Okahoma State University Oklahoma State University

Moldova

The Republic of Moldova is a small country in Eastern Europe bordered by Ukraine and Romania. Moldova was a part of the Soviet Union after World War II but gained its independence in 1991. After independence, Moldova faced overwhelming challenges to restructure the economical and political systems from the state owned structure to a market based system. The economic collapse of the 1990’s and the Russian financial crisis of 1998 has left most Moldovans with little or no future prospects, poor nutrition, one of the lowest life expectancies in Europe, and extreme poverty for one fifth of its population

Moldova has a largely agricultural based economy. Agriculture consumes about 40 percent of the net material product and employs roughly 36 percent of the labor force. Moldova has rich agricultural resources with a favorable climate and rich soils.

Widespread poverty remains a problem, especially in rural areas. Around 25 percent of the labor force has left the country to look for opportunity elsewhere. In 2007 36.2 percent of Moldova’s GDP came from remittances, or money sent home from emigrants. With such an exodus of young professionals this creates another problem as they leave their families behind in Moldova while working abroad. At least 29 percent of Moldovan children are left without one or both parents causing long term negative effects of a childhood without parental support.

Despite overwhelming obstacles Moldova’s outlook looks promising. Moody’s investor service has declared that the local and foreign-currency debt situation in Moldova is stable. Moldova also weathered the 2008 Global financial crisis with more resiliency than more developed European neighbors. Moldova’s economy continues to grow, but is still vulnerable because of dependencies on remittances and the Russian economy.