Expert-Grup launches the second issue of the Regional Economic Review: Transnistrian region. The report analyses the growth trends and economic risks of the Transnistrian region.
The year 2015 is expected to be much more difficult than the current year, given the expected economic recession of about 3%-5%. The reason is that the factors that mitigated the negative shocks and allowed to keep the Transnistrian economy afloat in 2014 are expected to vanish in 2015.
At the same time, a range of risks persists. Thus, the economic difficulties of Ukraine and the Russian Federation, in parallel with the slow recovery of the EU economy will undermine the foreign demand and the Government efforts to reorient from the Eastern to the Western market. Along with the depreciation of the Russian ruble, it will also affect the welfare of migrant families.
At the same time, the more austere budget anticipated for 2015, along with possible increases in public utility fees and delays in wage payments in the public sector will affect adversely the domestic demand. Due to lower consumption and exports, investments do not have good prospects either. Surveys in the region show an increasing pessimism among the managers of major industrial enterprises, which is due to the economic crisis and security in Ukraine, and to the worsening domestic economic conditions.
In addition, the expected recession in the Russian Federation in 2015 will limit the appetite for investment of banks and other companies from the region, which have Russian capital. An additional constraint is related to the high probability of less favourable weather conditions compared to 2013 and 2014, when the region recorded significant increases in agricultural production.
See the Report presentation in Prezi format, below:
The Report has been published with the financial support of the Dutch Embassy in Bucharest. The opinions expressed in this document belong to the authors and do not necessarily reflect the views of the donor.