A new Memorandum with the IMF: what it means for Moldova and especially for vulnerable groups
Automatically translated summary. The full text is available in Romanian.
An opinion paper by the Independent Think Tank “Expert-Grup” examines how support from the International Monetary Fund affects the social protection of vulnerable groups in the Republic of Moldova, against the backdrop of the Covid-19 pandemic, the energy crisis and the 2022 budget deficit.
The pandemic hit vulnerable groups hardest. Absolute poverty rose by about 2 percentage points to 27% in 2020, while extreme poverty stayed high at around 11%. The energy crisis of autumn 2021 and unprecedented gas bills added further pressure.
After the early parliamentary elections of July 2021, the governing programme “Moldova of Good Times” pledged higher pensions, a “Silver Fund” for elderly care, higher disability benefits, more employment, poverty cut to 20% and extreme poverty to 5%, and gas subsidies. These needs far exceed the national budget, so external partners unblocked financing. A 2022 deficit of about MDL 15 billion is to be covered mainly by development partners, with the IMF Memorandum having a catalytic effect on other loans. The paper was prepared with IPIS and supported by the Soros Foundation Moldova.
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