The Economy, Banking System and Monetary Policy

The Republic of Moldova is a specific case from the echelon of post-communist states where the economic transition progresses slowly. In 2003 PIB was situated on the half of the registered level in 1990, but the income for one inhabitant is of one third. Expressed at the parity of the power of buying, we estimated the average incomes per capital in 2003 to be about 2200 USD. The population does not declare a significant part from the real incomes and there is no evidence about official statistics. These things proceed from transfers of money got from workers who are abroad and from “black” economic activities. Currency influxes that are very intensive since 2004 (estimated at 600 millions USD, it means 20% of PIB) and the big number of emigrants demonstrates the fact that real incomes of households from which the members of the family are abroad are about 50-100% bigger than those identified in the official statistics. Inequalities of incomes are not reduced, the coefficient Gina in 2002 remained about 0,42, being an average characterized for poor countries from Latin Africa.

In 2004 the added gross value in economy was obtained in agriculture in proportions of 22,5%, in industry - 20,8% and in services (jobs) - 56,7%. From the structural point of view, it is observed such an agricultural defficiency of the economy with the insufficient weight of the processed industry. Besides this, it is observed the increase of the regional disparities of the development, a promoted tendency of disproportions between the economic activity from the capital and that from the regions of the country.

The low rate of savings makes the investments in exact money to be relatively low. In 2004 the rate of estimated investments was of 17% of PIB. It is mentioned the dependence of the economic increase of the consuming financed by the money transfers from abroad. The economy is vulnerable in accordance with the unstable weather conditions and the increase of prices for products that they are importing, first of all the fuel. In 2004 was observed a tendency of geographical diversification of exportations, the weight of UE states increasing to 30%, but states from CSI – reducing to 51%. Altogether, the exports are of 980 millions USD, but the imports were twice bigger. The exports remained dependent of a small assortment of products with a small added value and a limited competitiveness.

From the institutional point of view, the economy has an ambiguous defining and the insufficient protection of property rights and the confusion of an honest competition by the groups of pressure. The corruption is perceived as being ubiquitous and intense. In the elaborated annual raiting of the International Transparency, the score of 2,4 is attributed to Moldova and it worsened beginning with 2001.

The separatist region Transnistria is an insecurity factor that creates economic risks too. First of all, the conflict compromised the integrity of the economic system inherited from RSSM. Secondly, Transnistria offers opportunities for economic offences and serves as a source of budget losses and an image for the Republic of Moldova. The region is used as a transit zone of illegal exporting of capitals and international operations of loundary money.