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The Ministry of Economy and Infrastructure singled out the factors that contributed to Moldovan industry’s 8.1% growth in January-May 2018

The Ministry of Economy and Infrastructure singled out the factors that contributed to Moldovan industry’s 8.1% growth in January-May 2018

According to the ministry, compared to the same period of the last year, the following main factors contributed to the increase in the industrial production index: expansion of the activities of the free economic zones, in particular, the implementation of investment projects in the automotive industry; expansion and diversification of export markets as a result of taking advantage of the opportunities offered by the Moldova-EU Association Agreement. In addition, the Moldovan industry was positively affected by the favorable evolution in the agricultural sector, as well as the increase in domestic and external demand for manufactured goods. Among the most progressive branch industries, which led to the growth of the industry in the first 5 months of 2018, there were mentioned the following ones: production of electric wires and cables (39%), production of parts for automobiles and engines (+ 42%), production of glass products (47%), fruit and vegetable processing (41%), production of oils and fats (+ 37%), processing and preserving of meat (+ 13%), production of beverages (+ 7%), clothing production (+ 7.2%), production of other textiles (+ 20%), footwear and leather treatment (+ 21%), energy production and supply (+ 4.6%). The processing industry, which accounts for about 82% of all manufactured goods, made the largest contribution to the growth of industry (+7.1 percentage points from 8.1%), registering a 9.4% growth. The Ministry of Economy and Infrastructure notes that the automotive industry is becoming an increasingly important branch of the national economy, creating new jobs with decent wages and products for export. Significant growth was recorded in the production of electrical wires and cables and the production of parts for cars and engines (about 40%). Expansion of these industries is connected with the development of investment projects in the FEZ, launched by foreign investors last year (the project of the Japanese company Sumitomo, launched in Orhei, the expansion of the German companies Draexlmaier in Cahul and Coroplast in Causeni, etc.). As of the end of 2017, about 12 thousand jobs were created in the FEZ of Moldova, the average salary was about 8.3 thousand lei, and the share of manufactured products in the total export volume was about 24%. It is emphasized that the food industry, which is another strategic sector for the national economy, contributed to the growth of industry at the level of 2.4 percentage points. In January-May 2018, production within this branch industry increased by 12%, which was facilitated by favorable changes in the agricultural sector of the last year. The most productive subsectors of the food industry were: processing and canning of fruits and vegetables (+ 41%), production of oils and fats (+ 37%), processing and preserving of meat products (+ 13%), production of beverages (+ 7%), bakery products (+ 6.4%), processing and preserving of fish (+ 49%). The production of glass also affected the increase in the volume of industrial production at the level of 1.1 percentage points in the overall indicator. The glass industry increased by about 47%, mainly due to the increase in the volume of products output exported abroad: the volume of exports increased by 46%. The agency indicated that the production of textiles, clothing and footwear are industries with significant potential, and they had a significant impact on the growth of industrial production (+ 2.1 percentage points). Over 5 months of this year, textile production increased by 19%, clothing - by 7.2%, footwear - by 21%. These industries mainly export products abroad (about 80% of production), and expansion of these industries’ production in the foreign markets is the main growth factor. In January-May 2018, in the energy sector, the production and supply of electricity, heat, gas, hot water and air conditioning increased by 4.6%, and this contributed to the growth of industry at the level of 1 percentage point. The growth of production and energy supply was affected by positive changes in the sectors of the economy. Extractive industry showed its instability in the first 5 months of 2018. After a 30-40% increase in January-February, this industry’s decrease in the following months was 1.1% to 14%. The instability of the relevant industry is due to both weather factors and the situation in the construction sector, which is in stagnation. //11.07.2018 - InfoMarket.

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