End-of-Mission press releases include statements of
IMF staff teams that convey preliminary findings after a visit to a
country. The views expressed in this statement are those of the IMF
staff and do not necessarily represent the views of the IMF’s
Executive Board. Based on the preliminary findings of this mission,
staff will prepare a report that, subject to management approval,
will be presented to the IMF's Executive Board for discussion and
- The IMF team reached a staff-level agreement with the Moldovan
authorities for the augmentation of access under the Extended Credit
Facility and Extended Fund Facility arrangements. The authorities have
requested an increase of about US$267 million in financial support to help
Moldova cope with the impact of the war in Ukraine and surging international
energy and food prices.
- On the heels of the recent energy price shocks and lingering pandemic,
the war in Ukraine and the international sanctions on Russia and Belarus
have significantly weakened Moldova’s near-term economic outlook and
prompted a deterioration of its external and fiscal accounts.
- Increased IMF financing will help the authorities contain short-term
risks and provide resources to meet the urgent humanitarian and
socio-economic needs while catalyzing other donor funding.
Washington, DC: An international Monetary Fund (IMF) mission led by
Ruben Atoyan conducted discussions on the augmentation of access under the
Extended Credit Facility – Extended Fund Facility (ECF-EFF) arrangements during
April 4-11, 2022.
At the conclusion of the mission, Mr. Atoyan issued the following statement:
“After productive discussions, the Moldovan authorities and the IMF team have
reached a staff-level agreement on the augmentation of the Extended Credit
Facility (ECF)-Extended Fund Facility (EFF)arrangements. (See
Press Release No. 21/393) . The team will recommend increasing IMF support
to Moldova by SDR194.6 million (about $267 million), bringing the total
financing envelope under the program to SDR594.3 million (about $815 million).
This additional financial support will help meet the urgent balance of payments
financing needs arising from large adverse shocks, including the war in Ukraine
and international sanctions on Russia and Belarus, and catalyze support from the
international community. The agreement is subject to approval by the IMF
Executive Board, which is scheduled to consider the augmentation request in May.
The first disbursement under the augmented program in the amount of SDR108.2
million (about $149 million) would be made available immediately with the
completion of the first review and allocated for budgetary support.
“The war in Ukraine has resulted in significant spillovers to the Moldovan
economy. Real GDP is expected to stagnate this year, with projections subject to
high uncertainty. Disruptions in trade and higher commodity prices are expected
to widen the current account deficit to 13.3 percent of GDP this year. Urgent
balance of payments financing needs arising from the escalating shocks are
estimated to be about $1.7 billion in 2022-23 and expected to be financed by IMF
financing and other donor assistance. Amid temporary liquidity pressures
triggered at the onset of the war, the banking sector has shown resilience
supported by strong liquidity and capital buffers.
“The authorities are appropriately prioritizing measures to deal with the
humanitarian crisis in an already complex environment. Fiscal policy remains
focused on managing the sizeable influx of refugees and mitigating adverse
effects of rising energy and food prices. Within its mandate of price and
financial stability, the National Bank of Moldova has raised the policy rate to
contain inflation and intervened in the foreign-exchange market to smooth
exchange rate volatility. Despite the challenging landscape, the implementation
of the program’s structural commitments through end-March—including in the areas
of anti-corruption and rule of law, fiscal governance, financial sector
oversight, and state-owned enterprise regulatory reforms—has been strong.
“The fiscal deficit is expected to widen to about 7.2 percent of GDP this
year due to lower revenues and higher spending on humanitarian and economic
support. The evolving fiscal financing gap would be closed by mobilizing
financing from the IMF and other partners to complement that available from
domestic capital markets. While public debt is projected to increase in the near
term, the authorities are committed to maintaining debt sustainability as the
crisis abates, while preserving fiscal space for ambitious governance reforms
and development spending.
“The IMF team welcomes the authorities’ commitment to the program’s core aims
of strengthening governance and institutional frameworks and addressing
long-standing developmental needs. The ambitious structural reform agenda remain
critical for creating conditions for sustainable and inclusive long-term
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