Moldova

Moldova’s central bank chief said a collapse in inflation showed that the abrupt turn away from Russian energy had paid off as the republic wedged between Ukraine and Romania seeks accession to the European Union, Bloomberg News reported. Central Bank Governor Anca Dragu said an influx of EU financial aid and fresh energy supplies from Romania were behind last year’s slowdown in inflation to 4.2% from more than 30% in 2022. The recovery after the turmoil brought on by Russia’s invasion of Ukraine was far more robust than Moldova’s authorities had initially expected, she said.

European Union governments decided on Tuesday to nearly double the amount of EU financial support to Moldova to a total of 295 million euros ($324.74 million), the Swedish presidency of the EU said, Reuters reported. The decision comes just days before a meeting of the European Political Community in Moldova on June 1, as the EU seeks to quell pro-Russian sentiments in parts of Moldova. "Moldova can continue to count on the EU. We will continue to support Moldova, also financially.

Moldova’s pro-Western government resigned amid the worsening economic fallout from the war in neighboring Ukraine, a day after Ukrainian President Volodymyr Zelensky warned that Russia was trying to destabilize the country, the Wall Street Journal reported. Announcing her decision Friday, Moldovan Prime Minister Natalia Gavrilita told a news briefing in the capital Chisinau that no one could have predicted the scale of the challenges her government has faced since the Russian invasion began nearly a year ago.

Moldova's central bank has cut its key interest rate to 17% from 20% as consumer price inflation has continued to slow, Central Bank Governor Octavian Armasu said on Tuesday, Reuters reported. Armasu said the central bank expected consumer price inflation to slow to 13.7% this year after peaking in 2022. He noted inflation slowed to 30.2% in December compared with 34.6% in October last year. "The decision is based on disinflationary processes in the short term and it is aimed at supporting the national economy and businesses," he told a news briefing.

The Moldovan government says loss-making national airline Air Moldova has been sold to a Romanian group for 1.2 billion Moldovan lei ($71 million). The Public Property Agency said Tuesday that Civil Aviation Group paid 50 million lei ($2.96 million) to Moldova's state budget, the International New York Times reported on an Associated Press story. The remaining money from the purchase will go toward covering debts that were sold to prevent the airline's bankruptcy. Air Moldova was founded in 1983 and has flights to 33 destinations.

Moldova will step up an investigation into the disappearance of more than $1 billion from three banks, the head of the central bank told Reuters on Tuesday, after around 10,000 people protested over the scandal at the weekend. Last year Moldova placed Banca de Economii, Banca Sociala and Unibank under central bank administration after a series of non-performing loans bankrupted the lenders, which together account for up to 20 percent of the tiny former Soviet republic's banking system in terms of assets.