EU freezes Moldova financing until new govt is formed - head of EU delegation
CHISINAU. July 8 (Interfax) - The European Union has suspended the external financing of Moldova until the creation of a new government, Pirkka Tapiola, head of the EU Delegation to Moldova, told reporters on Wednesday.
Tapiola said European funding will only reach the Moldovan budget when the authorities form a new government capable of conducting negotiations on the new memorandum with the IMF and on resolving the crisis in the banking sector.
Tapiola said the EU wants Moldova to form a ruling coalition within the shortest period of time possible and the new government should immediately turn to the IMF, conduct negotiations and sign a new memorandum on financing. He said the IMF is currently closely looking at two aspects: the banking crisis and the country's macroeconomic stability.
Moldovan Parliament Speaker Andrian Candu previously told reporters that "the EU and international donors can only de-freeze the financing of Moldova after a stable government is formed."
Moldova's incumbent Finance Minister Anatol Arapu, for his part, told Interfax the EU envisages funding for Moldova in the amount of EUR40.7 million this year. The money was expected to come to the state treasury as budget support for some areas, including judicial system reform. Financing was suspended after the Moldovan government resigned on June 12. Negotiations on the signing of a new memorandum with the IMF were also halted.
Now that the Moldovan government has resigned, three parties are conducting negotiations on the creation of a pro-European alliance, which will form a new government. However, they currently have not been able to resolve their differences associated with the principles governing the distribution of posts between members of the ruling coalition.
