MEGA - Moldova Economic Growth Analysis, no.6, 2012

The recurrence of some tendencies similar to those during 2008-2009 crisis points out the vulnerability of Moldovan economy to external shocks and its incapacity to tackle the challenges from inside the country. We cannot expect an open economy to be immune to external shocks, but at the same time in a healthy economy the dependence of domestic demand on the situation abroad should be lower and may save the economy from recession. As shown in MEGA nr.6, in case of Moldova, narrow interventions in the system proved to be inefficient in medium- and long-term, therefore, there is clear need for more consistent reforms and radical change in the institutional settings. The economic activity cannot grow in an unhealthy business environment and Moldova failed to provide such an environment due to still persistent unfair competition, trade barriers and administrative burden. Higher economic activity ultimately determines higher employment opportunities and incomes generated inside the country, making the economy less dependent on external factors. These are essential elements to ensure the economy develops, not only grows.