The European Commission to double the ongoing macro-financial assistance to Moldova, increasing its total amount by 145 million euros - from 150 million euros to 295 million euros.
As noted in its report, the EC assistance is aimed at providing additional support to Moldova, whose economy has been hit hard by the consequences of the Russian invasion of Ukraine, as well as the severe energy crisis that has persisted since October 2021. The increase in macro-financial assistance will help the country cover some additional financing needs in 2023, maintain macroeconomic stability and ensure further reforms. The current EC proposal will accompany the current IMF country program. As noted by the European Commission, the two additional disbursements under the proposed increase in macro-financial assistance will be strictly contingent on progress in the IMF program and on the implementation of new policy conditions to be agreed between Moldova and the EU and added to the existing Memorandum of Understanding. These policy conditions will address some of the major shortcomings identified in recent years in the Moldovan economy and economic governance system, as well as in other key areas, including good governance and the fight against corruption, the rule of law and energy security. Of the additional assistance of 145 million euros, up to 45 million euros will be provided in grants and up to 100 million euros in soft loans. The amount is to be paid in two additional installments, scheduled for the third and fourth quarters of 2023, subject to the fulfillment of agreed conditions. Now the European Parliament and the European Council should consider and accept the EC proposal to increase the current macro-financial assistance to Moldova. Once accepted, the proposal will enter into force, and disbursements can be made. Macro-financial assistance is part of the EU's broader engagement with neighboring and enlargement partners, and is intended as an exceptional crisis response tool. It is available to enlargement and neighborhood partners with severe balance-of-payments problems. The new EU macro-financial assistance package for Moldova came into force on July 18, 2022, with 150 million euros to be provided, including 120 million euros in concessional loans and 30 million euros in grants. // 25.01.2023 - InfoMarket.
