{
  "title": "Press Release: IMF Executive Board Completes Third Reviews Under the Extended Credit Facility and the Extended Fund Facility Arrangements with Moldova, Approves US$79 Million Disbursement",
  "publication": "IMF News, July 13, 2011",
  "sourceUrl": "https://www.imf.org/en/news/articles/2015/09/14/01/49/pr11277",
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  "summary": "The Executive Board completed the third reviews of Moldova's economic performance under the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) arrangements.",
  "publishDate": "2011-07-13",
  "sections": [
    {
      "heading": "IMF decision and financing",
      "content": "- The Executive Board completed the third reviews of Moldova's economic performance under the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) arrangements.\n- The blended financing arrangements under the ECF and the EFF were approved on January 29, 2010, for an amount equivalent to SDR 369.6 million (about US$586 million).\n- The completion of the third reviews makes an amount equivalent to SDR 50 million (about US$79 million) immediately available to the authorities.\n- The Executive Board also approved the authorities’ request for modification of performance criteria on the National Bank of Moldova (NBM) net international reserves and net domestic assets for end-September 2011 and end-March 2012.\n- The Executive Board’s decision was taken on a lapse of time basis, effective July 13, 2011."
    },
    {
      "heading": "Economic outlook and recovery",
      "content": "- Moldova’s economy has essentially completed its recovery from the 2009 recession.\n- Robust growth continued into 2011, spurred by brisk domestic demand and very strong exports.\n- Core inflation remained contained, despite some pressure from higher energy prices on headline inflation.\n- The outlook is described as positive."
    },
    {
      "heading": "Fiscal policy and sustainability",
      "content": "- The program is on track to restore fiscal sustainability by 2012 as planned.\n- Fiscal policy focus:\n  - Rationalizing current expenditure.\n  - Safeguarding spending on priority investment and social assistance to the most vulnerable.\n- Fiscal consolidation will be further supported by comprehensive tax policy and administration reforms in 2012 and beyond."
    },
    {
      "heading": "Monetary policy and reserves",
      "content": "- Recent tightening of monetary policy has anchored inflation expectations in the face of rising energy prices and domestic demand.\n- Further tightening may need to be considered if:\n  - The effect of higher energy prices spills over to core inflation, or\n  - Domestic demand accelerates further.\n- The NBM’s planned increase in foreign reserves is considered appropriate in response to the higher-than-projected influx of foreign exchange from recovering remittances and capital inflows."
    },
    {
      "heading": "Financial sector developments",
      "content": "- Conditions in the financial sector continued to improve:\n  - Banks showing stronger profits.\n  - Declining nonperforming loans.\n- Completion of frameworks on crisis preparedness and debt resolution will enhance financial stability and promote financial intermediation.\n- The arrangement between the authorities and commercial banks on sharing the costs related to the failed Investprivatbank is welcome."
    },
    {
      "heading": "Structural reforms and sectoral priorities",
      "content": "- Comprehensive reforms are needed to restore financial sustainability in the energy sector.\n  - Establishment of efficient pricing and payment mechanisms will support cost recovery and contain the accumulation of new debt.\n- Improving the business climate and promoting exports are essential to sustain strong growth in the medium term.\n- Removal of trade barriers and divestment of state enterprises are identified as important steps.\n\nPress Release No. 11/277, July 13, 2011 — International Monetary Fund\n\n---\n\n\n References\n\n- Republic of Moldova and the IMF\n- Press Releases\n- PRESS CENTER\n- Press Release No. 10/21\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2015/09/14/01/49/pr11277"
    }
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    "Published: July 13, 2011",
    "The Executive Board completed the third reviews of Moldova's economic performance under the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) arrangements.",
    "The blended financing arrangements under the ECF and the EFF were approved on January 29, 2010, for an amount equivalent to SDR 369.6 million (about US$586 million).",
    "The completion of the third reviews makes an amount equivalent to SDR 50 million (about US$79 million) immediately available to the authorities.",
    "The Executive Board also approved the authorities’ request for modification of performance criteria on the National Bank of Moldova (NBM) net international reserves and net domestic assets for end-September 2011 and end-March 2012.",
    "The Executive Board’s decision was taken on a lapse of time basis, effective July 13, 2011.",
    "Moldova’s economy has essentially completed its recovery from the 2009 recession.",
    "Robust growth continued into 2011, spurred by brisk domestic demand and very strong exports.",
    "Core inflation remained contained, despite some pressure from higher energy prices on headline inflation.",
    "The outlook is described as positive.",
    "The program is on track to restore fiscal sustainability by 2012 as planned.",
    "Fiscal policy focus:",
    "Fiscal consolidation will be further supported by comprehensive tax policy and administration reforms in 2012 and beyond.",
    "Recent tightening of monetary policy has anchored inflation expectations in the face of rising energy prices and domestic demand.",
    "Further tightening may need to be considered if:",
    "The NBM’s planned increase in foreign reserves is considered appropriate in response to the higher-than-projected influx of foreign exchange from recovering remittances and capital inflows.",
    "Conditions in the financial sector continued to improve:",
    "Completion of frameworks on crisis preparedness and debt resolution will enhance financial stability and promote financial intermediation.",
    "The arrangement between the authorities and commercial banks on sharing the costs related to the failed Investprivatbank is welcome.",
    "Comprehensive reforms are needed to restore financial sustainability in the energy sector.",
    "Improving the business climate and promoting exports are essential to sustain strong growth in the medium term.",
    "Removal of trade barriers and divestment of state enterprises are identified as important steps.",
    "[Republic of Moldova and the IMF](http://www.imf.org/external/country/MDA/index.htm)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[Press Release No. 10/21](https://www.imf.org/external/np/sec/pr/2010/pr1021.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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