Moldovan Parliament ratified a memorandum and agreements with the EU on new macro-financial assistance of 150 million euros.
In particular, the MPs approved in the second reading the projects of ratification of the memorandum-agreement between the RM and the EU on macro-financial assistance for Moldova, the credit line agreement between Moldova, the European Union and the NBM on macro-financial assistance for Moldova totaling 120 million euros and the grant agreement between the RM and the EU on macro-financial assistance for Moldova. All three documents were signed in Brussels on June 22 and stipulate that Moldova will receive 120 million euros of concessional loans and 30 million euros of grants from the EU under the new macro-financial assistance. As Finance Minister Dumitru Budianschi said earlier, the European Parliament and the Council of the European Union decided on April 6 to provide additional macro-financial assistance to Moldova in the context of the impact of the war in Ukraine, in particular to restore the economy affected by the war and pandemic, as well as to manage the gas crisis that started in October 2021. The Memorandum-Agreement between the Republic of Moldova and the EU on macro-financial assistance provides a list of 15 conditions that the country will have to meet in order to receive the European Union's aid of 150 million euros. The money is expected to be allotted in three equal tranches of 50 million euros, and the first tranche is expected to consist of a 35 million euro loan and a 15 million euro grant, the second - a 40 million euro loan and a 10 million euro grant, and the third - a 45 million euro loan and a 5 million euro grant. EU financial assistance will be provided between 2022 and 2024, starting from the first day after the entry into force of the Memorandum of Understanding. The allocation of the tranches will depend on the fulfillment of the provisions of the memorandum and other agreements between Moldova and the EU. There are three conditions for the first tranche, six conditions for the second tranche, and six conditions for the third tranche. The macro-financial assistance will contribute to Moldova's economic recovery by promoting a set of policy measures. The main reforms will target the energy sector, the fight against corruption, the rule of law, and the business climate. The money will also be used to cover our country's budgetary needs. Moldova will benefit from the EU's macro-financial assistance for a 15-year term, and the interest rate for each tranche will depend on the cost of borrowing by the European Commission on the international financial market. Finance Minister Dumitru Budianschi said that, according to rough estimates, the interest rate for all tranches of macro-financial assistance will be 1.5%. According to him, in this case, Moldova will return 26 million euros in addition to the principal amount of the loan in the form of interest for the entire period. But given that Moldova will receive 30 million euros in the form of a grant, the loan will be essentially interest-free. // 14.07.2022 - InfoMarket
