The World Bank has lowered its GDP growth forecast for Moldova in 2026 by 0.8 percentage points—from 2.7% to 1.9%—but has maintained its forecast for 2027 at 3.8%
This follows from the latest edition of the Europe & Central Asia Economic Update, prepared and published by the World Bank Group. The report states that economic growth in the developing countries of Europe and Central Asia (ECA) is likely to slow significantly this year due to the consequences of the conflict in the Middle East, geopolitical tensions, and trade fragmentation. Overall, economic growth in the region is expected to slow to 2.1% in 2026. Growth in Russia is projected to slow to 0.8%, while in the rest of the region, growth is likely to decline to 2.9%, as rising energy prices will dampen consumption and uncertainty will negatively impact investment. “The region’s resilience continues to be put to the test, as a number of countries depend on imports of natural gas, oil, and fertilizers,” noted Antonella Bassani, World Bank Vice President for Europe and Central Asia. According to her, many countries will need to make efforts to overcome the crisis’s consequences, with particular attention required for targeted support of the most vulnerable segments of the population. Continuing economic policy reforms aimed at fostering business growth and job creation will also help mitigate the crisis’s impact and enhance the resilience and dynamism of economies. In Central Asia, growth is expected to slow to an average of 4.9% in 2026–2027 as oil production in Kazakhstan stabilizes. The Central European economy is likely to grow by about 2.4% this year, with growth rates subsequently slowing to 2.3% in 2027, as the decline in consumption is partially offset by EU-funded public investment. In the Western Balkans, economic growth is projected to average 3.1% over the next two years, driven by infrastructure investment and robust service exports. Economic growth in Ukraine is expected to slow to 1.2% this year due to ongoing hostilities, rising energy prices, and fiscal strain. World Bank experts note that a protracted and more intense conflict in the Middle East remains a key risk capable of leading to a serious disruption of global energy and fertilizer supplies, resulting in a significant rise in energy and food prices and an even sharper slowdown in economic growth in the region. The slowdown in productivity growth observed in many ECA countries over the past decade has prompted a number of policymakers to supplement general economic reforms with industrial policy—government interventions aimed at supporting specific sectors, activities, or enterprises. A special section of the World Bank report, dedicated to analyzing how countries can use industrial policy to accelerate economic growth and create jobs, notes that the region’s approach would benefit from a clearer definition of priority areas and a focus on measures that foster future competitiveness rather than reinforcing existing structural weaknesses in the economy. For example, currently nearly two-thirds of all industrial policy measures are focused on agriculture and food production, and only 10% are aimed at supporting high-tech sectors or the production of capital goods. “To achieve higher productivity and employment growth, ECA countries should focus on implementing large-scale economic policy reforms aimed at modernizing the business environment, stimulating entrepreneurship, and improving the quality of education,” notes Ivailo Izvorski, Chief Economist for the Europe and Central Asia Region at the World Bank Group. According to him, the most important type of industrial policy capable of helping to address clearly identified market failures is targeted state support, such as the creation of industrial parks or special economic zones. However, the use of industrial policy measures should be restrained and of a temporary nature. In cases where the state implements industrial policy, the report recommends focusing it on supporting new and rapidly growing private-sector companies and innovative ideas, rather than on protecting existing market participants, such as state-owned enterprises; furthermore, industrial policy measures should strengthen, not undermine, competition. It should be noted that the World Bank previously raised its forecast for Moldova’s GDP growth in 2026 from 2.4% to 2.7% and projects Moldova’s economic growth in 2027 at 3.8%. These figures were included in the World Bank’s “Global Economic Prospects” report for January 2026. Moldova’s GDP in 2025, compared to 2024, grew by 2.4% in real terms, reaching 353.5209 billion lei. The Ministry of Economic Development and Digitalization forecasts Moldova’s GDP growth at 2.2% in 2026, followed by a gradual acceleration in the medium term to 4.2% in 2029. The IMF previously projected that Moldova’s GDP growth would be 2.3% in 2026, and that it would range from 3.5% to 3.7% over the following five years. // 09.04.2026 – InfoMarket
