Moldovan Economy in 2007

Key event of the year has certainly been the triple presidential initiative of liberalizing capital, fiscal amnesty and reform of the income tax. Some effects of the proposed reforms are already visibile, including the fact that the financial autonomy of the local public authorities has been further undermined by introducing zero rate tax on the reinvested corporate income. The EU-Moldova Actions Plan's implementation lingered, while the main failure of the year was the second stage of the regulatory reform. Industrial sector has followed contradictory evolutions, while the agricultural sector suffered a double hit: from the part of Romania abolishing the trade preferences in result of it joining the EU and from the part of Russian Federation introducing trade embargo on imports of Moldovan alcoholic beverages. As in previous years, the budgetary revenues have been executed far above the plan, with main contribution coming from the indirect taxes. In the banking sector new foreign investors came, which created both risks and poortunities for the Moldovan financial sector.