EU financial support to Moldova, aimed at strengthening the country’s public administration, has had only a limited effect, according to a new report from the European Court of Auditors. The report says the lack of political will from the national authorities explains some of the shortcomings. Also, the granting of additional incentive‐based funds was not fully justified, IPN reports.
The auditors made a number of recommendations to the European Commission for improving EU assistance to Moldova, including to use the early warning system more rigorously to prevent or mitigate risks, to better link budget support programs to national strategies, to strengthen the use of conditionality and performance indicators, to link additional incentive‐based funds more clearly to demonstrable progress, and to ensure the sustainability of projects by more systematically assessing the capacity and political commitment of public authorities to sustain outcomes.
When the auditors examined budget support programs in the sectors of justice, public finance, public health and water, they found only limited evidence of progress. External factors such as lack of political will from the national authorities explained some of the shortcomings. Others were due to weaknesses in the design and implementation of the programs and projects audited.
The auditors found that the Commission could have responded more quickly when risks associated with the support materialized. Programs were not sufficiently aligned with Moldovan strategies and their potential benefit was reduced because the Commission did not fully use its power to set preconditions for payment. The Commission could have been more stringent when assessing whether conditions had been fulfilled and the granting of additional incentive‐based funds was not fully justified.
Project designs were generally found to be relevant and EU assistance channeled through projects was partially effective in strengthening the public administration. However, the scope and timing of projects was not always well coordinated with budget support programs. Specific technical assistance for the development of administrative capacity did not start until months after the main budget support program.
Other technical assistance and twinning projects were not always used to prepare or support budget support programs. While projects generally delivered the expected outputs, the results were not always sustainable due to a lack of political will and other external factors.
All the budget support payments for the Republic of Moldova have been suspended until all the general conditions are met, including those concerning macroeconomic stability and budget transparency. An agreement with the International Monetary Fund is essential in this regard.
Since 2007, Moldova has been allocated EU aid amounting to €782 million through the European neighborhood instruments, which represents nearly €37 per inhabitant per year, the highest amount among the EU’s eastern neighbors.
