Moldova will benefit from European Investment Bank’s credits

Prime deputy premier of Moldova, Zinaida Greceanii, and Vice President of the European Investment Bank (EIB), Sauli Niinisto, signed on Wednesday, November 1, the Agreement regarding the bank’s activities in Moldova. The project of the agreement on economic cooperation between Chisinau Government and EIB aims at developing the economic cooperation by facilitating the conclusion of loans by the Bank for investment projects. The Agreement is to be ratified by the Moldovan Parliament. Zinaida Greceanii stated while signing the agreement that the start of cooperation with EIB is an important historic moment for Moldova’s development. According to her, EIB credits will be offered only for investment purposes and not for current consumption, and will be targeted especially at the road infrastructure, communications and energy sector. There are also investment projects that lead to a sustainable economic growth in Moldova. Credit lines to support the small and medium-sized business will be also opened. “At present the Government is not eligible to contract credits under commercial terms, that is why we agreed with IMB and WB to contract credits from EIB, while the partners for developing Moldova will co-finance these investment projects as grants, which will be not smaller than 25% of the total cost of the project”, said Greceanii. She mentioned that the credits will be provided as long as they can be efficiently assimilated in order to ensure the economic growth. EIB can offer credits both to governments and private companies. The credits offered to governments do not require special guarantees and can be offered for a 15-20-year period, with a minimum value of 30-40 mln EUR. The interest rate is calculated according to the formula: monthly Eurobond (at present of 2.75%) + 0,55%. The conditions for the legal persons differ from those that the state benefits from as regards guarantees and interest rate. To contract a credit, legal persons must present guarantees to the banks that are ranked on the international market with “A” or “AA” level. The interest rate varies from case to case depending on the percent of the risk. The projects will be presented to the EIB, which will obligatorily request from Moldova to present views concerning their importance and opportunity. Sauli Niinisto mentioned that, according to a loan mandate, available till 2007, approved by EIB with a view to be supported by the EU Neighborhood Policy, Russia, Ukraine, Belarus and Moldova could benefit together from a credit of 500 mln EUR. “Russia did not asked for loans from EIB, so Moldova may profit from additional available resources”, Niinisto said. The official mentioned that now the EIB discusses the approval of a new mandate for Russia, Ukraine and Moldova for the next seven years, which will be larger compared to the first one. Its value will be approved in December by the EU member states. EIB is a European institution, founded in 1958 through the Treaty of Roma – document of foundation of the European Economic Community. The Bank has the aim to contribute to the European integration and to development of the EU with a view to increasing the economic and social cohesion between the member states. The EIB share holders are the 25 member states of the EU that subscribe altogether its capital (about 163.6 bln EUR). At present, EIB became the most important source of international financing of the projects of the new member states of the EU, neighbor states and those from the Balkan region.