Moldova Economy - 2006

Economy - overview:
Moldova remains one of the poorest countries in Europe despite recent progress from its small economic base. It enjoys a favorable climate and good farmland but has no major mineral deposits. As a result, the economy depends heavily on agriculture, featuring fruits, vegetables, wine, and tobacco. Moldova must import almost all of its energy supplies. Energy shortages contributed to sharp production declines after the breakup of the Soviet Union in December 1991. As part of an ambitious reform effort after independence, Moldova introduced a convertible currency, freed prices, stopped issuing preferential credits to state enterprises, backed steady land privatization, removed export controls, and freed interest rates. The government entered into agreements with the World Bank and the IMF to promote growth and reduce poverty. The economy returned to positive growth in 2000, and has remained at or above 6% every year since. Further reforms will come slowly because of strong political forces backing government controls. The economy remains vulnerable to higher fuel prices, poor agricultural weather, and the skepticism of foreign investors.

GDP (purchasing power parity):
$9.519 billion (2005 est.)

GDP (official exchange rate):
$2.519 billion (2005 est.)

GDP - real growth rate:
7.5% (2005 est.)

GDP - per capita (PPP):
$2,100 (2005 est.)

GDP - composition by sector:
agriculture: 20.5%
industry: 23.9%
services: 55.6% (2005 est.)

Labor force:
1.34 million (2005 est.)

Labor force - by occupation:
agriculture: 40%
industry: 14%
services: 46% (1998)

Unemployment rate:
8%; note - roughly 25% of working age Moldovans are employed abroad (2002 est.)

Population below poverty line:
80% (2001 est.)

Household income or consumption by percentage share:
lowest 10%: 2.2%
highest 10%: 30.7% (1997)

Distribution of family income - Gini index:
36.2 (2001)

Inflation rate (consumer prices):
12% (2005 est.)

Investment (gross fixed):
21% of GDP (2005 est.)

Budget:
revenues: $1.069 billion
expenditures: $1.065 billion; including capital expenditures of $NA (2005 est.)

Public debt:
72.9% of GDP (2005 est.)

Agriculture - products:
vegetables, fruits, wine, grain, sugar beets, sunflower seed, tobacco; beef, milk

Industries:
sugar, vegetable oil, food processing, agricultural machinery; foundry equipment, refrigerators and freezers, washing machines; hosiery, shoes, textiles

Industrial production growth rate:
17% (2003 est.)

Electricity - production:
2.942 billion kWh (2003)

Electricity - consumption:
3.036 billion kWh (2003)

Electricity - exports:
300 million kWh (2003)

Electricity - imports:
600 million kWh (2003)

Oil - production:
0 bbl/day (2003 est.)

Oil - consumption:
37,000 bbl/day (2003 est.)

Oil - exports:
NA bbl/day

Oil - imports:
NA bbl/day

Natural gas - production:
0 cu m (2003 est.)

Natural gas - consumption:
2.38 billion cu m (2003 est.)

Natural gas - exports:
0 cu m (2001 est.)

Natural gas - imports:
2.05 billion cu m (2001 est.)

Current account balance:
-$178 million (2005 est.)

Exports:
$1.04 billion f.o.b. (2005 est.)

Exports - commodities:
foodstuffs, textiles, machinery

Exports - partners:
Russia 35.8%, Italy 13.9%, Romania 10%, Germany 7.3%, Ukraine 6.6%, Belarus 6%, US 4.6% (2004)

Imports:
$2.23 billion f.o.b. (2005 est.)

Imports - commodities:
mineral products and fuel, machinery and equipment, chemicals, textiles (2000)

Imports - partners:
Ukraine 24.6%, Russia 12.2%, Romania 9.3%, Germany 8.5%, Italy 7.4% (2004)

Reserves of foreign exchange and gold:
$520 million (2005 est.)

Debt - external:
$1.926 billion (2005 est.)

Economic aid - recipient:
$100 million (2000)

Currency (code):
Moldovan leu (MDL)

Exchange rates:
lei per US dollar - 12.6 (2005), 12.33 (2004), 13.945 (2003), 13.571 (2002), 12.865 (2001)