Expert-Grup

The economy will end 2015 in a 0.8% recession, while a deep restructuring of the economic model is needed

Thursday, 17 December 20157927 views
The economy will end 2015 in a 0.8% recession, while a deep restructuring of the economic model is needed

Automatically translated summary. The full article is available in Romanian.

The Independent Think Tank “Expert-Grup” has published its MEGA (Moldovan Economic Growth Analysis) report for Q4 2015 in Chișinău. It estimates that Moldova's economy will contract by 0.8% in 2015, after the economic risks identified earlier in the year materialised, and expects a slow recovery in 2016.

The report projects growth of +2.9% in 2016. Industry (+3.1%) and domestic trade (+2.3%) supported 2015 performance, while agriculture, falling 12.6%, weighed most. The recession could have been deeper without the depreciation of the national currency, which helped exports. The budget deficit is expected at 3% of GDP, foreign exchange reserves are low, and the banking sector is weakened after three banks, holding a third of system assets, failed.

Political paralysis blocks reforms, the 2016 budget is unapproved, and the management crisis at the National Bank of Moldova prevents a new IMF memorandum. Expert-Grup urges a law on stabilising and reforming the banking system and an IMF agreement. Executive director Adrian Lupușor said remittance-dependent consumption cannot ensure balanced growth, and called for coordinated fiscal, industrial, monetary and trade policies to transform the economy.

View the original article in Romanian