The European Commission announced on April 22 that it has adopted a proposal for a EUR 3 billion macro-financial assistance (MFA) package to ten enlargement and neighborhood partners, including EUR 150 million for Georgia, to help the countries to limit the economic fallout of the coronavirus pandemic.
The Proposal represents “an important demonstration of the EU’s solidarity with these countries at a time of unprecedented crisis,” the Commission noted.
The MFA funds will be made available in the course of 12 months in the form of loans on highly favorable terms to help countries cover immediate financial needs, according to the European Commission.
Macro-Financial Assistance package will help our partners cover their immediate, urgent financing needs. It will enhance the efforts to protect people and mitigate the negative socio-economic consequences. #WesternBalkans #EaP #South #WeStandTogether pic.twitter.com/pOXIJeU1cp
— Oliver Varhelyi (@OliverVarhelyi) April 22, 2020
The Commission also noted that MFA funds will be available to the selected countries with policy conditionality.
To benefit from an MFA, countries should meet certain political preconditions in terms of respect of democratic principles, human rights and rule of law,” stated the European Commission.
Noteworthy, that out of the six Eastern Partnership countries, only Georgia, Moldova and Ukraine are listed as eligible states to the EU’s macro-financial assistance. Azerbaijan, Armenia and Belarus are not yet part of the EU’s MFA package.
Moldova is set to secure EUR 100 million, while Ukraine can access to EUR 1.2 billion.
The Commission stressed that the proposal is subject to adoption by the European Parliament and the Council of the EU, adding that following its adoption the first installment will be disbursed “as swiftly as possible” and upon the agreement on a Memorandum of Understanding with each partner country.
Earlier in April, the European Commission allocated over EUR 183 million of funds for Georgia as part of its global response to the coronavirus outbreak.
European Ambassador Hartzell Addresses PM Gakharia
In a letter to Prime Minister Gakharia, released on April 22 evening, European Ambassador Carl Hartzell wrote that “today I am proud to convey that the European Commission has proposed a third package, in the form of EUR 150 million of loans on highly favorable terms to further help Georgia cover its immediate financing needs.”
“Together with IMF support, our funds aim to enhance macroeconomic stability and create space to allow resources to be channeled towards protecting the Georgian citizens and mitigating the pandemic’s negative socio-economic consequences,” noted Ambassador Hartzell.
Head of the EU Delegation to Georgia highlighted that “Team Europe support to Georgia backs the healthcare front and addresses short-term financing needs, as well as the longer-term structural impact on the society and the economy.”
Proud to announce proposal for third #TeamEurope Covid-19 support package for 🇬🇪 composed of €150 million of low-interest loans for urgent financial needs.
— Carl Hartzell (@CarlHartzellEU) April 22, 2020
“As is normally the case with macro-financial assistance (MFA), disbursements will, inter alia, be conditional on satisfactory progress on the IMF programme and the continued drawing on IMF funds by Georgia,” stressed Ambassador Hartzell.
He said that the proposal “represents an important demonstration of the European Union’s and the whole Team Europe’s solidarity with a key partner and friend at a time of unprecedented crisis.”
“The first one, presented on 30 March, provided for urgent healthcare supplies and technical expertise, assistance to vulnerable groups, and wide liquidity support to small and medium-sized enterprises (SMEs), including local currency,” stated the Head of the EU Delegation to Georgia.
As for the second package, unveiled on 8 April, Ambassador Hartzell said it “included over EUR 183 million for Georgia in support to socio-economic measures, including a contribution to bridging the financing gap.”
“These packages have brought the total COVID-related support to EUR 250 million in non-reimbursable grants to date,” highlighted Ambassador Hartzell.