Trade and Investment Opportunities in Moldova
June 2015
Project number: 06-02-02-15
Fahd Shah
Dr Eisa Abdelgalil
Source: National Geographic Society, accessed via
http://travel.nationalgeographic.com/travel/countries/moldova-guide/
Economic Research Department
Dubai Chamber of Commerce and Industry
Page 0
Overview
Moldova Key Statistics (2015)
Population (million)
 Moldova is small landlocked country located in the eastern
Europe. It is a member of the Commonwealth of independent
States (CIS) and is bordered by Ukraine and Romania.
 The capital of the country is Chisinau. The country’s official
language is Moldovan which is similar to Romanian. According
to data from the Moldovan National Bureau of Statistics, the
country had a population of around 3.56 million people in
2015. According to data from the World Bank Group, it also
had a high adult literacy rate of around 99% by 2012.
Area (square kilometers)
3.56
33, 846
Languages
Moldovan, Russian and
Gaguaz
Capital City
Chisinau
32
Number of Regions
Moldovan LEU
Currency
Total GDP (USD billions)
6.14
1,726
Per Capita GDP
Real GDP growth (%)
-1%
Source: Dubai Chamber based on data from IMF World Economic Outlook, April 2015 and
Moldovan Investment and Export Promotion Organization
 The Republic of Moldova has a parliamentary system and its
area covers about 33,846 square kilometers. Moldova has a
strategic position in between the CIS and EU regions.
Administrative map of Moldova
 To strengthen trade relations, Moldova has signed an
agreement with the EU to for a Deep and Comprehensive Free
Trade Area (DCFTA). It has also signed a free trade agreement
with Turkey, which was expected to come into effect in 2015.
Source: www.unesco.org , Moldova Country Report, Moldova Ministry of Education and
Science
Page 1
Moldova’s GDP structure
Moldovan GDP by sector (2015)
 According to data from the IMF, Moldova had a GDP of around
Billion USD in 2015. The services sector had the largest share at
around 64% of GDP, followed by industry at around 20% in 2015.
Agriculture also has a relatively significant share of around 16%
in Moldova's GDP in 2015. This reflects the importance of
Moldova's agricultural sector which has grown overtime due to
the presence of fertile land and a favorable climate.
 Private consumption makes up by far the largest portion of GDP
by expenditure, around 93% of GDP by expenditure in 2015.
Government consumption makes up about 15% of GDP while
investments make up around 22%. Because imports exceed
exports, net exports subtract 32% from GDP.
 The consumer oriented nature of the Moldovan economy is one
reason for the large share of private consumption and for
imports being much larger than exports. According to data from
the IMF, income from remittances makes up about 24% of
Moldova’s GDP. As people have migrated from Moldova,
remittances sent back home to other family members have
fueled consumption.
Agriculture
[PERCENTA
GE]
Services
64%
Industry
20%
Source: Dubai Chamber based on data from Economist Intelligence Unit (EIU) and World Bank, World
Development Indicators. Data for 2015 is based on EIU forecasts.
Moldovan GDP by Expenditure (2015)
Expenditure type
% of GDP
Private consumption
93
Government
consumption
15
Investments
22
Net exports (Exports –
Imports)
-32
Rebasing residual
2
Source: Dubai Chamber based on Economist Intelligence Unit (EIU)
Page 2
Economic Performance
Moldova GDP growth and budget deficit
10
8
Percentage change
 Moldova's economic growth has seen large fluctuations due in
part to regional and global economic challenges. For example
according to the IMF, in 2012, the economy contracted due to
drought from which it later recovered. Future output is expected
to be impacted by slowdown in demand from major trading
partners including among the Commonwealth of Independent
States (CIS).
Real GDP growth
6
4
2
0
2009
2010
2011
2012
2013
2014f 2015f 2016f 2017f 2018f
-2
Budget deficit
-4
 Moldova’s budget deficit which saw a reduction over the last few
years is expected to see become larger. The increase in the deficit
is expected partly due in part to weaker economic growth coupled
with a need for the government to increase pensions to support
Moldova's aging population.
-6
Source: IMF, World Economic Outlook Database, April 2015.
Moldova inflation rate
 Inflation in Moldova is expected to remain between 4% to 8%
from 2015 to 2018. Overall, Moldova’s economy is highly
dependent on remittances from Moldovans’s working in foreign
countries and in demand form its major trading partners the
European Union and the CIS countries.
