An IMF evaluation mission of the economic growth and poverty reduction mechanism will arrive to Chisinau

An International Money Fund (IMF) evaluation mission from the Poverty Reduction and Growth Facility mechanism (PRGF), led by Thomas Richardson, will be in Chisinau during October 11-25. The main goal of the mission is to evaluate the achievements of the Government and the National Bank of Moldova regarding the realization of the program requirements, and also to evaluate macro economical progress for 2007. The mission will try to reach an understanding with the Government and the NBM regarding the macro economic prognosis and objectives for 2007. From a structural point of view, it is expected that the program will be based on three directions: maintaining of financial sector reform, improved fiscal management and structural reforms meant to improve business climate. The IMF Resident Representative in the Republic of Moldova, Johan Mathisen, declared Friday, during a press conference, that the discussions with the Republic of Moldova authorities “will create premise” for the disbursement, in the middle of December, of the installment of the USD 118.2 million credit. The IMF official also declared that because of the stress that Republic of Moldova suffered due to the natural gas price increase and the Russian embargo on Moldovan wines, the amount of the first installment could be increased from the previous USD 16.2 million. The mission especially intends to review the situation of the increased inflation level, which rose up to 14.5%, including for the current and future year. The IMF program objective for Moldova is to bring the inflation level below 10%, Mathisen added. The IMF program for the Republic of Moldova has been approved at the beginning of May for a period of three years. The document has been approved based on the Mechanism of Economic Growth and Poverty Reduction Paper (EGPRP) and will be meant to realize its objectives. PRGF is the IMF accreditation mechanism with preferential regime for countries with low incomes. The interest rate based on PRGF is only 0.5%, the credits are offered for a 10 year term and 5.5 year grace period. The disbursement will take place every 6 months, and after each stage an IMF evaluation will follow. The Republic of Moldova didn’t have an IMF program since 2003. From the old program, worth USD 147 million, the Republic of Moldova received only three installments worth approximately USD 37 million.