Exclusive interview given by Ruben
ATOYAN, International Monetary Fund's (IMF) Mission Chief for
Moldova, to the editor-in-chief of the news agency Infotag,
Atoyan, the IMF announced that its three-year program with
Moldova, ending on March 20, has been broadly successful in
achieving its objectives. Could you please name the areas where
the biggest progress was achieved?
Ruben Atoyan:Indeed, the program that
ends in March has been successful. This is very much
commendable, especially given the fact that the provisions of
the program have been implemented by three different
governments. I must say that this is not something very common
for countries with a frequent change of government.
First of all, in the past three years,
we have seen significant progress in the banking sector and in
strengthening the financial sector governance.Today, all large
Moldovan banks have fit-and-proper and transparent ownership and
all banks have good profitability and liquidity indicators.Non-performing
loans have been on a declining trajectory, while banking sector
supervision and regulation have been significantly strengthened.
This is very important for the banking sector and for the
macro-financial stability of the country in general.
Infotag: Yet, there must be
areas where not everything went as planned. What are these
Ruben Atoyan: Indeed, I would like to
say that not everything that we planned at the beginning of the
program was achieved.
First of all, I would like to say that
the lack of progress in investigating the 1 billion dollar bank
fraud and the slow recovery of the stolen assets has largely
Progress in the business climate, market
competition, and the energy sector reforms also have not been as
advanced as we hoped at the beginning of the program.
I would also like to say that despite
the progress achieved in the financial and banking sector under
the IMF-supported program, we see weaknesses in the oversight
and regulation of the non-banking financial sector. This has led
to visible build up of risks in that sector.
Yet, not achieving all the objectives of
the program is not something very unusual. Overall, the program
has been broadly successful and achieved its key objectives.
Infotag: What could you say
about the activities of the National Bank of Moldova (NBM)
during this period?
Ruben Atoyan: Independence of the
central bank is crucial for any country.
From the legal point of view, the NBM is
independent. Yet, over the last one and a half years we have
sometimes seen Moldovan politicians from across the political
spectrum speaking on behalf of the National Bank or advising it
on what needs to be done.
This proves that there is still room for
strengthening the independence of the National Bank. In my view,
the notion that safeguarding the National Bank’s independence is
key for preserving hard-won gains in banking sector
rehabilitation is yet to be fully embraced by political elites
in Moldova. In this context, I would like to reiterate that
NBM's independence is critical for its ability to deliver on its
mandates of maintaining price and financial sector stability.
Infotag: The Moldovan government
has already expressed interest in starting negotiating a new
program with the IMF. What three main conditions should Moldova
meet in order to get a new program with the IMF?
Rubem Atoyan:Indeed, the government of
Moldova has already expressed interest in a new program with the
IMF. A new program will help the country to address governance
and institutional vulnerabilities.
I cannot speak about conditions now as
these are subject to negotiations between Moldovan authorities
and IMF staff. But in terms of priorities, I would recommend to
the government and - I understand that the government is very
much receptive to these ideas - to strengthen the
anti-corruption framework, strengthen the rule of law,
strengthen fiscal institutions and anti-money laundering
framework, launch comprehensive and ambitious reforms of
state-owned enterprises. And also strengthen supervisory and
regulatory frameworks of the non-bank financial sector.
These would be broadly reform areas
which we will be happy to support by policy advice and financing
in the context of a new program.
Infotag: What could the duration
of the new program be?
Ruben Atoyan: From our point of view, a
new three-year program is appropriate given the complexity of
the issues that the new program will address and the time needed
to make progress in these areas. We understand what the
government shares the same opinion.
Infotag: Could Moldova rely on
some additional IMF support to deal with the coronavirus crisis?
Ruben Atoyan: Moldova successfully
completed the program with the IMF. It enters the coronavirus
crisis having strong fiscal, financial and external buffers.
Unfortunately, not all countries affected by coronavirus are in
the same situation.
We are in constant dialogue with the
authorities in Chisinau on a wide range of possible responses in
fiscal, financial and operational areas and we are trying to
advise the authorities to design appropriate policy response to
cope with this crisis. Advance planning and coordination are the
overarching themes of our policy advice.
In parallel, we stand ready to provide
emergency financing under specialized lending instruments
designed to help countries to overcome emergencies such as
pandemics or natural disasters. In the case of Moldova, these
loans—potentially in the amount of up to $118 million and based
on concessional financing—can be disbursed very quickly to
assist in implementing policies to mitigate negative effects of
the ongoing global pandemic.
Infotag: When do you plan to pay
a new visit to Chisinau?
Ruben Atoyan: Right now IMF staff is
instructed to suspend all international travel because of
coronavirus pandemic. But I would like to tell you that my day
is full of video- and teleconferences with the Moldovan
While at this point we do not have a
specific date of our next mission to Chisinau, I can assure you
that our policy dialogue does not suffer because we are not
visiting Chisinau. We stand ready to help our member countries,
including Moldova, to overcome current challenges by mobilizing
necessary financing, providing policy advice, and facilitating
coordination of the crisis response across our 189-country