How Moldova escaped the effects of a giant banking crisis
A leaked report revealed that in 2014 up to $1bn, equivalent to more than one-eighth of the country’s GDP, had been stolen from three banks
MOLDOVA is a country of ignominious records. It is by far Europe’s poorest place. Among countries that bother to count foreign tourists, only Tuvalu welcomes fewer. To these dubious achievements, this little Romanian-speaking former Soviet republic added a new one in 2014. A leaked report revealed that up to $1bn, equivalent to more than an eighth of the country’s GDP, had been stolen from three banks. Relative to the size of its economy, that may be the biggest bank fraud of all time. What happened next, however, was surprising.
Following the theft economists had feared the worst, especially since two of Moldova’s biggest trading partners, Ukraine and Russia, were mired in financial crises of their own. Yet since then the country has coped remarkably well. GDP shrank by a mere 0.5% in 2015 (whereas Russia’s fell by 4% and Ukraine’s tanked by 10%). Last year Moldova grew by 2%, fast by European standards.
This article appeared in the Europe section of the print edition under the headline “A do-over in Moldova”
Europe February 18th 2017
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