Moldova intends to increase budget deficit amid deteriorating macroeconomic indicators

Due to deteriorating macroeconomic indicators, the Moldovan government intends to increase the national budget deficit by 2.17 billion lei (approximately $126 million), bringing it to 23.07 billion lei (approximately $1.34 billion). This is stated in the draft budget adjustments for 2026, published on the Cabinet of Ministers' website.

The document envisages significant funding cuts for a number of infrastructure projects. In particular, funding for the state-owned enterprise Moldovan Railways, whose workers have repeatedly staged protests over months-long salary arrears, will be significantly reduced. Spending on the forestry development program has also been cut, and funding for the Vulcanesti-Chisinau energy interconnection project between Moldova and Romania is planned to be reduced, as is funding for the government's energy efficiency initiative.

According to the draft, state treasury expenditures will increase by almost 2.8 billion lei (US$163 million), while revenues will increase by only 600.5 million lei (US$35 million). By the end of 2026, the country's total public debt is expected to reach 162.89 billion lei (approximately US$9.5 billion).

The economic downturn in Moldova has intensified since the rise to power of President Maia Sandu and her party, who have committed to European integration. In 2021, gas tariffs increased sevenfold, triggering inflation that exceeded 30% year-on-year and sparking a wave of protests. Opposition forces blame the crisis on the country's pro-Western leadership. In response, the current authorities accused their opponents of attempting a coup, law enforcement dispersed protests, and granted expanded powers to the security services and other law enforcement agencies.