IMF Mission postpones visit to Moldova until after elections

“The economic recovery in Moldova is taking place at a faster pace than we thought in the fall of 2009”, said IMF Resident Representative Tokhir Mirzoev at an informal meeting with the press. Tokhir Mirzoev added that the quality of economic growth seems to improve as well. While in the first three months growth stemmed only from increasing, remittance-fueled consumption, in the second quarter there is an increasing value added in production and service provision. “We haven't yet released any official forecast, but I think that a GDP growth of over 3% in 2010 is possible, despite the upcoming election campaign”, said Tokhir Mirzoev. Concerning the rate of inflation, Mr Mirzoev said it will be lower than that predicted in May and will amount to 8 – 8.5% per annum. Tokhir Mirzoev also said that this year Moldova will not receive any more tranches from the loan offered by the IMF. The assessment mission that was initially expected in Chisinau in October will be postponed until the first quarter of next year, that is, until after elections take place, Parliament is formed and a new Cabinet is installed in office. Depending on the results of negotiations with the new Government, the IMF will transfer the next installment of the loan offered by the IMF for the activities agreed on in the fall of 2009. Concerning the draft budget for the next year, Tokhir Mirzoev said that this was also a matter which was supposed to be discussed with the assessment mission in October. “In this situation, when Parliament is to be dissolved in a few days, it is impossible to adopt the budget until the end of this year. But the problem is not if the budget is adopted until year-end, but rather what kind of budget this is and to which extent it meets the economic realities. Because no IMF loans for direct budget support are considered for the next year”, said Mr Mirzoev.