Andrei Radulescu
“I draw attention to the significant decline in Moldova’s potential annual economic growth rate in recent years in the context of exogenous shocks (including regional geopolitical tensions) and their consequences (crisis in the energy sector),” he said.
The results of econometric estimations developed using the IMF database indicate a slowdown in Moldova’s potential annual economic growth rate from a level above the 5% threshold before the Great Recession (in 2007) to below 2% at present.
Moreover, after the onset of the coronavirus pandemic, the potential annual economic growth rate in RM in 2023 is less than 2%, the lowest since 2000.
Last but not least, the results of the developed estimates indicate that economic activity in Moldova is growing at a rate lower than potential starting in 2022.
“I would emphasize that the decline in potential annual economic growth rates and the development of the economy in recent years at rates below potential have contributed to the strengthening of the population decline trend in Moldova,” the analyst said.
According to IMF estimates, Moldova’s population has fallen from 2.89 million in 2006 to 2.36 million at present. The Fund forecasts the continuation of this downward trend in the medium term, to the level of 2.05 million people by 2030.
On the other hand, there are also recent positive developments in the economy of RM. These are mainly due to the implementation of reforms under the €1.9 billion Growth Plan for the period 2025-2027, supported by the European Commission and aimed at developing infrastructure (including hospitals), improving energy security, increasing access to finance for SMEs and improving their access to the single market.
Thus, according to the NBS, gross fixed capital formation increased at an annualized rate of 16.1% in the first three months of 2025.
At the same time, industrial output increased for the fifth consecutive month in July 2025 and the annualized growth rate accelerated to 6.2%. In addition, the developed econometric estimates indicate that industrial production in Moldova is growing at an annual rate higher than the potential rate,” the Romanian economist added.
