Expert-Grup estimates economic risks of 2013

The year 2012 was one of the most difficult years economically for Moldova, as our country experienced both economic shocks and weather-induced disasters, which were amplified by a host of institutional weaknesses. This is one of the conclusions contained in an “Economic Radiography of the Year 2012” by Expert-Grup. In its study, the think-tank also anticipated a number of key risks for 2013, Info-Prim Neo reports. One risk is related to the negative effects of the enduring crisis in some EU countries on the Moldovan economy. Another risk could be related to Moldova's failure in the international competition for investments. “In 2011 and 2012 Moldova didn't see significant foreign direct investment. This is mainly due to the global economic crisis. However, in some countries in the region, like Ukraine, Georgia and Bulgaria, FDI in the first half of the year rose, while in Moldova it dropped by 39%”, said Expert-Grup director Valeriu Prohnitchi. Other major risks are related to potential pressures over the National Bank in the wake of a proposal that aims to introduce a Government-appointed representative to a proposed supervisory board of the Bank. “Such a provision would contravene the international standards for the independence of central banks. The involvement of political actors means that they will be able to manipulate the monetary policy for electoral purposes”, said Prohnitchi. There is also the risk of the unhealthy situation on the labor market, which reached the point where the deficit of hands hampers economic growth, with migration starting to play a negative rather than positive role. Expert-Grup is recommending the Government to firmly promote reforms, to opt for a systemic and sustainable solution, and to negotiate a new memorandum with the IMF whereby all the component parties of the Eurointegration Alliance commit to respecting a set of rules for sustainable growth.