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Posted by: trm.md
News / Economic
03 June 2020 / 17:15
The government will negotiate with CEB a loan of €70 million
The Government approved today the initiation of negotiations on the draft Framework Agreement between the Republic of Moldova and the Council of Europe Development Bank (CEB) for the implementation of the project "Emergency response to COVID-19 and support for micro, small and medium enterprises".
The head of the negotiating delegation, Deputy Prime Minister Serghei Puşcuţa, mentioned that the Council of Europe Development Bank is committed to providing flexible and timely financing to member countries to strengthen the public health system and mitigate the socio-economic impact of the COVID-19 pandemic.
"In order to ensure an efficient and prompt response to the needs of the health system of the Republic of Moldova in the fight against COVID-19, as well as its consequences, the Government of the Republic of Moldova submitted to the CEB an approach expressing interest in contracting a loan in an estimated value of up to €70 million," said Serghei Puşcuţa.
Thus, the proposed project will be structured in two components. The first, which refers to the health sector, in the amount of €40 million, will finance the following types of expenses: acquisition, in emergency procedures, of medical equipment and consumables, rehabilitation and transformation of medical spaces / units, mobilization of expertise in order to ensure emergency response measures to COVID-19. The other, to support micro, small and medium-sized enterprises, amounting to €30 million, will provide financing for working capital and investment needs of SMEs affected by the crisis, helping them to maintain viable jobs.
The Government of the Republic of Moldova estimates that the financial resources under the loan will cover COVID-19 expenditures from the 2020-2022 budget period. Consequently, the disbursement deadline is set for June 30, 2022. The maximum maturity of the credit for the health component is 15 years and seven years - for the support component for micro, small and medium enterprises.
At the same time, the share of CEB financing is a maximum of 90%. Under the health component, the Government will co-finance the remaining expenditures with financial resources from the community of development partners, and under the support component for micro, small and medium enterprises, the Government contribution will be the revolving resources of the Credit Line Directorate from similar projects for SMEs, financed by other international creditors.
In addition, in the process of rectifying the State Budget Law for 2020, the necessary resources and expenditures for the initiation of the current project in 2020 were planned.
"In order to ensure an efficient and prompt response to the needs of the health system of the Republic of Moldova in the fight against COVID-19, as well as its consequences, the Government of the Republic of Moldova submitted to the CEB an approach expressing interest in contracting a loan in an estimated value of up to €70 million," said Serghei Puşcuţa.
Thus, the proposed project will be structured in two components. The first, which refers to the health sector, in the amount of €40 million, will finance the following types of expenses: acquisition, in emergency procedures, of medical equipment and consumables, rehabilitation and transformation of medical spaces / units, mobilization of expertise in order to ensure emergency response measures to COVID-19. The other, to support micro, small and medium-sized enterprises, amounting to €30 million, will provide financing for working capital and investment needs of SMEs affected by the crisis, helping them to maintain viable jobs.
The Government of the Republic of Moldova estimates that the financial resources under the loan will cover COVID-19 expenditures from the 2020-2022 budget period. Consequently, the disbursement deadline is set for June 30, 2022. The maximum maturity of the credit for the health component is 15 years and seven years - for the support component for micro, small and medium enterprises.
At the same time, the share of CEB financing is a maximum of 90%. Under the health component, the Government will co-finance the remaining expenditures with financial resources from the community of development partners, and under the support component for micro, small and medium enterprises, the Government contribution will be the revolving resources of the Credit Line Directorate from similar projects for SMEs, financed by other international creditors.
In addition, in the process of rectifying the State Budget Law for 2020, the necessary resources and expenditures for the initiation of the current project in 2020 were planned.
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