The separatist Transnistrian region of Moldova is preparing its 2026 budget amid a deep economic crisis, following an estimated contraction of nearly 18% in 2025, according to a statement from the executive authorities in Tiraspol. The region faced scarce and problematic gas supplies last year, after it lost the direct free gas supplies from Russia in January 2025.

Officials are also outlining a Budget and Tax Policy Concept for 2027 and the medium term, reflecting ongoing economic strain and external pressures. The first deputy prime minister said implementation of the framework will depend on several conditions, including uninterrupted natural gas supplies, stable access to foreign payments, a steady exchange rate, and no escalation of sanctions or external shocks.

While Russia is still providing financial support to the region, Moldova is gradually enforcing a national taxation and customs regime on the separatist territory, building up at the same time a budget for financing the economic integration of the region in view of joint EU accession.

The region's economic downturn in 2025 was driven largely by an energy crisis and disruptions to gas supplies. Industrial production declined by 27.3%, while foreign trade turnover fell by 28.5%. Gross domestic product dropped by almost 18% in real terms, while inflation reached 14.7% following a sharp increase in tariffs.

Early indicators for 2026 suggest a feeble rebound. Industrial output in January and February increased by nearly 70% compared with the same period a year earlier, although it remains about 20% below 2024 levels.

External trade continues to lag. Exports have declined by almost 60%, and imports are down 24.5%, pointing to subdued economic activity. Inflation has eased significantly to 1.7%, indicating reduced price pressures after the previous year’s surge.

Authorities said the medium-term budget will retain a strong social focus while aiming for gradual fiscal consolidation. Tax policy will prioritise predictability, targeting a tax burden of around 28% of GDP, within a margin of plus or minus one percentage point.

Planned state support will be directed towards key sectors including industry, agriculture, import substitution, information technology, domestic tourism and energy efficiency, as the region seeks to stabilise its economy under continued constraints.