EBRD lends 300 million euros to Moldova to overcome energy disruptions

Moldovan Deputy Prime Minister Andrei Spinu speaks during a news conference in Chisinau, Moldova November 1, 2021. REUTERS/Vladislav Culiomza

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CHISINAU, June 23 (Reuters) – The European Bank for Reconstruction and Development (EBRD) said on Thursday it would lend 300 million euros ($316 million) to Moldova to help it weather disruptions in energy supplies aggravated by Russia’s war in Ukraine.

Moldova, sandwiched between Ukraine and Romania, gets almost all of its gas for industry and heating from Russian giant Gazprom PAO (GAZP.MM), under a contract extending until 2026.

Supplies have been the subject of difficult periodic negotiations over prices, which have skyrocketed even before the invasion of Ukraine, and over Moldova’s ability to pay its debts.

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The loan to the pro-Western government of President Maia Sandu will be granted in two tranches – 200 million euros to avoid disruption and another 100 million euros to constitute a strategic reserve in Ukraine or Romania.

“We work in the summer so we have fewer worries in the winter,” Deputy Prime Minister Andrei Spinu said in a Facebook post.

The EBRD said its loan would finance up to 20% of Moldova’s planned gas imports in 2022 and would be provided to state energy trader JSC Energocom to secure gas at EU hubs.

This would “ensure an uninterrupted supply of gas to Moldova and protect the basic needs and economic livelihoods of 2.7 million Moldovans and refugees from Ukraine”, he said.

Since the invasion, a series of explosions have hit the pro-Russian separatist enclave of Transnistria in Moldova, raising speculation that Russia may send troops across the border.

The Moldovan government instituted a state of emergency shortly after the invasion, banning the transmission of Russian-language news broadcasts.

Russian Foreign Minister Sergei Lavrov criticized the move, saying Moldova was trying to abolish everything Russian.

“It’s sad,” he told Belarusian state television in an interview published Thursday.

($1 = 0.9505 euros)

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Reporting by Alexander Tanas, Ronald Popeski and David Ljunggren; edited by Richard Pullin

Our standards: The Thomson Reuters Trust Principles.

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