Percentage change
10
8
6
4
2
0
2008
2009
2010
2011
2012
2013
2014 2015f 2016f 2017f 2018f
Source: IMF, World Economic Outlook Database, April 2015.
Page 3
Moldova population
Moldova’s Population (millions of people)
5
 While the trend of net migration has decreased from 2000 to
2015 and is expected to fall further, it is still expected to have a
continued negative impact on the growth of population.
4
3
2
1
2050
2045
2040
2035
2030
2025
2020
2015
2010
2005
0
2000
 The population of Moldova is expected to fall overtime, partly due
to the impact of migration. Moldovan people have historically
preferred to move to other countries. The Moldovan population is
therefore expected to decreases from around 3.44 million people
in 2015 to around 2.484 million by 2050. Aging across Europe
combined with migration of working age people also means that
the average age of the Moldovan population is expected to
increase from 27.7 years in 1980 to around 45.8 years of age by
2050.
Source: Dubai Chamber based on data from Population Division of the Department of Economic and
Social Affairs of the United Nations Secretariat, World Population Prospects: The 2012
Revision, http://esa.un.org/unpd/wpp/index.htm
Moldovan net migration rate (%)
0
 However, even if the number of people in Moldova falls overtime,
there are still opportunities in agricultural production and in
consumer sector. Also an aging population needs better access to
health care and medicines. These opportunities will be explored
later in this report.
-2
-4
-6
-8
-10
-12
-14
-16
-18
Source: Dubai Chamber based on data from United Nations, Population Division of the
Department of Economic and Social Affairs of the United Nations Secretariat,
World Population Prospects: The 2012 Revision, http://esa.un.org/unpd/wpp/index.htm
Page 4
Foreign Trade: Flows
Goods trade flow with the world
3
1
Billion USD
 A growing economy has meant that demand for imports of goods
by Moldova has seen strong increase. Imports by Moldova from
the world market grew at a Compound Annual Growth Rate
(CAGR) of around 14% from 2009 to 2014.
Exports
2009
-1
2010
2011
2012
2013
2014
-3
Trade Balance
 Moldova's service exports performed well and grew at a CAGR of
around 11.41% from 2009 to 2014. According to data from
trademap.org, Moldova’s major services exports in 2014
included commercial services followed by transport, travel and
telecommunication, computer and information services. Overall
service export and import trade was balanced and the trade
balanced was slightly positive in 2014.
Imports
-7
Source: Dubai Chamber based on data from trademap.org, International
Trade Centre.
Services trade flows and trade balance
with the world
2
Exports
Billion USD
 Exports of goods to the world market in turn grew at a CAGR of
around 16.36% during this period. Given the large amount of
imports over exports, Moldova had a negative trade balance
during the period. The trade deficit grew from around USD 2
billion in 2009 to around USD 4 billion in 2014.
-5
1
Trade Balance
2009
2010
2011
2012
2013
2014
-1
-2
Imports
Source: Dubai Chamber based on data from trademap.org, International
Trade Centre
Page 5
Foreign Trade: Composition
Moldova major imports from the world market (2014)
Commodities not elsewhere specified
Mineral fuels, oils, distillation products,
etc
Machinery, boilers, etc
17%
 Moldova's major imports from the world market in 2014
consisted of mineral fuels, machinery, electrical equipment, cars,
tractors (for agricultural use), plastics and pharmaceuticals. Most
of the country’s imports therefore consisted of finished products.
Electrical, electronic equipment
Vehicles other than railway, tramway
38%
Plastics and articles thereof
14%
Pharmaceutical products
Aircraft and parts thereof
Iron and steel
 Moldova's competitive advantage in exports consists of
exporting agricultural products and also basic goods. Many of
Moldova's exports consisted of agricultural and food related
products.
7%
Tobacco and manufactured substitutes
Other
6%
2%
2% 2%
3% 4%
5%
Source: Dubai Chamber based on trademap.org and International Trade Centre.
 The largest category was Electrical and electronic equipment
which made up about 11% of exports, followed by oil seed,
grains and fruits at 9%, cereals with a share in exports of about
8% and edible fruits and nuts with a share of around 8% exports
to the world market in 2014.
Moldova major exports to the world market (2014)
Electrical, electronic equipment
11%
Oil seed, oleagic fruits, grain,
seed, fruit, etc, nes
Cereals
30%
9%
Edible fruit, nuts, peel of citrus
fruit, melons
Iron and steel
 Other major exports products in 2014 consisted of iron and
steel, apparel and footwear related products.
