Measures to Revive Moldova's Construction Sector

Automatically translated summary. The full text is available in Romanian.

A study on the construction sector of the Republic of Moldova argues that its current situation is not caused only by the global economic crisis. It points to structural and institutional problems that built up over recent years, and proposes measures to revive the sector in addition to the government's planned action plan.

According to the study, the first recessionary symptoms were visible long before the global economic crisis took effect. They stemmed from a supply shock in the sector. The crisis then added a demand shock, which deepened the decline further.

To revive the sector, the study considers the following actions necessary to complement the government's planned measures: (i) abolishing VAT on housing construction work from 2010 for a limited period of two to three years; (ii) developing state mortgage programmes for young families with at least one child; (iii) a state guarantee of the initial contribution required for mortgage loans; (iv) launching infrastructure programmes financed from the state budget and external funds; and (v) simplifying the procedure for issuing construction permits.

View the original in Romanian

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