EU Disburses €460 Million in Financial Assistance to Tunisia, Kosovo, Montenegro and North Macedonia

Updated: Jun 9, 2021



On 1 June 2021, the European Commission, on behalf of the EU, has made further disbursements under its COVID-19 Macro-Financial Assistance (MFA) package to Tunisia, Kosovo, Montenegro and North Macedonia. The disbursements of €300 million to Tunisia, €50 million to Kosovo, €30 million to Montenegro and €80 million to North Macedonia are part of the €3 billion MFA package agreed in May 2020 to help ten enlargement and neighbourhood partners mitigate the economic fallout of the COVID-19 pandemic. This disbursements demonstrate the EU's solidarity with our partners at a time of unprecedented crisis.


Paolo Gentiloni, Commissioner for the Economy, said: “Today marks another concrete step forward in the fight against the fallout of the Covid-19 pandemic with the successful completion of the macro-financial assistance to Kosovo, Montenegro and North Macedonia and the first disbursement to Tunisia. The EU remains more committed than ever to support its neighbours in these difficult times.”


For Tunisia, this is the first tranche of its €600 million MFA programme that entered into force in May 2021. Given the emergency nature of this support, the first disbursement is not conditional on the fulfilment of any specific policy conditions.


For Kosovo, this is the second and final tranche of its €100 million MFA programme. Kosovo has fulfilled the policy conditions agreed with the EU for the release of the second €50 million disbursement under the programme. These included important measures to improve the sustainability of public finances, enhance financial stability, strengthen good governance and the fight against corruption, as well as initiatives to increase youth employment.


For Montenegro, this is the second and final tranche of its €60 million MFA programme. Montenegro has fulfilled the policy conditions agreed with the EU for the release of the second €30 million disbursement under the programme. These included important measures in the areas of public finance management, financial stability, good governance and the fight against corruption, improvements in the business environment, and social protection.


For North Macedonia, this is the second and final tranche of its €160 million MFA programme. North Macedonia has fulfilled the policy conditions agreed with the EU for the release of the second €80 million disbursement under the programme. These included important measures to strengthen fiscal governance and transparency, fight corruption, enhance financial sector supervision, improve the business environment, and tackle youth unemployment.


The EU's response follows a ‘Team Europe' approach, aimed at saving lives by providing quick and targeted support to our partners to face this pandemic. It combines resources from the EU, its Member States and financial institutions, in particular the European Investment Bank and the European Bank for Reconstruction and Development, to support partner countries and address their short-term financing needs, as well as the longer-term structural impacts on societies and the economy. As ECOPNET (European Cooperation and Partnership Network), we are pleased to see the role of the EU as a global actor and major contributor to the international development system that promotes a coordinated multilateral response, in partnership with the United Nations, International Financial Institutions, as well as the G7 and the G20.


All four partners receiving disbursements continue to satisfy the pre-conditions for granting MFA as regards the respect of human rights and effective democratic mechanisms, including a multi-party parliamentary system and the rule of law.


Background


MFA is part of the EU's wider engagement with neighbouring and enlargement partners and is intended as an exceptional crisis response instrument. It is available to enlargement and EU neighbourhood partners experiencing severe balance-of-payments problems. It demonstrates the EU's solidarity with these partners and the support of effective policies at a time of unprecedented crisis.


The decision to provide MFA to ten enlargement and neighbourhood partners in the context of the COVID-19 pandemic was proposed by the Commission on 22 April 2020 and adopted by the European Parliament and the Council on 25 May 2020.


In addition to MFA, the EU supports the partners in its Neighbourhood policy and the Western Balkans through several other instruments, including humanitarian aid, budget support, thematic programmes, technical assistance, blending facilities and guarantees from the European Fund for Sustainable Development to support investment in the sectors most affected by the coronavirus pandemic.





Source: European Commission Press Corner