8%
Articles of apparel, accessories,
not knit or crochet
Beverages and vinegar
4%
8%
4%
8%
6%
5%
7%
Articles of apparel, accessories,
knit or crochet
Furniture, lighting, signs,
prefabricated building
Footwear, gaiters and the like,
parts thereof
Other
Source: Dubai Chamber based on trademap.org, International Trade Centre
Page 6
Foreign Trade: Major partners
Moldova’s major export markets (2014)
30%
 Moldova's major import and export partners are located in the
region around it either in Europe or former CIS countries. Its
major export market is Russia which takes almost one fourth of
goods exports. Other important export markets in 2014 included
Romania, Ukraine, Germany and Poland.
25%
23.3%
20%
17.4%
15%
11.7%
10%
6.8%
5.2%
5%
 Moldova's major sources of imports are also little more spread
out geographically and where the top markets have lower share
in total imports, as compared to top export markets. Therefore
Romania is the top import source for Moldova, followed by Italy
ad then the Russian Federation and then Turkey.
4.6%
4.5%
4.2%
1.9%
1.9%
0%
Source: Dubai Chamber based on trademap.org and International Trade Centre.
Moldova’s major import sources (2014)
 Moldova remains highly reliant on its top export markets as the
top 3 export markets Russian Federation, Romania and Ukraine
demanded around 52% of total exports. There is therefore a
need a to diversify in other export markets. On the import side,
the top import source markets are more diversified with the top
3 import source markets making up about 42% of imports in
2014.
20%
18.3%
16%
12.7%
12%
11.4%
9.1%
8%
4%
6.1%
5.5%
4.9%
2.9%
2.3%
2.2%
0%
Source: Dubai Chamber based on trademap.org, International Trade Centre
Page 7
Trade with Dubai: Flow and composition
Dubai’s trade with Moldova (million AED)
20
Exports
0
2005
AED Million
 Moldova’s trade with Dubai has seen fluctuations but has
generally shown robust. Dubai's total exports to Moldova grew
from around 9.66 million AED in 2005 to around USD 15.76
million by 2014. Exports therefore grew at a Compound Annual
Growth Rate (CAGR) of around 5.6% from 2005 to 2014.
10
2006
2007
2008
2009
2010
2011
2012
2013
2014
-10
-20
Imports
-30
-40
 Imports grew at a faster rate of around 15.9% during this period.
Imports from Moldova made up the majority of trade, with
imports valued at around AED 34.35 million in 2014, while exports
to Moldova were valued at around AED 15.76 million in 2014.
-50
-60
Source: Dubai Chamber based on data from Dubai Customs
Dubai’s major exports to Moldova (2014)
 Dubai's major exports in 2014 consisted of finished goods such as
electrical machinery, appliances, vehicles, and coffee and tea.
1%
1%
[PERCENTAG
E]
2%
2%
Boilers, machinery and mehcanical
appliances
Vehicles other than railway and
tramway
5%
 Dubai’s major imports from Moldova in 2014 consisted of mostly
clothing and footwear articles. The largest share is for articles of
apparel knitted and not knitted HS chapters 61 and 62. Together
these items of apparel alone made up around 74% share of
Dubai's imports from Moldova in 2014. Other import products
included articles of leather and footwear.
Electrical machinery and
equipment
Coffee, tea and spices
[PERCENTAG
E]
[PERCENTAG
E]
Tobacco and substitutes
Paper and Paperboard
Musical instruments and parts
Plastics and articles
13%
27%
Essential oils and perfumes
Other products
Source: Dubai Chamber based on data from Dubai Customs
Page 8
Selected Free trade agreements of Republic of Moldova
 Moldova is a party to many free trade agreements. The
two major trade agreements are with Moldova's major
trading partners in the CIS region and the EU.
 Moldova also has trade agreements with countries in
eastern Europe such as Bosnia Herzegovina and Albania.
Moldova also has recently signed a free trade agreement
with Turkey which is expected to increase trade between
the two countries.
Moldova’s membership and Free Trade Agreements (FTA)
 World Trade Organization (WTO)
 Agreement with EU , Deep and Comprehensive Free trade
Area (DCFTA)
 Commonwealth of Independent States FTA
 Moldova and Turkey FTA
 Central European Free Trade Agreement (CEFTA) incudes
(Moldova, Serbia, Montegeru, Bosnia Herzegovina,
Kosovo and Albania).
