The World Bank has raised its GDP growth forecast for Moldova in 2025 from 0.9% to 1.5%, in 2026 from 2.4% to 2.7%, and in 2027 from 4.4% to 3.8%
It is planned that in nominal terms, the country's GDP will amount to 347.2 billion lei in 2025, 374.7 billion lei in 2026, and 408.5 billion lei in 2027. This follows from the latest Moldova Economic Update (Fall 2025) presented by the World Bank representatives at a meeting of the Economic Press Club. Moderate GDP growth of 1.5% in 2025 is expected to be driven by stable disposable income, increased investment amid lower interest rates, and higher agricultural yields in the second half of the year. The main sources of growth remain accelerated investment activity and stable disposable income, supported by lower inflation. However, external challenges remain. Weak export performance, particularly to Romania, combined with sustained import growth fueled by robust domestic demand, will continue to weigh on net exports and limit the pace of economic recovery. On the supply side, the agricultural sector is projected to recover in the second half of the year, contributing positively to GDP growth. The information and communication technology (ICT) sector will remain an important growth driver, while the industrial sector is expected to make a more significant contribution. However, the sector's growth potential will be limited by external demand, which is still below pre-pandemic levels, and by ongoing difficulties in the food industry caused by the recent swine flu epidemic and unfavorable spring weather conditions. The World Bank estimates that the transport sector will have a negative impact on growth as Moldova's transit role declines due to the partial resumption of Ukraine's traditional trade routes. In the medium term, economic growth is expected to accelerate, driven by an improvement in the external environment, labor productivity growth, and EU-related reforms and investments. Real GDP is projected to grow by 2.7% in 2026 and 3.8% in 2027 as a result of a more favorable external environment and the cumulative impact of structural reforms aimed at improving competitiveness and diversifying the economy. Private consumption and investment will remain the main drivers of growth, supported by the absorption of EU funds and the continued improvement in real disposable income. At the sectoral level, ICT and services are expected to remain the main drivers of economic growth, contributing to the expansion of economic activity. In parallel, industrial production is projected to gradually accelerate amid stabilizing external demand and improved investment sentiment due to the clarity of the political situation after the elections. Lower interest rates, supported by slowing inflation, are expected to stimulate activity in the financial services and construction sectors. Agriculture will gradually benefit from the implementation of EU-compliant reforms aimed at improving the sector's productivity and sustainability. In terms of aggregate demand, lower prices, real wage growth, and fiscal support measures that increase disposable income will contribute to poverty reduction. According to estimates, the poverty rate, calculated using the above-average income threshold, is projected to decline from 18.1% in 2024 to 15.5% in 2025, 14% in 2026, and 12.4% in 2027. Inflation is projected to continue to decline as supply pressures ease. Average annual inflation is estimated at 7.8% in 2025, remaining above the 5% target, mainly due to continued pressure on energy prices. It is expected to return to the target range by the end of 2026, fluctuating within the medium-term corridor, amid falling import prices and a growing export-oriented economy. Average annual inflation is projected to be 5.3% in 2026 and 4.5% in 2027. The World Bank expects the NBM to maintain a flexible exchange rate regime, intervening in the foreign exchange market as necessary to stabilize the national currency and keep inflation within the target range. As exports and foreign direct investment strengthen, Moldova's current account deficit is projected to narrow and external financing conditions to improve, although the deficit will remain high, underscoring the need for prudent external debt management. After a sharp increase in the current account deficit to about 19.8% of GDP in 2025, the deficit is expected to decline steadily to 19.1% in 2026 and 18.6% in 2027, but in the medium term it will remain more than twice the historical average, highlighting the current external vulnerability. This adjustment will be supported by improved export performance to the EU, including through robust expansion of services exports and stabilization of energy imports. The World Bank expects foreign direct investment inflows to become more significant as Moldova's ties with the EU deepen and remittances are projected to stabilize after declining to insignificant levels from CIS countries. The World Bank forecasts that official reserve assets will remain at a comfortable level, but Moldova will continue to depend on international financial assistance to cover its external financing needs, underscoring the importance of prudent external debt management. The budget deficit is expected to remain above 4% of GDP in the medium term. Budget revenues as a percentage of GDP are projected to return to historical averages as external grants decline and import revenues normalize. Total expenditures are expected to decline in 2026 but remain above historical averages, supported by growth in capital expenditures. Public investment is expected to gradually increase, reaching around 3% of GDP by 2027, supported by improved public investment management and resources available under the EU Growth Plan and the related Investment Plan to meet critical infrastructure needs. Social spending will continue to be the largest item in the budget, but is expected to become more targeted. As a result, both the budget deficit and public debt will remain above pre-pandemic levels, underscoring the need for prudent fiscal management to maintain debt sustainability and comply with the 2.5% deficit rule (excluding grants and externally financed capital investments). In the medium term, fiscal reforms should focus on improving revenue collection and expenditure efficiency, while protecting priority investments. According to the Joint Debt Sustainability Analysis (2024) conducted by the IMF and the World Bank, Moldova is exposed to a low risk of an external debt crisis and a moderate risk of a public sector debt crisis. // 04.11.2025 — InfoMarket
