Moldova does rather well despite the world financial crisis and the financial and economic instability in some of the countries of the region, the head of the IMF’s European Department Mission Graeme Justice told a news conference held today to mark the end of the IMF mission that had worked in Chisinau during December 4-15. Info-Prim Neo reports that the mission conducted the Fifth Review under the Poverty Reduction and Growth Facility (PRGF) arrangement with Moldova Graeme Justice said that the economic growth in Moldova this year would be 6.5%, while the annual rate of inflation would probably not exceed 8%. The structural reforms stipulated in the PRGF arrangement have been implemented in due time, except certain social reforms that are overdue. Justice said that the mission shares the Government’s concerns about a lower growth rate expected next year following the lower exports to certain states, the lower remittances, especially those sent by the Moldovans that work in Italy and Russia, and the lower foreign direct investment. The head of the IMF mission said that they and the Government of Moldova agreed on a number of measures designed to combat these phenomena and alleviate the effects of the world financial crisis. Among them, Justice mentioned the necessity of continuing promoting prudent monetary and budgetary-financial macroeconomic policies. In this connection, he said that the state budget for 2009 is prudent and stressed that the banking sector continues to strengthen, with the support of the National Bank of Moldova. He approved of the fact that the foreign exchange reserves at this yearend will be much larger compared with the end of 2007. Another set of measures are intended to improve the business climate and Moldova’s attractiveness for potential investors. In the wake of the world financial crisis, the regional competition for foreign direct investment becomes stiffer. These measures were included in the updated Memorandum on Economic and Financial Policies for 2009, which will be submitted to the IMF Board for examination. If approved, the next tranche of US$18 million would be transferred to Moldova early next year. Grame Justice also said that this was the last but one mission of the IMF under the PRGF arrangement. The last mission was set for the end of February next year. The PGRF arrangement with Moldova totals about US$166 million, of which about US$131 million have been disbursed so far. “I think we can already say that we deserve congratulations as the three-year program signed by the Government of Moldova and the IMF will be implemented successfully,” the IMF official said. The Poverty Reduction and Growth Facility is the IMF's concessional facility for low income countries. PRGF loans carry an annual interest rate of 0.5 percent, and are repayable over 10 years with a 5.5-year grace period on principal payments. The loans are transferred to the National Bank of Moldova to keep the foreign exchange reserves and support the national currency.