 The Republic of Moldova is also a member of the World
Trade Organization. The high number of free trade
agreement highlights Moldova’s openness to new trade
partners and its desire to create a business friendly
environment.
Source: Dubai Chamber based on data from the Moldova Investment and Export Promotion
Organization, CEFTA Secretariat (http://www.cefta.int/ ), European Commission and the WTO
Page 9
Potential products for increased exports from UAE to Moldova
Product code and
description
Imports by
Moldova world
market (USD
million), 2014
Annual growth
of imports from
world market
2010 to 2014, %
Growth of UAE’s
export to the
world, 2010 to
2014 %
Analysis of opportunity
HS 27, Mineral fuels
919
16
12
 Moldova needs to import its oil and this forms its biggest import from
the world market. UAE oil companies can therefore export refined oil
products via ship and then land through nearby countries to gain
access to the Moldovan market. This import market has seen strong
growth of around 16% per annum from 2010 to 2014 making it an
important growth market.
HS 84, Machinery
and boilers
428
7
15
 Machinery and boilers make up another large import category.
Important sub-categories include machinery for agricultural use such as
HS 8432 Agricultural, forest machinery for soil prep/cultivation and HS
8433 Harvesting/threshing machinery. High quality used machinery can
also be sourced from major agricultural producing countries for
potential export to Moldova.
HS 85, Electrical
and electronic
equipment
356
3
10
 Moldova imported about 356 million USD of Electrical and electronic
equipment in 2014. Imports in this category grew at an annual rate of
about 3 % from 2010 to 2014 and UAE’s exports to the world market
grew at an annual rate of about 10% from 2010 to 2014. Some major
producers of electrical products are in Asia creating opportunities for
intermediation for Dubai businesses.
HS 8703 , Cars
156
5
20
 Moldova imported about USD 325 million worth of cars in 2014. Imports
in the category grew at an annual rate of around 5% from 2010 to 2014.
UAE exporters also increased their exports to the world market in this
product by 20% in this product category, indicating their competitive
strength.
Source: Dubai Chamber based on trademap.org, International Trade Centre
Page 10
Potential products for increased exports from UAE to Moldova
Product code and
description
Imports by
Moldova world
market (USD
million), 2014
Annual growth
of imports from
world market
2010 to 2014, %
Growth of UAE’s
export to the
world, 2010 to
2014, %
Analysis of opportunity
HS 8701, Tractors
47
6
13
 Moldova imported about USD 47 million worth of tractors for use in
agricultural production. Imports under this product category grew at an
annual rate of 6% from 2010 to 2014 while UAE’s exports to the world
of this product also grew at a rate of 13%. Further research of this
market could mean opportunities for UAE businesses to increase their
exports to Moldova in this product category.
HS 39, Plastics and
articles
236
9
18
 Moldova imported about USD 236 worth of plastics and articles in 2014.
Imports of this product category grew at an annual rate of around 9%
form 2010 to 2014, while UAE exporters grew their exports to the world
market in this product category by a robust 18% from 2010 to 2014.
This product category could therefore also be a potential market for
increased UAE exports and re-exports to Moldova.
HS 30,
Pharmaceutical
products
192
10
24
 With an aging population demand for pharmaceuticals is growing in
Moldova. In 2014 the country imported about USD 912 worth of
products under this category and from 2010 to 2014 the imports grew at
an annual rate of 10%. UAE exporters also increase their exports in this
category by 24% from 2010 to 2014 indicating their competitive
strength.
HS 73, Articles of
iron and steel,
121
6
10
 Articles of iron and steel is another product category with import
potential for Moldova. In 20114 Moldova imported about USD 121
million worth of products under this category. The import market grew at
an annual growth rate of about 6% between 2010 to 2014 while UAE’s
exporters also grew their exports at an annual rate of around 10% from
2010 to 2014. Articles of iron and steel could therefore be another
possible product for increased exports from UAE to Moldova.
Source: Dubai Chamber based on trademap.org, International Trade Centre
Page 11
Establishing a business in Moldova
Document required for business registration
1)
 According to PWC, Moldova allows for the creation of the following
for profit entities: Limited Liability Company (LLC), Joint Stock
Company (JSC), General Partnerships, Limited Partnership and
Cooperatives.
