Moldova’s economy shows recovery; IMF to revise forecasts upwards
Moldova's economy is showing the first clear signs of macroeconomic recovery, according to Prime Minister Alexandru Munteanu, who estimates an economic growth of about 2% for this year.
The official noted that key indicators like industrial production, exports, and private investments have begun to increase. This positive outlook was confirmed during discussions on the morning of December 4 with the mission of the International Monetary Fund (IMF forecast).
"You saw the first statistical data this week which showed a rise in industrial production, a growth in exports, and an increase in construction and private sector investments," Munteanu stated on Jurnal TV. "These are just the initial signs, but even the IMF Mission, with whom I met this morning, informed me that they will revise their previous conclusions towards an improvement."
Munteanu projects a modest yet stable economic growth of around 2% for 2025. "I would think somewhere around 2 percent this year. We can make a bet and see. It's what I observe as a macroeconomist, seeing all the current trends."
The Head of Government anticipates that the IMF will also improve its projections for next year. "The IMF mission informed us today that they will revise all predictions upwards. If we achieve growth this year, next year's rate will be even greater."
"Catching the Wind": IMF Partnership and Lower Borrowing Costs
The Premier explained that while the Republic of Moldova does not have an urgent need for external financing, securing a new program with the IMF would provide enhanced fiscal credibility and an endorsement of its macroeconomic health.
"Although we do not need the IMF's money, having a program would be beneficial because it offers additional credibility," he affirmed. "I told them that there is no urgent necessity for funds, but we want a program as a supplementary certification. A program with the IMF will elevate our classification by international financial institutions, leading to lower borrowing costs."
Munteanu used a nautical metaphor to describe the current economic moment: "The weather has cleared up and we must catch the wind. It's like a sailboat: if you set the sails correctly, you catch the wind's direction."
2026 Budget: A Focus on Responsible Investments
On December 4, the Government approved the budget for 2026, which the Premier defined as "the budget of responsible investments." It features a budget deficit of 5.4% of GDP—20.9 billion lei—which Munteanu described as "significant but manageable."
"Any deficit is inherently unhealthy because it means we spend more than we earn, which necessitates borrowing," the premier explained. "Is borrowing good or bad? If you borrow to buy a Mercedes and then go into insolvency, it's not good. If you borrow to start a business, have done the math, and make a profit, then it's a completely different matter."
Munteanu rejected comparing the state to a private company but cited Romania's historical mistakes with external debt. "Do you recall the situation of our brothers in Romania in the '70s, when Ceaușescu decided to pay off all external debts? It resulted in an economic and social disaster," he noted.
Utilizing 1.9 Billion Euros from the EU Growth Plan
The Premier detailed how the European Funds from the Growth Plan for Moldova will be deployed. "It is a vast program that affects virtually all ministries. We are planning for roads, infrastructure, bridges, the railway, supporting entrepreneurs, micro-crediting, and schools—all kinds of incentives for residents who want to start a small business."
The Prime Minister stressed that investments are the main solution for combating the youth exodus. "Economic growth also means solving our major demographic problem. Young people are leaving the country. However, Moldovans are very attached to their homes; remittances have never decreased."
He added that the 1.9 billion euros granted by the EU do not depend on the IMF program, but a significant challenge remains: human resources. "Don't be scared, everything is under control. We share a problem with many other countries: the lack of capacity to use this money, the lack of human resources. In the Cabinet, we are discussing how to hire people to utilize these funds effectively," Munteanu explained.
Stabilizing the Economy: "We Must Harness that Momentum"
The Premier insisted that Moldova has successfully stabilized its economy following the recent energy crises. "The last 10 billion lei were used for compensations and allowances, dealing with energy shocks unprecedented in our history. But we have overcome it. We have gained energy independence, and in a few weeks, we will launch the Vulcănești line. We have stabilized the economy, and now we must develop it. We must harness that momentum; we must not drop anchor," concluded Prime Minister Alexandru Munteanu.
Translation by Iurie Tataru
