Moldova’s external debt will fall significantly in 2024! In five years, we could get rid of long-term borrowing

Moldova’s external debt decreased by 3.7% (-$377.83 million) in the first six months of 2024, according to data released by the National Bank of Moldova (NBM). A reduction in private debt by USD 193.74 million (-3.1%) mainly influenced this decrease.

The external debt-to-GDP ratio decreased by 4.5 percentage points since end-2023. Long-term external debt continues to account for the largest share of external debt, holding 73.7% of the total, down 3.5% from the end of last year. Short-term debt decreased by 4.4% on June 30, 2024, to 26.3% of total external debt, bani.md reports.

Total gross external debt amounted to USD 9.7 trillion, equivalent to 56.7% of GDP. The decrease in the rollover rate (-43.8% compared to March 31, 2024) indicates that new borrowing has decreased while servicing of long-term debt has increased. This phenomenon confirms the 36% reduction in the average implied maturity of this debt.

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If borrowers maintain the repayment pace seen in the second quarter of 2024, they could fully repay the current long-term debt stock in about five years and six months.