Moldova’s 6% budget deficit puts pressure on economy

Published 12.11.2026 16:40

Moldova’s economic development minister Claudiu Năsui has warned that the state budget deficit, now close to 6% of GDP, threatens the economy and argues against raising taxes.

Short-term borrowing adds to fiscal pressure

Following the latest budget revision, Moldova’s state budget deficit has reached 23 billion lei. The government spends more than it collects in taxes and other revenue, covering the gap through borrowing, much of it on a short-term basis, according to the minister.

“We have a deficit of 6%. It is absolutely enormous, colossal. Most of it is financed through short-term borrowing. I don't think we fully understand what that means. Revenue comes from taxes, from your money. But where does the difference come from? In fact, it also comes from our money, but from the future. It comes from debt. The state says: I don't have the money, so I'll borrow it and pay you back later. But where will that money come from? From you again,” Claudiu Năsui said.

Speaking on Moldova 1's Me and the European Union programme, Năsui discussed ways to increase budget revenues over the long term without placing a heavier burden on taxpayers.

Minister argues against higher taxes

Năsui said raising taxes was a politically easier option, but warned that it could hurt citizens and businesses while encouraging undeclared economic activity.

“You either raise taxes, putting more pressure on entrepreneurs, discouraging formal employment and entrepreneurship, and encouraging the informal sector. Between these two options, my choice is clear. If we want to do what is best for this country, we must cut spending. We need to reduce government expenditure, even if that is politically very difficult,” the minister said.

He argued that reducing public spending was more difficult politically because it required the government to give up certain benefits and budget allocations.

Government revises 2026 budget

The September 2026 revision of the state budget provides additional funding for energy compensation payments, rural infrastructure development, the Road Fund and one-off payments for public sector employees.

Following the revision, state budget expenditure was set at 103.35 billion lei, while revenues are projected at 80.27 billion lei. The resulting deficit stands at 23.07 billion lei, equivalent to 5.95% of GDP.

The government aims to reduce the budget deficit by half, bringing it closer to 3% of GDP.

Translation by Iurie Tataru

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