2)
 For most foreign investors, the ideal company form would be either
an LLC and or a JSC. Limited liability structures and the ease of
meeting regulations in some sectors are reason for this preference. It
is also more convenient to use an LLC structure for 100% investment
in the company.
5)
 A series of steps that investors would normally have to take to set-up
a business is provided below, while a list of documents required is
provided on the right.
7)
3)
4)
6)
Copy of the parent company's registration
certificate authenticated by a notary.
An extract from the national commercial register
authenticated by a notary.
Copies of certificate of incorporation by a foreign
company.
Certificate of foreign company's solvency issued
by a bank.
Decision by foreign company to establish a
company through foreign investment in Moldova
(for example through shareholder meeting).
If the services of an attorney are used in
Moldova for registration purposes, a letter
authorizing the attorney to set-up business in
Moldova is required.
Provision of a legal address is also required.
Source: Foreign Investment Guide 2007, Moldovan Investment and Export
Promotion Organization (MIEPO).
Steps in registering a company in Moldova
File documents and get ID
number from Chamber of
Registration
Open temporary Bank Account,
deposit at least 40% of company
paid up capital and pay
registration fees.
Obtain a registration certificate
and Constitutive Act.
Obtain official stamp from Ministry
of Information Development.
Source: Molodova Foreign Investment Guide 2007, Moldovan Investment and Export Promotion Organization (MIEPO)
Page 12
Taxes
Major taxes and payments payable by businesses
Type of tax
Rates of taxation
Corporate Income Tax
Rate of taxation varies between 7% and 18% for Individual Entrepreneurs
depending on income. Rate of tax is 7% for farming enterprises, 3% for
legal entities that are small and medium enterprises. General Corporate
income tax is 12% for other legal entities. This 12% tax can be halved to
about 6% for entities within the Free Economic Zones (FEZ).
Value Added Tax
20% Standard VAT, 8% VAT on certain supplies such as bread, bakery
products, milk, some pharmaceuticals and sugars etc. VAT on other
supplies such as those involving of goods, supplies to and from the
territory of free economic zones (FEZs), import and supply of goods
destined for technical assistance projects under specific conditions
Capital gains tax
Taxable gains are calculated as 50% of total capital gains from sale of assets
and are to be included as part of gross income to be taxed at normal tax
rates.
Social Security Contribution
The employer is required to make social security contribution of about
23% of salary while the employee makes a contribution to about 6%.
Health insurance contribution
Around 4% of salaries and health insurance contribution is paid by both
employer and employee.
Source: Doing Business 2015, doingbusiness.org, World Bank Group and Price WaterHouse Coopers and MIEPO, Investing Guide Moldova 2014.
Page 13
Free Economic Zones and Industrial Parks
 The government of Moldova has created several Free Economic
Zones (FEZ) and Industrial parks to encourage investment in the
country.
 FEZ incentives include the following:
 Entities which are located in the FEZ’s of Moldova and which
are involved in export of goods outside the customs territory of
Moldova or delivery of produced goods to other FEZ residents
can apply 50% of the applicable CIT rate on their income.
 Income obtained by a FEZ company on export of goods outside
the customs territory of Moldova or for supply of goods to
other FEZ resident for export to outside Moldova is exempted
from CIT for three years provided the enterprises invested a
capital equivalent of about USD 1 million in fixed assets or
infrastructure.
 Income obtained by a FEZ company on export of goods outside
the customs territory of Moldova or for supply of goods to
other FEZ resident for export to outside Moldova is exempted
from CIT for five years provided the enterprises invested a
capital equivalent of about USD 5 million in fixed assets or
infrastructure.
 Industrial Parks incentives include the following:
 Free of charge transfer of land for purpose
of establishing an industrial park
 Allowance to private public land that is
associated with construction according to
the price allowed by the law.
 Allowance for free zoning of agricultural into
industrial land.
 Possibility of reduced rental price for state
land.
 Some examples of potential FEZ locations
are provided in the next page.
 FEZs also allow for repatriation of profits from Moldova after
full filling tax requirements. Furthermore, workers can be hired
through a simplified procedure.
Page 14
Selected Free Economic Zones
Selected Free Economic Zones (FEZ) locations for investment
Name
FEZ description
FEZ Expo Business Chisinau
Located in Chisinau, the free zone covers about 23.6 hectares and is planned to operate
between 1995 to 2025.
