Advantageous country location, strong doing business rank, free economic zones, and free trade agreements - these are just a few reasons why Moldova is a good choice to invest in.

So why invest in the Republic of Moldova?

  • Unique geographic position: bordered by the EU (Romania) and the CIS (Ukraine), Moldova is the only country with autonomous trade agreements with the EU and 43 free trade agreements with the CIS, CEFTA, GUAM, Turkey. Also, Moldova is a Member of the World Trade Organization.
  • Skilled and competitive workforce: good technical skills, proficiency in languages (Moldavian (Romanian) and Russian, and often English, French or German) and one of the lowest salaries in Europe (average monthly salary for the qualified, multilingual workforce: EUR 450)
  • Friendly fiscal system
    • Corporate income tax - 12% (7% for farmers enterprises, 6% within Free Economic Zones, 3% within Free Port)
    • VAT - 20% (6% for natural gases, 8% for agri-food and pharmaceutical, 0% international transportation)
    • Social insurance contributions - 23%
    • Unique 7% tax for residents of Moldova IT Park
    • Favorable investment legislation and government's availability to negotiate directly with potential foreign investors (full-time investment support team)
    • Possibility of setting up joint ventures
  • Investment Platforms
    • 7 Free Economic Zones
    • 8 Industrial Parks
    • 16 Multifunctional Industrial Platforms
    • Moldova IT Park
  • Advanced ICT infrastructure
    • 6th for lowest fixed broadband costs globally
    • 100% mobile penetration and 98.2% Fiber Optic backbone network
    • 4th place in the world based on % of the population covered with Gigabit Internet
  • Excellence in E-Reporting, E-Government, and E-Documents
    • One-Stop-Shop - 131 documents available online
    • E-public services: fiscal declarations system, biometric passport, automated border crossing system based on electronic passports, digital map, mobile digital signature, and online services

Besides having a favorable geographical position at the crossroads of commercial routes, the Republic of Moldova also has the access to sea transportation through the country's Giurgiulești port on Danube river. All these together make Moldova an investment arena with great potential.

Strategic sectors for investments:

Agrifood

Agriculture has always been one of the leading sectors in the Moldovan economy, largely for natural reasons: the rich soil resources, biological diversity, good climate, and geographical conditions.

Fresh and processed fruit, grapes, wines, and tobacco items make up a significant part of the exports - around 40% of all. The European Union remains the largest sale market for these products and CIS countries absorb another significant part of exports. The share of agricultural production in Moldova's Gross Domestic Product stood at around 12% during the last years. Together with the processing industry, it represents more than 16% of the Gross Domestic Product.

Moldova exported in 2020 goods worth almost two and a half billion US dollars (2485.2 million US dollars). Because of the consequences of Covid-19 the exports were down by 10.6% compared to 2019, according to a report published by the National Bureau of Statistics of Moldova.

Exports to European Union countries (EU-27) accounted for 66.7% of total exports in 2020 (US $ 1658.4 million, 6.9% less than in 2019). Exports of goods to CIS countries accounted for 15.2% of total exports in 2020 (US $ 377 million, 13.3% less than in 2019).

Vine and wine

Wine-making is an essential branch of the economy. The share of viticulture and winemaking in global agricultural output is about 15 percent and respectively 23 percent from the total agro-food.

In 2020 the vineyards covered a total area of 133,000 hectares, over 95% is privately owned. The existing wine production companies have a wine grape processing capacity of 1 million tons and storage of wines over 800 million.

Moreover, the Republic of Moldova is recorded in the Guinness Book, with the biggest collection in the world with over 1.5 million bottles.

Walnut

According to the International Trade Centre in Geneva, Moldova is one of the largest exporters of walnuts to Europe, after the USA, Mexico, and China. Walnuts plantations have registered a rapid growth since the year 2000, from an area of 4.000 hectares up to 33.000 hectares in 2020 compared to 14.000 hectares in 2013. Average productivity varies from 2 to 3 tons per hectare, depending on the variety and climatic conditions.

Organic culture

With a rich tradition of harvesting most of the fruit and vegetables grown across the European continent, and an industrial experience in the livestock sector, the Republic of Moldova has succeeded in adopting good agricultural practices - based on innovation, environmental protection, and efficient soil management - earlier than other countries in the region.

Moldovan products are subject to strict control at any stage of production and are compliant with all phytosanitary requirements. They have certificates of conformity and quality in ISO 9001, ISO 14001, ISO 22000, among others, to be exported. This is one of the reasons why Moldavian products have access to the vast market of the European Union and in the countries of the Middle East.

Automotive

Although the Republic of Moldova is not yet a car manufacturing country, it plays an important role in the world automotive industry.

Nowadays, the automotive industry is a key growth sector for the Moldavian economy. This is due to an increased focus on the unused industrial potential of Moldova and the maintained industrial orientation in the education system (Technical University, technical colleges, vocational schools).

Internationally known prefer to locate themselves in Moldova's Free Economic Zones (FEZ), which represents an excellent location for industrial development and production relocation oriented for exports. Production concentrates on cables, wiring harnesses for cars, seat and car covers, steering wheels, injection molding, metal processing, electronics, electronic components, and systems.

Automotive components made in Moldova are delivered to the largest producers of cars and trucks including such giants as Ford, Mercedes, Volvo, Volkswagen, Renault, BMW, Škoda.

Renewable energy

The Republic of Moldova has vast renewable energy potential, which remains still largely untapped. With renewables becoming increasingly cost-competitive, policymakers have recognized them as an important means to address the Republic of Moldova's energy challenges and achieve a sustainable future. Notably, the country has already met several major targets set out in its National Renewable Energy Action Plan for 2013-2020, including the objective to cover at least 17% of gross final energy consumption with renewables.

IT industry

The IT industry in Moldova is undoubtedly the most dynamic and fastest-growing economic sector in Moldova, which offers the highest salaries, employs the youth and the creative people, digitally transforms the entire society, and is a Government's top priority. The information and communications technology industry has become one of the locomotives of economic growth in the Republic of Moldova in 2019-2020. As expected, the incentives offered by the innovative IT virtual Park legislation (7% single tax on turnover) gave a significant boost to the ICT sector Development. At the same time, the country's rising position in international ICT ranking plays an instrumental role in building a regionally and globally competitive economy.

In the field of Information Technologies in Moldova there has been a dynamic growth in the last years. The turnover in the industry has increased more than 2.5 times in 3 years. In these sectors, we have growth. The changes are due to the emergence of new opportunities. One of the key projects aimed at stimulating the growth of the IT industry and innovation is the virtual IT park, launched on January 1, 2018. Over two years of activity, over 500 companies have been registered in the park, of which 300 are IT companies with foreign capital. The park is virtual, and the residents of the park operate in any region of the country. The resident of the park benefits from a specially simplified business model, tax services in the form of a single tax of 7% of the sales income. In the two years of existence, the park has been able to gain worldwide recognition. At the same time, were announced that several programmes were being launched for the creation of business incubators to solve the problems of personnel shortage in the IT sector.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.