Moldova is a small lower-middle-income economy. Although the poorest country in Europe, it has made significant progress in reducing poverty and promoting inclusive growth since the early 2000s. The economy has expanded by an average of 5% annually, driven by consumption and fueled by remittances. The latter account for a quarter of GDP, among the highest shares in the world.
The project will help reduce the vulnerability of rural households, which represent a disproportionately high share of the poor, to the impacts of climate change, and enhance the capacity of government institutions, key stakeholders, communities and the public to manage climate change risks.
In 2016 Moldova registered robust growth, recovery was supported by favorable conditions in agriculture and robust private consumption. Higher wages, lower inflation and higher employment resulted in a decline in poverty rate. Supported by consumption and accommodative fiscal policy, growth is projected to maintain its momentum in the mediumterm. While Moldova is slowly rebuilding its macroeconomic buffers, major policy challenges related to governance— particularly in the financial sector—and efficiency of public spending remain. Read more