Moldova’s foreign trade gap widened by 19% y/y to $773mn in Q2, the statistics office reported. In euros, the gap increased by only 9.6% y/y but its magnitude (€648mn) amounts to 8% of the full year’s GDP.
Over the 12 months ending June, the trade gap hit $2.67bn (€2.24bn), or 27.7% of the GDP projected for this year ($9.69bn).
And yet, the country’s foreign trade reserves at the central bank increased by $492mn over the year (or by 21% y/y) to $2.87bn or nearly 30% of GDP at the end of June — or nearly 13 months of imports (of goods only). By the end of July, the reserves had increased to $2.95bn. Robust wage remittances are driving imports up (as the local production base cannot cope with the rising demand for goods), strengthening the local currency at the same time.
Q2 exports increased by 17.4% y/y to €533mn, a high rate compared to the pace of imports (12.9% y/y). But Moldova’s imports (€1.18bn in Q2) are twice as large as the exports and the trade gap keeps widening. The exports to the European Union countries increased by an impressive rate of 30% y/y to €373mn, while those to Russia shrank by 22% y/y.
FOREIGN TRADE | ||||||||
EUR mn | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | Q1 18 | Q2 18 |
Total exports | 1,672 | 1,824 | 1,772 | 1,773 | 1,849 | 2,137 | 551 | 533 |
CIS | 719 | 695 | 556 | 444 | 374 | 409 | 91 | 78 |
EU | 783 | 853 | 945 | 1,097 | 1,205 | 1,406 | 369 | 373 |
Other | 170 | 276 | 272 | 232 | 270 | 322 | 88 | 80 |
Total imports | 4,033 | 4,127 | 4,036 | 3,598 | 3,632 | 4,266 | 1,078 | 1,180 |
Total balance | -2,360 | -2,303 | -2,264 | -1,825 | -1,784 | -2,128 | -528 | -648 |
y/y | ||||||||
Total exports | 5.2% | 9.1% | -2.9% | 0.0% | 4.3% | 15.6% | 11.1% | 17.4% |
CIS | 9.0% | -3.3% | -20.0% | -20.1% | -15.8% | 9.5% | -8.1% | -22.2% |
EU | 0.9% | 9.0% | 10.7% | 16.1% | 9.8% | 16.6% | 17.1% | 29.8% |
Other | 10.5% | 62.2% | -1.7% | -14.7% | 16.3% | 19.6% | 8.8% | 20.8% |
Total imports | 8.4% | 2.3% | -2.2% | -10.8% | 0.9% | 17.4% | 11.4% | 12.9% |
Total balance | 10.8% | -2.5% | -1.7% | -19.4% | -2.3% | 19.3% | 11.9% | 9.6% |
Source: BNS, Intellinews |