Proposal for a DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending DECISION (EU) 2022/563 as regards the amount of macro-financial assistance to the Republic of Moldova
Date: 2023-01-24
Institutions: Directorate-General for Economic and Financial Affairs, European Commission
Subjects: Community loan, EU aid, European neighbourhood policy, Moldova, economic reform, economic stabilisation, financial aid, macro-financial assistance

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   EUROPEAN COMMISSION  Brussels, 24.1.2023  COM(2023) 53 final 2023/0018 (COD)  Proposal for a DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending DECISION (EU) 2022/563 as regards the amount of macro-financial assistance to the Republic of Moldova {SWD(2023) 25 final}  
 
EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

In 2022, the global economic situation deteriorated. The circumstances underlying Moldova’s 
first request for macro-financial assistance (MFA), made in 2022, further worsened. Moldova 
is both directly and indirectly affected by Russia’s war of aggression against Ukraine, which 
came on top of the energy crisis it has faced since October 2021. Moreover, since the start of 
the  war,  over  half  a  million  people  have  crossed  the  Moldovan  border,  and  about  90 000 
remain  in  the  country.  This  has  put  additional  pressure  on  Moldova’s  public  finances. 
Therefore, the overall macroeconomic position weakened significantly in 2022. Following a 
marked post-pandemic recovery in 2021, growth in the first 9 months of 2022 plummeted and 
the  country  entered  a  deep  recession.  With  limited  buffers  to  mitigate  the  crisis,  Moldova 
requested  further  assistance  from  international  partners.  This  suggested  MFA  increase  thus 
comes as part of larger EU and international assistance for Moldova. 

The  ongoing  MFA  operation  was  requested  by  Moldova  on  19 November  2021.  The  MFA, 
amounting to EUR 150 million (in loans on concessional terms  and grants), was adopted by 
the  European  Parliament  and  the  Council  on  6 April  2022  and  entered  into  force  on 
18 July 2022.  Following  fulfilment  of  the  policy  conditions  attached  to  it,  the  first 
disbursement  was  made  on  1 August  2022.  Under  this  ongoing  operation,  EUR 100 million 
(in loans on concessional terms and grants) remains available to Moldova until January 2025. 
The second disbursement is expected in the first quarter of 2023. 

In  line  with  regular  MFA  procedures,  the  operation  was  made  available  to  Moldova  in 
combination with a new International Monetary Fund (IMF) arrangement, which was adopted 
in December 2021 and expanded in May 2022. The expanded support by the IMF under the 
Extended  Credit  Facility  /  Extended  Fund  Facility  (ECF/EFF)  programme  amounts  to 
USD 795 million. 

Notwithstanding the current assistance to Moldova, the ongoing energy crisis and the effects 
of  the  war  in  Ukraine  continue  to  pose  sizeable  challenges.  According  to  the  IMF’s  latest 
estimates (December 2022), Moldova’s overall external financing gap for 2023 has increased 
by  EUR 430 million  (around  3%  of  gross  domestic  product  (GDP))  compared  to  the  IMF’s 
first programme review (September 2022). This translates to an overall financing gap of about 
EUR 803 million (5% of GDP) for 2023. Against this backdrop and in line with the principle 
of fair burden-sharing, the Commission submits to the Parliament and the Council a proposal 
to increase the ongoing MFA to Moldova by EUR 145 million, of which EUR 100 million in 
loans and EUR 45 million in grants. 

The  additional  MFA  assistance  would  be  disbursed  in  two  new  instalments,  linked  to: 
(i) additional  policy  conditionality;  (ii)  good  progress  in  implementing  the  Association 
Agreement and the Deep and Comprehensive Free Trade Area (DCFTA); and (iii) a positive 
track record in implementing the IMF programme. The policy conditions attached to the two 
new  instalments  would build  on  those  agreed  in  the  Memorandum  of  Understanding  on  the 
current MFA. This would strengthen the focus of the programme and ensure consistency with 
the  EU-Moldova  policy  priorities  and  the  Moldovan  government  agenda.  The  additional 
support  is  also  in  line  with  the  strengthened  EU-Moldova  relationship  under  the  candidate 
country status, which Moldova was granted on 23 June 2022. 

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The implementation of the proposed operation is expected to go hand in hand with additional 
EU  support  under  budgetary  operations  financed  by  the  Neighbourhood,  Development  and 
International Cooperation Instrument (NDICI). 

As further detailed in the Commission staff working document accompanying this proposal, 
the  Commission  has  taken  account  of  the  assessment  of  the  political  situation  made  by  the 
European  External  Action  Service,  and  considers 
the  political  and  economic 
preconditions for the proposed MFA operation are satisfied. 

that 

• 

General context  

Russia’s invasion of Ukraine had a strong negative impact on the Moldovan economy amid an 
increasingly challenging global context. In January-September 2022, the Moldovan economy 
contracted  by  4%,  suggesting  a  deep  recession  for  the  year  overall.  The  contraction  was 
driven  largely  by  a  fall  in  household  consumption  and  investment.  On  the  production  side, 
agriculture had a strongly negative impact on growth, following a drought in the summer of 
2022. The energy crisis, which intensified in 2022, has put additional pressure on Moldova’s 
public  finances.  The  sharp  rise  in  energy  prices  fuelled  the  high  inflation  and  triggered  the 
need for further spending on subsidies for the most vulnerable consumers. 

In  2023,  Moldova’s  outlook  remains  bleak.  It  is  set  to  be  further  impacted  by  Russia’s 
intensifying  attacks  on  Ukraine  and  by  the  economic  slowdown  across  the  EU  (Moldova’s 
key trading partner). According to an IMF forecast (November 2022), in 2023, growth is set 
to pick up only moderately, to 1.5%, and to go back to its pre-crisis levels only in 2024-2025. 

In 2023, inflation is set to go down markedly, but to remain in the double digits, averaging at 
13.7%,  compared  to  28.5%  in  2022.  The  spike  in  energy  and  food  prices  drove  the  high 
inflation  in  2022,  which  peaked  at  34%  in  October.  In  response  to  the  strong  inflationary 
pressure, the central bank hiked the key interest rate three times last year (by a cumulative 9 
percentage points), to 21.5%. By the end of the year, inflation began to ease, yet moderately 
(to 31% in November), prompting a slight downward adjustment of the base rate to 20%. 

The budget deficit is set to remain wide in 2023, at 6% of GDP, compared to 4.2% of GDP in 
2022. Much of the widening will be due to higher spending on the most vulnerable consumers 
as a result of the spike in energy tariffs, and some public salary increases deemed necessary 
given the soaring inflation. Moldova’s public debt-to-GDP ratio is low compared to most of 
its regional peers, but it is set to increase to 38% in 2023, against 36% of GDP at the end of 
2022. About 95% of Moldova’s public external debt was extended by multilateral creditors on 
concessional terms. Nevertheless, due to the country’s high sensitivity to external shocks, the 
IMF has revised its rating of Moldova’s risk of debt distress from low to medium. 

