Medium-term budget forecast: after a decline of 4.5% in 2020, in the next 3 years Moldova's GDP will grow annually by at least 4%.
The document, which is a guideline for planning the country's annual budget, was published in Monitorul Oficial on November 13 and entered into force. The mid-term forecast was drawn up taking into account the drought and the negative socio-economic impact of the COVID-19 pandemic in the region and in the country. According to the updated data, by the end of 2020, GDP is expected to decline by 4.5% in Moldova, exports and imports will decrease by 12.9% and, accordingly, by 10%, by the end of the year, industrial production will decrease by 10%, and agricultural production - by 11.9%, investments in long-term assets will decrease by 4.8%. According to the baseline scenario, economic recovery is expected in the first half of 2021: manufacturing sectors will begin to recover from the first quarter, and the labor market - from the second quarter of 2021. Medium-term budgetary framework for 2021-2023 provide that in 2021 the economic growth in Moldova will be 4.1%, in 2022 - 4%, in 2023 - 4.2%. In nominal terms, GDP will grow from 223.4 billion lei in 2021 to 266.9 billion lei in 2023.The average annual inflation rate will be 2.3% next year, in 2022 - 5.5%, in 2023 - 5%. In the next 3 years, the leu is expected to depreciate by more than 10% against the US dollar: the average annual exchange rate in 2020 is expected to be 18.25 lei per dollar, in 2021 - 19.07 lei, in 2022 - 19.72 lei, in 2023 - 20.3 lei per dollar. In the next 3 years, exports will grow annually by 21.2%, 9.9% and, accordingly, by 8.8%, and imports - by 19.3%, 8.5% and, respectively, by 6.5%. The trade deficit will grow from 3.3 billion lei in 2021 to 3.7 billion lei. The volume of industrial production after a recession this year will grow in subsequent years - by 5.2%, 4% and 4.5%, and in the agricultural sector the growth in 2021 will be 13.3%, in 2022 - 1.2%, in 2023 - 0.8%. Investments in long-term tangible assets will grow to 33.5 billion lei in 2021 (+ 6.5% compared to 2020), to 38.1 billion lei in 2023 (+ 4.9% compared to 2022). The average salary in Moldova will grow from 8,422 lei in 2021 to 9,920 lei, or by 17.8% (the annual growth of wages in real terms is expected to be 4.7%, 2.5% and 4.2% in the next 3 years). These forecasts may change as there are both external risks (fluctuations in the global oil market, geopolitical changes, trade barriers, uncertainty in relations between the EU and the US) and internal risks (the second wave of COVID-19, a slower recovery in production and demand, unfavorable climatic conditions and a decrease in agricultural production and foreign trade, political uncertainty, macroeconomic imbalance - an increase in the budget deficit, current accounts, an increase in the cost of labor, fluctuations in the exchange rate of the national currency). Given the high degree of uncertainty, the medium-term budgetary framework also mentions an alternative forecast scenario, which provides for a longer period of economic revitalization and a slower economic recovery. In case of an unfavorable development of the situation, the decline in GDP may be about 6% in 2020.// 13.11.2020 — InfoMarket.
