Farmers will be able to get loans of up to US$600,000

The Millennium Challenge Fund Moldova signed lending agreements with seven national banks, launching thus the lending program for investments in post-harvest infrastructure within the Compact Program, which is financed by the U.S. Millennium Challenge Cooperation, Info-Prim Neo reports. The seven selected banks are Moldova Agroindbank, Moldinconbank, Mobiasbanca Groupe Societe Generale, Victoriabank, Energbank, Banca Sociala, and Comertbank. Under the lending program, investment and operational loans to the value of US$12 million will be released to farmers. A loan will vary between US$50,000 and US$600,000 or the equivalent in lei or euros. The loans are repayable in 3-7 years and are intended for building refrigerated storehouses and purchasing equipment for sorting, washing and packing fruit and vegetables, producing juices and extracting oils, laboratory equipment for controlling the quality of the products, refrigerated trucks and other machines. “The interest rate on the loans intended for producers will be by 2.5% lower than the average rate on the market (which is now 14-15%). The equipment and services purchased with this money will be exempted from VAT and customs duties,” said Valentina Badrajan, executive director of the Millennium Challenge Fund Moldova. The producers can form associations as the loans are higher compared with other programs implemented in Moldova, where the value of loans totals US$150,000. “About 25 investment projects are planned to be financed at the first stage. Over the next 7-10 years, the number of projects will rise to 75 because the money repaid by the producers that will take out loans among the first will be transferred to an account from where other producers will be financed. The lending mechanism will be similar to that used within the Japanese 2KR Project,” said Valentina Badrajan. Attending the launch of the program, Prime Minister Vlad Filat said the lending activities for post-harvest infrastructure are in line with the Government’s program. “What we aim to achieve in agriculture is to increase the value added of agricultural products by adjusting the sorting, packing and storing systems to the international standards,” he stated. U.S. Ambassador to Moldova William H. Moser voiced hope that the use of loans for developing post-harvest infrastructure will enable to improve the working conditions and life of the farmers. Millennium Challenge Cooperation vice president Patrick C. Fine urged the producers to make effort to obtain higher profitability, while Alexandru Slusari, of Uniagroprotect, as a representative of the producers, said this long-term lending program is good, especially because it will allow the small and large farms to increase competitiveness of the products so as to cope with the competition on the national and foreign markets. Lending for investments in post-harvest infrastructure is a distinct activity of the Compact Program signed by the Government of Moldova and the U.S. Government early in 2010. It has a value of US$262 million and is implemented by the Millennium Challenge Fund Moldova. The money is designed to contribute to raising the Moldovan people’s incomes during 2010-2015 by developing road infrastructure, renovating the irrigation systems and stimulating transition to modern agriculture.