IMF World Economic Outlook publication has shown that the economy of the Republic of Moldova is set to grow by 2% and 4.3% in 2023 and 2024, respectively. Experts at the Fund also predict growth of 5.1% in the country’s GDP by 2028.
However, despite the positive growth projections, the inflation rate in Moldova is expected to remain high in the coming years. In 2023, the average annual inflation rate is projected to be 13.8%, which is expected to drop to 5% in 2024 and remain at 5% in 2028. At the end of 2023, the inflation rate is estimated to be 8%, dropping to 5% at the end of 2024.
Additionally, the current account deficit in Moldova is expected to decrease gradually from 12.8% of GDP in 2023 to 11.6% in 2024, and further to 8.3% by 2028. The contraction of Moldova’s GDP by 5.9% in 2022, which was caused by the war in Ukraine, has been confirmed by the recent visit of the IMF’s experts to the country in March.
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The IMF also predicts a moderate economic recovery in 2023, supported by the recovery of domestic demand and improved growth prospects of Moldova’s trading partners. The World Bank has also improved its 2023 GDP growth projection for Moldova from 1.6% to 1.8%. However, it has maintained its projection for 2024 at 4.2%. Meanwhile, the European Bank for Reconstruction and Development (EBRD) has projected a 1.3% decline in Moldova’s GDP in 2023, followed by a 3.5% growth in 2024.
Despite the challenges, the positive growth projections provide some hope for the future of the Moldovan economy.