Pessimistic economic forecasts: The war in Ukraine “cuts” Moldova’s economic momentum

Moldova’s economy will face significant challenges in 2023 due to the military conflict between Ukraine and Russia, the global economic crisis, and high gas and electricity prices. The local elections in 2023 could also negatively impact the country’s economic trajectory and the implementation of economic reforms due to the political populism characteristic of these periods, according to the National Institute of Economic Research’s economic forecast for 2023.

Economists estimate an economic growth rate of 3.5%, but this is not even a recovery from the recession in 2022 and is largely based on the hope for a more favorable meteorological year and growth in the agricultural sector. However, the evolution of the agricultural sector significantly influences Moldova’s manufacturing industry.

In the INCE forecast, it is also noted that in 2022, the explosive growth of foreign trade caused by re-exports from and to Ukraine had a strong impact on the economy, but the source of this growth has already been exhausted. For 2023, industrial production volume is expected to grow by 4.8%, largely due to a significant increase in agricultural production volume and agro-food exports, which are expected to grow by 3.8%.


According to the forecast, imports will increase by 2.4%, and the trade deficit will reach 4940 million USD. The conflict in Ukraine has affected investments and will affect foreign direct investment in Moldova. The government is trying to diversify the economy and attract foreign investment in information technology and tourism.

A nominal salary increase of 13% and a real increase of 1.5% are estimated, and the unemployment rate is expected to be around 3.5%. Obviously, the dynamics of macroeconomic indicators in 2023 will be influenced by internal and external factors, including political decisions and the evolution of the geopolitical situation. Among these factors are energy resource prices, which are expected to decrease significantly this year, according to IMF projections, including the price of Russian gas in Europe.

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