Page 17 - FSUOGM Week 20 2022

FSUOGM NEWS IN BRIEF FSUOGM

Reconstruction and Development (EBRD) Bank of Moldova (BNM) to raise the base 40-month $558mn ECF/EFF programme
has warned. They have multiple impacts, rate by almost 1,000 basis points from June approved in December 2021.
not limited to inflation, the EBRD said in 2021 to 12.5% in March 2022.
its Regional Economic Prospects report High gas prices contributed to a current
published on May 10. account deficit of 11.6% cent of GDP in Gazprom says transit gas
Moldova’s exceptionally strong GDP 2021, prompting BNM interventions in
growth of 13.9% last year was driven the foreign exchange market and thus pumping through Ukraine as
by double-digit growth in household decreasing international reserve assets from
consumption, fuelled in turn by robust $4bn in October 2021 to $3.4bn in March usual
growth of salaries, social assistance and 2022, but still covering approximately five
remittances, and by revived export demand months of imports. Transit pumping of Russian natural gas
from European automotive value chains. In addition, subsidies to households through Ukraine is going on as usual with
But the high inflation (over 20% y/y), and businesses are putting pressure on the planned pumping for Thursday standing
a massive influx of refugees (15% of government finances and crowding out at 98.9 million cubic meters, gas giant
the local population) and costly energy public investments. Gazprom said in a statement.
imports pushing up the current account International support will help alleviate As per contract with Ukraine, Gazprom
gap (11.6% of GDP in 2021 and rising) some of the immediate financing concerns, is to pump 40 billion cubic meters of gas
are major structural problems that would the EBRD said, adding that downside risks to the E.U. through the country in 2022, or
bring country’s GDP growth down to from high inflation and the impact of the 109.6 million cubic meters per day.
1% (optimistic scenario), the EBRD said. war on Ukraine remain substantial.
However, in 2023 the country’s economy In light of the adverse shock on
could advance by another 3.5%. Moldova’s economy, the authorities have
High inflation prompted the National asked for augmentation of the IMF’s

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