IMF Staff Concludes Consultations with Moldova on a New Economic Program
IMF News, July 27, 2020
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- Published: July 27, 2020
Mission and staff-level agreement
- IMF mission led by Ruben Atoyan held remote discussions with Moldovan authorities during July 7-24, 2020.
- IMF staff and the Moldovan authorities 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.
- Statement issued at end of consultations by Ruben Atoyan.
Financing and program terms
- Proposed access under the arrangement: SDR 400 million (232 percent of Moldova’s quota in the Fund and about US$ 558 million).
- Arrangement duration: three-year ECF/EFF arrangements.
- Staff-level agreement is subject to approval by IMF Management and the Executive Board.
- Consideration by the Executive Board was expected in September, subject to the authorities’ implementation of a number of prior actions.
Prior actions and conditionality areas
- Prior actions include measures in:
- central bank independence,
- financial sector oversight,
- fiscal transparency.
- Implementation of these prior actions is a condition for Board consideration of the new program.
Policy objectives and expected impact
- Program aims to:
- maintain macroeconomic stability,
- provide an anchor for authorities’ policies to support the post-pandemic recovery,
- catalyze external financing from other donors,
- advance ambitious institutional reforms.
- Institutional reform priorities identified:
- fiscal governance,
- non-bank financial sector oversight,
- market regulation,
- anti-corruption,
- rule of law.
Governance reform and central bank
- The governance reform of the National Bank of Moldova (NBM) supported by the Fund and NBM’s performance during the previous program are highlighted as important achievements.
- The successful clean-up of the banking sector in the aftermath of the major bank fraud is credited to the supervisory work of the NBM.
- Statement emphasizes:
- unequivocal commitment to the irreversibility of the banking sector reforms as critical for financial sector stability,
- an independent central bank helps macroeconomic stability, supports investor confidence, and protects the financial system,
- preserving NBM independence is in Moldova’s interest and is a critical requirement under the new IMF-supported program.
Press Release No. 20/270 — July 27, 2020 — IMF Communications Department
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- Press Release-English
