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World Bank Extends USD 55 Mn Loan to Boost Moldova's Agriculture Sector

The Ministry of Agriculture and the World Bank are now set to collaborate closely to ensure the efficient and effective implementation of the loan.

Shivam Dwivedi
World Bank Extends USD 55 Mn Loan to Boost Moldova's Agriculture Sector (Photo Source: Pixabay)
World Bank Extends USD 55 Mn Loan to Boost Moldova's Agriculture Sector (Photo Source: Pixabay)

The Ministry of Agriculture in Moldova announced on Monday that it has successfully signed an agreement with the World Bank to secure a USD 55 million loan (equivalent to 51.4 million euros). The funds will be dedicated to developing underperforming agricultural sub-sectors in the country.

The financing, which is expected to be implemented by 2029, aims to achieve several key objectives. Primarily, it seeks to increase the income of farmers and create new employment opportunities within the agricultural industry. Additionally, the loan will be utilized to promote smart agricultural practices, foster organic production, and open up new market opportunities for Moldovan farmers.

One of the primary areas of investment from the loan will be the rehabilitation of Moldova's irrigation infrastructure. Approximately USD 25 million will be allocated to enhance and modernize the irrigation systems, thereby optimizing water usage and improving agricultural productivity.

Furthermore, a substantial portion of the loan, amounting to USD 6.5 million, will be directed towards strengthening the capabilities of two important agricultural entities in Moldova—the National Agency for Intervention and Payments for Agriculture (AIPA) and the National Agency for Food Safety (ANSA). These funds will enable these agencies to enhance their operations and better support farmers in the country.

In addition to these initiatives, USD 2.5 million will be allocated for effective project management purposes. This allocation ensures that the loan is efficiently utilized, and the objectives are achieved within the stipulated timeframe.

Agriculture plays a pivotal role in Moldova's economy, contributing around 15% to the country's GDP. Moreover, it is a major source of employment, providing jobs to approximately 21% of the population. The loan from the World Bank will serve as a catalyst for the growth and development of the agricultural sector, contributing to the overall economic prosperity of Moldova.

Inguna Dobraja, the World Bank Country Director for Moldova, expressed her optimism about the agreement, stating that the financial support would allow Moldova to unlock the untapped potential in its agricultural sub-sectors, leading to increased productivity, improved livelihoods, and sustainable economic growth.

This loan agreement comes shortly after the World Bank approved a support package of USD 134.3 million to assist Moldova's government in mitigating the socio-economic impacts caused by Russia's invasion of Ukraine. These financial interventions demonstrate the World Bank's commitment to helping Moldova overcome challenges and achieve its developmental goals.

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