Month: June 2023

After a January 2023 Moneyval report citing “needs improvement” landed on desks in Monaco, the Principality has been making big strides to heighten standards in the fights against money laundering and related crimes.  

It is called Bill No.1.077 and is Monaco’s 130-point draft bill to ensure that the Principality is internationally accepted as adhering to the best standards in the fight against money-laundering, terrorism financing and funding of illegal weapons.  

On 29th June, the National Council voted unanimously in favour of the bill, which represents the first part of several other forms of legislation that will help to make the Monegasque system as watertight as possible against these types of crimes.  

Established and reviewed in a rather short timeframe, the bill is a response to the Moneyval Committee’s January 2023 recommendations and shows the continued commitment the Principality has on this issue.  

One of the most significant provisions on Bill No. 1.077 is the creation of an independent administrative authority to be called the Monegasque Financial Security Authority. This will replace the current entity, Financial Circuits Information and Control Service (SICCFIN), which has been on the case thus far.  

This new organisation will be “endowed with appropriate resources and means, [and] will have three branches: financial intelligence, investigations, and the imposition of sanctions”.  

WHAT’S NEXT? 

More bills will be coming up for a vote in the National Council in the not-too-distant future, including Bill No. 1.078. This is a refined extension of the current measures to stop any financing of terrorists and illegal weapons within Monaco’s borders.  

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Photo credit: Monaco Communications Department / Michael Alesi  

The Monaco Economic Board were treated to a preview of the newly released IMSEE report into life in the Principality that features more in-depth data on employment and the Monegasque economy than ever before.  

The director of Monaco’s statistical agency IMSEE, Alexandre Bubbio, met with members of the Monaco Economic Board (MEB) at the Novotel Hotel on 22nd June. He introduced the latest edition of the annual report, now considerably substantial in its breadth of data and topics, with particular reference to the new ground covered in the 2023 edition.  

A separate chapter is now devoted to employment, giving a clear picture of the situation within the Principality, as well as a section focusing on the 12 sectors of economic activity that is simplified with infographics and enhanced by data tables for more in-depth coverage.  

An overview of the economy 

Bubbio and other IMSEE representatives then provided the MEB members present with a short overview of the Monegasque economy.  

In brief, public finances are in good shape with a budget surplus of €32.2 million in 2022. Over the decade, only 2020 was in deficit, and this was explained by the pandemic. Other indicators show the same trend of a strong post-health crisis rebound and a positive evolution over the last 10 years.

In that period, the GDP has increased by 47.3%, the turnover of the Principality has risen by 32.2%, and the average price per square meter in property sales is up by an enormous 60.6%. 

The private sector employed 65,529 people in 2022. International trade, excluding France, grew by an annual average of 5.4% over 10 years.  

The new interactive dashboard available on the IMSEE, which neatly summarises data on foreign trade country-by-country, amongst other functions, was also highlighted at the event.  

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Photo credit: Carte Blanche/ MEB 

The European Commission has set forth two proposals regarding the use of currency, with one being the possibility of a new digital form of the euro as a complement to cash.  

The European Commission (EC) has proposed two new ideas concerning the use of banknotes in the bloc.  

Though 60% of people surveyed still want the option to pay with cash when they choose, the reality is that increasingly the public is paying via digital means, either with cards or via apps. This trend, certainly bolstered by the pandemic, seems to be the way of the future, and as such, the EC has come up with two “mutually supportive sets of measures” so that people have both cash and digital payment options open to them.  

ACCESS AND ABILITY TO USE CASH 

The EC is focusing on acceptance and access when it comes to the use of cash in the eurozone. Acceptance of banknotes and coins is high throughout, but there are some establishments who have decided to go completely digital, thus preventing certain people access to goods and services. Additionally, the closure of several automatic teller machines has made access to cash increasingly difficult for some.  

To remedy these issues, the EC is suggesting the need to ensure cash is accepted everywhere and will monitor the situation to address the problem. It will reserve the right to step in if necessary to create a cash-friendly environment for all, notably for the elderly, who tend to prefer this method over cards or apps.  

A DIGITAL EURO?

The European Central Bank is looking into the possibility of introducing a digital euro. Following in the footsteps of several other central banks worldwide, this would give consumers an alternative EU-wide payment structure, building on today’s current options.  

The thought is that in addition to giving people more ways to pay, it would also strengthen the euro’s international role.  

The digital euro could be used like any other currency, working like a digital wallet where businesses and individuals could pay using this system anywhere in the EU. It would also be available for both online and offline payments, such as transactions made from device-to-device in an area without a solid internet connection, like in underground car parks or remote areas.  

The offline payments would enjoy a high level of privacy and data protection, like with online options.  

According to a report from the EC, “[This form of currency] would allow users to make digital payments while disclosing less personal data than they do today when making card payments, just like when paying with cash, and the same as what they disclose when they take cash out of an ATM.” 

Banks and other payment service providers would distribute this digital version and basic services relating to it free of charge. Most merchants, with the exception of certain micro-businesses who would find setting up a new infrastructure cost prohibitive, would be obliged to accept it as legal tender.  

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Photo source: Rodion Kutsaiev for Unsplash

The Monaco government has made some changes to the subsidies it offers residents who purchase electric vehicles, rewarding less-emitting vehicles and increasing the bonus for electric two-wheelers.

Monaco has been offering subsidies for the purchase of ecological vehicles since 1994. Half of the government’s own fleet is electric.

Now, as of 26th June, the government is changing its support system to help fund the most ecological vehicles purchased by individuals and professionals.

In order for people to receive a government subsidy for their private vehicle, it must now be electric or an electric-petrol hybrid with a value of less than €60,000, base price including tax.

The amount of aid also varies according to the level of CO² emissions, falling into three categories:

– vehicles emitting less than 21 g/km of CO² benefit from an aid of 30% of the base price including tax of the vehicle, capped at €10,000;

– vehicles emitting 21 to 50g/km of CO² benefit from a fixed bonus amounting to €5,000;

– and those emitting 51 to 98 g/km of CO² benefit from a fixed bonus of €1,500.

An incentive system has also been put in place for professionals and associations who acquire, as part of their activity, better performing electric or electric-petrol hybrid vehicles. For the acquisition of light utility vehicles ≤3.5 tonnes emitting less than 21 g/km of CO², an additional fixed aid of €3,000 is added to the bonus for purchase amounting to 30%, capped at €10,000, of the price of the vehicle.

For the purchase of electric goods trucks >3.5 tons emitting less than 21 g/km of CO², a premium amounting to 20% of the price of the vehicle, capped at €40,000, is applied.

The government also wants to boost the use of electric two-wheelers in Monaco by increasing the subsidy to 40% of the price of the vehicle, capped at €4,500.

People wanting to buy an electric bicycle will also receive a flat-rate cash back of €400, provided that the purchase is made from a merchant located in the European Union and that the delivery is made in Monaco.

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Photo credit: Eren Goldman on Unsplash