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Economic Monitor Moldova

The Moldovan economy is showing signs of recovery following the recession in 2022. Economic growth of 2.0% is forecasted for 2023, driven by the agricultural sector. In 2024, growth could increase to 3.9%, due to rising private consumption.
Despite a fall in the inflation rate to 4.2% by the end of 2023 and a lower budget deficit, challenges remain due to currency appreciation and a lack of growth stimulus.
Trade with Ukraine has declined, while exports of services have increased. Trade relations with the EU, which focus on plums and pork, and a possible switch from USD to EUR as the reference currency could offer new economic opportunities.

  • Moldova
WA 19 | February 2024
Macroeconomic Analyses and Forecasting
  • Only moderate economic recovery after strong recession in 2022
    – 2023: GDP estimated to grow by 2.0%, driven by agricultural production
    – 2024: growth forecast at 3.9% due to stronger private consumption
    – However, downward revisions likely for both years
  • NBM successfully targeted inflation, which reached 4.2% in Dec-23 -back in the tolerance band
  • Recent appreciation of Moldovan leu; negative effect on international competitiveness of MDA firms
  • Lower than expected budget deficit of 5.0% of GDP in 2023 due to budget under-execution; slightly decreasing to 4.6% of GDP in 2024 planned
  • Overall decline in foreign trade in goods over 2023 due to lower trade activities linked to UKR (re-export of fuel and UKR agro products); at the same time, strong service exports
    ➢ Stabilisation of the macroeconomic situation, however lack of growth drivers
Special issues
  • EU-MDA trade. Key products for negotiations over tariff rate quotas (TRQs) are plums and pork
  • Reference currency. Switching from the US dollar to euro would lead to savings in the real economy
  • Economic growth and labour market. Declining potential growth in recent years, however, there are opportunities within the labor market to enhance its contribution

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