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Moldovan government to strengthen cooperation with IMF

Chisinau, 8 May /MOLDPRES/ - The Moldovan government will strengthen its cooperation with the International Monetary Fund (IMF) in order to implement macroeconomic policies and structural reforms so as to register a sustained economic growth. The statement was made yesterday by Moldovan Finance Minister Mariana Durlesteanu at a meeting with a mission of the IMF European Department, headed by Graeme Justice.
According to the protocol and press service of the Finance Ministry, IMF Resident Representative to Moldova Johan Mathisen has made an analysis of the budgetary situation in Moldova in the first three months of 2008. The official positively appreciated the fulfillment of goals seen in the Poverty Reduction and Growth Facility (PRGF) Programme. They also set the objectives for the next months.

During the meeting the officials focused on control of expenses, treasure system, arrears of the local authorities, budgets of the local public authoriti es and their execution, as well as the financing of the budget of central authorities.

The Poverty Reduction and Growth Facility (PRGF) is the IMF's concessional facility for low income countries. PRGF loans carry an annual interest rate of 0.5 per cent, and are repayable over 10 years with a 5.5-year grace period on principal payments.

The PGRF arrangement with Moldova totals about 174 million dollars, of which about 124 million dollars have been disbursed so far.

Moldovan premier meets IMF mission in Chisinau

Chisinau, 8 May /MOLDPRES/ - Prime Minister Zinaida Grecianii on 7 May met a mission of the International Monetary Fund (IMF), on a 7-21 May mission to Chisinau.

The main task of the IMF mission is to conduct the Fourth Review under the Poverty Reduction and Growth Facility arrangement, carried out with Moldova's government, which provides for assistance worth 124.7 million dollars, according to the executive's press service.

The head of the IMF mission, Graeme Justice, said that the government implemented the great majority of the provisions of the bilateral Memorandum (Memorandum on Economic and Financial Policies). The IMF's main concern remains keeping inflation within the established parameters, with the global increase in prices for foodstuffs and energy resources, as well as in the wake of the last year drought. To this end, Graeme Justice suggested to sharpen the monetary and fiscal policies, and balance the state budget.
The prime minister said that the inflation increase in the first quarter of 2008 was triggered by the rise in prices for four categories of goods in Moldova, among which some food products and the passenger transport. At the same time, the prices for non-food products increased only 0.9 per cent, and if not to take into account the above products, a deflation would be registered.
Zinaida Grecianii said that the increase in the interest rate might not be the best solution to keep the inflation level, with untraditional solutions being necessary. "The government removed the quantitative restrictions on the import of meat, which will stimulate the supply of these products, and limited the trade supplement in the commerce with construction materials, mainly cement, and we are willing to cope with the rise in the inflation level," Grecianii said. At the same time, the prime minister declared for pressing ahead with the investment projects, even in the conditions wh en they could fuel the demand on the domestic market.

The premier handed over to Graeme Justice a draft of the new Memorandum with IMF, and voiced conviction that the sides will reach a consensus as regards all the issues raised for discussion.