On the external side, the current account deficit remains high, at 13.7% of GDP in the third 
quarter of 2022, and is set to remain at comparable levels in 2023, at 11.8% of GDP. This is 
driven largely by a large negative trade balance, at about 32% of GDP in the third quarter of 
2022. However, at 14.2% of GDP, remittances remained broadly stable, despite some initial 
projections  that  transfers  from  abroad,  especially  Russia  and  the  Commonwealth  of 
Independent  States,  would  fall  markedly.  Net  foreign  direct  investment  showed  some 
resilience  in  the  first  half  of  2022  (largely  due  to  companies’  high  reinvested  earnings). 
However,  due  to  the  uncertainty  caused  by  the  war,  an  IMF  forecast  (November  2022) 
expects it to decrease sharply, down to 0.4% of GDP for 2022 overall. 

Since  the  start  of  Russia’s  invasion  of  Ukraine,  Moldova’s  foreign  currency  reserves  have 
been highly volatile, which has prompted sizeable interventions by the central bank. Initially, 
Moldova’s foreign currency reserves decreased considerably from USD 3.9 billion at the end 
of 2021 (covering 5.5 months of imports) to a trough of USD 3.3 billion (covering 4.5 months 

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of imports) in  April  2022. This  was largely  caused by  a rapid  withdrawal  of bank deposits. 
The  Moldovan  leu  also  depreciated  against  the  US  dollar  by  around  7%  in  the  first  half  of 
2022.  Although  reserve  levels  were  restored  by  the  end  of  2022,  risks  remain  on  the 
downside, related largely to the ongoing war in Ukraine. The central bank projects a drop in 
reserves  at  the  start  of  2023,  partly  due  to  a  mild  economic  recovery  and  higher  import 
demand, and additional fluctuations in the foreign exchange market.  

• 

Consistency with existing policy provisions in the policy area 

The  proposed  MFA  increase  would  support  the  resources  allocated  to  Moldova  under  the 
existing  operation  adopted  by  the  Parliament  and  the  Council  on  6 April 2022  under 
Decision (EU) 2022/563  on  providing  MFA  to  Moldova  amounting  to  EUR 150 million  in 
loans and grants. The additional conditions attached to the increased amount would build on 
the  reform  priorities  outlined  in  the  existing  Memorandum  of  Understanding,  keeping  the 
focus  on  public  finance  governance,  the  rule  of  law,  combating  corruption,  improving  the 
business climate, and promoting further energy sector reforms. 

• 

Consistency with other EU policies 

The  EU  and  Moldova  have  developed  a  close  political  and  economic  relationship  over  the 
years, leading to the conclusion of the Association Agreement (including the DCFTA), which 
was  signed  on  27 June  2014  and  entered  into  force  on  1 July 2016.  An  EU-Moldova 
Association  Agenda  sets  out  the  list  of  priorities  for  joint  work.  An  updated  Association 
Agenda for 2021-2027 was adopted on 22 August 2022. 

Following  Moldova’s  application  on  3 March 2022,  the  EU  granted  Moldova  candidate 
country  status  on 23 June 2022 on the understanding that  the  country will take  a number of 
steps,  notably  in  the  areas  of  the  rule  of  law,  reform  of  the  justice  sector,  combating 
corruption, and fundamental rights. 

Also  Moldova’s  economic  ties  with  the  EU  are  well  developed.  The  EU  continues  to  be 
Moldova’s  largest  trading  partner,  accounting  for  50%  of  Moldova’s  total  trade  in  2021 
(about 61% of total exports and 44% of total imports). 

Candidate  countries  and  countries  that  are  covered  by  the  European  Neighbourhood  Policy 
are eligible for MFA (if they fulfil various conditions). The increased MFA would supplement 
the  NDICI,  strengthened  by  additional  resources  of 
the  grants  mobilised  under 
EUR 55 million  in  2023,  and  other  EU  programmes.  The  increased  MFA  would  also 
supplement  the  conditions  envisaged  under  the  budget  support  packages  currently  being 
implemented by the EU. By supporting an appropriate framework for macroeconomic policy 
and structural reforms, the EU’s MFA increases the added value and effectiveness of the EU’s 
overall financial interventions, including through other financial instruments. 

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

The legal basis for this proposal is Article 212 TFEU. 

• 

Subsidiarity (for non-exclusive competence)  

The subsidiarity principle is respected. The objectives of restoring short-term macroeconomic 
stability in Moldova cannot be sufficiently achieved by the Member States alone and can be 
better achieved by the EU. The main reasons are the budgetary constraints faced at national 

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level  and the need for strong donor  coordination to  maximise the scale and effectiveness  of 
the assistance. 

• 

Proportionality 

The  proposal  complies  with  the  proportionality  principle.  It  limits  itself  to  the  minimum 
required  to  achieve  the  objectives  of  short-term  macroeconomic  stability  and  does  not  go 
beyond what is necessary for that purpose. 

As identified by the Commission based on IMF estimates in the context of the Extended Fund 
Facility,  the  proposed  amount  -  EUR 295 million  -  of  the  increased  MFA,  including  the 
existing amount, corresponds to 33% of Moldova's estimated residual financing gap in 2022-
2024. This is consistent with standard practices on burden-sharing for MFA operations. Under 
the terms of the ECOFIN Council conclusions of 8 October 2002, the upper limit is 60% for a 
candidate country and a country with an association agreement. It also takes into account the 
assistance pledged to Moldova by other bilateral and multilateral donors. 

• 

Choice of the instrument 

Project  finance  or  technical  assistance  would  not  be  suitable  or  sufficient  to  address  the 
macroeconomic  objectives.  The  key  value  added  of  the  MFA  in  comparison  with  other  EU 
instruments  would  be  to  alleviate  external  financial  constraints  and  to  help  create  a  stable 
macroeconomic  framework,  including  by  promoting  a  sustainable  balance  of  payments  and 
budgetary situation, and an appropriate framework for structural reforms. By helping to put in 
place  an  appropriate  overall  policy  framework,  the  MFA  can  increase  the  effectiveness  of 
actions financed in Moldova under other, more narrowly focused EU financial instruments. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EVALUATIONS, 

EX POST 

OF 

STAKEHOLDER 

Stakeholder consultations 

MFA  is  provided  as  an  integral  part  of  the  international  support  for  Moldova's  economic 
stabilisation. In preparing this proposal, the Commission services consulted the IMF and the 
World Bank, which have already put in place sizeable financing programmes. On 12 January 
2023,  the  Commission  consulted  the  Alternate  Economic  and  Financial  Committee,  which 
endorsed  the  draft  proposal.  The  Commission  has  also  been  in  regular  contact  with  the 
Moldovan authorities. 

• 

Collection and use of expertise 

In  line  with  the  requirements  of  the  Financial  Regulation,  in  the  context  of  the  COVID-19 
MFA package, the Commission services carried out an operational assessment of the financial 
and administrative circuits of Moldova. This was to ascertain that the procedures in place for 
the management of programme assistance, including MFA, provide adequate guarantees. The 
final report of the operational assessment, prepared by a consultancy company, was received 
in June 2020. The report notes clear progress in public finance management systems and other 
financial circuits since 2015, when the last exercise was undertaken. The report concludes that 
the  status  of  Moldova’s  financial  circuits  and  procedures  is  deemed  favourable  for  a 
subsequent MFA operation. Developments in this area will continue to be closely monitored, 
including  through  the  regular  progress  reports  on  public  finance  management  reforms 
produced by the EU Delegation in Chisinau. 

