The Parliament of Moldova approved in the second reading amendments to the program with the IMF to increase the amount of the fund's assistance to finance the state budget.
In particular, the deputies adopted in the final reading amendments to two laws providing for an increase in the amount of external state loans allocated by the International Monetary Fund through the ECF (Expanded Credit Facility) and EFF (Extended Financing Facility) lending mechanisms to finance the state budget by 157.1 million special rights borrowings (SDR) - from 314.3 million to 471.4 million SDR. The changes are made due to the fact that on May 11, the Executive Board approved an overall increase in financial assistance to Moldova under the current Economic Reform Program by 194.26 million SDRs (approximately $260.11 million) to 594.3 million SDRs (approximately $795.72). At the same time, the amount of loans to support the state budget was increased from 314.3 million to 471.4 million SDR. It was agreed that, in particular, 169.5 million SDRs would be received under the ECF mechanism to finance the needs of the budget, which is 64.8 million SDRs more than previously planned (the previous amount was 104.7 million SDRs). Herewith, 301.9 million SDRs will be allocated under the EFF mechanism, which is 92.3 million SDRs more (the previous amount was 209.6 million SDRs). Meanwhile, funds within the framework of the EFF will be returned in 12 equal tranches after 4.5 years from each payment made from the loan account. The loan repayment term is 10 years. A floating interest rate will be applied, which as of May 9 this year was 1.498% per annum. The service fee will be 0.5% of the amount paid, the commitment fee - 0.3%. Thus, under the ECF mechanism, funds will be returned in 10 equal tranches after 5.5 years from each payment made from the loan account. The interest rate on the loan in question will be set every 2 years and will be 0% until 2023. Additional financial assistance 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, as well as help attract the provision of new support from the international community. The loan will be used to finance the needs of the state budget.//23.06.2022 — InfoMarket.
