Regional Financial Integration - a Solution to Streamline the Financial System of the Republic of Moldova

Abstract

The financial system in the Republic of Moldova does not have the potential to generate economies of scale. Consequently, the financial products and services provided are characterized by limited diversification, insufficient volume and high costs. Under these circumstances, one of the solutions that can help to overcome this impediment is Moldova's financial integration at regional level. In the context of this research the authors have set the following objectives: to define the concept of regional financial integration; to identify and argue the benefits and negative effects of the process of international financial integration; to develop the methodological framework for measuring financial integration; to assess the level of financial integration of the Republic of Moldova; to develop the mechanism of transmission of the potential effects of financial integration on the performance indicators of the financial system of the Republic of Moldova; to formulate solutions for the extension of financial integration of the Republic of Moldova at the regional level in terms of financial system efficiency. The authors of this paper used the following research techniques and methods: economic analysis, synthesis, analogy, modeling, induction, deduction, mathematization and formalization in the field of international finance knowledge and others. The originality and value of the research lies in developing the conceptual and methodological framework associated with regional financial integration in order to increase the efficiency of the financial system of the Republic of Moldova. UDC: 339.7:336(478); JEL: F36, F38, F55, G2, Q01.