Moldovan government approves the start of negotiations with the International Bank for Reconstruction and Development to provide the country with $125 million for emergency response, resilience and competitiveness.
Budgetary support may be provided within the Funding Agreement for the second program "Emergency Response, Resilience and Competitiveness Development Policy Operation (DPO)", which Moldova intends to sign with the International Bank for Reconstruction and Development (IBRD) and other donors. In this context, the government approved a draft law on initiation of negotiations on the agreement with IBRD. The goal of the financing program is to support the strategies established by the government to mitigate the negative effects of the crises and emergency regime in the country, as well as to ensure Moldova's sustainability and competitiveness. The program will be implemented in the form of budget support. It is planned that the International Bank for Reconstruction and Development will provide $125 million, of which $100 million is a loan and $25 million is a grant. According to the draft agreement, the repayment term is 21 years, including a grace period of 3 years. The interest rate is variable, with a commitment fee of 0.25% of the unpaid amount and a one-time fee of 0.25% of the loan amount. Both the grant and the loan will be repaid in one tranche. It is worth mentioning that the second program "Emergency Response, Resilience and Competitiveness Development Policy Operation" provides for financial assistance from other donors as well. It is a grant of $111 million, of which Moldova will receive $25 million through the Global Concessional Financing Facility (GCFF) and $86 million - through the Multi-Donor Trust Fund. All funds will be used to finance eight sub-measures, including: integration of Ukrainian refugees; strengthening civil protection response and management in emergency situations, including the influx of refugees; establishing a guaranteed minimum income for children separately; implementing energy efficiency policies for public and residential buildings; changing the legal framework for deposit guarantees to increase coverage of bank deposits; strengthening the legal framework for corporate governance of state-owned enterprises The mentioned financing agreement will enter into force after being signed and ratified by the Moldovan Parliament and when all the conditions specified in the financing agreement are fulfilled. // 12.04.2023 - InfoMarket.
