In Moldova we focus on:
- Creating the conditions to support private sector development: The EBRD is supporting measures to improve the business environment, both through investment projects which help attract foreign direct investors, as well as through engaging with the Moldovan authorities to promote much-needed reforms. The EBRD is supporting the Economic Council, an advisory body to the Prime Minister, which brings together policy-makers and the business community with a view to enhancing the business climate. Improving the business climate is crucial for the Bank’s ability to further support the private sector and attract investment. Governance and transparency in the banking sector are particular concerns and the EBRD is working closely with the authorities to address them.
- Promoting European standards and regional integration: The EBRD is investing in projects which help Moldova develop value-added exports – especially in manufacturing and agribusiness sectors – which will be competitive in regional markets. As Moldova and the EU are moving forward towards a Deep and Comprehensive Free Trade Area (DCFTA), Moldovan companies need to adopt higher production and quality standards than those currently applied. In addition, the EBRD is financing improvements in the country’s infrastructure to develop links to neighbouring countries as well as internal transport infrastructure needed to bring domestic producers closer to their markets. The Bank is contributing to strengthening energy security and efficiency, and is helping develop the telecommunications sector.
- Enhancing commercialisation and sustainability of municipal enterprises: The EBRD is continuing to finance regional and municipal water supply companies and is looking into ways to modernize district heating and solid waste management and promote public-private partnerships (PPPs) in the sector.
As well as being a country where the EBRD works, Moldova is also an EBRD donor. Moldova contributed € 325,000 to the Eastern Europe Energy Efficiency and Environment Partnership (E5P) Fund in 2015. The EBRD project for Balti District Heating will receive funding from the E5P.
The EBRD’s latest Moldova strategy was adopted on 29 November 2017
EBRD forecast for Moldova’s Real GDP Growth in 2017 3.0%
EBRD forecast for Moldova’s Real GDP Growth in 2018 3.5%
Moldova’s GDP grew by 2.8 per cent year-on-year in the first half of 2017. In the first eight months of 2017, inbound money transfers resumed growth of 9.5 per cent year-on-year after a decline in the previous two years. Supported by strong export performance and recovering remittances, the leu appreciated by 14.5 per cent in relation to the US dollar until mid-October 2017. Amid monetary tightening and a stable leu, inflation decelerated to 6.3 per cent year-on-year in the first nine months of 2017. Official reserve assets remained adequately high at US$ 2.5 billion in end-August 2017, providing approximately six months of import coverage. In April 2017, the IMF completed the first programme review and released a US$ 21.5 million tranche. Macroeconomic stabilisation and an improved external environment underpin near-term growth outlook. However, vulnerabilities in the financial sector remain despite recently taken steps to improve banking supervision and the regulatory framework. We forecast Moldova’s economy to grow by 3 per cent in 2017 and 3.5 per cent in 2018. The forecast is subject to uncertainty due to a narrow economic base concentrated in agriculture.