BUCHAREST (Romania), November 29 (SeeNews) - Romania's finance ministry said it has signed an agreement to receive the first loan under the EU's Recovery and Resilience Facility (RRF), in the amount of 15 billion euro ($16.9 billion).
The proceeds of the loan will be used to finance the state budget deficit and refinance government debt, based on budget expenditures made for reforms included in Romania's National Recovery and Resilience Plan, the finance ministry said in a press release on Friday.
The financing will be made available in ten installments, and is conditioned on the fulfilment by the Romanian side of milestones and targets in the reform programme and investments associated with the loan.
The European Commission will make available pre-financing of 13% of the loan amount, or approximately 1.94 billion euro, after the entry into force of the agreement.
"We have taken an important step for Romania to receive the first money through the Recovery and Resilience Mechanism. This is about €15 billion in the budget expenditure needed for the reforms and investments foreseen in the NRRP," finance minister Adrian Caciu said.
The finance ministry will conclude a subsidiary agreement with the ministry of investment and European projects, which will establish the rights and obligations of the parties in applying the provisions of the loan agreement, including monitoring the achievement of milestones and targets and reporting required by the European Commission, Caciu added.
The loan is available until December 31, 2026.
Romania benefits of approximately 29.18 billion euro through NRRP, of which 14.24 billion is grant financing and the rest is loans. The Commission approved the plan at the end of September, while the EU Council gave its positive assessment of the plan at the end of October.
The RRF makes 723.8 billion euro in loans and grants available to support reforms and investments undertaken by member states. The facility entered into force in February and will finance reforms and investments in member states until December 31, 2026.