Moldova to contract 25-million-euros loan from French Development Agency for energy sector's reform, transition to green energy

The parliament has approved, in the first reading, a draft law, in order to ratify the Credit Facility Agreement which will ensure the financing of the state budget needs, while also contributing to promoting reforms in the energy sector of  Moldova. The loan amounting to 25 million euros is to be provided by the French Development Agency. The draft was voted by 74 deputies.

According to the Agreement, the loan maturity is 15 years, including a 5-year grace period. The loan repayment is to be made semi-annually in 20 equal installments. The interest rate will be selected at the time of disbursement between the fixed interest rate or floating rate (6-month Euribor - margin of 0.9 pp).

“These reforms will enhance energy security and advance the process of convergence with EU standards. The concerned interventions aim to facilitate the transition to a more sustainable and ecological energy system, by modernizing infrastructure, improving energy efficiency, developing renewable energy sources, protecting consumers and promoting environmental policies and combating climate change,” State Secretary of the Finance Ministry Ion Gumene said.

The credit will be disbursed in a single installment by the end of 2025.

Ion Gumene specified that this type of loan comes as general budget support, and the money Moldova is to receive is a supplement for the investments already made by the government, in order to ensure that all reforms made so far are implemented.

“Reforms not only of normative acts, but also of empowerment of institutions or allocation of certain funds from the budget to launch certain programmes. When we talk about green energy, we mean the normative framework in the residential, public, renewable energy, energy efficiency sectors and in many other areas. Through such instruments, we act simultaneously to produce the changes we desire.”

The ratification of the Credit Facility Agreement between Moldova and the French Development Agency, Green Energy Transition Programme, will be submitted to parliament for consideration in the second reading.