IMF Staff Concludes Consultations with Moldova on a New Economic Program
July 27, 2020
- IMF staff and the Moldovan authorities have reached staff-level agreement on an economic reform program to be supported by three-year Extended Credit Facility and Extended Fund Facility (ECF/EFF) arrangements.
- It would allow Moldova to access about US$ 558 million of financial assistance.
- The new program will build on progress made under the previous program and strive to support Moldova’s post-pandemic recovery, and advance ambitious institutional reforms.
WASHINGTON, DC - An International Monetary Fund (IMF) mission, led by Ruben Atoyan, held discussions remotely from the IMF Headquarters in Washington, D.C. with the Moldovan authorities during July 7-24, 2020 on an IMF-supported economic program.
At the end of the consultations Mr. Atoyan issued the following statement:
“IMF staff and the Moldovan authorities have reached staff-level agreement on an economic reform program to be supported by three-year Extended Credit Facility and Extended Fund Facility (ECF/EFF) arrangements. Access under this arrangement is proposed to be set at SDR 400 million (232 percent of Moldova’s quota in the Fund and about US$ 558 million). The staff level agreement is subject to approval by IMF Management and the Executive Board. Considerations of the new program by the Executive Board is expected in September, subject to the authorities’ implementation of a number of prior actions, including in areas of the central bank independence, financial sector oversight, and fiscal transparency.
“The new ECF/EFF arrangements will help maintain macroeconomic stability, provide an anchor for authorities’ policies to support the post-pandemic recovery, and catalyze external financing from other donors. Building on progress made under the previous program, the new arrangement will also strive to advance ambitious institutional reforms aimed at tackling widespread vulnerabilities in areas of fiscal governance, non-bank financial sector oversight, market regulation, anti-corruption, and rule of law.
“The governance reform of the National Bank of Moldova (NBM) supported by the Fund and NBM’s performance during the previous program is an important achievement for Moldova. The successful clean-up of the banking sector in the aftermath of the major bank fraud is a credit to the supervisory work of the NBM. Unequivocal commitment to the irreversibility of the banking sector reforms is critical for the financial sector stability. An independent central bank helps macroeconomic stability, supports investor confidence, and protects the financial system—all crucial preconditions for inclusive and sustainable growth. It is in the interest of Moldova to preserve the independence of NBM and it is also a critical requirement under the new IMF-supported program.”
More information
IMF Lending Tracker (emergency financing request approved by the IMF Executive Board)
https://www.imf.org/en/Topics/imf-and-covid19/COVID-Lending-Tracker
IMF Executive Board calendar
https://www.imf.org/external/NP/SEC/bc/eng/index.aspx
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