IMF says new programme with Moldova to help advance reforms aimed at backing more sustainable economic growth

The new programme with the International Monetary Fund (IMF) will help anchor macroeconomic stability amid persistent global uncertainties, strengthen the policy framework and promote structural reforms meant to support more sustainable and inclusive economic growth, as well as back Moldova’s strategic goal of advancing its EU accession agenda. The IMF announced today made statements to this effect, after the authorities said that Moldova and the IMF had reached a staff-level agreement on a new non‑financing programme supported under the Policy Coordination Instrument (PCI).

The decision was announced after an IMF staff team led by Alina Iancu had visited Chisinau on May 7-20 and held meetings with Moldova’s authorities, in the context of the request for a new programme.

“The new PCI program, which is a non‑financing programme designed to support sound economic policies, confirms the authorities’ continued commitment to ensuring macroeconomic and financial stability and sustainable economic growth,” said Alina Iancu at the end of the visit.

According to the official, although the Moldovan economy recovered in 2025, despite the energy crisis at the beginning of the year, a new energy shock is affecting economic activity and increasing inflationary pressures in 2026.

“Real GDP grew last year by 2.4 per cent, supported by resilient domestic demand and a strong rebound in economic activity in the agricultural sector. Average headline inflation in 2025 was 7.8 per cent and, at the beginning of the year, returned to the National Bank of Moldova’s (BNM) target range of 5±1.5 per cent, as pressures from food and energy prices eased. However, the new energy shock triggered by the war in the Middle East is reducing economic growth and accelerating inflation. The growth rate is expected to slow this year to 1.5 per cent, as higher energy costs and weaker external demand will constrain consumption, investment and exports. We estimate that average inflation will reach 8.1 per cent in 2026, while the current account deficit will widen to 22.1 per cent of GDP,” emphasized Alina Iancu.

She added that Moldova’s outlook largely depended on the duration and intensity of the war in the Middle East, as well as the war in Ukraine.

“If energy costs stay high, this could generate persistent inflationary pressures, while disruptions in fertilizer and fuel markets could negatively affect agricultural output. The high degree of uncertainty and the worsening of global financial conditions could also affect investments, remittances and external demand. These shocks could further weaken economic growth and deepen external imbalances,” the IMF warned.

The agreement on the new programme is to be submitted for approval to the IMF Executive Board.

Under the parameters of the programme, fiscal policy will follow a reliable medium‑term budget consolidation path. Thus, the Moldovan authorities commit to reducing the deficit to 3.5 per cent of GDP by 2029, while ensuring adequate budget space for financing capital investments, wage reform and social spending. This goal will be achieved through broad reforms aimed at strengthening the tax system, with a focus on broadening the VAT base, simplifying the income tax system and improving revenue administration, the IMF noted.

Also, public financial management reforms will focus on strengthening medium‑term budget planning, improving liquidity and debt management, public investment management and anchoring fiscal policy on a robust set of rules. The PCI programme also provides for better assessment of fiscal risks generated by state‑owned enterprises.

At the same time, the BNM will continue to closely monitor the macroeconomic situation and inflation risks and to use the available instruments to maintain prices’ stability.

Other reforms under the programme will focus on safeguarding the use of public funds. In addition, improving the quality, coverage and timeliness of economic statistics will support the policymaking process. The policies and reforms included in the PCI programmer will also support Moldova’s strategic aspiration to advance its EU accession agenda.