The Republic of Moldova received 27 million dollars from the IMF, after the financial institution disbursed the money, according to provided information. The institution declared that the war in Ukraine has had a major impact on the Moldovan economy amid rising energy costs.
The Executive Board of the International Monetary Fund (IMF) concluded the first analyzes within the Arrangements regarding the Extended Credit Facility (ECF) and the Extended Fund Facility (FEP) for 40 months for the Republic of Moldova. This allows the immediate disbursement of SDR 20.65 million (approximately USD 27 million) usable for budget support, bringing Moldova’s total payments under the combined FEC/FEP agreements to SDR 185.95 million (approximately USD 242 million).
The consequences of the war in Ukraine continue to affect Moldova’s prospects. The economy is expected to stagnate in the short term, with inflation remaining high amid rising food and energy prices. Despite signs of resilience, current account deficits and budgets are expected to widen significantly this year. Risks to the outlook remain exceptionally high, including those related to the regional energy crisis. Moldova’s program implementation remains strong despite the challenging environment, with important program commitments being met in the areas of fiscal and financial governance, as well as rule of law and anti-corruption.
Following the Executive Board discussions, Kenji Okamura, Deputy General Manager and Interim President, made the following statement:
“Many challenges continue to weigh heavily on Moldova, including spillovers from Russia’s war in Ukraine, the negative impact of rising inflation on purchasing power and energy security concerns. As a result, Moldova’s economic prospects remain subject to exceptionally high internal and external risks.
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“Despite these challenges, the authorities remain firmly committed to the program supported by the Fund, which aims to support vulnerable people, while advancing governance reforms and addressing development needs to create conditions for sustainable and inclusive growth. They have successfully delivered on their structural commitments on fiscal governance, financial sector supervision and strengthening anti-corruption legislation, and even included additional conditionality to support the structural fiscal agenda”, Okamura said.
l supervision and regulation also remains important, especially given the vulnerabilities in the non-banking sector,” Kenji Okamura added.