DCFTA's study determines increase in total exports of Moldova

Chisinau, 05 July /MOLDPRES/ – In 2015 – 2018, the total exports Moldova to EU increased by $1.5 billion or 34 per cent over the four – year period before foundation of the Deep and Comprehensive Free Trade Area (DCFTA) twice as fast as exports to other markets.

The European Union has strengthened its positions as basic selling market for exporters of Moldova. Almost 40 per cent of it was determined exclusively by DCFTA. Thus, the net effect of DCFTA amounted up to around $600 million. The data are contained in a study by the Expert – Grup Independent Analytical Centre, signed by Adrian Lupusor.

According to study, the exports of agri – food goods benefited more from DCFTA compared to industrial products. Also, the net impact of DCFTA on exports of agri – food products was about three times higher than on industrial products. It has finally shattered concerns about the potential negative impact of the liberalisation of EU trade in the agri – food sector, which is less competitive.

Similarly, trade of Moldova and EU has become much more balanced due to the rapid growth of exports on EU market and reduction of imports of industrial products from EU. The level of export – import coverage has increased visibly from 47 per cent on average in 2011 – 2014 up to 66 per cent in 2015 – 2018, while this indicator has fallen sharply in trade with CIS, and compared with other states – rose twice more slowly.

Additionally to positive performance of foreign trade in the context within DCFTA, the study author reveals that there is concern on export focus, which indicates risks to growth sustainability so far and gaps in competitiveness of domestic producers. Despite the impressive growth of exports, the experts find that more than 50 per cent of exports of industrial products being oriented on a single market (Romania), and more than half of the exports of agri – food goods are oriented only on 03 markets (Romania, Italy and UK of GB&NI). This reveals a number of obvious risks deriving from export dependence on demand from several EU markets, as well as highlighting the low level of competitiveness of domestic producers.

The study notes that, in lack of a more plenary exploitation of DCFTA opportunities and deeper systemic and structural changes, the benefits of DCFTA observed so far may be temporary and fundamental deficiencies of competitiveness of domestic producers could perpetuate. In this context, Adrian Lupusor argues that public policies should aim for upcoming 05 years 02 strategic priorities: ensuring the continuity and irreversibility of quantitative growth of exports on EU market and increasing the quality of exports on it by increasing the diversification and added value generated by them for economy.