Moldova Economic Forecast

Moldova Economic Outlook

May 12, 2020

Economic conditions deteriorated sharply in the first quarter of the year, after annual growth plummeted to 0.2% in the fourth quarter of 2019. Although industrial output gathered momentum in January–February, production is set to have slumped in March as Covid-19 ravaged the economy, likely leading to a contraction of merchandise exports in Q1. Moreover, lower remittance inflows, weaker household spending and postponed investment decisions in March seemingly weighed heavily on overall demand in Q1, and are set to hammer the economy even harder in Q2. Amid urgent balance of payment needs, on April 17 the IMF approved an emergency USD 235 million loan to the country. Meanwhile, although the government has yet to unveil a comprehensive fiscal package, unemployment benefits have been expanded and some taxes deferred.

Moldova Economic Growth

The economy is set to shrink this year as the Covid-19 pandemic takes its toll. Consumer spending will likely plummet amid falling remittances, while capital investment should decline as households and businesses postpone investment decisions. Although the fiscal deficit is set to jump as a result of the crisis, public debt should remain at a comfortable level. FocusEconomics panelists see GDP contracting 2.4% in 2020, which is down 1.2 percentage points from last month’s forecast. In 2021, they project it to expand 3.5%.

Moldova Economy Data

2015 2016 2017 2018 2019
Population (million)3.63.63.53.53.5
GDP per capita (USD)2,1642,2862,7943,229-  
GDP per capita (EUR)1,9772,0592,4252,735-  
GDP (EUR bn)7.07.38.69.7-  
Economic Growth (GDP, annual variation in %)-0.34.44.74.0-  
Unemployment Rate4.23.83.32.9-  
Fiscal Balance (% of GDP)-2.2-1.9-0.8-0.9-  
Public Debt (% of GDP)37.835.631.829.7-  
Money (annual variation of M2 in %)18.314.310.08.2-  
Inflation Rate (CPI, annual variation in %, eop)13.62.47.30.97.5
Inflation Rate (CPI, annual variation in %)9.76.46.63.04.9
Policy Interest Rate (%)19.509.006.506.505.50
Exchange Rate (vs USD)19.7019.9217.1017.0417.15
Exchange Rate (vs EUR)21.3920.9520.5219.5519.23
Exchange Rate (vs EUR, aop)20.7521.9920.7919.8419.61
Current Account (% of GDP)-6.0-3.5-5.6-10.6-  
Current Account Balance (USD bn)-0.5-0.3-0.6-1.2-  
Trade Balance (USD billion)-2.1-2.1-2.6-3.3-  
Exports (USD billion)1.51.61.92.0-  
Imports (USD billion)3.63.64.45.3-  
Exports (annual variation in %)-17.03.420.15.6-  
Imports (annual variation in %)-25.30.121.719.1-  
International Reserves (USD)1.72.22.83.03.1
External Debt (% of GDP)79.276.368.764.2-  

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Moldova Facts

Value Change Date
Exchange Rate17.150.03 %Jan 01
Stock Market0.10.0 %Jan 07

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