The 2020 economic crisis affected Moldova's foreign trade to a much lesser extent than previous crises in the country's history - IDIS Viitorul.
This opinion was expressed by the economic expert of the Institute for Development and Social Initiatives Veaceslav Ionita. He recalled that last year, the dynamics of Moldovan exports were negatively affected by the drought, which led to a sharp decrease in agricultural exports, almost by half compared to the level of 2019. The global crisis partially affected the exports of the automotive and pharmaceutical industries. But in March, there was a clear trend towards a recovery in foreign trade after a significant decline last year. Veaceslav Ionita explained that as far as foreign trade is concerned, the annual value of which is $8 billion, we take into account the total volume of exports and the total volume of imports. The analyst stated that Moldova's foreign trade turnover decreased 4 times during the crisis of 1998-1999, 2009, 2014-2015 and 2020. According to the IDIS Viitorul economic expert, the volume of Moldova's foreign trade decreased last year, compared to 2019, by $722 million, while exports decreased by about $296 million, and imports - by $426 million. The economist says that the 2020 crisis hit Moldova hard, but there were some elements in this crisis that set it apart from the previous ones. So, during other crises, the level of loans decreased, but last year, on the contrary, increased. Earlier, the foreign exchange reserves of the National Bank of Moldova decreased due to the fact that it had to intervene in the foreign exchange market, but in 2020 this did not happen. At the same time, there was a downward trend in the exchange rate, and the NBM was forced to sell currency. However, last year the NBM had a surplus of foreign currency, and the National Bank was forced to buy foreign currency in order to slow down the strengthening of the national currency. According to the analyst, one of the common symptoms of all crises is the decline in foreign trade. In 1998-1999 it decreased by $1 billion, in 2009 - by almost $2 billion, in 2014-2015 - also by about $2 billion, and in 2020 - by $722 million. Veaceslav Ionita noted that Moldovan exports decreased during all economic crises. Last year, this decline was $296 million, which is much less than in previous crises. Last year, the global COVID-19 crisis was a secondary crisis. This negatively affected exports at 30%. Drought in agriculture worsened the export situation the most, and as a result, in 2020, Moldova experienced the sharpest decline in agricultural production in history. Thus, grains, seeds and oilseeds, the largest export industry in Moldova after the auto industry, registered the sharpest decline last year. The analyst named five main sectors of the Moldovan economy, in which exports fell. The matter concerns grains and seeds - $157 million, automotive industry - $100 million, pharmaceuticals - $41 million, clothing - $33 million, tobacco - $13.8 million. Thus, more than half of the recession was caused by the 2020 drought. In certain industries of Moldova exports increased last year: oils and fats - $33.6 million, aviation equipment - $15.6 million, fruits and nuts - $14.5 million, land transport - $6.6 million and food waste - $6.4 million. As for imports, Veaceslav Ionita noted that they decreased by about $430 million: consumption decreased by about $100 million and savings in financial resources due to cheaper energy resources - by about $330 million. Last year, Moldova paid $590 million for energy imports, this is at least over the past 15 years, and saved $330 million, compared to 2019. In 2020, during the crisis, the largest decline in the history of petroleum products was recorded in the consumption of energy resources. Oil has hit its lowest price in the last 25 years. The fall in oil prices led to a decrease in prices for gas, electricity, oil, and a decrease in import prices, but poor regulation led to the fact that prices in Moldova remained relatively high, and citizens could not take full advantage of the cheapening of energy resources. The expert recalled that according to a IDIS Viitorul study, the majority of Moldovans spend their holidays abroad and spend about $800 million annually. Last year they were forced to stay at home and did not spend about $500 million. Thus, these $500 million from people who could not travel abroad and $330 million from the cheapening of energy resources, led to the fact that last year Moldova saved at least $830 million remaining in the foreign exchange market, which created a surplus of foreign currency. //31.05.2021 - InfoMarket.
