Anatoly Topal, Mayor of Chadyr-Lunga
As Anatoly Topal, mayor of the municipality of Chadyr-Lunga, explained, the funds will be used to finance four projects. The first, costing 2 million lei, concerns water supply and wastewater treatment. Another project is aimed at developing post-incubation infrastructure for residents of the business incubator, with a budget of 1.48 million lei. And two projects are for the repair of two road sections. One is 1,250 meters long, costing 2.68 million lei, and the second is 800 meters long (1.84 million lei).
The investment offering is structured as two classes of bonds: one in the amount of 3 million lei with a 2-year term (8.25% coupon rate) and one in the amount of 5 million lei with a 3-year term (8.5% coupon rate). The face value of each bond is 1,000 lei. The subscription period will run from August 3 through August 17, 2026, inclusive, on business days, according to the established schedule.
As with previous issuances, this offering is being carried out with the support of the Independent Analytical Center “Expert Grup” in partnership with maib, a financial intermediary, as well as the Embassy of the Netherlands in Moldova.
As a reminder, municipal bonds issued by local governments in Moldova are used to finance capital investments or to refinance debt incurred during their implementation.
Government Involvement Reduces Risks
At the same time, government agencies (the Ministry of Finance) and the capital market (the National Commission for the Financial Market) are involved in the issuance, which reduces the risks associated with such projects.
Cădîr-Lunga is the first municipality in Moldova to enter the municipal bond market for the third time. As Logos Press previously reported, during the previous issuance, city authorities used the borrowed funds to repair roads and sidewalks on 11 streets.
According to Valerian Moraru, senior economic advisor at the Embassy of the Kingdom of the Netherlands in Moldova, by financing their projects directly from the capital market, municipalities gain both investment and the accompanying financial discipline.
“We equally support local governments that gain access to financing on a transparent basis and investors who are provided with a reliable instrument and the opportunity to participate in the city’s development,” he said.
Analyzing Chadyr-Lunga’s experience with this investment instrument, Adrian Lupuşor, executive director of the Independent Analytical Center “Expert Grup,” emphasizes: “The third bond issue confirms investors’ confidence in the city administration and its commitment to high standards of financial management.”
Meanwhile, Alexandru Sonik, Vice President of the maib Board, notes: “This fact is clear proof that the capital market can become a real tool for financing local development. The financial products we provide as intermediaries directly contribute to improving residents’ quality of life.”
An Additional Investment Tool
Experts do not view municipal bonds as an alternative to bank loans, but rather as an additional investment tool. At the same time, they are cheaper than bank loans and government bonds.
And since the residents of Chadyr-Lunga, for example, also paid water connection fees during the previous bond issue, the city administration was able to pay interest to investors ahead of schedule. Moreover, they did not lose out due to the high interest rates on bank deposits and government securities that existed at the time.
The Ministry of Finance views municipal bonds as an important tool not only—and not so much—for the capital market, but rather for the development of local financial autonomy, especially given that local budgets are almost entirely (70–80%) dependent on transfers from the state budget.
For the Ministry of Finance, financial decentralization—along with training in the management of public funds—is a priority, as is the development of new financing instruments, including through the development of the capital market.
Therefore, in 2025, at the ministry’s initiative, Moldova introduced an exemption from personal income tax on in the form of capital gains or interest on government securities and/or bonds issued by local government bodies. This also increased the attractiveness of these instruments.
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