Top bank revises in decrease forecasts on Moldovan economy's evolution in 2015

Chisinau, 11 June /MOLDPRES/ - The World Bank (WB) reviewed in diminution to -2 per cent the forecasts as to the growth of the Moldovan economy in 2015, from 3,0 per cent as it anticipated in past January, according to the Global Economic Prospects, published on 10 June.

WB experts anticipate a recession of 2 per cent of the Moldovan economy, due to  regional crisis, diminishing of foreign demand, money transfers and financing. The regional crisis had significant negative consequences for the region, including Moldova, via the trade which began to dramatically fall in the last quarter of 2014, the report says.

The depreciation of the national currency, which led to the increase of inflation, determined central banks (Armenia, Georgia, Moldova) to increase the base rate. The flow of remittances dropped, the depreciation of the Russian rouble and strengthening of the dollar led to deterioration of the exchange rate. WB experts say that the authorities are to recognize losses inflicted to the state in the banking sector, to review the prudential supervision and improve the regulation of the sector, in order to minimize future risks.

The bank also changed in diminution forecasts for 2016, from 3.5 per cent to 1.5 per cent and the ones for 2017, from five per cent to four per cent.

The bank’s experts believe that risks for the region reside in a new diminution in price of petroleum, escalation of geopolitical tensions and sharp hardening of global financial conditions. A recovery under expectations of the global economy and unfavourable solving of problems between Greece and its creditors are added to these.

The Economics Ministry forecasts a decrease of the economy by 1 per cent in 2015 after an 4.6-per cent increase in 2014. The International Monetary Fund also expects an economic contraction of 1 per cent. Experts of the Expert-Grup independent analytical centre forecast a diminution by 0.2 per cent of the Gross Domestic Product in case of optimistic developments, whereas the pessimistic forecasts show a decrease of 1.8 per cent. Viitorul institute’s experts expect a four-per cent drop of GDP.

The National Economic Research Institute is the most optimistic ,as it estimates an economic growth of 0.6 per cent in 2015, if „imminent risks are managed appropriately”. Economists say that, if risks not appropriately managed, „the national economy might enter a recession in 2015, according to the pessimistic scenario, a 2-per cent contraction of the GDP being estimated in real terms against 2014”.

(Reporter V. Bercu, Editor A. Raileanu)