Economics

MOLDOVAN ECONOMY TO GROW 5.2% IN 2019 AT BEST - EXPERT-GRUP

14 december, 2018

The Moldova's economic growth in 2019 will account for 5.2% according to optimistic forecast or 3.5% - according to the pessimistic one, said Expert-Grup specialists.

At the presentation of the MEGA annual economic study, experts said that regardless of scenario, population revenues will keep growing, ensuring the growth household consumption by 4.3-5.6% depending on the course of events, which will be the main source of economy growth, given its role in the aggregate demand structure.

"The growth of the Moldovan GDP will also be due to the growth of industrial production (4.3-4.9%) and agricultural production (4.1-4.7%). The trade contribution to economy will grow (5.4-6.8%), as well as of the construction (6.8-7.8%) transportation services (4.3%-5.2%). A positive trend will preserve in the net tax revenues to the GDP as well - VAT, excise taxes, customs tariffs", experts said.

They added that given the low base rate which established at the level of historical minimum (6.5%), the continuation of crediting growth is expected in 2019.

"Next year, banks will be paying more attention to physical persons, thus the volumes of consumption credits will considerably grow. The macro-financial organization's activity will keep extending due to the demand from individuals. In the second half-year, the crediting to economic agents will also grow given the growth of companies' investment appetites, as well as the lowering of the state supervision in several major banks. According to the forecast, the volumes of the issued credits in national currency will grow 3-15%, while in foreign currency - 10-17%", experts said.

According to them, the investment activity may also grow in 2019, though it will not play a major role in the total growth structure.

"In case a pessimistic scenario materializes, investments in fixed capital will grow 6.5%, while in case of optimistic scenario - 8.5%. Given the total decline of investment activity over recent years, such a growth still should be regarded as unsatisfactory, because not the entire resource potential of economic agents and the accumulated liquidity of the financial system are used. While this growth trend does not cover the economy's general needs", experts said.

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