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• 

Impact assessment 

The EU’s MFA is an exceptional emergency instrument aimed at addressing severe balance-
of-payment difficulties in non-EU countries. Because there is a political imperative to move 
ahead quickly in a situation requiring a rapid response, this MFA proposal is exempted from 
the requirement to carry out an impact assessment, in accordance with the Commission Better 
Regulation Guidelines (SWD (2015) 111 final). 

More  generally,  the  Commission  MFA  proposals  build  on  lessons  learned  from  ex post 
evaluations  carried  out  on  past  operations  in  the  EU’s  neighbourhood.  The  increased  MFA, 
and  the  economic  adjustment  and  reform  programme  attached  to  it,  will  help  alleviate 
Moldova’s  short-term  financing  needs.  It  will  also  support  policy  measures  aimed  at 
strengthening  the  medium-term  balance  of  payments  and  fiscal  sustainability  and  raising 
sustainable growth, complementing the ongoing IMF programme with Moldova. These policy 
conditions should address some of the fundamental weaknesses shown over the years by the 
Moldovan economy and its economic governance system. 

• 

Fundamental rights 

Candidate  countries  and  countries  that  are  covered  by  the  European  Neighbourhood  Policy 
are eligible for MFA.  A precondition  for  granting MFA is  that the eligible country respects 
effective democratic mechanisms, including a multi-party parliamentary system and the rule 
of law, and guarantees respect for human rights. 

The  renewed  commitment  to  reform  and  strong  political  will  shown  by  the  Moldovan 
authorities  (since  the  elections  in  July  2021)  in  key  reform  areas,  such  as  justice  sector 
reforms, good governance, the rule of law and the fight against corruption, is a clear positive 
sign. The authorities are committed to conducting these reforms in a transparent manner and 
in  line  with  EU  standards.  Therefore,  the  political  precondition  for  an  MFA  operation  is 
considered to be satisfied. 

4. 

BUDGETARY IMPLICATIONS 

The proposed increase of EUR 145 million in Moldova's ongoing MFA operation is planned 
to be disbursed in two equal instalments, to be released in 2023, if the conditions are fulfilled. 
The  financial  programming  over  the  2022-2024  period  provides  that  a  grant  component  of 
EUR 45 million  can  be  financed  from  the  available  budget  under  budget  line  14  20  03  01 
‘Macro-financial assistance (MFA) - grants’. For the loan component of EUR 100 million, the 
required provisioning at  a rate of 9% of the External Action Guarantee will be programmed 
under  the  NDICI,  for  a  total  amount  of  EUR 9 million  (budget  line  14  02  01  70  ‘NDICI  – 
Provisioning of the Common Provisioning Fund’). 

5. 

• 

OTHER ELEMENTS 

Implementation plans and monitoring, evaluation and reporting arrangements 

The  EU  will  make  the  MFA  increase  available  to  Moldova  for  a  total  amount  of 
EUR 145 million, provided in the form of medium- to long-term loans, and including a grant 
component.  This  will  help  to  cover  Moldova’s  residual  financing  needs  in  2023.  The 
disbursement of the two additional instalments will be subject to the fulfilment of additional 
policy measures. 

The assistance will be managed by the Commission. Specific provisions on the prevention of 
fraud and other irregularities, consistent with the Financial Regulation, are applicable. 

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The Commission and the Moldovan authorities have agreed a Memorandum of Understanding 
setting  out  the  structural  reform  measures  associated  with  the  ongoing  MFA  operation, 
including aspects of timing and sequencing.  As a result of the MFA increase, further policy 
actions will be negotiated with the authorities and added to the existing memorandum. 

Moreover, as is normally the case with MFA, the disbursements would be conditional, among 
other  things,  on  satisfactory  reviews  under  the  IMF  programme,  as  well  as  progress  on  the 
implementation  of 
the  DCFTA.  The 
the  EU-Moldova  Association  Agreement  and 
Commission will work closely with the authorities to monitor progress on the policy actions 
and the preconditions, as specified above. 

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2023/0018 (COD) 

Proposal for a 

DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

amending DECISION (EU) 2022/563 as regards the amount of macro-financial 
assistance to the Republic of Moldova 

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 212 thereof, 

Having regard to the proposal from the European Commission, 

After transmission of the draft legislative act to the national parliaments, 

Acting in accordance with the ordinary legislative procedure, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

On  6  April  2022,  the  European  Parliament  and  Council  adopted  Decision  (EU) 
2022/5631  providing  new  macro-financial  assistance  (‘MFA’)  to  Moldova  for  an 
amount of EUR 150 million, in medium term-loans and through a grant element. The 
MFA  entered  into  force  on  18  July  for  two  and  a  half  years.  On  1  August  2022, 
following  successful  fulfilment  of  all  policy  actions  agreed  with  the  Union  in  the 
Memorandum of Understanding, the first instalment of EUR 50 million was disbursed. 

The  MFA  was  adopted  in  parallel  with  a  new  IMF  programme  for  Moldova  of  20 
December  2021  (Extended  Credit  Facility/Extended  Fund  Facility  worth  USD  564 
million).  On  11 May  2022,  as  a  result  of  the  growing  financing  needs  stemming 
largely  from  the  effects  of  the  war  in  Ukraine  on  the  Moldovan  economy,  the  IMF 
adopted  a  decision  to  increase  the  arrangement  by  USD  267  million.  On  9  January 
2023,  the  IMF  announced  that  Moldova  has  successfully  completed  the  second 
programme  review,  which  allowed  the  immediate  disbursement  of  another  USD  27 
million under the arrangement.  

The  Union’s  indicative  allocation  for  Moldova  under  the  European  Neighbourhood 
Instrument  was  EUR  518.15  million  for  the  2014-2020  period,  including  budgetary 
support and technical assistance. The Single Support Frameworks for 2014-2017 and 
2017-2020 identified the priority sector for cooperation with  Moldova funded by the 
European Neighbourhood Instrument for the previous budgetary period. The priorities 
for  2021-2027  are  set  out  in  the  new  Multiannual  Indicative  Programme,  which  has 
been prepared in close consultation with all relevant stakeholders.  

Given  that  there  is  still  a  significant  residual  external  financing  gap  in  Moldova's 
balance of payments for 2023, over and above the resources provided by the IMF and 
other  multilateral  institutions,  it  is  necessary  to  increase  the  Union  macro-financial 
assistance  provided  to  Moldova  in  accordance  with  Decision  (EU)  2022/563.  That 

1 

Decision  (EU)  2022/563  of  the  European  Parliament  and  of  the  Council  of  6 April  2022  providing 
macro-financial assistance to the Republic of Moldova (OJ L 109, 8.4.2022, p. 6). 

