World Bank forecasts 3.4 per cent growth of Moldova's economy in 2019

Chisinau, 13 May /MOLDPRES/ – The World Bank (WB) has revised downwards estimates of the evolution of the Moldovan economy in 2019 to 3.4 per cent. In report: Global Economic Prospects (GEP) in January 2019, it was anticipated an economic advance of 3.8 per cent.

"The pace of economic growth will be more modest in the medium term as a result of weaker domestic and foreign demand," has said the WB expert, Marcel Chistruga, in a presentation of economic prospects for Moldova, organised today by the Chisinau WB Office.

According to expert, "the expansionary fiscal policy measures that have been adopted will be important to sustain economic growth in 2019. Also, the normalisation of financial intermediation will play an important role." Similarly, due to higher growth reduced remittances, a higher level of inflation that the WB expects, which will erode the available income of population, "the growth will preserve to 3.4 per cent."  

The WB expects the Moldova's economy to grow by 3.6 per cent in 2020 and by 3.8 per cent in 2021. "The impact of expansionary fiscal policies will dissipate, so it will be important to maintain growth, consumer confidence and business environment. And these things must go hand in hand with improving lending terms and conditions," said Marcel Chistruga.

The major contribution "will come from industry and services, while the contribution of agricultural sector will be marginal, after so many good harvest years. And that is when we do not have climatic shocks."

The WB believes that medium – term inflation will enter the targeting corridor of 5+/–1.5 percentage points with some experts, especially in 2019 when inflationary pressures are beginning to show up. The fiscal deficit for 2019 will increase up to 2.7 per cent of GDP.

The WB expert has also noted that "the political uncertainty that has existed and individual interests and other governance issues have hampered, basically, the reform agenda and investment process in Moldova."

The Ministry of Economy and Infrastructure forecasts an increase in the economy in 2019 by 4 percent, up to MDL 209.3 billion, and the International Monetary Fund (IMF) expects GDP to grow by 3.5 per cent.