The bank fraud will affect the country’s economic development during many years on, said experts of the Independent Analytical Center “Expert-Grup”. For this year, these forecast a slight economic growth of 2.5%, which is about three times lower than the level needed to keep pace with the countries of the region. In the last number of the publication MEGA issued on April 6, the experts said that this growth will not be enough for dealing with the internal macroeconomic imbalances, IPN reports.
According to the experts, the recovery will be fostered by the compensatory growth in agriculture, after a difficult agricultural year in 2015. Given the low comparison basis of 2015, it will be easier to obtain positive growths in 2016. Inflation will be tempered and this will positively influence the real economic growth and will motivate the National Bank of Moldova to gradually relax the monetary policy.
Despite the projected GDP growth, the experts identified three constraints that will affect the country’s economic development. The first derives from the bank fraud that equals 12% of the GDP, the bankruptcy of the three banks and the resulting fiscal implications. The second is related to the freezing of the external assistance that will lead to the suspension of investments in infrastructure. The third refers to the undermining of economic competitiveness caused by the slow growth rate of productivity compared with the rise in salaries.
However, the banking sector remains the main source of risks for the Moldovan economy. “The crisis in the banking sector represents a major vulnerable point for the Moldovan economy. Therefore, a complex plan for reforming the banking sector should be immediately worked out and implemented, with emphasis on the intensification of the investigation into the bank fraud, improvement of bank share ownership transparency and quality and strengthening of the independence and regulatory powers of the National Bank of Moldova,” said the executive director of “Expert-Grup” Adrian Lupusor.
The experts said that the economic growth during the next two years will be also undermined by a problematic budgetary-fiscal framework through the blockage of the external financial assistance and the rise in the public debt, caused by the conversion of the urgent loans provided to the bankrupt banks into state securities. Though the fiscal consolidation efforts taken by the authorities are welcome, “Expert-Grup” considers special stress should be laid on the improvement of the efficiency of fiscal administration.