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increase  is,  under  the  current  exceptional  circumstances,  considered  to  be  an 
appropriate response to Moldova's request for support to the economic stabilisation, in 
conjunction with the IMF programme. The Union's macro-financial assistance would 
support  the  economic  stabilisation  and  the  structural  reform  agenda  of  Moldova, 
supplementing  resources  made  available  under  the  IMF's  financial  arrangement. 
Therefore Decision (EU) 2022/563 should be amended accordingly. 

The determination of the amount of the Union’s additional macro-financial assistance 
is  based  on  an  updated  quantitative  assessment  of  Moldova’s  residual  external 
financing  needs  and  takes  into  account  its  capacity  to  finance  itself  with  its  own 
resources, in particular the international reserves at its disposal. The determination of 
the amount of the assistance takes into account expected financial contributions from 
multilateral  donors,  including  the  IMF  and  World  Bank,  and  the  need  to  ensure  fair 
burden  sharing  between  the  Union  and  other  donors,  as  well  as  the  pre-existing 
deployment  of  the  Union's  other  external  financing  instruments  in  Moldova  and  the 
added value of the overall Union involvement.   

The increase of the Union's macro-financial assistance should be subject to economic 
policy conditions,  to  be added to  the existing Memorandum  of Understanding which 
will  as  a  consequence  have  to  be  amended  accordingly.  In  addition,  the  detailed 
financial terms of the Union's macro-financial assistance will have to be laid down in 
an addendum to the Loan Agreement and the Grant Agreement that was signed on 22 
June 2022 by the Commission and Moldova, 

(5) 

(6) 

HAVE ADOPTED THIS DECISION: 

1. 

Decision (EU) 2022/563 is amended as follows: 

(1) 

In Article 1, paragraph 1 is replaced by the following:  

Article 1 

“1. The Union shall make macro-financial assistance of a maximum amount of EUR 
295  million  available  to  Moldova  ("the  Union's  macro-financial  assistance"),  with  a 
view to supporting Moldova's economic stabilisation and a substantive reform agenda. 
Of  that  maximum  amount,  up  to  EUR  220  million  shall  be  provided  in  the  form  of 
loans  and  up  to  EUR  75  million  in  the  form  of  grants.  The  release  of  the  Union's 
macro-financial  assistance  is  subject  to  the  approval  of  the  Union  budget  for  the 
relevant  year  by  the  European  Parliament  and  the  Council.  The  assistance  shall 
contribute to covering Moldova's balance of payments needs as identified in the IMF 
programme.”; 

(2)  Article 4 is amended as follows: 

(a) 

paragraph 1 is replaced by the following:  

2. 

“1. Subject to the conditions referred to in paragraph 3, the Union’s macro-financial 
assistance  shall  be  made  available  by  the  Commission  in  five  instalments,  each  of 
which shall consist of a loan and a grant element. The size of each instalment shall be 
laid down in the amended Memorandum of Understanding referred to in Article 2.”;  

(b)  paragraph 4 is replaced by the following:  

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“4. The release of the second instalment  shall, in principle, take place at  the earliest 
three months after the release of the first instalment. The release of the third instalment 
shall, in principle, take place at the earliest three months after the release of the second 
instalment.  The  release  of  the  fourth  instalment  shall,  in  principle,  take  place  at  the 
earliest three months after the release of the third instalment. The release of the fifth 
instalment shall, in principle, take place at the earliest three months after the release of 
the fourth instalment.” 

Article 4 

This Decision shall enter into force on the third day after its publication in the Official Journal 
of the European Union.  

Done at Brussels, 

For the European Parliament 
The President 

For the Council 
The President 

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LEGISLATIVE FINANCIAL STATEMENT 

1. 

FRAMEWORK OF THE PROPOSAL/INITIATIVE 

1.1.  Title of the proposal/initiative 

1.2.  Policy area(s) concerned 

1.3.  The proposal/initiative relates to: 

1.4.  Objective(s) 

1.4.1. General objective(s) 

1.4.2. Specific objective(s) 

1.4.3. Expected result(s) and impact 

1.4.4. Indicators of performance 

1.5.  Grounds for the proposal/initiative 

1.5.1. Requirement(s)  to  be  met  in  the  short  or  long  term  including  a  detailed 
timeline for roll-out of the implementation of the initiative 

1.5.2. Added  value  of  Union  involvement  (it  may  result  from  different  factors,  e.g. 
coordination gains, legal certainty, greater effectiveness or complementarities). For 
the purposes of this point 'added value of Union involvement' is the value resulting 
from  Union  intervention  which  is  additional  to  the  value  that  would  have  been 
otherwise created by Member States alone. 

1.5.3. Lessons learned from similar experiences in the past 

1.5.4. Compatibility  with  the  Multiannual  Financial  Framework  and  possible 
synergies with other appropriate instruments 

1.5.5. Assessment  of  the  different  available  financing  options,  including  scope  for 
redeployment 

1.6.  Duration and financial impact of the proposal/initiative 

1.7.  Management mode(s) planned 

2.  MANAGEMENT MEASURES 

2.1.  Monitoring and reporting rules 

2.2.  Management and control system(s) 

2.2.1. Justification  of 
mechanism(s), the payment modalities and the control strategy proposed 

the  management  mode(s), 

funding 

the 

implementation 

2.2.2. Information  concerning the risks identified and the internal control  system(s) 
set up to mitigate them 

2.2.3. Estimation  and  justification  of  the  cost-effectiveness  of  the  controls  (ratio  of 
"control  costs  ÷  value  of  the  related  funds  managed"),  and  assessment  of  the 
expected levels of risk of error (at payment & at closure) 

2.3.  Measures to prevent fraud and irregularities 

3. 

ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE 

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3.1.  Heading(s)  of  the  multiannual  financial  framework  and  expenditure 
budget line(s) affected 

3.2.  Estimated financial impact of the proposal on appropriations 

3.2.1. Summary of estimated impact on operational appropriations 

3.2.2. Estimated output funded with operational appropriations 

3.2.3. Summary of estimated impact on administrative appropriations 

3.2.4. Compatibility with the current multiannual financial framework 

3.2.5. Third-party contributions 

3.3.  Estimated impact on revenue 

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LEGISLATIVE FINANCIAL STATEMENT 

1. 

FRAMEWORK OF THE PROPOSAL/INITIATIVE  

1.1. 

Title of the proposal/initiative  

Proposal  for  a  Decision  of  the  European  Parliament  and  of  the  Council  providing 
further Macro-financial assistance to the Republic of Moldova 

1.2. 

Policy area(s) concerned in the ABM/ABB structure2  

Policy area:  Economic and Financial Affairs 

Activity: 

International economic and financial affairs 

1.3. 

Nature of the proposal/initiative  

The proposal/initiative relates to a new action  

  The  proposal/initiative 
project/preparatory action3  

relates 

to  a  new  action 

following  a  pilot 

  The proposal/initiative relates to the extension of an existing action  

X  The proposal/initiative relates to an action redirected towards a new action  

1.4. 

