IMF Executive Board Completes the Fourth and Fifth Reviews under the Extended Credit Facility and Extended Fund Facility Arrangements for the Republic of Moldova

September 20, 2019

  • Executive Board’s decision enables the disbursement of SDR33.6 million (about US$46.1 million) to Moldova.
  • The program remains broadly on track, with strong ownership, and past policy slippages are fully corrected.
  • It is critical to pursue prudent and well-coordinated macroeconomic policies, and continue reforms, notably to complete the cleansing of the financial sector, improve governance, strengthen institutional frameworks, and ensure transparency and predictability in the energy sector.

On September 20, 2019, the Executive Board of the International Monetary Fund (IMF) completed the fourth and fifth reviews under the Extended Credit Facility (ECF) and Extended Fund Facility (EFF) Arrangements. This makes available to Moldova the cumulative amount of SDR33.6 million (about US$46.1 million). The Board also approved Moldova’s request for extension of the arrangements to March 20, 2020 and rephasing of access in order to allow for the successful completion of the program.

The ECF/EFF arrangements in a total amount of SDR 129.4 million (about US$178.7 million, or 75 percent of the Republic of Moldova’s quota) were approved on November 7, 2016 (see Press Release No 16/491 for details). It aims to support the country’s economic and financial reform program.

Following the Executive Board discussion, Mr. Mitsuhiro Furusawa, Deputy Managing Director and Acting Chair, made the following statement:

“The Moldovan authorities have taken decisive corrective measures to bring the Fund-supported program back on track and to achieve its objectives of ensuring macroeconomic stability and advancing reforms. Going forward, it is critical that the authorities continue to pursue prudent policies and structural reforms aimed at strengthening the financial sector, maintaining fiscal sustainability, and creating space for social and infrastructure spending.

“Significant progress has been achieved in the financial sector’s reform agenda. Important measures to secure shareholder transparency and fitness and probity of the domestic banking system were completed. Progress has been achieved in improving supervision, regulatory frameworks, unwinding bank related-party exposures, and strengthening financial safety nets. Moving forward, exit of the second largest bank from temporary administration, addressing rising risks in the non-bank financial sector, and improving the AML/CFT framework will be critical, in addition to making decisive progress on asset recovery.

“The amended 2019 budget will help mitigate immediate fiscal pressures. Strong implementation of adopted measures will be key in ensuring fiscal sustainability, while securing the needed fiscal space for priority projects. New initiatives need to be carefully costed. Continued efforts are needed to strengthen tax administration and compliance, streamline tax expenditures, and reduce risks from SOEs and PPPs. Strengthening public investment management would help improve the efficiency of public investments and scale up public infrastructure.

“Monetary policy should continue to focus on maintaining price stability, in the context of a flexible exchange rate regime. The NBM should continue to improve its operational framework and capacity. Safeguarding the NBM’s independence is critical for its ability to fulfill its mandates of maintaining price and financial sector stability.

“Progress towards structural bottlenecks is needed to unlock Moldova’s economic potential. Improving governance and fighting corruption, strengthening bank intermediation, implementing transparent and predictable energy tariff policy, and promoting a business-friendly environment will boost growth potential and raise incomes.”


IMF Communications Department

PRESS OFFICER: Gediminas Vilkas

Phone: +1 202 623-7100Email: