|Author (Corporate)||Council of the European Union, European Parliament|
|Series Title||Official Journal of the European Union|
|Series Details||L 165, Pages 31-37|
Decision (EU) 2020/701 - formally adopted by the Council of the European Union and the European Parliament on 25 May 2020 - which allocates a €3 billion Macro-Financial Assistance (MFA) package to ten enlargement and neighbourhood countries aiming at helping them to limit the economic impact of the COVID-19 (coronavirus) pandemic.
Macro-Financial Assistance is part of the European Union's wider engagement with neighbouring and enlargement countries and is intended as an EU crisis response instrument. It is available to those partners experiencing severe balance-of-payments problems with policy conditionality. To benefit from an MFA, countries should meet certain political pre-conditions, and should also benefit from an IMF financial assistance programme.
This particular proposal - which followed a preliminary assessment of financing needs - provides for the MFA funds to be distributed as follows:
The funds are to made available for 12 months in the form of loans on favourable terms to help these countries cover their immediate, urgent financing needs. Together with the IMF support, the funds can contribute to enhancing macroeconomic stability and providing space to allow a more effective allocation of resources.
The proposal was put forward by the European Commission on 22 April 2020, adding to its overall approach for supporting partners across the world. The European Parliament's plenary endorsed the initiative on 15 May, followed by the Council of the European Union on 20 May. The Act was signed by the co-legislators on 25 May, and it was published in the Official Journal on 27 May 2020.
The European Commission signed on 16 July 2020 a Memorandum of Understanding (MoU) with North Macedonia for the disbursement of the first package of financial support in this framework. A MoU was signed with Ukraine on 23 July for support in limiting the economic fallout of the pandemic. On 11 August, the Commission announced that similar agreements had also been agreed with Albania, Georgia, Jordan and Montenegro. The MoU with Kosovo and Moldova had by then been already signed. Negotiations with Bosnia & Herzegovina and Tunisia were underway.
New tranches of this support package were released by the European Commission to some of these countries on 1 June 2021.
|Subject Categories||Economic and Financial Affairs|
|Subject Tags||Economic Governance | Situation, European Neighbourhood Policy [ENP]|
|Keywords||COVID-19 (Coronavirus), Macro-Financial Assistance [MFA]
|International Organisations||European Union [EU]|