Moldova must accelerate investments under Growth Plan; EU Ambassador explains conditions for funding

The European Union verifies whether the reforms undertaken by Moldova have been fulfilled before granting the installments under the 1.9 billion-euros Growth Plan. EU Ambassador to Moldova Iwona Piórko has made statements to this effect. However, Moldova must also strengthen its capacity to turn financial support into investments.

The diplomat explained that the funds under the Growth Plan were conditional on the implementation of reforms and are granted in installments, after verifying that the commitments undertaken have been fulfilled.

„The 1.9 billion-euros in support under this Growth Plan is unprecedented. The funds are absolutely conditional; they are provided in installments every six months, and we carefully verify the reforms that have been requested. If they have been implemented, you receive the money,” Iwona Piórko said.

The ambassador noted that Moldova had recently received a new installment of 157 million euros. The deadline for the next installment is December, and the number and complexity of the reforms that must be implemented will be greater.

„The next deadline is December, and it will be even more difficult because this time you had 20 steps and fulfilled 18, but in December there will be 40 steps and very difficult reforms, and yes, the amount of money will also be twice as large,” the ambassador said.

As for how the money is spent, Iwona Piórko said that responsibility lied primarily with the government of Moldova, in compliance with the legislation underpinning the Growth Plan. The European Union is paying particular attention to the investment component, which accounts for 25 per cent of the plan's funds.

Iwona Piórko said Moldova was achieving good results in terms of reforms, but must accelerate the pace of investments. She noted that this is difficult, given that the country has a small market, a war is being waged at its border and the authorities are managing more other problems simultaneously. The ambassador also welcomed the initiative to create a mechanism that would bring together investments in Moldova in one place.

„So, while you are doing very well with the reforms, you still need to be faster when it comes to investments. This is certainly very difficult, because you are a small market, you have a war at your border and you still have problems that you are working on. The announcement of the creation of the Moldova Project structure, which will concentrate investments, was very well received in Brussels at the Association Council. We consider it a good idea; you can conduct procurement in a well-targeted manner,” Iwona Piórko said.

The ambassador also mentioned the Vulcanesti–Chisinau power line project, which she said was important for Moldova and which she hopes would be completed soon. The project will also be monitored under the mechanisms for implementing the Growth Plan.

At the same time, Iwona Piórko said that Moldova does not automatically lose the funds under the Growth Plan, if it fails to implement all reforms on time, as there is a period during which the authorities can address the outstanding requirements and fulfill the conditions for receiving the money.

„You will not lose this money. I believe that you have at least one year available to complete the steps that you have not fulfilled now and receive the money. The funds are simply not disbursed, if the reform has not been implemented, but there is also a certain grace period,” the ambassador said.

The diplomat specified that the absorption of funds and the public administration's ability to manage large-scale projects were major challenges for any state in the process of joining the European Union, particularly for countries with smaller populations and markets.

The European Union supports the intention of Moldova’s government to conclude the technical accession negotiations by 2028, provided that the pace of reforms is maintained, EU Ambassador to the Republic of Moldova Iwona Piórko said. The diplomat also said that Moldova was close to opening two more negotiation clusters.