BUCHAREST, Nov. 1 (Xinhua) -- The World Bank (WB) on Thursday greatly raised its forecast for Moldova's economic growth in 2018 to 4.8 percent from 3.8 percent projected in May.
The increase in Moldova's economic growth is exclusively due to a big domestic demand, stimulated by a real increase in salaries, especially in the budgetary sector, as well as strong growth of remittances, according to statements made by the bank's office in Chisinau at a press conference.
"With this structure of the economy, when the economic growth comes from the part of consumption, it is very important to have deep structural reforms, which might change the economic paradigm and would create conditions for a sustainable increase of the productivity," WB expert Marcel Chistruga said at the press conference.
According to the WB expert, the revitalization of foreign inflows and the improvement of the situation in the financial sector will further back private investments, as well as the accumulation of stocks, and this will inevitably lead to an increase in imports, resulting in a negative contribution from net exports to growth. Furthermore, the parliamentary elections due in February will trigger an expansion of short-term public spending.
"We believe that the bigger confidence of consumers and the business environment, as well as continuous normalization in the financial sector will be practically the engines of the economic growth in the medium term," said Chistruga, adding that the paces of economic growth will be more moderate in the next years and the WB expects a 3.5-percent increase of the economy till 2020.
