing business in Moldova: cheap and effective

1. Liberal Trade Policies;

2. Economic and structural reforms successfully put in place;

3. Wide range of special tax incentives;

4. Stable monetary policy;

5. Skilled and cheap workforce

~ 200-250€ for medium managers and

~ 80-140 € for non-qualified workers;

Existing hub investors in Moldova

Giurgiulesti International Free Port:

- Start of operation in 2007- The only direct sea/river-borne

transshipment and distribution point to and from Moldova;

- A regional logistics hub, industrial park and free economic zone on the border of the EU with access to road, rail, river, sea;

- Privately-owned and privately operated according to EU standards;

- For more information see www.gifp.md

International Air Cargo Tendencies

• Western European hubs are getting more and more expensive

• Industry continues to seek new paths to profitability• Congestion problems in major European hubs facilitate

airfreight migration to second tier and regional airports

Chisinau Airport ID Card:

• Chisinau Airport is the biggest and main airport of Moldova, (lATA : KIV, ICAO : LUKK), Eastern Europe;• Location -13 km south of Chisinau;• Area -480 ha;• Terminal -built in 1970 and upgraded in 2000;• Processing capacity -1.2 M passengers/year;• Open 24/7; • Concrete Runway 08-26: length of 3,590 m and a width of 45 m;• Runway strength-PCN 59/R/B/X/T;• Taxiway system- with taxiways A1, A2, B1, B2, C1, C2, D and E;• Aprons area -with aircraft parking places, cargo/passenger pads, small

repair and maintenance area, aircraft de-icing area, fire fighting station, etc.;

• Category –4C;• Emergency protection Services Level – 6;• Aircraft parking stands – 33.

Chisinau airport long-run perspectives for cargo hub

• Competition absence • H24 / 7 days at no extra cost• No hidden costs• High-performance security system ELBIT (Israel),

delivered 2010 • Direct access to apron• Not overloaded airport (~30 flights per day)• Specialized services• Flexible, qualified and cheap labor force (~300

EUR )• Large unused area (33,3 ha) + possibility of

extension up to….• Possibility to activate in a FEZ or in an industrial

park• Long-term contracts, based on a mutually

beneficial relationship• Strategic position• Possibility to discover new destinations

Available local Key- Success factors for cargo hub

• Geo strategic position• Land availability (any

extension available on your request)

• No special environmental restriction

• Competitive pricing

• Slot availability• Efficient operations• Possibility to create

Free Economic Zone/ Industrial Park

• Quick time to market processes

Legally available now

Chisinau Airport is the busiest airport in Moldova and the principal gateway for international flights. In 2010, it served 937037 passengers, which is 15.8% more than in the previous year. Import and

export cargo services constitutes 1816 tons of cargo and 584 tons of mail.

+8.1% +7.9% +15.3%+23.2%

+14.7%+13.6%

+25.6%

+23.1%-4.6%

+15.8%

0

100000

200000

300000

400000

500000

600000

700000

800000

900000

1000000

Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

PAX 254178 274662296431 341695421011 482741548331 688782847881 809072937030

1 2 3 4 5 6 7 8 9 10 11

Dynamics of cargo and mail turnover

P

0

500

1000

1500

2000

Cargo and Mail Indicators 2003-2010

Cargo 965 1050 1348 1497 1856 1931 1631 1816Mail 320 336 377 343 468 538 403 584

2003 2004 2005 2006 2007 2008 2009 2010

Airlines structure of a cargo transportation

 

2008 2009 2010

cargo mail cargo mail cargo mail

Company tones % tones % tones % tones % tones % tones %

Air Moldova581,

530,

1193,

235,

9 52632,

3208,

151,

7708.

749.3 294

50.3

Turkish Airlines

856,3

44,3

300,2

55,8

661,1

40,5

133,2

33,1

480.4

33.4 241

41.3

Siberia Airlines 53,7 2,8 21,5 4,0 73,3 4,5 15,4 3,8 22.1 1.5 0.8 0.13

Carpat Air 70,8 3,7 1,5 0,3 46,6 2,9 0,6 0,1 35.8 2.5 0 0.0

Austrian Airlines 47,5 2,5 5,0 0,9 50,2 3,1 5,4 1,4 57.8 4 3.9 0.7

2006 2007 2008 2009Total transported cargo (mln of tonnes), including: 16.7 18.5 17.7 9.2

Railway transportation 11.1 11.8 11.0 4.4

Motor transportation 5.4 6.5 6.5 4.6Fluvial transportation (thousand tonnes) 141.5 166.5 202.0 182.0

Air transportation (thousand tonnes) 0.97 1.00 0.83 0.83

Freight traffic of the transport enterprises

Specific tax-free forms of investmentsINDUSTRIAL PARKS

Opportunities offered by Industrial Parks of the Republic of Moldova:

• Offers support on central and local level;

• Allows better use of public and private assets;

• Grants 30 years’ Title to Administrator Company;

• Allows the administrator company to be a resident in its industrial park.

Moldovan Industrial Park incentives are:

1. Free of charge land destination change;

2. Free of charge state-owned land transfer to administrator company;

3. Opportunity to rent state-owned land with 30% discount;

4. State contributions to infrastructure and technology development;

5. Limited and controlled state inspections;

6. Assistance from local authorities and Council to promote investment projects of national importance;

7. Fiscal incentives.

FREE ECONOMIC ZONESThe following activities are allowed

in the free economic zones: 1. Manufacturing of export-oriented

products; 2. Sorting, packing, marking and other

similar operations on goods transiting Moldova;

3. Other activities, such as utilities, warehousing, public catering, etc. as needed to support the main activities.

FEZs offer the following customs and tax benefits to their residents:

- Exemption from VAT;- Exemption from customs duties on

goods imported into the FEZ and subsequently exported;

- Exemption from excise duties for goods imported into the FEZ and subsequently exported;

- The income tax is 50% from the quota set in Moldova.

Investor’s rights and obligations in Moldova

Investor’s rights:

• Freedom of Investments;• Non-Discriminatory Investment

Environment;• Transparency;• Guarantees of Investors’ Rights;• Guarantee against loss;• Resolution of Disputes;• Freely convert Moldovan national

currency and foreign currency; • To repatriate their profits from

Moldova after they fulfill their tax liabilities;

• To own real estate in Moldova for the purposes of carrying out their business activities

Investors’ Compliance and obligations:

• To invent in compliance with international agreements, the Law and other legislative acts;

• To comply with the legal requirements of public authorities.

24/7 operations

Favorable geographical

position

Cheap labor force

Possibility to activate in a FEZ /

Industrial ParkNo environmental

restriction

Competition absence

High-performance

security system

Land availability

PROFITABLE BUSINESS AT

CHISINAU AIRPORT

Create your Cargo hub in the

heart of Europe