The EBRD raised its forecast for Moldova's GDP growth in 2021 from 4.5% to 7%, but retained its forecast for Moldova’s economic growth in 2022 at 4%.
These data are presented in the bank's new Regional Economic Prospects in the EBRD Regions, dated November. In a similar June review, experts from the European Bank for Reconstruction and Development raised their forecast for Moldova's GDP growth in 2021 from 3.5% to 4.5%, noting that in 2022 Moldova’s economy is expected to grow at 4%. EBRD analysts note that the economy of Moldova in the first half of 2021 was marked by strong economic growth of 11.7% on an annualized basis. This growth was mainly driven by double-digit growth in investment and household consumption on the demand side, as well as similarly strong performance in manufacturing, construction and ICT. Strong growth was supported by a recovery in export demand from European automotive value chains, as well as a significant increase in remittances, which grew 23.2% year-on-year in the first half of the year, and added to household disposable income. EBRD experts point out that the increase in food and energy prices since the beginning of 2021 led to an increase in inflation in Moldova from almost zero in January to 6.7% in September 2021, which exceeded the National Bank's target of 5%. The NBM responded by raising the base rate in three stages to 5.5% in October 2021. The EBRD notes that since Moldova is integrated into European supply chains, especially in the automotive and textile industries, continued economic growth depends on global demand and, is likely to follow the pattern of global economic recovery. Based on strong economic performance in the first half of 2021, EBRD experts expect that in 2021 Moldova's GDP growth will be 7%, and in 2022 - 4%. Risks of deterioration are associated with low progress in the vaccination process and a potential energy crisis associated with gas. // 04.11.2021 – InfoMarket
