2022 Index of Economic Freedom

Moldova

OVERALL SCORE61.3
WORLD RANK78
Rule of Law

Property Rights55.9

Judicial Effectiveness30.7

Government Integrity34.7

Government Size

Tax Burden94.1

Government Spending68.1

Fiscal Health87.2

Regulatory Efficiency

Business Freedom64.2

Labor Freedom46.4

Monetary Freedom72.4

Open Markets

Trade Freedom76.6

Investment Freedom55.0

Financial Freedom50.0

Create a Comparison Chart

See how Moldova compares to another country using any of the measures in the Index.

vs
Close
Download PDF
Quick Facts
  • Population:
    • 2.6 million
  • GDP (PPP):
    • $33.7 billion
    • -7.5% growth
    • 1.8% 5-year compound annual growth
    • $12,811 per capita
  • Unemployment:
    • 4.7%
  • Inflation (CPI):
    • 3.8%
  • FDI Inflow:
    • $55.0 million

Moldova’s economic freedom score is 61.3, making its economy the 78th freest in the 2022 Index. Moldova is ranked 39th among 45 countries in the Europe region, and its overall score is below the regional average but above the world average.

Five years ago, Moldova’s economy began to decelerate, and growth turned negative in 2020 before recovering in 2021. During those five years, economic freedom continued to expand slowly. Led by higher scores for rule of law and government spending, Moldova has recorded a 3.3-point overall gain of economic freedom since 2017 and remains in the “Moderately Free” category for the third year in a row. The tax burden is light, and fiscal health is solid, but investment freedom and financial freedom are lagging.

IMPACT OF COVID-19: As of December 1, 2021, 9,141 deaths had been attributed to the pandemic in Moldova, and the government’s response to the crisis ranked 141st among the countries included in this Index in terms of its stringency. The economy contracted by 7.5 percent in 2020.

Close

Background

Moldova, landlocked but separated from the Black Sea by only three kilometers of Ukrainian territory, was long a pawn in Eastern European politics. It is vulnerable to economic pressure from Russia and has to contend with a secessionist pro-Russian movement in its Transnistria region, which is currently home to about 1,500 Russian troops. The election of Western-leaning President Maia Sandu, street protests, a constitutional crisis, and dissolution of the Russia-friendly parliament led to snap parliamentary elections in July 2021. The pro-Western Party of Action and Solidarity (PAS) gained a clear victory. Former Finance Minister Natalia Gavrilita was appointed prime minister in August 2021. Moldova’s economy depends on emigrants’ remittances and such agricultural products as fruits, vegetables, wine, and tobacco.

Rule of Law

Property Rights 55.9 Create a Graph using this measurement

Judicial Effectiveness 30.7 Create a Graph using this measurement

Government Integrity 34.7 Create a Graph using this measurement

Property rights are protected by law, and ownership titles are registered by a national cadastral office, but enforcement is undermined by a weak and sometimes corrupt judiciary. Judicial appointments lack transparency, and courts are highly susceptible to political pressure. Corruption remains entrenched at all levels of government, and anticorruption laws are not adequately enforced. Officials engage in corrupt practices with impunity.

Government Size

The top individual income and corporate tax rates are 12 percent. Other taxes include a value-added tax. The overall tax burden equals 17.3 percent of total domestic income. Government spending has amounted to 32.6 percent of total output (GDP) over the past three years, and budget deficits have averaged 2.5 percent of GDP. Public debt is equivalent to 35.3 percent of GDP.

Regulatory Efficiency

Inefficient administrative capacities, political uncertainty, and vested bureaucratic interests stunt business freedom. Remittances from the approximately one million Moldovans who work abroad account for almost 15 percent of GDP. The government subsidizes agriculture and other sectors and maintains price controls on food and other staple goods.

Open Markets

Moldova has nine preferential trade agreements in force. The trade-weighted average tariff rate is 4.2 percent, and eight nontariff measures are in effect. Foreign and domestic investors are treated equally, but the overall investment regime is not conducive to dynamic investment growth. The level of overall financial intermediation remains shallow. Long-term financing remains difficult.

Country's Score Over Time

View Chart of Scores over Time

Regional Ranking

RANK COUNTRY OVERALL CHANGE
1Switzerland84.22.3
2Ireland820.6
3Luxembourg80.64.6
4Estonia801.8
5Netherlands79.52.7
6Finland78.32.2
7Denmark780.2
8Sweden77.93.2
9Iceland77-0.4
10Norway76.93.5
11Germany76.13.6
12Lithuania75.8-1.1
13Latvia74.82.5
14Czech Republic74.40.6
15Austria73.8-0.1
16Cyprus72.91.5
17United Kingdom72.7-5.7
18Georgia71.8-5.4
19Malta71.51.3
20Bulgaria710.6
21Portugal70.83.3
22Slovenia70.52.2
23Slovak Republic69.73.4
24Belgium69.6-0.5
25Poland68.7-1.0
26Spain68.2-1.7
27Croatia67.64.0
28Romania67.1-2.4
29Hungary66.9-0.3
30Albania66.61.4
31France65.90.2
32North Macedonia65.7-2.9
33Italy65.40.5
34Armenia65.3-6.6
35Serbia65.2-2.0
36Bosnia and Herzegovina63.40.5
37Azerbaijan61.6-8.5
38Greece61.50.6
39Moldova61.3-1.2
40Kosovo60.1-6.4
41Montenegro57.8-5.6
42Turkey56.9-7.1
43Russia56.1-5.4
44Ukraine54.1-2.1
45Belarus53-8.0
See Entire Region List ›

View all countries ›

Back to Top