Economic overview

In 2013, Gross Domestic Product (GDP) totalled MDL 99,879 million (EUR 5,448 million), with an increase of 8.9% (in compared prices) from the level in 2012. Thus, the Moldovan economy enjoyed a revival in 2013, following the 2012 recession.

The economy of Moldova is highly dependent of remittances, which are around 24% of GDP[1].

The economy of Republic of Moldova developed on average more dynamically than most EU countries during the last years. Over the years 2009-2012, the economy grew 

approximately at 4.5% each year, which represents a remarkable rate in times of crisis. Its cumulative economic growth rate tood at 14% in the years 2009-2012. The most dynamic sectors have been ICT, manufacturing industry, automotive industry, agriculture and others. Historically, the largest industries in Moldova have been manufacturing industry, agriculture and food processing, textile, apparel and footwear. The ICT sector is a rather new and fast growing sector for Moldova, with many foreign companies entering the market                   

The GDP registered a constant growth over 2009-2011. The worsening economic conditions in Europe and extremely hot and dry weather sent Moldova’s economy into recession in 2009. In 2011, the economy started to recover, registering a slow increase in GDP. The forecasts for 2013 are positive, as agriculture and manufacturing industry expect to recover, with ICT and other sectors tend to expand. World Bank growth expectations amount for 4-5 percent in 2014-2015, due to increased external demand of products exported by Moldova. The industry production reached 13.9% of GDP in2012, while agriculture production reached 10.2% in 2012.  

The increased industrial production is registered in the manufacturing industry and mining and quarrying industry. A significant intake was brought by the automotive industry, which is one of the most dynamic industries in Moldova. The share of agricultural sector decreased mainly due to the severe drought. However, the agricultural  sector has large potentials in production of fresh and processed fruits and vegetables, wall nuts, honey, meat, dairy products and poultry. Much potential could also be found in production of organic and biological food. This is due to the rich soil and appropriate climate. 

Production of goods in 2013 contributed to increasing the GDP with around 26%, while services contributed with around 58.9% (i.e. the main branches being transport and communication services, wholesale and retail trade services, construction activities, etc.).

In 2012 the unemployment rate stood at 5.6%, with a medium term of 13 months of unemployment. The total amount of unemployed persons includes: 42.2 thousand men and 25.6 thousand women included:

The export volume for the last 10 years has increased by more than three times to USD 2,399 million, with an increase of 11% in 2013 from the 2012 level.  

In 2013, exports of goods to EU countries totalled USD 1,140.9 million (i.e. 12.5% more than in 2012), accounting for 47.6% of total exports (compared to 46.9% in 2012). Export of domestic goods constituted USD 1,617.3 million (67.4% of total exports), registering an increase of 16.4% compared to 2012. Exports of goods to CIS countries totalled USD 924 million, accounting for 38.5% of total exports, with a decrease of 0.4% compared with 2012.

 Import volume has increased four times in the last 10 years, while in 2013 it registered an increase of 5.4% compared with 2012 and constituted USD 5,492.7 million. Moldova had a negative trade balance in 2013 (amounting to USD 3,093.7 million).

The annual inflation rate in Moldova was 5.2% for 2013. The unemployment rate was 5.1% in 2013 (a decrease from 5.6% in 2012). The total amount of unemployed people includes:

60.2% men and 39.8% women;
58.3% urban population and 41.7% rural population.

Total FDI

Net flow of foreign direct investment into the national economy increased considerably in 2013, amounting to USD 231.3 million (net value), with an increase of 32.1% compared to 2012. Net foreign direct investment flow is differentiated by sector.

The inflow of net direct foreign investments into the economy of Moldova amounted to USD 348.1 million in 2013, compared to USD 350.1 million in 2012. The biggest portion was allocated towards share capital - 52.8% (USD 183.9 million). Outflows related to FDI were valued at USD 116.7 million, compared to USD 177.4 million in 2012, mainly due to repayments of loans previously contracted from foreign investors (65.1% of total outflows).

Total stock of foreign direct investment gained by 31 December 2013 was valued at USD 3,668.3 million, consisting of: equity in the share capital and reinvested income amounting to USD 2,709.5 million and intercompany loans (other capital) - USD 958.8 million.

Two thirds of the foreign capital present in the Republic of Moldova is invested in joint venture companies, while the rest belongs to companies in foreign ownership. From the perspective of the total capital value and also from the numerical perspective, companies with foreign capital are concentrated in the category of companies with a large share of foreign capital (75 - 100%), indicating that foreign investors prefer to control the management of companies as much as possible, or even integrally.

Companies with foreign capital are larger than the local ones and promote a more active investment policy in comparison to companies with domestic capital. Large-scale production, better economic performances and greater access to external financial sources has made it possible for companies with foreign capital to register essentially bigger inflows of tangible and intangible assets during recent years. During that period it has also been demonstrated that, with some exceptions, companies oriented towards satisfying internal demand promote a more active investment policy compared with those oriented mainly towards exports.

The ratio of FDI flow into the economy of Moldova in GDP was 2.9% in 2013.

Source: National Bureau of Statistics

[1] National Bureau of Statistics (Main macroeconomic indicators 1995 - 2013)

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