FEZ Balti
Created for a period of 25 years in Balti city in the north of the country. The Free Zone is
divided into four subzones. A total of USD 39.3 million in investments have been made since
establishment.
FEZ Valkanes
The FEZ was created in 1998 for a period of 25 years. The FEZ covers an area of around 122.3
hectares divided into two zones. 30 residents were registered in the zone in 2012 while total
investments amounted to USD 15 million.
Giurgiulesti International Free
Port (GIFP)
Located about 133.8 kilometers up the river Danube, GIFP was established for a period of 25
years in 2005. It covers an area of around 120 hectares including a petroleum terminal, a
cargo port and an industrial free zone. The free zone is under private ownership and an
advantage of setting up business in this free zone is that business can also engage in activities
that they would do outside the free zones in Moldova. Some examples of activities in this
zone includes its use for port and transport services, manufacture of industrial products,
wholesale trade and packaging of goods. There is no minimum investment required to be part
of GIFP.
Free Zone Ungheni Business
Located in the city of Unfgheni in the centre of Moldova. The free zone was established in
2002 for a period of 42 years. Its total area is around 42.34 hectares. There were 35 residents
registered in the free zone in 2013 while investment amounted to around USD 55.8 million
Source: Doing Business 2015, doingbusiness.org, World Bank Group and Price WaterHouse Coopers and MIEPO, Investing Guide Moldova 2014.
Page 15
Inward FDI inflows into the Republic of Moldova
 According to information from UNCTAD, Moldova has been
generally successful in attracting inward FDI. In 2009 FDI inflows
saw big fall due in part to the impact of the global economic
downturn.
Republic of Moldova FDI inflows
(USD millions)
800
700
600
500
 While the Moldovan economy recovered in 2010 and 2011, in
2012 the economy experienced a decline in growth. This was also
coupled with growth concerns in the Eurozone economies.
Therefore while FDI inflows have recovered, they have not yet
risen to 2007 levels.
400
300
200
100
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
 The Moldovan government has relatively low tax rates, for
example the corporate tax rate is about 12%. The Republic of
Moldova offers many tax and other incentive for potential
investors. The government of Moldova has created Free Economic
Zones (FEZ) in which activities such as production for export,
sorting and packaging of goods for transit through Moldova.
There is zero VAT on goods exported from an FEZ and income
obtained from export of goods from FEZ to outside the customs
region of Moldova is exempted from Corporate Income Tax (CIT)
for five years provided that the enterprise invested about USD 5
million in fixed assets or in development of infrastructure of the
FEZ.
2000
0
Source: Dubai Chamber based on United Nations Conference on Trade and Development
(UNCTAD), UNCTADSTAT
Page 16
FDI Inflow: Composition
Sector composition of cumulative FDI inflows into
Moldova (2011)
 According to data from the Moldovan Ministry of Economy,
sectors receiving large shares investment inflows in 2011 included
financial services, manufacturing and real estate. Inspite of the
potential in the agricultural sector, investment in this sector had a
small share of overall FDI inflows
 EU countries made up most of the FDI inflows into Moldova in
2011. Therefore Holland, Germany, UK, Spain, Italy and Poland
together made up the largest share of FDI inflows into Moldova.
Russia had the second highest share at 11% for individual
countries.
 The US had about 7% share in FDI inflows in Moldova's economy
in 2011, while Turkey also had made investments into Moldova
and had a share of about 3% in 2011. Overall most major
investors in Moldova tend to be countries across Europe, who
tend to understand the local business environment and want to
use Moldova as a hub for doing business.
Financial Services
Manufacturing Industry
[VALUE]
[VALUE]
2
Real Estate Transactions
1
Electricity, Water and
Gas
Transport and
Communication
[VALUE]
Health and Social
Services
[VALUE]
Agriculture
23
Others
10
Source: Dubai Chamber based on data from Ministry of Economy Republic of Moldova and Invest
in Moldova Country Report, Moldovan Investment and Export Promotion Organization (MIEPO).
FDI inflows into Moldova by source country (2011)
Holland
19
23
Russia
Cyprus
[VALUE]
[VALUE]
USA
Germany
UK
3
3
Romania
11
Spain
Turkey
4
Italy
5
[VALUE]
Poland
Ukraine
5
6
7
Others
Source: Dubai Chamber based on data from Ministry of Economy Republic of Moldova and Invest in
Moldova Country Report, Moldovan Investment and Export Promotion Organization (MIEPO).