Objective(s) 

1.4.1.  The  Commission's  multiannual 

strategic  objective(s) 

targeted  by 

the 

proposal/initiative  

 “An economy that works for people” 

“A stronger Europe in the world” 

1.4.2. 

Specific objective(s) 

(a)  Supporting macro-financial stability and promoting growth-enhancing reforms 
outside the EU, including through regular economic dialogues with key partners and 
by providing macro-financial assistance; and  

(b)  Supporting  the  enlargement  process  and  the  implementation  of  the  EU 
enlargement  and  neighbourhood  policies  and  other  EU  priorities  in  partners  by 
conducting economic analysis and providing policy assessments and advice. 

1.4.3.  Expected result(s) and impact 

Specify the effects which the proposal/initiative should have on the beneficiaries/groups targeted. 

 

 

 

Contribute to covering the external financing needs of Moldova in the context 
of  a  significant  deterioration  of  their  external  accounts  brought  about  by  the 
effects  of Russia’s invasion of Ukraine on the Moldovan economy  as  well  as 
the ongoing energy emergency.  

Alleviate the partner’s budgetary financing needs. 

Support the fiscal consolidation effort and external stabilisation in the context 
of the IMF programme. 

2 
3 

ABM: activity-based management; ABB: activity-based budgeting. 
As referred to in Article 54(2)(a) or (b) of the Financial Regulation. 

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 

Support  structural  reforms  aimed  at  improving  the  overall  macroeconomic 
management,  strengthening  economic  governance  and  transparency,  and 
improving conditions for sustainable growth. 

1.4.4. 

Indicators of performance 

Specify the indicators for monitoring progress and achievements. 

The authorities of Moldova will be required to report on a set of economic indicators 
to the Commission services on a regular basis and, provide a comprehensive report 
on the compliance with the agreed policy conditions ahead of the disbursement of the 
instalments of the assistance.  

The  Commission  services  will  continue  to  monitor  public  finance  management, 
following  the  operational  assessment  of  the  financial  circuits  and  administrative 
procedures in Moldova, that was delivered in June 2020. The EU Delegation in the 
partners will also provide regular reporting on issues relevant for the monitoring of 
the assistance. The Commission services will remain in close contact  with the IMF 
and  the  World  Bank  to  benefit  from  their  insights  from  their  on-going  activities  in 
the respective partner.  

An annual report to the Council and European Parliament is foreseen in the proposed 
legislative decision, including an assessment of the implementation of this operation. 
An  independent  ex-post  evaluation  of  the  assistance  will  be  carried  out  within  two 
years after the expiry of the implementation period. 

1.5. 

Grounds for the proposal/initiative  

1.5.1.  Requirement(s) to be met in the short or long term including a detailed timeline for 

roll-out of the implementation of the initiative 

The  disbursement  of  the  assistance  will  be  conditional  on  the  fulfilment  of  the 
political  pre-conditions  and a satisfactory track  record in  the implementation  of the 
economic programme between Moldova and the  IMF.  In addition,  the Commission 
shall agree with the authorities of Moldova on specific policy conditions, to be added 
to the existing Memorandum of Understanding.  

The  additional  assistance  is  planned  to  be  disbursed  in  two  instalments.  The 
disbursement of the first instalment is expected to take place in Q3 2023, the second 
instalment could be disbursed in Q4 2023, provided that the policy measures attached 
to each instalment have been implemented. 

1.5.2.  Added  value  of  Union  involvement  (it  may  result  from  different  factors,  e.g. 
coordination gains, legal certainty, greater effectiveness or complementarities). For 
the purposes of this point 'added value of Union involvement' is the value resulting 
from  Union  intervention  which  is  additional  to  the  value  that  would  have  been 
otherwise created by Member States alone. 

The instrument of macro-financial assistance is a policy-based instrument directed to 
alleviate  short-  and  medium-term  external  financial  needs.  In  the  context  of  the 
ongoing  crisis,  the  MFA  will  help  to  provide  economic  policy  space  for  the 
authorities  to  mount  an  effective  economic  response  to  the  deteriorating  external 
position  and  increased  fiscal  needs.  The  MFA  will  also  contribute  to  promoting 
macroeconomic and political stability. The operation will complement the resources 
made available by the international  financial institutions, bilateral  donors  and other 
EU financial institutions. In doing so, it will contribute to the overall effectiveness of 

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the financial support provided by the international community, as well as of other EU 
financial assistance, including budgetary support operations. 

Furthermore, by providing long-term financing in highly concessional terms, usually 
lower  than  the  rest  of  international  or  bilateral  donors,  the  MFA  programme  is 
expected to help the government to execute its budget without fiscal deviations and 
to contribute to debt sustainability. 

In  addition  to  the  financial  impact  of  the  MFA,  the  proposed  programme  will 
strengthen the government’s reform commitment and their aspiration towards closer 
relations  with  the  EU,  as  reflected  by  the  Association  Agreement  that  entered  into 
force in 2016, and as per the candidate country status granted on 23 June 2022. This 
result  will  be  achieved,  inter  alia,  through  appropriate  conditionality  for  the 
disbursement of the assistance. In a larger context, the programme will signal that the 
EU is ready to support partners in the Eastern neighbourhood, including Moldova, in 
moments of economic difficulties.  

1.5.3.  Lessons learned from similar experiences in the past 

Macro-financial  assistance  operations  in  partners  are  subject  to  ex-post  evaluation. 
Evaluations  conducted  thus  far  (on  completed  MFA  programmes),  concluded  that 
MFA  operations  do  contribute,  albeit  sometimes  modestly  and  indirectly,  to  the 
improvement  of  the  external  sustainability,  the  macroeconomic  stability,  and  the 
achievement of structural reforms in the partner. In most cases, MFA operations had 
a positive effect on the balance of payments of the partner and helped to relax their 
budgetary constraints. They also led to somewhat higher economic growth. 

1.5.4.  Compatibility  with  the  Multiannual  Financial  Framework  and  possible  synergies 

with other appropriate instruments 

Compatibility with the Multiannual Financial Framework 

In  the  2021-2027  multiannual  financial  framework,  the  provisioning  of  MFA  loans 
will  be  covered  by  the  External  Action  Guarantee  within  Global  Europe 
(Neighbourhood,  Development  and  International  Cooperation  Instrument).  The 
(indicative) lending capacity foreseen for MFA is sufficient to cover this operation as 
well as other MFA operations being implemented. 

Possible synergies with other appropriate instruments 

The EU is among the major donors to Moldova, supporting their economic, structural 
and  institutional  reforms  as  well  as  civil  society.  EU  financial  support  to  Moldova 
over  2014-2020  amounted  to  EUR  518,15  million  (the  2021-2027  Multiannual 
Indicative Programme (MIP), which is under preparation). In this context, this MFA 
operation  complements  other  EU  external  actions  or  instruments  used  to  support 
Moldova. It is also aligned with the new Global Europe instrument (Neighbourhood, 
Development and International Cooperation instrument) and the instrument for Pre-
accession assistance (IPA-III) for 2021-2027.  

