One of the most widely discussed topics recently has been the reduction of the budget deficit, which stands at approximately 6% of GDP. Prime Minister Vasile Tofan himself has stated that maintaining the budget deficit at such a high level is a path towards bankruptcy. It should be noted that the objective of reducing the budget deficit is achievable, as demonstrated both by the experience of other countries and by the experience accumulated by the Republic of Moldova over the years.

First of all, it should be mentioned that whenever the need to reduce the budget deficit arises, several fundamental approaches are considered or, more precisely, several sets of essential measures.

The first set of measures concerns controlling and reducing public expenditure. These include: bringing the operating expenses of central public authorities back to previous levels; reviewing salaries and bonuses in the public sector; cutting non-essential costs within state institutions; and prioritizing public investments strictly in projects with high economic returns, among others.

The second set of measures concerns increasing revenues and fiscal policies. These include: broadening the tax base; combating tax evasion; tackling the “grey” economy; gradually formalizing employment; reducing the number of existing tax regimes; and adjusting the tax burden, among others.

The third set of measures consists of those generally referred to as structural and external measures. These include: prudent borrowing and attracting low-cost financing or non-repayable/concessional external support; complying with budgetary discipline rules; and aligning with European targets or recommendations on medium-term fiscal sustainability, among others.

Judging by statements made by certain government representatives, as well as by some concrete actions being undertaken, several of these measures are already receiving attention from the authorities. Personally, I believe that all possible measures should be analyzed to determine how applicable they are under the specific circumstances currently facing the Republic of Moldova.

Relevant examples from other countries, including neighboring Romania, should also be examined. According to Eurostat data, Romania reduced its budget deficit from 9.2% of GDP in 2024 to 7.8% of GDP in 2025, representing one of the largest fiscal adjustments in the European Union, although its deficit remained the highest in the bloc.

During the first nine months of 2026, the budget deficit continued to decline, reaching 3.81% of GDP. The main factors behind the reduction of Romania’s budget deficit were: 1. increased revenues; 2. control over personnel expenditure; and 3. increased investment.

In particular, it should be emphasized that public investment grew at an accelerated pace (for example, by 48.6% in the third quarter of 2026), stimulating economic growth, although interest payments on public debt also increased.

Incidentally, the Republic of Moldova has faced situations similar to the current one. For example, in 2009, the budget deficit stood at approximately 9% of GDP. Subsequently, this indicator declined significantly thanks to measures such as: budget revisions (following a 2.4% increase in revenues in 2010 compared with the initial forecast); broadening the tax base; combating tax evasion and the informal economy; improving the management of external and domestic payments with the support of the International Monetary Fund, the World Bank and the European Union; implementing a policy of moderate austerity; and prioritizing public expenditure, among others.

In other words, reducing the budget deficit to an acceptable level is a difficult but not impossible task. Everything depends on the approaches adopted by the authorities and the extent to which relevant precedents are taken into account.

Mircea Baciu, entrepreneur from the Republic of Moldova