The Moldovan Ministry of Finances will partially guarantee the reimbursement of the EBRD loan to Moldovan Railways (CFM) for the procurement of locomotives and modernisation of the railway infrastructure. According to the decision approved on 29 July 2016, the Ministry of Finances will only guarantee for the loan part that goes to the procurement of locomotives.
The decision was adopted as a result of CFM’s failure to fully guarantee for the loan. We recall that according to the transport and logistics 2022 strategy, CFM elaborates the investment plan for the company’s development in 2014-2024. This strategy has enabled negotiations to be launched and agreements to be signed with the IFIs to attract the first tranches of foreign investments in the railway sector from EBRD worth EUR 52.5 million.
After signing the loan agreement with EBRD for the “Restructuring of Moldovan Railways”, negotiations with EBRD on the co-financing contract were finalised in June, total budget amounting to EUR 105 million. CFM’s programme includes the acquisition of locomotives, the rehabilitation of infrastructure and the implementation of the information energy management system of CFM.
Also, EU provides financial support for company development endorsing a non-reimbursement grant of EUR 5.25 million through the Neighbourhood Investment Facility. This financing will be used for the procurement of new locomotives and technical assistance.
As of April, CFM announced the intention of launching the tender for the acquisition of 10 new locomotives. According to the declarations of CFM manager, Iurii Topala, according to the tender book, the delivery of the locomotives will take 12 months, but the vehicles could be procured earlier, according to the manufacturer’s availability. By the end of the year, CFM hopes to have several new locomotives and the remainder will be put into operation in 2017. Moldovan Railways rehabilitated 4 locomotives enabling the transport of higher freight volumes.
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