IMF Urges Moldova to Cut Budget Deficit and Target Energy Aid

The IMF mission issued recommendations upon its departure

The Moldovan authorities have called for strict fiscal discipline and targeted compensation. Experts from the International Monetary Fund (IMF), led by Alina Iancu, today concluded their visit, during which the key topic of discussion was the need for strict control over budgetary expenditure and the mobilisation of domestic revenue. Given the economy’s high vulnerability to external shocks, the Fund strongly recommends that Chisinau shift its focus from public financing to attracting private investment.

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According to the ministry’s website, during their most recent meeting with Finance Minister Victoria Belous, IMF representatives set out a number of key recommendations on public finance management.

The Fund insists on adherence to the fiscal framework and a systematic reduction of the general government deficit to the target level of 3.5 per cent of GDP in the medium term.

Spending on energy subsidies for the population must be as targeted as possible, so as to support only the most vulnerable groups and not place an undue burden on the public purse.

At the same time, the IMF has endorsed the drive to modernise tax administration and broaden the VAT base, both of which are currently undergoing public consultation.

The authorities have also been advised to limit current expenditure, curb the growth of the public sector wage bill, and redirect the resources thus freed up towards capital investment and infrastructure development.

Finance Minister Victoria Belous gave assurances that Moldova continues to fulfil the commitments it has undertaken under the Policy Coordination Instrument (PCI). At the same time, the minister emphasised that, due to geopolitical risks, the government does not rule out the possibility of transitioning to IMF programmes involving direct financial lending in the future.

During the meeting, the parties agreed to continue their cooperation through technical assistance in 2027 in the areas of public debt management, wage reform, tax administration and the assessment of public investment management.

It should be noted that the IMF mission, led by Alina Yanku, was in Chișinău from 21 to 28 October 2026 to assess and monitor recent economic developments.

This story was translated with the assistance of artificial intelligence.The translation was also reviewed by the Logos Press editorial team.

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