Moldova is more vulnerable to the adverse impact of climate change than the rest of Europe, due to its (i) higher sensitivity to changes in climate conditions (reflecting its heavier reliance on agriculture, a comparatively-larger rural population, high dependence on energy imports and limited diversification of energy supply sources, and limited financial resources to provide high-quality public services); and (ii) weaker adaptative capacity to climate shocks (due to its comparatively weaker disaster preparedness strategy, low adaptation in the agriculture sector and poorer quality of infrastructure). Strengthening resilience to natural disasters will require significant adaptation investments in the coming years. This paper shows that such investments can substantially reduce output losses caused by natural disasters, will be more cost-efficient than responding to disasters ex-post, and will contribute to boost Moldova’s long-term economic growth and support its development objectives. However, due to limited domestic financial resources in a complex economic environment, Moldova cannot finance the most-needed adaptation investments without endangering public debt sustainability or hindering its growth potential. Therefore, external support will be critical to help meet the adaptation needs. In addition, continued progress on structural reforms (including on enhancing public investment efficiency, governance, the efficiency of education expenditure, strengthening the business environment and crowding in private investments) will support Moldova’s readiness to fully benefit from climate adaptation investments.