Macrofinancial assistance to Moldova

SUMMARY OF:

Decision (EU) 2022/563 providing macrofinancial assistance to Moldova

WHAT IS THE AIM OF THE DECISION?

It aims to provide swift financial support to Moldova to strengthen its resilience in the current geopolitical context, support its economic stabilisation and reform agenda, and cover its balance of payments.

KEY POINTS

EU–Moldova relations

The European Union (EU) develops its relations with Moldova through the European neighbourhood policy and the Eastern Partnership. An association agreement between the two parties, which includes the gradual introduction of a deep and comprehensive free trade area, came into force on 1 July 2016.

Macrofinancial assistance

Macrofinancial assistance (MFA) is available to countries covered by the European neighbourhood policy experiencing an acute balance-of-payments crisis. It is provided on an exceptional and temporary basis and aims to address a country’s immediate external financing needs and underpin economic policy reforms.
The EU’s MFA is expected to work alongside budget support from the Neighbourhood, Development and International Cooperation Instrument – Global Europe as set out in Regulation (EU) 2021/947 (see summary).

Macrofinancial assistance to Moldova

As established by amending Decision (EU) 2023/1165, the EU will make €295 million available to Moldova to support its economic stabilisation and substantive reform agenda.
Up to €220 million will be provided in loans and up to €75 million in grants.
The European Commission can borrow the necessary funds on capital markets or from financial institutions and lend them to Moldova. The loans have a maximum average maturity of 15 years.
The Commission manages the release of the MFA.
The funds will be made available over 2.5 years.
As a precondition, Moldova must respect effective democratic mechanisms, including a multiparty parliamentary system, the rule of law and human rights.
A memorandum of understanding sets out the economic policy and financial reforms, with a time frame, that Moldova must implement.
The MFA will be made available in five instalments, each containing a loan and a grant element.
The Commission releases the instalments, providing certain conditions are met, with the second, third, fourth and fifth instalments not being released until at least 3 months after the preceding instalment.

FROM WHEN DOES THE DECISION APPLY?

It has applied since 11 April 2022.

BACKGROUND

Moldova’s economy has been hit by the 2020 recession caused by the COVID-19 pandemic, the political stalemate following the November 2020 presidential elections and the recent energy crisis that began in October 2021. In addition, Moldova’s economic stability has been further aggravated by Russia’s unprovoked invasion of Ukraine.
The country’s economic ties with the EU are well developed. The EU is Moldova’s largest trading partner, accounting for 52% of its total trade in 2020.
For further information, see:
- EU–Moldova relations – factsheet (European Union External Action Service).

MAIN DOCUMENT

Decision (EU) 2022/563 of the European Parliament and of the Council of 6 April 2022 providing macro-financial assistance to the Republic of Moldova (OJ L 109, 8.4.2022, pp. 6–12).

Successive amendments to Decision (EU) 2022/563 have been incorporated into the original text. This consolidated version is of documentary value only.

Macrofinancial assistance to Moldova

SUMMARY OF:

WHAT IS THE AIM OF THE DECISION?

KEY POINTS

FROM WHEN DOES THE DECISION APPLY?

BACKGROUND

MAIN DOCUMENT

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