The loan of €120 million provided by the European Investment Bank (EIB) within the program “Moldova’s Orchard” for restructuring the horticultural sector of Moldova has been less than 10% used. It was expected that about €20 million would be allocated annually. Many business entities said they cannot raise loans because they do not have the security required by the commercial banks that provide financing within the program, IPN reports.

Iurie Brumarel, executive director of “Moldova’s Orchard”, told a news conference that only about €7 million has been released in loans during a year of the launch of the initiative. The money was raised by 15 horticultural companies. Another ten applications for financing are at the final examination stage and 3 million lei more is to be allocated by this yearend. If the banks hadn’t asked for security from horticulturists, the number of accepted applications would have been ten times higher.

Campaigns to inform the business entities about the available financial resources have been conducted since the program was launched last summer. Iurie Brumarel said there is an initiative to create a guarantee fund in agriculture to support the farmers who cannot pledge something.

Deputy Minister of Agriculture Vasile Luca said authorities’ efforts this year will center on the involvement of more financial institutions in the project. “We are holding talks with the EIB to extend the list of banks so that the pace of releasing loans within this project increases from next year,” he stated.

Business entities can take out a loan repayable in ten years, with a grace period of four years, at an interest rate of 5-6% annually. A loan can be of €5,000 to €5 million and can be used to modernize and automate primary production processes in horticulture, to build irrigation and anti-hail systems and to diversify the export markets for Moldovan fruit. The program has a budget of €120 million that is to be used until 2021.