Republic of Moldova: Selected Issues
IMF Staff Country Reports, December 19, 2023
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- Republic of Moldova: Selected Issues
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Bibliographic details
- Published: December 19, 2023
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400264085.002
Overview
- This Selected Issues paper discusses opportunities and challenges of climate adaptation policies in Moldova.
- Strengthening resilience to natural disasters will require significant adaptation investments in the coming years.
- The paper finds that adaptation investments can:
- substantially reduce output losses caused by natural disasters,
- be more cost-efficient than responding to disasters ex-post,
- contribute to boost Moldova’s long-term economic growth and support its development objectives.
- Due to limited domestic financial resources in a complex economic environment, Moldova cannot finance the most-needed adaptation investments without endangering public debt sustainability or hindering its growth potential.
- Therefore, external support will be critical to help meet the adaptation needs.
Key findings and evidence
- Adaptation investments reduce output losses caused by natural disasters.
- Adaptation is more cost-efficient than ex-post disaster response.
- Adaptation investments contribute to long-term economic growth and development objectives.
- Domestic financing alone is insufficient to fund the most-needed adaptation investments without risking public debt sustainability or constraining growth.
Policy implications and recommendations
- Prioritize adaptation investments that yield the largest reductions in output losses and are cost-efficient relative to ex-post responses.
- Seek external support and financing to close the adaptation financing gap, given limited domestic fiscal space and the risk to public debt sustainability.
- Integrate adaptation investment planning with macroeconomic considerations to avoid hindering growth potential while strengthening resilience to natural disasters.
Topics and keywords
- Subject: Climate change, Corruption, Crime, Environment, Infrastructure, International organization, Monetary policy, National accounts, Natural disasters
- Keywords: Adaptation gap, Climate change, Corruption, debt financing of Adaptation investment, Eastern Europe, economic growth in Moldova, Europe, Global, Infrastructure, macro impact, Natural disasters, quantifying Adaptation investment
Content in this bundle
- Republic of Moldova: Selected Issues; IMF Country Report No. 23/429; November 28, 2023