Our key enemy is not a financial crisis, but a panic that could lead to a sudden depreciation of the leu. Info-Prim Neo interview with economic analyst Veaceslav Ionita

[ - Mr Ionita, the authorities assure us that Moldova will not be affected by the world financial crisis. What do you think about this?] - Moldova would not experience a crisis similar to the world one for the simple reason that we practically do not have a financial sector. To be affected by the crisis, the financial sector, the stock market, should be of at least 300 billion lei. In Moldova, it totals 15 billion lei. The mortgage market should be of at least 50 billion lei. In our country, it is 1 billion lei. The banking sector is also very small – of only 30 billion lei. For comparison, the banking sector in Ireland, which was hit by the crisis, represents 10 GDPs. In Moldova, this would mean 600-700 billion lei. So, without a developed banking sector, stock market and realty market, Moldova will not be affected by the crisis as other countries. The crisis in Moldova can come from a different direction and would have as a result the sudden depreciation of the leu. [ - Would the depreciation of the leu be serious?] - In 2006, the Moldovan leu depreciated gradually. In 2007, it appreciated a little. From January 2008 until mid-October, the leu appreciated against the five major foreign currencies (Romanian leu, Russian ruble, Ukrainian hrivna, the US dollar and the euro) by 16.5%. The appreciation of the leu resulted in lower exports, larger imports and vulnerability. Since the start of the year, all the currencies appreciated against the dollar, but since end-August – beginning of September they started to depreciate. When the Moldovan leu started to decrease in value, the National Bank, instead of letting it depreciate, intervened in order to maintain it. All the currencies depreciated against the dollar (in fact, it would be correct to say that the dollar and not the leu increased in value), but we try to keep the leu strong. The Moldovan leu is now by at least 25% stronger than it should be. The leu is by 10% stronger than the US dollar, while the rest of the currencies are by at least 5% weaker than the dollar. As a result, the leu goes in the wrong direction and the situation on the market is tense. Our key enemy is now not the financial crisis, but the panic that could lead to the depreciation of the leu. It’s hard to say how much the leu would depreciate, by at least 25-50% for sure. When the depreciation would start is also not known. [ - What effects can the world crisis have on the ordinary Moldovan?] - To lose the money kept in banks is not the most serious danger for the ordinary people. The Moldovans that keep their savings in lei would suffer losses as a result of the depreciation of the leu because their money would cost less in foreign currency. [ - What do you recommend doing in such a situation?] - I would recommend not taking steps during the next two-three months because the risk of keeping the money in any currency (leu, euro or dollar) is the same. No one knows what would happen to the three currencies in the near future. So, the people should not exchange the money, but keep it in the currency in which it is now. For a long term, of at least two years, I would keep the money in euros or, in the worst case, in dollars.