Press Release

Chisinau, April 25 ( INFOTAG ). The International Monetary Fund remains open for discussions on a new cooperation program with the Republic of Moldova, IMF Resident Representative in Moldova, Mr. Tokhir Mirzoev told journalists today.

He said that the International Monetary Fund believes that it is appropriate to start a dialogue on the matter only after the creation of a full-fledged government.

Asked whether the new memorandum will have a financial component as well, Tokhir Mirzoev said that in the beginning, it should be established if this component is truly needed.

"The last tranches were used for replenishing the currency reserves of the National Bank of Moldova. Yet, at present, there are enough currency reserves at the NBM and there is no stringent need for financial assistance of the International Monetary Fund," he said.

Mirzoev reminded that the current three-year financing program between Moldova and the International Monetary Fund will end in late April.

"In early 2013, the IMF Board of Directors decided to extend by three months the cooperation program between Moldova and the International Monetary Fund, in order to give the authorities much time for the implementation of the agreements reached during the latest assessment mission, held in November 2012. Since then, much has been done, but less - put into life. Alongside this, some of the recent political measures, undertaken by the Moldovan Government and approved by the Parliament, run counter to the agreements with the IMF. Proceeding from these facts, and taking into account the political situation in Moldova, and in particular, the absence of a full-fledged government, the International Monetary Fund cannot complete the last Review Program by late April," he said.

In his words, in connection with this, Moldova will not receive the last tranche of US$76.3 million, within the three-year financing program with the International Monetary Fund.

"I don't see anything disastrous in the fact that Moldova will not receive this money. The work of the IMF will not stop here and the cooperation will not be ceased. We will further provide technical assistance to the Republic of Moldova," said Mirzoev.

Infotag's dossier: Since 1993, Moldova has had the following arrangements with the IMF in support of the authorities' economic adjustment programs: Compensatory and Contingency Financing Facility (CCFF), Systemic Transformation Facility (STF), Stand-by arrangements (SBA), Extended Fund Facilities (EFF), and Poverty Reduction and Growth Facilities (PRGF) - from 2009 called Extended Credit Facilities (ECF). In 2009 Moldova has also benefited from a one-time SDR allocation amounting to SDR 117.71 million.

Total Fund credit and loans outstanding at the end of December 2012 amounted to SDR 398.2 million (about US$612 million).

Following the November 2012 visit, Moldova and IMF arranged to prolong the term of the current program, which expired at the end of 2012, for 3 months. Completion of the 6th assessment mission would have enabled Moldova to receive the last tranche of US$76 million, meant to maintain its monetary reserves. The Board of Directors of IMF was expected to assess the sixth review of the Program and adopt the resolution for allotting Moldova the last tranche till the end of April, 2013. The Three-Year Arrangement approved by IMF for Moldova on January, 29, 2010 provides backing at a total amount of 369.6 million of Special Drawing Rights (SDR) of which 320 million SDR or close to US$490 million has been allocated to Moldova. 50% of the loan is allotted under the Extended Credit Facility which provides the zero rate interest rate till the end of 2013, the 5.5 -year - long grace period and the 10-year-long maturity. The rest of the sum is granted under the Extended Fund Facility which stipulates the interest rate equal to the basis rate of SDR, the 4.5 -year -long grace period and the 10-year-long maturity.

Chisinau, April 25 ( INFOTAG ). There are many significant differences between the macro-economic situation recorded in 2009, when Moldova started talks with the International Monetary Fund, on a cooperation program, and the current state of things in this sector, believes IMF Resident Representative in Moldova, Mr. Tokhir Mirzoev.

He said on Thursday at a meeting with Moldovan journalists that the inflation rate has been maintained at a stable level. Thus, the National Bank of Moldova manages to preserve the inflation rates within the established corridor (5% В±1.5%). The budgetary deficit and the budgetary discipline have significantly strengthened, accounting for 2% in late 2012.

"This is close to the level regarded as sustainable by the International Monetary Fund. In general, the macro-economic and financial stability is preserved at the needed level," said Mirzoev.

In his words, over the past years, the Moldovan authorities managed to lay the groundwork and to start important structural reforms.

"Unfortunately, many of them remain at the stage of debates or at the approval of the legislative basis. Yet, there are many reforms that have been started and that are being promoted," said Mirzoev.

In his words, for the further development, it is very important to consolidate the attained results and not to roll back.

"In this connection, we have expressed our concern with the recently-adopted political measures, as they are undermining the budgetary discipline, formed over the past three years," he said.

Infotag's dossier: The first who spoke of IMF's shattered confidence in Moldova, was acting Deputy Premier, acting Minister of Economy, Valeriu Lazar, who said that "the Republic of Moldova behaved unfairly towards the International Monetary Fund." In his opinion, the relations with the IMF are back in the 2009 year, when the country had no agreements with the fund. The main reason for the dented confidence was the adoption of some legislative acts, without the consent of the IMF.

In retort, then-acting Prime Minister, Vlad Filat [a Liberal Democrat] named "speculative" the sayings by the Acting Deputy Premier; Minister of Economy Valeriu Lazar [a Democrat] that Moldova's relations with the IMF have allegedly deteriorated after the AEI authorities had passed some Laws without the Fund's blessing. At that time, Filat also said that an International Monetary Fund mission will come to Chisinau "in the nearest time".