Statement to the Press

(November 24, 1999)

There have been a number of questions from the media recently concerning the relationship between the International Monetary Fund (IMF) and the Republic of Moldova. The following is intended to clarify the IMF position.

At the time of the last mission—which left Chisinau on November 3—an understanding had been reached with the previous government concerning a package of economic policies and a financial program which would be supported with Fund resources. In the event, a new government is currently being formed. It is our hope that the new government and the IMF will, in due course, be able to agree to a program similar to the one that had  been agreed to earlier in the month. But this may take time, as a track record of policy implementation may be needed.

The economic and financial situation in Moldova is precarious and there is the very real risk that past progress will be lost through policy slippage. It is essential that the authorities do everything possible during this transition period to ensure the integrity of the public finances. This would include adhering to a responsible fiscal policy by executing the 1999 budget, as amended, as well as dealing with state property and licenses in an open, transparent, and prudent manner. In this regard, we share the government’s concerns about the way the second cellular license was recently issued.