IMF ascertains slowdown in economic growth in Moldova

The economic growth in Moldova this year will be 3% as against 6.5% last year. This is one of the conclusions of the IMF mission that ended its visit in Chisinau. Among the most serious shortcomings are the poorly-developed justice and the lack of transparency in the area of property, said the mission’s head Nikolay Gueorguiev. The growth rate of the internal and foreign trade and of remittances slowed down in the first quarter, while the industrial production volume decreased. According to Gueorguiev, the slowdown in economic growth was caused especially by the economic crisis that hit the EU. The IMF mission’s head also said that the conditions of the agreement with the IMF have been generally met, with some exceptions that refer especially to the larger budget deficit. Prime Minister Vlad Filat said that they agreed with the IMF mission to continue making effort to maintain the economic stability and the budget within the necessary parameters. The budget for this year will be reviewed so as to adopt a package of measures to increase the incomes and cancel the non-budget expenditure. The Premier also said that the VAT on agricultural products will be raised from 8% to 20% in 2013, but the difference of 12% will be later refunded to the farmers. The legislation will be modified so as to allow registering the cars older than seven that are on Moldova’s territory. This will enable to augment the budget revenues. According to Vlad Filat, the Government will sign a new cooperation agreement with the IMF after the current program is completed at this yearend. Moldova’s three-year IMF program, approved on January 29, 2010, is supported by a loan of about US$570 million designed to maintain financial stability, reduce poverty and foster economic growth.