Moldova's GDP is expected to decline by 4.0 per cent in 2020 according to the forecast of the European Bank for Reconstruction and Development (EBRD).
"The coronavirus crisis will likely have a significant negative impact on the already decelerating economy", the EBRD said in the May 2020 edition of its Regional Economic Prospects report.
The EBRD forecast Moldova GDP to decline by 4.0 per cent in 2020 followed by a recovery of 5.0 per cent in 2021.
"Weaker demand from trade partners will lower Moldovan exports, especially from the free trade zone which is well integrated into the global supply chains. This will be exacerbated by a likely drop in remittances, which will weigh on disposable incomes", the EBRD said.
EBRD experts add that the increased uncertainty, 14 compounded by the volatility in the financial markets, will likely lead to postponed private-sector investment projects.
According to the bank, economic growth in Moldova decelerated to 3.6 per cent in 2019 due to a near-standstill in the last quarter of the year. Strong investments benefiting from heightened construction activity, private consumption and robust export growth all contributed to economic expansion.