Four ministries (Energy, Finance, Environment and Labor and Social Protection) of the Government of the Republic of Moldova and the French Development Agency (AFD) signed on June 23, during an official event, a Memorandum of Understanding to support the reform of the energy sector of the Republic of Moldova.

The 6-year initiative is an opportunity to promote the implementation of an Energy Policy Based Loan Program and aims to support the reform of the energy sector of the Republic of Moldova in view of the country's accession to the European Union, in particular focusing on investments in energy infrastructure, energy efficiency in buildings, renewable energy development, consumer protection, environment and climate.

The program will start in 2023 and will run for the next six years. It will offer:

- Concessional loans provided by AFD (a first installment of €40 million in 2023), the breakdown of which will be linked to the implementation of agreed reforms,

- A technical assistance program financed by a €5 million grant provided through the European Commission's Neighborhood Investment Platform. This grant aims to support Moldovan ministries and public institutions in the implementation and monitoring of reform. The technical assistance program will be managed by Expertise France, AFD Group's technical cooperation subsidiary.

The program will:

support energy sector reforms;
facilitate the mobilization of technical expertise needed to implement reforms;
remove obstacles to change through sustained policy dialog;
provide concessional budget support following the successful implementation of a reform phase.

AFD Group's extensive support to Moldova's energy sector started in 2022 by financing technical cooperation between Moldelectrica and the French transmission and system operator RTE to facilitate integration into the European electricity grid. AFD will also work with UNDP Moldova in the evaluation of the first phase of the Energy Vulnerability Reduction Fund.

The French Ambassador to the Republic of Moldova, Graham PAUL, said: "This operation is a concrete example of the deepening technical and financial cooperation between France and the Republic of Moldova. By providing short and medium term support, France, as part of Team Europe, is contributing to Moldova's energy security and resilience".

"The long-term approach of this cooperation program is valuable and the technical assistance will support the Republic of Moldova on its path towards EU accession and energy sector reform", added Victor PARLICOV, Minister of Energy.

"We are very happy when EU Member States, such as France, join the European institutions to support Moldova's European path and, above all, contribute to a greener Moldova. This is a Team Europe initiative to steer the Republic of Moldova towards a favorable environment for investment in renewable energy reform", said Magdalena Mueller-Uri, Head of the Cooperation Section, EU Delegation to the Republic of Moldova.

AFD Group's collaboration with the Republic of Moldova is recent but with fruitful results. In February 2022, the Group opened its office in Chisinau. It is supporting convergence towards the European Union and is one of the leading bilateral lenders to the Republic of Moldova. The AFD Group has financed studies and technical assistance through grants, provided budget support in the areas of energy, environment and transport, and supported civil society organizations. Proparco - AFD Group's private sector subsidiary - supports small business development, while Expertise France - AFD Group's technical cooperation agency - works in the areas of anti-money laundering, transparency and access to justice.

During the event, in addition to the signing of the Memorandum, bilateral meetings on energy, afforestation and irrigation were held to deepen the collaboration between the Republic of Moldova and AFD Group.

About the French Development Agency Group

The AFD Group contributes to the implementation of France's policies in the field of sustainable development and international solidarity. The Group comprises Agence Française de Développement (AFD), which finances the public sector, civil society organizations, research and training; its subsidiary Proparco, dedicated to the private sector; Expertise France, a technical cooperation agency. The Group finances, supports and accelerates the transition needed for a more equitable and resilient world.

Together with its partners, the AFD Group develops joint solutions for and with people in more than 150 countries as well as in 11 French overseas departments and territories. Our teams contribute to the commitment of France and the French people to achieve the Sustainable Development Goals (SDGs). They work on more than 4,800 projects in the field. Our aim is to reconcile economic development with the preservation of the commons, from peace, climate and biodiversity to health, education and gender equality. Towards a shared world.

More details at www.afd.fr/en