The World Bank forecasts that the Moldovan economy will shrink by 2% in 2015 following a recession in the second half of this year, IPN reports.
A study presented in a news conference on October 12 says that after Moldova saw an economic growth of 4.6% in 2014, in the first half of 2015 the growth slowed down to 3.6%. Consumption declined following the decrease in remittances, especially of those from Russia.
The depreciation of the leu resulted in higher import prices, while the emergency loans provided to the three banks in difficulty led to a rise in liquidity in the baking system. To cope with the situation, the National Bank of Moldova increased the base rate by 13% to 19.5%. This affects the activity of the companies that do not have resources to develop.
The study shows that the Government faces increased fiscal pressure following the reduction in external assistance and budget revenues. In January – August, the public deficit represented 1.3% of the GDP. The costs are being rationalized so as to adjust them to the available financing. Owing to the large lending costs and lower customs revenues amid the decline in exports and imports and in external assistance, the Government restricted the purchases of goods and services.
The World Bank considers that a modest improvement of 0.5% in 2016 will follow the recession of the second half of this year. According to the experts, it is important for Moldova to insistently promote structural reforms so as to support macro-fiscal stability, increase competitiveness of the Moldovan economy and create workplaces.