The key value added of the MFA in comparison to other EU instruments would be to 
help create a stable macroeconomic framework, including by promoting a sustainable 
balance-of-payments  and  budgetary  situation,  and  an  appropriate  framework  for 
advancing structural reforms. MFA does not provide regular financial support and is 
to  be  discontinued  as  soon  as  the  partner’s  external  financial  situation  has  been 
brought back onto a sustainable path.  

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MFA would also  be complementary to  interventions envisaged by the international 
community,  in  particular  the  adjustment  and  reform  programmes  supported  by  the 
IMF and the World Bank. 

1.5.5.  Assessment  of  the  different  available  financing  options,  including  scope  for 

redeployment 

By  using  loans,  this  MFA  operation  increases  the  effectiveness  of  the  EU  budget 
through the leverage effect and provides for the best cost-efficient option.  

The  Commission  is  empowered  to  borrow  funds  from  capital  markets  on  behalf  of 
both  the  European  Union  and  Euratom  using  the  guarantee  of  the  EU  budget.  The 
aim is to obtain funds from the market at the best available rates due to the top credit 
status  (AAA-rated  by  Fitch,  Moody's  and  DBRS,  AA  by  S&P,  all  with  stable 
outlook)  of  the  EU/Euratom  and  then  on-lend  them  to  eligible  borrowers  in  the 
context of lending under the EFSM, BoP, MFA and to Euratom projects. Borrowing 
and  lending  is  conducted  as  a  back-to-back  operation,  ensuring  that  the  EU  budget 
does not take any interest rate or foreign exchange risk. The target of obtaining funds 
at  the  best  available  rates  for  borrowing  and  lending  activities  has  been  achieved 
because those rates are in line with peer institutions (EIB, EFSM, and ESM). 

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1.6. 

Duration and financial impact of the proposal/initiative 

X limited duration  

–    in effect from 2022 to 2024  

–    Financial impact from 2022 to 2024 for commitment appropriations and from 

2022 to 2025 for payment appropriations.  

 unlimited duration 

–  Implementation with a start-up period from YYYY to YYYY, 

–  followed by full-scale operation. 

1.7.  Management mode(s) planned4  

X Direct management by the Commission 

–  X by its departments, including by its staff in the Union delegations;  

–    by the executive agencies  

 Shared management with the Member States  

 Indirect management by entrusting budget implementation tasks to: 

–   third countries or the bodies they have designated; 

–   international organisations and their agencies (to be specified); 

–   the EIB and the European Investment Fund; 

–   bodies referred to in Articles 70 and 71 of the Financial Regulation; 

–   public law bodies; 

–   bodies governed by private law with a public service mission to the extent that 

they are provided with adequate financial guarantees; 

–   bodies governed by the private law of a Member State that are entrusted with 
the  implementation  of  a  public-private  partnership  and  that  are  provided  with 
adequate financial guarantees; 

–    persons  entrusted  with  the  implementation  of  specific  actions  in  the  CFSP 

pursuant to Title V of the TEU, and identified in the relevant basic act. 

– 

If more than one management mode is indicated, please provide details in the ‘Comments’ section. 

Comments  

4 

Details of management modes and references to the Financial Regulation may be found on the 
BudgWeb site: 
https://myintracomm.ec.europa.eu/budgweb/EN/man/budgmanag/Pages/budgmanag.aspx  

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2. 

MANAGEMENT MEASURES  

2.1.  Monitoring and reporting rules  

Specify frequency and conditions. 

The  actions  to  be  financed  under  this  Decision  will  be  implemented  under  direct 
management  by  the  Commission  from  headquarters  and  with  support  of  the  Union 
delegations.  

This assistance is of macroeconomic nature and its design is consistent with the IMF-
supported programme. The monitoring of the action by the Commission services will 
take  place  on  the  basis  of  progress  in  the  implementation  of  the  IMF  arrangement 
and the implementation of specific reform measures to be agreed with the authorities 
of  the  partners  in  a  Memorandum  of  Understanding  with  a  frequency  that  is 
consistent with the number of instalments (See also point 1.4.4).  

2.2.  Management and control system(s)  

2.2.1. 

Justification of the management mode(s), the funding implementation mechanism(s), 
the payment modalities and the control strategy proposed 

The  actions  to  be  financed  under  this  Decision  will  be  implemented  under  direct 
management  by  the  Commission  from  headquarters  and  with  support  of  the  Union 
delegations.  

MFA disbursements are dependent on successful reviews, and tied to the fulfilment 
of  conditionality  attached  to  each  operation.  The  implementation  of  conditions  is 
closely  monitored  by  the  Commission,  in  close  coordination  with  the  Union 
Delegations. 

2.2.2. 

Information concerning the risks identified and the internal control system(s) set up 
to mitigate them 

Risks identified 

There  are  fiduciary,  policy  and  political  risks  related  to  the  proposed  MFA 
operations.  

There  is  a  risk  that  the  MFA  could  be  used  in  a  fraudulent  way.  As  MFA  is  not 
designated to specific expenses (contrary to project financing, for example), this risk 
is  related  to  factors  such  as  the  general  quality  of  management  systems  in  the 
partner’s  Central  Bank  and  the  Ministry  of  Finance,  administrative  procedures, 
control and oversight functions, the security of IT systems and the appropriateness of 
internal and external audit capabilities. 

A  second  risk  stems  from  the  possibility  that  the  partner  will  fail  to  service  the 
financial liabilities towards the EU stemming from the proposed MFA loans (default 
or  credit  risk),  which  could  be  caused  for  example  by  a  significant  additional 
deterioration of the balance of payments and fiscal position of the partner. 

Internal control systems 

The  macro-financial  assistance  will  be  liable  to  verification,  control,  and  auditing 
procedures under the responsibility of the Commission, including the European Anti-
Fraud Office (OLAF), and by the European Court of Auditors as foreseen by Article 
129 of the Financial Regulation 

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Ex-ante:  Commission  assessment  of  management  and  control  system  in  the 
beneficiary country. For each beneficiary country, an ex-ante operational assessment 
of the financial circuits and control environment is carried out by the Commission, if 
necessary,  with  technical  support  from  consultants.  An  analysis  of  accounting 
procedures, segregation of duties and internal/external audit of the Central bank and 
the Ministry of Finance are carried out to ensure a reasonable level of assurance for 
sound  financial  management.  Should  weaknesses  be  identified,  they  are  translated 
into  conditions,  which  have  to  be  implemented  before  the  disbursement  of  the 
assistance. Also, when needed, specific arrangements for payments (e.g. ring-fenced 
accounts) are put in place. 

During  implementation:  Commission  checks  of  periodic  partner  declarations.  The 
payment is subject to (1) monitoring by DG ECFIN staff, in close coordination with 
the  EU  Delegations  and  with  the  external  stakeholders,  like  the  IMF,  of  the 
implementation of the agreed conditionalities, and (2) the normal control procedure 
provided  for  by  the  financial  circuit  (model  2)  used  in  DG  ECFIN,  including  the 
verification  by  the  financial  unit  of  the  fulfilment  of  conditions  attached  to  the 
disbursement of the assistance mentioned above. The disbursement relating to MFA 
operations may be subject to additional independent ex-post (documentary and/or on-
the-spot)  verifications  by  officials  of  the  ex-post  control  team  of  the  DG.  Such 
verifications  may  also  be  initiated  at  the  request  of  the  responsible  AOSD. 
Interruptions  and  suspensions  of  payments,  financial  corrections  (implemented  by 
Commission), and recoveries may be practiced where needed (it has not occurred so 
far), and are explicitly foreseen in the financing agreements with the partners. 

