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Tiraspol, the capital city of Pridnestrovie, with the Dniester river in the foreground.

TIRASPOL (Tiraspol Times) - The Ministry of the Economy of the Pridnestrovskaia Moldavskaia Respublica (PMR) released its 2007 forecast Thursday, estimating a year-on-year growth in industrial output of seven percent to 900 million U.S. dollars.

According to the ministry's projections, exports from the unrecognized country will grow a full 22% and will reach $610 million. Imports will decrease by some 13% to $740 million, narrowing the 2007 trade decifit to $130 million. The PMR government projects a budget deficit equivalent to 13% of GDP.

Retail sales are expected to grow at a more modest pace. For 2007, retail sales of 3,780 million PMR Rubles are expected, which at the current exchange rate is equivalent to $453 million. This represents a 2.6% increase.

Target called "Mission Impossible"

Not everyone agrees that the country will be able to reach its 2007 growth target of 7%.
" - It is a brave goal to set, and there is nothing wrong with having big dreams," says commentator Michael Garner. "But unless something changes, I am afraid that it will remain just a dream."

That "something" is recognition. Should Pridnestrovie achieve widespread international recognition of its statehood in 2007, then all bets are off.

" - That, the diplomatic recognition, will be a huge and instant boon to the economies of both PMR and Moldova. It will send a signal to investors that Moldova will not repeat its failed 1992 war. It will bring international integration to Transdniestria, and a level of accountability which has been lacking because the doors of the rest of the world have been shut close in Transdniestria's face until now."

Moldova stands to benefit even more than Pridnestrovie, says Garner:
" - Actually, it will be double good for Moldova, because it means that the frozen conflict will have ended, and that good and productive economic relations between the two sides of the former Moldavian SSR can finally begin to take root. This time on a basis of trust and clear rules. When you look at this closely, you can't really find any other alternative for Moldova which is as attractive as this one."

17th year of 'de facto' sovereignty

Pridnestrovie meets the requirements for statehood under customary international law. It has a population which is the same size as that of Montenegro, a new country which declared independence in June of 2006 and then became the latest member to join the United Nations. It also has full and sovereign control of a defined territory of more than 4,000 square kilometers, or approximately twice the size of Luxembourg, a founding member of the United Nations. It has a government, armed forces, a court system, constitution and the ability to enter into relations with other states on an equal basis. Pridnestrovie declared independence in 1990. Now in its 17th year of existence, it is de facto independent. Although neighboring Moldova still has not given up on its territorial claim, it does not enforce any sovereignty within the borders of Pridnestrovie.

Better relations between the two countries - one currently recognized, and the other not - are seen as necessary before mutual economic growth can take off.

" - The international recognition of Pridnestrovie's current independence will finalize a status settlement and will end the current frozen conflict, which in turn will pave the way for rapid economic growth on both sides of the Dniester river," explains Garner.

See also:
» Pridnestrovie per-capita GDP up 17.3% despite economic warfare [1]