The European Parliament has approved a grant of 150 million euros for the Republic of Moldova
The European Parliament voted on Thursday to provide the Republic of Moldova with assistance of 150 million euros, in the form of macro-financial aid to cover part of its external financing needs, informs an EP communiqué.
MEPs approved the European Commission’s proposal to assist the Chisinau government in stabilizing the country’s economic situation with 558 votes in favor, 20 against and 10 abstentions. The € 120 million in loans and € 30 million in grants will be paid in three installments by 2024, with the first scheduled for this summer.
In order for the money to be paid, the Republic of Moldova must demonstrate significant progress in implementing a macroeconomic program established by the International Monetary Fund (IMF). It also needs to implement additional policy measures agreed with the EU to recover, inter alia, assets lost in the 2014 banking fraud, to reform public finance management, the justice sector, public procurement and to improve workers.
The government of the Republic of Moldova is aiming for reform, an institution for almost a year, initially working for good governance and justice, and has intensified the fight against corruption, according to MEPs. However, Moldova’s economy has been hit by the COVID-19 pandemic and the summer drought, which has shrunk the country’s economy by 7%, exacerbated by a 2021 gas dispute with Russia’s Gazprom.
Parliament also adopted in this plenary session the Agreement between the EU and the Republic of Moldova on the operational activities of the European Border Police and Coast Guard Agency (FRONTEX) in the Republic of Moldova.
“Although Moldova has already taken some measures to combat corruption, organized crime and illicit financial flows, there is room for further reform, especially in terms of democratic institutions, decentralization, strengthening of public administration and depoliticization of public anti-corruption institutions.” The statement was made by the Czech rapporteur, Marketa Gregorova, from the EP-Greens.
“Moldova is currently feeling the impact of the war on its borders, which has led to rising energy prices and additional costs. As a result, current macro-financial assistance is no longer sufficient to cover the funding gap. I therefore welcome the EC’s efforts to find other ways to support Moldova in stabilizing its economy, “she added.
The Republic of Moldova is covered by the European Neighborhood Policy and is therefore eligible for macro-financial assistance. Since 2010, the EU has provided Moldova with 190 million euros in this type of assistance.
The IMF has identified that by 2022, the Republic of Moldova has a deficit of 480 million dollars (440 million euros) in terms of its financing needs, the quoted communiqué states.
Publisher: IC