The Moldovan authorities and the IMF Mission reached an agreement at the expert level on a new program of economic reforms in the amount of about $ 564 million.
The positive result of the talks was announced on Thursday at a briefing by Prime Minister Natalia Gavrilita and International Monetary Fund Resident Representative in Moldova Rodgers Chawani. Chawani said the 40-month program will be supported through the Extended Credit Facility (ECF) and the Extended Funding Facility (EFF). It aims to support economic recovery and launch an ambitious program of governance and institutional reforms. It is assumed that within the framework of the program, Moldova will receive access to financing in the amount of 400 million special drawing rights (232% of Moldova's quota in the IMF, which is approximately $ 564 million). The expert-level agreement must be approved by the IMF management and the Fund's Executive Board. After completing all preconditions, a meeting will be organized in December to present the mission's report to the IMF's Executive Board, Chawani said. It is assumed that the first tranche of $ 81 million may arrive in Moldova by the end of this year. Natalia Gavrilita noted that the approved program with the IMF is a catalyst for new financing from other development partners, it promotes greater confidence among investors and gives the government more freedom to develop programs of social, economic support and infrastructure. The prime minister stressed that the priorities of the new agreement with the IMF are fighting corruption and strengthening the rule of law. “Poor law enforcement and corruption in the judiciary and administration have become the biggest obstacles to economic growth, sustainable investment and improved living standards. Therefore, we have undertaken an obligation to conduct an extraordinary assessment in the field of justice and bring law enforcement agencies to justice, ”said Natalia Gavrilita. She stressed that in the short term, fiscal policy will focus on mitigating the impact of the COVID-19 pandemic and the current energy crisis; Financing of programs already launched by the government will continue, including increases in pensions and benefits, wage subsidies to maintain jobs and compensate for declining economic activity, and new programs will be funded to compensate households and economic agents for higher energy prices. In the medium term, efforts will focus on securing investment in infrastructure (roads, water and sanitation systems, energy systems and energy efficiency), as well as implementing programs to improve the business environment, education and health care. “We will continue to fight smuggling and tax evasion by improving tax and customs administration, rationalize costs, improve state enterprise management, evaluate companies' financial statements and strengthen their administrative boards. We will continue to put things in order in public procurement, ensure transparency and fight corruption in this area, ”the Prime Minister said.// 21.10.2021 — InfoMarket