2.2.3.  Estimation and justification of the cost-effectiveness of the controls (ratio of "control 
costs ÷ value of the related funds managed"), and assessment of the expected levels 
of risk of error (at payment & at closure)  

The control systems in place, such as the ex-ante operational assessments or the ex-
post assessments, ensured an effective error rate for the MFA payments of 0%. There 
are no known  cases  of  fraud, corruption or illegal  activity. MFA operations have  a 
clear  intervention  logic,  one  that  allows  the  Commission  to  evaluate  their  impact. 
The  controls  enable  the  confirmation  of  assurance  and  of  attainment  of  policy 
objectives and priorities.  

2.3.  Measures to prevent fraud and irregularities  

Specify existing or envisaged prevention and protection measures, e.g. from the Anti-Fraud Strategy. 

To mitigate the risks of fraudulent use several measures have been and will be taken:  

First,  the  Loan  Agreement  comprises  of  a  set  of  provisions  on  inspection,  fraud 
prevention, audits and recovery of funds in case of fraud or corruption. It is further 
envisaged  that  a  number  of  specific  policy  conditions  will  be  attached  to  the 
assistance,  including  in  the  area  of  public  finance  management,  with  a  view  to 
strengthening  efficiency,  transparency,  and  accountability.  Also,  the  assistance  will 
be paid to a specific account of the Central Bank of the partner.  

Moreover, in line with the requirements of the Financial Regulation, the Commission 
services  have  carried  out  an  Operational  Assessment  of  the  financial  and 
administrative  circuits  of  Moldova  to  ascertain  that  the  procedures  in  place  for  the 
management of programme assistance, including MFA, provide adequate guarantees. 
The assessment was carried out in 2020, and covers areas such as budget preparation 
and  execution,  public  internal  financial  control,  internal  and  external  audit,  public 

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procurement, cash, and public debt management, as well as the independence of the 
central bank. Developments in that area will be further closely monitored by the EU 
Delegations in the respective partner. The Commission is also using budget support 
assistance  to  help  the  respective  partners  improve  their  PFM  systems,  and  these 
efforts are strongly supported by other donors. 

Finally, the assistance will be liable to verification, control and auditing procedures 
under  the  responsibility  of  the  Commission,  including  the  European  Anti-Fraud 
Office (OLAF), and the European Court of Auditors as foreseen by Article 129 of the 
Financial Regulation. 

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3. 

3.1. 

ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE  

Heading(s)  of  the  multiannual  financial  framework  and  expenditure  budget 
line(s) affected  

  Existing budget lines  

In order of multiannual financial framework headings and budget lines. 

Heading of 
multiannual 
financial 
framework 

Number  

Budget line 

Type of  
expenditure 

Contribution  

Diff./Non-
diff.5 

from 
EFTA 
countries6 

from 
candidate 
countries7 

from third 
countries 

14.02.01.70.06 [MFA loans – EAG] 

Diff. 

NO 

NO 

NO 

14.20.03.01 [MFA Grants] 

Diff. 

NO 

NO 

NO 

  New budget lines requested – Not applicable 

within the 
meaning of 
Article 21(2)(b) of 
the Financial 
Regulation  

NO 

NO 

5 
6 
7 

Diff. = Differentiated appropriations / Non-diff. = Non-differentiated appropriations. 
EFTA: European Free Trade Association.  
Candidate countries and, where applicable, potential candidates from the Western Balkans. 

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3.2. 

Estimated financial impact of the proposal on appropriations  

3.2.1. 

Summary of estimated impact on operational appropriations  

–    The proposal/initiative does not require the use of operational appropriations  

–  X  The proposal/initiative requires the use of operational appropriations, as explained below: 

Heading of multiannual financial  
framework  

6 

Heading 6 - 'Neighbourhood and the World'  

EUR million (to three decimal places) 

DG: ECFIN 

 Operational appropriations  

Year 
2021 

Year 
2022 

Year 
2023 

Year 
2024 

Year 
2025 

TOTAL 

Budget line8  

Commitments 

14.02.01.70.06 [MFA loans – EAG] 

Payments 

Budget line  

14.20.03.01 [MFA Grants] 

Commitments 

Payments 

(1a) 

(2a) 

(1b) 

(2b) 

Appropriations  of  an  administrative  nature  financed  from  the 
envelope of specific programmes9  

10.8 

10.8 

30 

20 

9 

9 

45 

55 

Budget line  
14.20.03.01  

TOTAL appropriations 

Commitments 

(3) 

=1a+1b 
+3 

40.8 

54 

0.15 

0.15 

19.8 

19.8 

75 

75 

0.15 

94.95 

8 
9 

According to the official budget nomenclature. 
Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former ‘BA’ lines), indirect research, direct research. 

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for DG ECFIN 

Payments 

=2a+2b 

+3 

30.8 

64 

0.15 

94.95 

 TOTAL operational appropriations  

Commitments 

Payments 

  TOTAL  appropriations  of  an  administrative  nature 
financed from the envelope for specific programmes  

(4) 

(5) 

(6) 

40.8 

30.8 

54 

64 

TOTAL appropriations  
under HEADING 6 
of the multiannual financial 
framework 

Commitments 

=4+ 6 

40.8 

54 

Payments 

=5+ 6 

30.8 

64 

94.8 

94.8 

0.15 

94.95 

94.95 

0.15 

0.15 

0.15 

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If more than one operational heading is affected by the proposal / initiative, repeat the section above: (EUR million (to three decimal places)) 

Heading of multiannual financial  
framework  

7 

Heading 7 – ‘European public administration’ 

This section should be filled in using the 'budget data of an administrative nature' to be firstly introduced in the Annex to the Legislative 
Financial Statement (Annex V to the internal rules), which is uploaded to DECIDE for interservice consultation purposes.  

