Reforms will be costly and felt in the short term. DCFTA benefits may come, but are not certain

The elimination of all import duties, immediate improvement of conditions for trade in services as well as generous offer on establishment significantly improves Moldova’s position as compared to that of other EU partners, on the EU market. From the day of entry into force of this Agreement, EU investors will have the incentive to establish in Moldova, Moldovan consumers will benefit from less expensive goods on the market and Moldova as a whole will enjoy a much stronger bilateral relationship with the EU. Finally, significant financial assistance related to the reform process and the status of an associated partner will provide a boost to the Moldovan economy. It is therefore difficult to speak about lack of immediate benefits. In quantitative terms, Moldova is expected to see its exports boosted by 16% and imports by 8% in the short term, which should also have a positive impact on the state revenues. There will of course be costs but the EU assistance to Moldova is not only limited to the DCFTA-related reforms and covers also the wider support to the budget, which should be used to cushion the impact of reform on the most vulnerable ones.