Page 17
Investment opportunities in the Agriculture
Production of selected agricultural and livestock products in
Moldova (thousands of tons)
 With its rich natural environment, rich soil and favorable climate,
Moldova’s agricultural sectors could hold potentially lucrative business
opportunities. Moldova's soil is ideal for growing corn, fruits and
vegetables. The production of corn has been stable from 2010 to 2013,
while the production of vegetable has seen some reduction. Fruit
production has experienced significant growth during this period.
 Given increased demand for organic products from the EU, thee exports
of organic products have experienced strong growth, growing at a
Compound Annual Growth Rate of around 47% from 2004 to 2013.
Moldova has organic regulations in place and around 2% of its current
arable land is used to produce organic food products.
2010
2011
2012
2013
1,420
1,468
572
1,419
Vegetables
341
362
231
292
Fruits
322
378
380
415
Production of corn
Source: Dubai Chamber based on data from Moldova National Bureau of Statistics and
‘Agricultural Report’ Republic of Moldova, Invest in Moldova.
Export of Organic products by Moldova (tons)
100,000
80,000
60,000
40,000
20,000
2013
2012
2011
2010
2009
2008
2007
2006
2005
0
2004
 Livestock production could have potential synergy for export of halal
meat to UAE and other GCC countries. Potential business opportunities
include setting up new cattle farms, renovation of existing cattle farms
and investment in halal meat storage and processing facilities.
Source: Dubai Chamber based on data from Moldova National Bureau of Statistics and
‘Agricultural Report’ Republic of Moldova, Invest in Moldova.
Page 18
Investment opportunities in the Automotive sector
Comparison of per minute production costs for selected
Eastern European countries (Euro)
 Moldova has a modern automotive industry which is supported
by a educated and skilled workforce, and proximity to major
European and CIS countries making it easy to transport
automotive products to Original Equipment Manufacturers
(OEM). Up until now the production has mainly been to produce
cables, car seat covers and wiring harnesses for cars.
 In terms of production costs, Moldova compared favorably with
other central and eastern European countries.
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
 Moldova is position on the largest pan European corridor
between Helsinki (Finalnd) and Alexandroupoli (Greece). It takes
about 2 days to deliver good to Germany. This makes it possible to
produce car parts and other automotive products using Just-inTime production. Prospective investors could invest in one of the
7 Free Economic Zones of Moldova which offer preferential
conditions and access to important transport routes. Investors
would also note that the 20% VAT in Moldova is reimbursed for
exports from FEZs.
Moldova
Romania
Serbia
Bulgaria
Source: Dubai Chamber based on data from Moldova National Bureau of Statistics, Spelleken
Assoc. and Avanz Experts‘ Panel, ‘introduction to the Automotive sector’ Republic of Moldova,
Moldova Investment and Export Promotion Organization
Distance to some Original Equipment Manufacturers from
Chisinau, Moldova (kilometers)
Pitesti (Dacia Renault)
560
Hungary
980
Slovakia
1180
Czech Republic
1510
Germany
1510
Source: Dubai Chamber based on data from Moldova National Bureau of Statistics, Spelleken
Assoc. and Avanz Experts‘ Panel, ‘introduction to the Automotive sector’ Republic of Moldova,
Moldova Investment and Export Promotion Organization
Page 19
Investment opportunities in Pharmaceuticals and Health
care
Per capita total health care expenditure in Moldova (USD)
 The size and growth of Moldova's health care sector creates
opportunities for businesses both on the supply side and demand
side. On the supply side Moldova's production value of medical and
testing appliances has seen grown at a CAGR of around 31% from
2009 to 2014. On the demand side per capita total health care
expenditure is also expected to continue to see a strong increase in
the future.
 Niche areas of growth could include aged care centers and aviation
sanitation. Given the need for more hospitals, there could be many
potentially lucrative business opportunities. Medical and testing
equipment could also be exported to other countries in Europe.
According to data from trademap.org, Moldova exported about USD
113 million worth of goods under HS 30 Pharmaceutical products,
most of them going to the CIS countries. Further investments in
pharmaceutical and medical appliance production in Moldova could
enable UAE businesses to benefit rom the opportunities in medical
product exports from Moldova.
250
200
150
100
50
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
0
2003
 As discussed earlier, Moldova’s population is undergoing significant
ageing. The average age of the Moldovan population is expected to
increase from 27.7 years in 1980 to around 45.8 years of age by 2050.
