Moldova will receive a concessional loan in the amount of 40 million euros from the French Development Agency to strengthen the energy sector and implement reforms.
According to the press service of the Parliament, the Commission for Foreign Policy and European Integration at its meeting on Wednesday approved the start of negotiations on the draft of the relevant Credit Line Agreement between Moldova and the French Development Agency (AFD). The document provides for a loan in the amount of 40 million euros, which will be used to finance the needs of the state budget in order to implement reforms in the field of energy infrastructure, energy efficiency and renewable energy sources. At the same time, the implementation of this agreement and the agreed reforms in practice will accelerate Moldova's transition to "green energy", contributing to energy security and long-term climate resilient development, in line with the requirements of EU and Energy Community legislation, as well as Moldova's obligations under the main international agreements, including the Paris Agreement. Negotiations on signing the loan agreement will be conducted by an official delegation of negotiators headed by the State Secretary of the Ministry of Finance. Once signed, the Agreement must be ratified by Parliament. As InfoMarket reported earlier, the French Development Agency is ready to provide Moldova with a preferential loan in the amount of 40 million euros to carry out reforms in the energy sector. As noted in the Ministry of Finance, on February 10, 2023, the department turned to the French Development Agency with a request to explore the possibility of providing a loan based on a development policy in the amount of 120 million euros on favorable terms for reforms in the energy and forestry sectors. On May 15, 2023, the first draft of the Credit Line Agreement in the amount of 40 million euros was received from French partners, subject to reforms in the energy sector. Relevant reforms should be carried out on the basis of the Policy Matrix (“Roadmap”), which includes all the actions that should be carried out by Moldova in the period 2023-2028. We are talking about 34 conditions, divided into 6 stages. The loan agreement, to be concluded with the French Development Agency, is a bilateral contract. The loan has a maturity of 15 years, including a 5-year grace period. The loan will be repaid every six months in 20 equal installments. The interest rate will be determined in the course of negotiations between a fixed interest rate or a floating rate (Euribor 6 months + margin). The commitment fee is expected to be 0.5% of the outstanding amount accrued since the date of signing the contract. A single commission will be 0.5% of the total loan amount. The loan will be disbursed in one payment. The cost of servicing this loan is paid from the state budget. //19.07.2023 – InfoMarket.
