EBRD is ready to provide Moldova with an additional loan of eur 150 mln. to back rehabilitation of principal roads

According to a spokesperson of the permanent office of EBRD in Moldova, an official decision on this matter is planned to be adopted at EBRD Board of Directors on May, 29.

The program is aimed at ceasing destruction of the road network of Moldova and repairing primary roads to boost growth in the national economy and facilitate regional integration. The loan is expected to be disbursed with three tranches. A total commitment of the program amounts to 315 mln. euros. It is going to be co-financed by the European Investment Bank and the European Union. Earlier, at a meeting with Premier of Moldova Vladimir Filat EBRD Transport Department Director Sue Barrett pointed out willingness of EBRD to release additional 150 mln. euros for rehabilitation of 213 kilometres of roads. This program is also to be co-financed by the European Investment Bank.

On September, 21, 2012 the government of Moldova requested EIB and EBRD to grant it two new loans of EUR 150 mln each at a total sum of EUR 300 mln. to implement the roads rehabilitation program. The head of the Moldovan government noted that developing road infrastructure is an area of the highest priority for authorities of the country that set a goal to have all roads rehabilitated and the road infrastructure upgraded as soon as possible. According to Vladimir Filat, implementing the Road Infrastructure Development Strategy and the Road Rehabilitation Program required investment; that was why authorities of Moldova addressed to EIB and EBRD with the new appeal for an extra backing. Earlier the European Investment Bank and the European Bank for Reconstruction and Development extended Moldova loans at a total sum of EUR 150 mln. to back the road rehabilitation program, valued at EUR 181.2 mln. Each of the banks assigned for Moldova 75 mln euros.

The EBRD loan was extended for 15 years with the 3-year grace period at the EUROLIBOR interest rate and 1% p.a. EIB extended the loan for 18 years with the 15-year long grace period. The interest rate was equal to the Eurolibor rate and 0.68% p.a. The European commission provided Moldova with a grant of EUR 31.2 mln. to implement the roads rehabilitation program in the country. In particular, the following key segments of national roads are to be rehabilitated and modernized at a total length of 150 km: Chisinau-Orhei-Sarateni-Balti; Chisinau –Calaras-Ungheni-Sculeni and Comrat-Ciumai. The EBRD Loan Agreement was signed on October, 29, 2010, the EIB Loan Agreement being signed on November, 23, 2010 .

Adapted from Allmoldova