According to Business Monitor International (BMI) Moldova
Pharmaceutical and Healthcare Report Q2 2015, the Moldovan
Pharmaceutical sector was forecasted to be worth around USD 297
million in 2015, while the healthcare sectors. healthcare sector is
forecasted to be worth around USD 820 million.
300
Source: Dubai Chamber based on data from Euromonitor International.
800
Production of Medical, Measuring, Testing Appliances
(Million Moldovan LEU)
600
400
200
0
2009
2010
2011
2012
2013
2014
Source: Dubai Chamber based on data from Euromonitor International.
Page 20
Investment opportunities in Textile and footwear
Gross Value Added from Manufacture of Textiles and Textile
products (Million Molodvan Leu)
 Moldova has a rich history in producing textile, quality apparel
and footwear. Production of textile and apparel and footwear
have grown, key markets include the EU, CIS countries and Turkey.
1800
1600
1400
1200
1000
800
600
400
200
2014
2013
2012
2011
2010
0
2009
 Moldova has the ability to quickly deliver fashion products given
that it takes about 1 day by truck to deliver products to Eastern
Europe and 2 days to Western Europe. With such low delivery
times and availability of required workforce, and relatively
competitive cost of production, there could be potentially
lucrative investment opportunities in the Moldovan textile and
footwear.
Source: Dubai Chamber based on data from Euromonitor International
Production of footwear (million Moldovan Leu)
300
250
200
150
100
50
2014
2013
2012
2011
2010
0
2009
 Given the need to manage the logistics needs of fast changing
fashion items, UAE businesses with experience in logistics could
establish warehouses and provide transport and trucking facilities
to Moldovan textile companies to get their goods quickly to the
export destination in Europe and elsewhere.
Source: Dubai Chamber based on data from Euromonitor International
Page 21
Risks And Challenges
Economic Challenges
 Demographic change: Moldova’s population is
facing a strong reduction in numbers due in part to
migration to other countries. This decline in
numbers of working members of society coupled
with an aging population can be expected to put a
significant burden on future economic growth and
budgetary revenues.
 Spillover of global and regional macro-economic
challenges: The Republic of Moldova has a
relatively small economy and is surrounded by
many large markets. As a result global and regional
economic and trade turbulences have the potential
to cause economic challenges in the country.
Business wanting to hedge against these risks
should therefore aim to diversify their businesses
across sectors and also in other regions.
 Challenges in effective financial intermediation:
Weak financial intermediation leading to difficulty in
access to finance is a major constraint for
businesses in Moldova which could also lead to
higher financing costs.
Ease of Doing business: While Moldova has made
improvements in the ease of doing business, some
challenges remain. Some of these include the following:
 Trading across borders: According to Doing
Business 2015 of the World Bank Group, it takes
about 27 days to import goods into Moldova and 23
days to export goods. Furthermore, According to
Doing Business 2015 of the World Bank Group, it
takes on average about 9 documents and 23 days to
export goods from Moldova. This is significantly
higher than the documents and time for Romania
and Hungary. The landlocked geography of the
country combined with documentation required can
be challenge in trading with business in Moldova.
 Dealing with construction permits: It takes about
247 days and 27 procedures to deal with
construction permits with Moldova ranking at 175 out
of 189 economies according to Doing Business
2015.
 Getting electricity: It takes about 118 days and 7
procedures to get electricity in Moldova and it ranked
at 149 out 189 economies in getting electricity
according to data from Doing Business 2015.
Page 22
Conclusion
 Despite some challenges and its landlocked geography, Moldova offers prospective business with a diverse range
of trade and investment opportunities. A large number of these opportunities arise from the potential to use Moldova
as a production, re-packaging and logistics base to do trade with the European Union countries on one side and the
CIS countries on the other side.
 Selected trade opportunities for UAE businesses include opportunities for exporting and re-exporting finished
products to Moldova such as:
• Cars,
• Tractors (for agriculture) ,
• Machinery,
• Electrical equipment,
• Plastics and articles and
• Pharmaceuticals.
Several of these products are made in Asia and this creates opportunities for UAE businesses to intermediate between
Asia and Europe and export these goods to Moldova.
 Sectors with possible investment opportunities include:
• Agriculture
• Automotive
• Pharmaceuticals and health care
• Textile and footwear
Page 23
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Page 25