Moldova Seeks IMF Loan to Avoid Financial Collapse

Moldovan Prime Minister Ion Chicu told a TV show on Wednesday that the country's public finances were in dire straits owing to the pandemic, and the country desperately needed a new IMF loan to avoid catastrophe.

Since March 17, budget revenues had been cut in half, Chicu said. "If we launch a massive emission of lei, [the national currency], this means inflation, and pensioners with 1,500-2,000 lei pensions [equal to 75 to 100 euros] will not be able to buy even bread. We will not allow this. There is no point in printing money," he said.

The PM told the show aired by NTV Moldova on Wednesday night that the state was currently paying pensions and salaries out of the money collected by the customs service in the first two months of the year while also drawing on a tranche of 20 million US dollars provided by the IMF at the start of 2020.

The Prime Minister said the only hope in this situation was another IMF loan, of about 200 million euros, or 4 billion lei, which he said the IMF might approve at the end of April after its board meets on April 17.

Between November 2016 and March 2020, Moldova received a loan of 178.7 million US dollars from the IMF, following the severe crisis caused by the unsolved so-called "grand theft" of a billion US dollars from the banking system, which represented about 15 per cent of the country's GDP.

The IMF and World Bank on Thursday announced an aggressive plan to tackle the worst economic effects of COVID-19 pandemic, especially in vulnerable countries, mainly the poorest ones. The plan targets 111 countries in total.

"We are moving forward with a new process that will immediately cancel the debt of the 27 countries facing debt distress. Additionally, all 76 of the World Bank's International...