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. Last Updated: 07/27/2016

Moldova: Economy Improving

CHISINAU -- Tough policies have brought some economic stability to the former Soviet republic of Moldova and Finance Minister Valeriu Chitan said he expects things to get better next year.


Delivering a report on the state of the Moldovan economy late Thursday, Chitan said low inflation, a stable currency and steadily declining interest rates were the first positive results of Moldova's tight credit and monetary policies.


"Next year will be the turning point in Moldova's economic reform and financial stabilization," he told journalists. "Try to imagine a curve on a graph. We have already covered 51 percent of the distance."


Moldova, a nation of 4.3 million sandwiched between Ukraine and Romania, went through months of falling output and soaring prices after it won independence as the Soviet Union fell apart. But Chitan said the worst was now over.


Moldovan consumer prices fell 0.1 percent in Aug. after a monthly rise of 2.2 percent in July, although officials said lower prices for food were the main reason for the sharp fall.


Monthly inflation peaked at 59 percent last December.


"We expect that in September and October monthly inflation will be not higher than 2 or 3 percent," Chitan said.


He said the timely introduction of the relatively stable leu currency last November had reduced "the import of inflation from Russia" to a minimum.