The European Commission proposed to increase the macro-financial assistance (MFA) being granted to the Republic of Moldova by up to 145 million euros, which raises the total amount of support being granted to this country to 295 million euros, informed the European executive in a statement, while the head of the Commission, Ursula von der Leyen, emphasized that the EU stands in solidarity with the Republic of Moldova to face the shock waves caused by Russia’s war in Ukraine.
With this proposal, the Commission stands with the Republic of Moldova, which continues to implement its reform agenda, while dealing with the consequences of Russia’s war of aggression against Ukraine, struggling with an energy crisis and hosting a large number of refugees. from Ukraine. The proposal follows the announcement made by President von der Leyen in Chisinau in November 2022 regarding additional financial support for Moldova.
“We stand in solidarity with Moldova as the shock waves of Russia’s brutal war continue to impact the country. Today we propose to supplement the macro-financial assistance for Moldova with EUR 145 million. This will greatly support the country’s economy and energy security,” said von der Leyen.
The additional assistance is aimed at providing additional support to the Republic of Moldova, whose economy has been severely affected by the consequences of Russia’s invasion of Ukraine, as well as by a significant energy crisis that has continued since October 2021.
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The increase in macro-financial assistance would help the country cover part of its additional financing needs in 2023, support macroeconomic stability and ensure the continuation of reforms. Today’s proposal would accompany the country’s ongoing program at the International Monetary Fund.
The two additional payments under the proposal to increase the MFA would be strictly conditional on the satisfactory progress registered within the International Monetary Fund program and the implementation of new policy conditions to be agreed between Moldova and the EU and added to the memorandum of understanding existing understanding. These policy conditions would aim to address some of the fundamental deficiencies exposed in recent years in Moldova’s 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. The conditions would complement the commitments undertaken by Moldova within the program agreed with the International Monetary Fund and the World Bank, as well as the EU budget support operations, the Association Agreement and the general objectives of EU-Moldova relations, further supporting Moldova on its European way.
Of the additional amount of up to 145 million euros, up to 45 million euros will be granted in the form of grants and up to 100 million euros in the form of loans under favorable financing conditions.
The amount would be paid in two additional installments planned for the third and fourth quarters of 2023, subject to policy conditions being met.
The European Parliament and the Council must now examine and adopt the proposal to increase the current macro-financial assistance to Moldova. Once passed, the proposal will go into effect and payments can be made.
We stand in solidarity with Moldova as shockwaves of Russia’s brutal war continue to impact the country.— Ursula von der Leyen (@vonderleyen) January 24, 2023
Today we propose to top up macro-financial assistance to Moldova by €145 million.
This will greatly support the country's economy and energy security.