The Executive Board of the International Monetary Fund completed the First Reviews under the Extended Credit Facility (ECF) and Extended Fund Facility (EFF) arrangements in a total amount of SDR 129.4 million. Completion of the review makes available SDR 15.7 million (about US$ 21.5 million), IPN report.
In a press release, the IMF Office in Moldova says the authorities continue to make significant progress in tackling long-standing vulnerabilities in the financial sector and advancing structural reforms. These efforts have helped to strengthen financial stability, and growth has returned. The economy is projected to grow by 4.5 percent in 2017, higher than previously expected.
In the financial sector, diagnostics of the largest banks are being completed, and progress has been made in strengthening bank governance and improving shareholder transparency. Continuing efforts to strengthen the governance and financial condition of banks, and enhancing regulatory and supervisory frameworks, are critical for long-term growth and development.
The National Bank of Moldova should stand ready to tighten monetary policy if inflation rises more quickly than projected. Priority actions this year include strengthening revenues, and improving the efficiency and prioritization of spending. Resources made available from these efforts should be directed toward capital expenditure and targeted social assistance. In addition, fiscal structural reforms would further strengthen fiscal management over the medium term.
On November 7, 2016 the Executive Board of the IMF approved three-year arrangements under the EFF and ECF with the Republic of Moldova to support the country’s economic and financial reform program. The cumulative access under the arrangements is SDR 129.4 million (about US$178.7 million, or 75 percent of the Republic of Moldova’s quota). An amount equivalent to SDR 26 million (about US$35.9 million) was made available to the Moldovan authorities last November. The remaining amount will be phased in over the duration of the program, subject to five semi-annual program reviews.
