Over – expected industry growth within first five months of 2018 in Moldova

Chisinau, 11 July /MOLDPRES/ – The industrial output grew by 8.1 per cent in the first five months of 2018 compared to the same period of 2017, above expectations of authorities and experts. The Ministry of Economy and Infrastructure (MEI) anticipates a 5.5 per cent increase in industry this year to around MDL 55 billion.

The MEI experts explain the January – May increase by expanding the activity of free economic zones (ZEL), especially investment projects in the automotive industry, widening and diversifying export markets as a result of capitalising upon opportunities offered by the Moldova – EU Association Agreement. Also, the favourable developments in agricultural sector of 2017, as well as the increase in domestic and external demand for indigenous industrial products, have been the main factors which led to industry rise.

The largest increases were recorded in manufacture of electrical wires and cables (by about 39 per cent), manufacture of motor vehicle and engine parts (by 42 per cent), glassware (by 47 per cent), fruit and vegetable processing (by 41 per cent) etc. The manufacturing, accounting for about 82 per cent of industrial goods, had the largest contribution to the growth of industry, namely 7.1 percentage points, recording an advance of 9.4 per cent.

According to the MEI's information and media communication service, the automotive industry is becoming an increasingly important branch of national economy, generating constantly new jobs, decent salaries and production for exports. The essential increases were recorded in manufacture of wires and cables and production of parts for motor vehicles and engines (by around 40 per cent). The expansion of these industries is related to development of investment projects within ZEL launched by foreign investors in 2017 (Japanese company Sumitomo project launched in Orhei, expansion of German companies Draexlmaier to Cahul and Coroplast to Causeni, etc.). According to data from the end of 2017, there were created about 12 thousand jobs in the ZEL, average salary was about MDL 8300, and share of industrial production made in total exports was about 24 per cent.

The food industry is another strategic branch for national economy, contributing to industry growth by 2.4 percentage points after an increase of 12 per cent in January – May 2018, supported by favourable developments in agricultural sector in 2017. The glass production also influenced the increase in volume of industrial production, by 1.1 percentage points. The glass industry has grown by about 47 per cent, driven mainly by increase in volume of production delivered abroad: export turnover increased by 46 per cent.

The manufacture of textiles, clothing and footwear are industries with significant potential and have had a substantial impact on the increase in industrial production, respectively 21 percentage points, according to MEI specialists.

On the other hand, mining industry showed instability in the first five months of 2018. After 30 – 40 per cent growth in January – February, this branch registered decreases in the following months between 1.1 per cent and 14 per cent. The instability of respective branch is determined by both weather factors and situation in construction sector, which is still stagnant.

(Reporter V. Bercu, editor A. Raileanu)