Moldova & IMF IMF Activities Publications Press Releases

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Chisinau, May 20 ( INFOTAG ). The policy of the Government and the National Bank of Moldova (NBM) on decreasing the inflation has been the main topic at a meeting between their representatives and the IMF mission, which completed its visit to Moldova on Tuesday.

IMF Mission Head Graeme Justice said at a press conference that the mission is satisfied with the Government's reforms and the NBM's measures on diminishing the consumer price level in the republic. In contrast to the IMF previous mission, which visited Chisinau in December 2007 only the mission head and IMF Resident Representative to Moldova Johan Matissen were present at the final conference. In December 2007, Prime Minister Vasile Tarlev, NBM President Leonid Talmaci, Minister of Economy and Trade Igor Dodon and Minister of Finance Mihai Pop were present at the final press conference.

The mission head expressed his optimism concerning Moldova's economic growth in 2008 and said that the IMF forecasts a 5-6% GDP increase.

Justice said that in case of good yield in the agrarian sector, this index can be even higher.

Speaking about the inflation, he remarked that despite the objective growth of prices for energy resources and foodstuffs, the increase of the basic inflation index is observed in Moldova.

The Fund explains the growth of prices for local food products with the 2007 drought, which caused the obvious price growth for food products.

Justice says that the availability of a big money mass under condition of the growth of the foodstuff supply at the market owing to a good yield can result in the abrupt decrease of the consumer price index.

The IMF mission Head expressed his optimism in respect of the inflation, which will be possible to decrease in the nearest two-three months.

He said that it is difficult to tell undoubtedly, what will be the inflation index in Moldova in 2008.

He said that there can be several scenarios, but we must be optimists and believe, if not in 2008, so in 2009 the inflation will not exceed 10%.

The mission considers that the IMF Board of Directors will be able to consider and to approve the IMF mission's results by the middle of June 2008.

In the frame of the Economic Growth and Poverty Reduction Strategy it expires in April 2009) the IMF will grant USD174 million to Moldova. Until the present time the IMF has already allocated USD124 million to Moldova. These resources are granted to the NBM on privileged terms: maturity - 10 years, interest rate - 0.5%, grace - 5.5 years.


Chisinau, May 20 ( INFOTAG ). Foreign investors show their active interest to the situation of Moldova's national economy, IMF mission head Graeme Justice said on Tuesday. The mission was in the republic from May 5.

He said that investors often address to the IMF and to its country office in Chisinau and ask about the macro-economic situation in the republic.

The IMF representatives remarked that in their explanations the fund's experts tell investors that the Moldovan national economy has good prospects for growth.

IMF Resident Representative to Moldova Johan Matissen said that among the republic's problems there is a high inflation for the time being and a number of transition period problems.

When asked by Infotag, whether the revised Memorandum on the Government's Economic and Financial Policy for 2008 includes conditions on the compulsory privatization of the state property, Justice said the state property privatization was not discussed with the Government.

The IMF experts expressed hope that the Government will continue the practice of publishing the Memorandum in order to give a chance to as many people as possible to be acquainted with this Memorandum.


Chisinau, May 20 ( INFOTAG ). The mission of the International Monetary Fund, which concluded its visit to Moldova on Tuesday, recommended that the Government should decrease the current account deficit.

IMF Mission Head Graeme Justice said at a news conference in the Government, that the decrease of the gap in the account will allow the Government to decrease the inflation level more efficiently.

In his words, in 2007 the index of Moldova's current account deficit constituted 17% of its GDP.

Justice said that in many aspects it is connected with the external shocks, the Moldovan national economy was exposed to last year: the abrupt price growth for natural gas and oil products, the drought and Russia's ban on Moldovan wine exports to the traditional Russian market.

The IMF experts consider that in 2008 the situation is much more favorable , which will allow Moldova to decrease the current account deficit, on the one hand, and it will have a positive effect on suppressing the inflation level, which constituted 5.7% from the 2008, on the other hand.

The mission underscored, as a positive factor the growth of budget revenues, which increases both owing tax contribution and privatization.