The World Bank kept its forecast for Moldova's GDP growth in 2021 and 2022 at 3.8% and 3.7%, respectively.
At the same time, in 2023, WB experts expect the Moldovan economy to grow by 3.8%. Such data are contained in the new edition of the World Bank's Global Economic Prospects for June 2021. Earlier, World Bank experts noted that after a strong economic recession in 2020 (-7% of GDP), Moldova will moderate economic recovery, and Moldova's GDP will only reach pre-COVID-19 levels in 2022. Analysts pointed out that the uncertainty associated with the duration of the pandemic and political developments in Moldova poses significant immediate risks and will keep the country's economy below its potential. According to WB analysts, the Moldovan economy will gain momentum thanks to a recovery in disposable income, partly due to remittances, positive tax dynamics (increased wages and transfers) and soft monetary policy. World Bank experts believe that all sectors of the Moldovan economy will recover as consumer and investor confidence grows amid a more favorable external environment and stimulating monetary and fiscal policies. Herewith, agriculture will be the leader among the sectors for recovery after a bad 2020. Internal risks are associated with political instability, institutional weakness and political restrictions in the implementation of judicial and structural reforms. WB experts draw attention to the fact that fragile economic conditions and low levels of productivity are exacerbated by significant government influence in the economy, shrinking fiscal space, low levels of financial intermediation and governance problems. Promoting long-term structural reforms against the backdrop of economic recovery measures and political instability is of paramount importance. According to WB analysts, the ability to reduce the impact of the crisis and support the recovery of the Moldovan economy will largely depend on external financing, in particular on successful negotiations on the new IMF program. “In the future, Moldova will have to tackle inequalities of opportunity and accelerate job creation in the private sector. In addition, as the episode of a severe drought in 2020 showed, the country's economy is very vulnerable to extreme weather events, ”the WB experts emphasized. According to the forecast of the World Bank experts, GDP growth in Moldova in 2021 will amount to 3.8%, in 2022 - 3.7%, and in 2023 - 3.8%, and in nominal terms it will be the level of 222.2 billion, 241.7 billion and 263.2 billion lei. A gradual increase in Moldovan exports is expected by 6.6% in 2021, by 7.1% in 2022 and by 7.5% in 2023. Imports will also grow in stages: by 5.1% in 2021, by 6.3% - in 2022 and by 6.5% in 2023. Average annual inflation in Moldova is expected at 4.4% in 2021 and at 5% - in 2022 and 2023. It is predicted that external debt will be 74.6% of GDP in 2021, 74% in 2022, and 73.5% in 2023. Public and publicly guaranteed debt will amount to 41.3% of GDP in 2021, 42.5% - in 2022 and 43.6% - in 2023.The budget deficit, according to forecasts of WB experts, will amount to 4% of GDP in 2021, 2.8% - in 2022 and 2.5 % - in 2023 // 08.06.2021 — InfoMarket
