The purchasing power of the euro has significantly decreased in recent years in the Republic of Moldova, according to an analysis by economic expert Veaceslav Ionita. According to him, the devaluation is evident when comparing the current value of the euro with its value from two decades ago, IPN reports.
“In the year 2000, Moldovans receiving 100 euros from remittances could buy a considerable amount of goods. By 2020, 240 euros were needed for the same quantity of goods. And by 2024, the sum has risen to 400 euros”, explains the expert.
Veaceslav Ionita highlights that in just four years, the purchasing power of the euro has decreased by over 70%. As a result, what could be bought with 100 euros in 2020 now requires approximately 170 euros. “A salary of 1,000 euros today is worth, in real terms, only 590 euros from 2020”, Ionita adds.
The decrease in purchasing power is attributed to inflation and rising prices in recent years. “Galoping inflation and price hikes have eaten away at the real value of money. Salaries in euros may seem large on paper, but in practice, they lose value quickly”, says the expert.
The analysis also reveals that in 2024, approximately 16.5% of employees in Moldova earn salaries higher than 1,000 euros per month, equivalent to 19,250 lei. This translates to 104,000 people. Compared to last year, their number has increased by 30,000, from 74,000.
According to the expert, the sectors that pay above-average salaries are: “The IT sector leads by far, with 62.3% of employees earning more than 1,000 euros. The financial sector follows, with nearly half of its employees (47.3%) surpassing this threshold. Surprisingly, public administration ranks third, with 22.8% of civil servants earning over 1,000 euros”, explains Veaceslav Ionita.
At the other end: “The HORECA sector has only 3.5% of employees earning above this threshold. In education, only 8.7% of teachers earn over 1,000 euros, and in culture and the arts, the percentage is 4.3%,” the expert points out.
“Although we see an increase in the number of high-income employees, inequalities between sectors remain a major issue. If we want to reduce these disparities, we need to invest more in education, culture, and infrastructure”, recommends Veaceslav Ionita.
“Ten years ago, only 1,900 people earned more than 1,000 euros. Today, the number is 50 times higher. This evolution shows that, despite the challenges, there are also positive signs in the economy. More Moldovans are managing to secure competitive salaries, which gives us hope for a better future”, concludes the economist.
The National Bank of Moldova (BNM) has announced that starting from January 2, 2025, the euro will be used as the reference currency for determining the official exchange rate of the Moldovan leu, replacing the U.S. dollar. According to the BNM, official data shows that over 60% of commercial transactions and 70% of remittances are in euros, and this currency is the most popular in the local foreign exchange market. The change will contribute to the stability of the exchange rate, benefiting the economy, according to the National Bank.
