Emerging Markets / July 19, 2017

European Agriculture and Trade in Moldova

The Republic of Moldova is a small landlocked nation located in southeastern Europe in between Ukraine and Romania. A part of the Soviet Union throughout most of the twentieth century, Moldova became an independent nation in 1991. However, the country remains one of the poorest economies in Europe and its domestic politics are largely influenced by Russian minorities living within its borders, particularly in the eastern region of Transnistria. With a total territory of almost 34.000 square kilometers, Moldova is somewhat larger than Maryland. The country’s landscape is dominated by a vast steppe and rolling hills alongside numerous rivers. Currently, the country has a total population of approximately 3.5 million citizens, some 45% of which live in an urban setting, notably the capital city of Chisinau with 725.000 inhabitants. Thus, the majority of Moldovans live in a rural setting as opposed to an urban one, which is extremely rare for a European country. The current national annual gross domestic product (GDP) is about US$6.7 billion and the country has experienced positive economic growth in recent years. The Moldovan economy is divided into 14% agriculture, 21% manufacturing, and 65% services. Similarly, it is estimated that the agricultural industry employs some 34% of the national labor force, while manufacturing employs about 12% and services employ another 54%. Meanwhile, the agriculture industry utilizes a staggering 75% of the national territory, while another 13% is forested.

In terms of natural resources, Moldova has lignite, phosphorites, gypsum, limestone, and arable land. Within manufacturing, the national industry is focused on sugar refining, vegetable oil, food processing, agricultural machinery, refrigerators & freezers, washing machines, hosiery, shoes, and textiles. Meanwhile, the country’s agricultural industry has as main products vegetables, fruits, grapes, grain, sugar beets, sunflower seeds, tobacco, beef, milk, and wine. In terms of trade, during 2015, Moldova imported US$4.1 billion worth of goods and exported US$2.4 billion, resulting in a negative trade balance of US$1.7 billion. Furthermore, Moldova’s main export, representing 24% or US$575 million of the country’s total, consists of vegetable products, notably sunflower seeds, nuts, and wheat. Likewise, the country’s main trading partners are Romania, Russia, Germany, Ukraine, Belarus, Italy, and Turkey.

European Agriculture and Trade in Moldova

In recent years, the average per capita protein intake of animal origin amongst the Moldovan population has been of 33 grams daily. Meanwhile, cereals, roots, and tubers supply 46% of the average food energy intake in the country. Simultaneously, land distribution and output in Moldova have evolved throughout the last several decades. Back in 1992, permanent pastures and meadows in the country covered 358.000 hectares, while arable land covered little over 1.7 million hectares and permanent crops accounted for 466.000 hectares. More recently, by 2014, permanent pastures and meadows had decreased to 349.000 hectares, while arable land had increased to represent more than 1.8 million hectares and permanent crops covered 292.000 hectares. Similarly, in 1992, the cereals market in Moldova utilized 676.000 hectares of land and yielded almost 2 million metric tons annually. Finally, in 2014, the country devoted close to 913.000 hectares of land to cereals production and yielded approximately 2.9 million metric tons.

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