DG: ECFIN 

Year 
2021 

Year 
2022 

Year 
2023 

Year 
2024 

Year 
2025 

TOTAL 

Human Resource 

Other administrative expenditure 

TOTAL appropriations  
under HEADING 7 
of the multiannual financial 
framework 

0.034 

0.044 

0.044 

0.011 

0.011 

0.020 

0.020 

0.144 

0.040 

0.034 

0.064 

0.064 

0.011 

0.011 

0.184 

0.034 

0.064 

0.064 

0.011 

0.011 

0.184 

Appropriatio
ns 

(Total 
commitments 
Total 
= 
payments) 

TOTAL appropriations  
under HEADINGS 1 to 7 
of the multiannual financial framework 
(Reference amount) 

Year 
2021 

Year 
2022 

Year 
2023 

Year 
2024 

Year 
2025 

Commitmen
ts 

=4+ 6 

0.034 

40.864 

54.064 

0.011 

0.161 

Payments 

=5+ 6 

0.034 

30.864 

64.064 

0.011 

0.161 

TOTAL 

95.134 

95.134 

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3.2.2.  Estimated output funded with operational appropriations  

Commitment appropriations in EUR million (to three decimal places) 

   Indicate 
objectives 
and outputs  

 

Year 2021 

Year 2022 

Year 2023 

Year 2024 

Year 2025 

TOTAL 

Type10 

Number  Cost  Number  Cost  Number  Cost  Number  Cost  Number  Cost 

Total 
number 

Total cost 

- Output 1 

- Output 2 

Grant 
disbursements 
Provisioning of the 
External Action 
Guarantee 

- Output 3 

Ex-post evaluation 

Subtotal for specific objective No 1 

TOTAL COST 

- 

- 

- 

- 

SPECIFIC OBJECTIVE NO 111 

1 

3 

4 

4 

20 

10.8 

30.8 

30.8 

2 

2 

4 

4 

55 

9 

64 

64 

3 

5 

1 

9 

9 

75 

19.8 

0.15 

94.95 

94.95 

- 

- 

- 

- 

1 

1 

1 

0.15 

0.15 

0.15 

10 
11 

Outputs are products and services to be supplied (e.g.: number of student exchanges financed, number of km of roads built, etc.).   
As described in point 1.4.2. ‘Specific objective(s)…’   

EN 

24 

EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
3.2.3. 

Summary of estimated impact on administrative appropriations  

–  X  The  proposal/initiative  requires  the  use  of  appropriations  of  an 

administrative nature, as explained below: 

EUR million (to three decimal places) 

Year 
2021 

Year 
2022 

Year 
2023 

Year 
2024 

Year  
2025 

TOTAL 

HEADING 7 
of the multiannual 
financial framework 

Human resources  

0.034 

0.044 

0.044 

0.011 

0.011 

0.144 

0.020 

0.020 

0.040 

0.034 

0.064 

0.064 

0.011 

0.011 

0.184 

Other administrative 
expenditure  

Subtotal HEADING 7 
of the multiannual 
financial framework  

Outside HEADING 712  
of the multiannual 
financial framework  

Human resources  

Other expenditure  
of an administrative 
nature 

Subtotal  
outside HEADING 7 
of the multiannual 
financial framework  

TOTAL 

0.034 

0.064 

0.064 

0.011 

0.011 

0.184 

The  appropriations  required  for  human  resources  and  other  expenditure  of  an  administrative  nature  will  be  met  by 
appropriations from the DG that are already assigned to management of the action and/or have been redeployed within the 
DG. 

12 

Technical  and/or  administrative  assistance  and  expenditure  in  support  of  the  implementation  of  EU programmes 
and/or actions (former ‘BA’ lines), indirect research, direct research. 

EN 

25 

  EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
3.2.3.1.  Estimated requirements of human resources  

–  X  The proposal/initiative requires the use of human resources, as explained 

below: 

Estimate to be expressed in full time equivalent units 

Year 
2021 

Year 
2022 

Year 
2023 

Year 
2024 

Year 
2025 

 Establishment plan posts (officials and temporary staff) 

20 01 02 01 (Headquarters and Commission’s Representation 
Offices) 

0.100 

0.250 

0.150 

0.010 

0.100 

20 01 02 03 (Delegations) 

01 01 01 01  (Indirect research) 

 01 01 01 11 (Direct research) 

Other budget lines (specify) 

 External staff (in Full Time Equivalent unit: FTE)13 

20 02 01 (AC, END, INT from the ‘global envelope’) 

0.200 

0.350 

0.200 

0.010 

0.100 

20 02 03 (AC, AL, END, INT and JPD in the delegations) 

XX 01  xx yy zz  14 

- at Headquarters 

- in Delegations  

01 01 01 02 (AC, END, INT - Indirect research) 

 01 01 01 12 (AC, END, INT - Direct research) 

Other budget lines (specify) 

TOTAL 

XX is the policy area or budget title concerned. 

0.300 

0.600 

0.350 

0.020 

0.200 

The human resources required will be met by staff from the DG who are already assigned to management of the 
action  and/or  have  been  redeployed  within  the  DG,  together  if  necessary  with  any  additional  allocation  which 
may  be  granted  to  the  managing  DG  under  the  annual  allocation  procedure  and  in  the  light  of  budgetary 
constraints. 

Description of tasks to be carried out: 

Officials  and 
staff 

temporary 

Director  Dir.  D:  Supervise  and  manage  the  operation,  liaise  with  Council  and 
Parliament for the adoption of the Decision and the approval of the Memorandum of 
Understanding  (MoU),  negotiate  the  MoU  with  the  authorities  of  Moldova,  review 
reports, lead missions and assess progress with conditionality compliance. 

HoU/DHoU  Dir.  D:  Assist  the  Director  in  managing  the  operation,  liaising  with 
Council and Parliament for the adoption of the Decision and the approval of the MoU, 
negotiating  with  the  Moldovian  authorities  the  MoU  and  Loan  Facility  Agreement 
(together  with  DG  BUDGET),  reviewing  reports  and  assessing  progress  with 
conditionality compliance.  

DG BUDGET (Units E1, E3 under the supervision of the Director): Prepare the Loan 
Facility  Agreement  (LFA),  negotiate  it  with  the  authorities  of  Moldova  and  have  it 
approved by the responsible Commission services and signed by both parties. Follow 
up  the  entry  into  force  of  the  LFA.  Prepare  the  Commission  decision(s)  on  the 

13 

14 

AC=  Contract  Staff;  AL  =  Local  Staff;  END=  Seconded  National  Expert;  INT  =  agency  staff; 
JPD= Junior Professionals in Delegations.  
Sub-ceiling for external staff covered by operational appropriations (former ‘BA’ lines). 

EN 

26 

  EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
External staff 

borrowing transaction(s), follow up the submission of the Request(s) for Funds, select 
the  banks,  prepare  and  execute  the  funding  transaction(s)  and  disburse  the  funds  to 
Moldova.  Carry  out  the  back-office  activities  to  follow  up  the  reimbursement  of  the 
loan(s). Prepare the corresponding reports on these activities. 

Desk economists, MFA Sector (Dir. D): Prepare the Decision and MoU, liaise with the 
authorities  and  the  IFIs,  conduct  review  missions,  prepare  Commission  staff  reports 
and  Commission  procedures  related  to  the  management  of  the  assistance,  liaise  with 
external experts for the operational assessment and the ex-post evaluation.  

EN 

27 

  EN 

 
 
3.2.4.  Compatibility with the current multiannual financial framework  

The proposal/initiative: 

–  X  can be fully financed through redeployment within the relevant heading of 

the Multiannual Financial Framework (MFF). 

3.2.5.  Third-party contributions  

The proposal/initiative: 

–  X  does not provide for co-financing by third parties 

EN 

28 

  EN 

 
3.3. 

Estimated impact on revenue  

–  X  The proposal/initiative has no financial impact on revenue. 

EN 

29 

  EN