Moldovan Parliament passed in first reading amendments to the program with the IMF, providing for an increase in aid to finance the state budget.
In particular, MPs passed in first reading amendments to two laws providing for an increase in the amount of external state loans granted by the International Monetary Fund through the ECF (Extended Credit Facility) and EFF (Extended Fund Facility) Arrangements to finance the state budget by 157.1 million Special Drawing Rights (SDR) - from 314.3 million to SDR 471.4 million. The changes were made since on May 11, 2022, the IMF Executive Board approved a total increase of SDR 194.26 million (approximately $260.11 million) to SDR 594.3 million (approximately $795.72 million) in financial assistance to Moldova under the current Economic Reform Program. At the same time, the amount of loans to support the state budget was increased from SDR 314.3 million to SDR 471.4 million. It was agreed that, in particular, under the ECF mechanism to finance the budget needs will be received SDR 169.5 million, which is SDR 64.8 million more than planned before (the previous amount - SDR 104.7 million). At the same time, SDR 301.9 million, an increase of SDR 92.3 million from SDR 209.6 million previously planned, will be allocated under the EFF mechanism. At the same time, the EFF funds will be repaid in 12 equal tranches after 4.5 years from each payment made from the loan account. The repayment period of the loan is 10 years. A floating interest rate will apply, which as of May 9 this year was 1.498% per annum. The service fee will be 0.5% of the amount paid, and the commitment fee will be 0.3%. At the same time, under the ECF mechanism, the funds will be repaid in 10 equal tranches after 5.5 years from each payment made from the loan account. The interest rate on the loan under consideration will be set every 2 years and will be 0% until 2023. Additional financial assistance supported by the ECF and EFF mechanisms will be used to cover urgent balance of payments financing needs arising from negative shocks, including the war in Ukraine and international sanctions imposed on Russia and Belarus, and will help attract new support from the international community. The loan will be used to finance state budget needs. // 02.06.2022 - InfoMarket
