FDI has a positive impact on Moldovan economy, GET Moldova
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16:27, 14 Nov 2017

FDI is one of the main drivers for economic growth and key to improving living standards in Moldova. It has a significant impact on production, employment, wages, state revenues and exports. A relevant analysis was made by the German Economic Team Moldova (GET) based on data provided by the National Bureau of Statistics and the National Bank of Moldova.

In a news conference at IPN, Ricardo Giucci, leader of GET Moldova and managing director at Berlin Economics, said that according to the National Bank of Moldova, the FDI per capita represent US$741, which is not so much. Almost ¼ of Moldova’s GDP is produced by companies with FDI. 61% of the FDI comes from the EU, while 28% from Russia.

Woldemar Walter, Project Manager of GET Moldova, said almost half of the people employed by FDI companies work in the manufacturing sectors such as textiles, food products and automotive supplies manufacturing. The average output per employee in companies with FDI is on average 71% higher than domestic ones due to a number of factors such as size of the company, capitalization, as well as the use of new technologies, managerial advantages and training of employees.

Woldemar Walter noted that thanks to higher productivity, companies with foreign capital are able to pay on average considerably higher salaries than domestic companies. This difference is especially large in capital-intensive sectors such as energy and in knowledge-based sectors like computer programming. In low-tech sectors such as textiles, the wage difference is quite limited.

Companies with foreign capital contribute strongly to the state budget. They account for 34% of corporate income tax. Furthermore, these companies account for 21% of social contributions, despite their share of 15% in total employment.

The experts note that in the manufacturing sector, companies with 100% foreign capital export 2/3 of their production, while domestic companies sell about 23% abroad. In such a way, these companies contribute to the inflow of foreign currency into the country.

GET Moldova is a group of economists who have advised the Moldovan government on economic policy issues since 2010. It is funded by the Federal Ministry of Economic Affairs and Energy of Germany.


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