Exchange of Notes for Grant Aid for the Republic of Moldova (Assistance for Underprivileged Farmers)

October 8, 2009
Japanese

The Government of Japan has decided to extend grant aid of 160 million JPY to the Republic of Moldova as an assistance for underprivileged farmers. Notes to this effect were exchanged on October 7 (Wed) (local time: same day) in Chisinau between Mr. Tadashi Izawa, Ambassador of Japan to Moldova (concurrently serves as Ambassador to Ukraine), and Mr. Valeriu Cosarciuc, Minister of Agriculture and Food Industry of the Republic of Moldova.
With the aim of providing assistance to underprivileged farmers in Moldova, this grant aid will supply the funds for the provision of agricultural machinery (tractors) which is essential for increasing production of Moldova’s staple crops of corn and wheat.
Moldova is blessed by a fertile type of soil known as “chernozem,” and was a major area of agricultural production in the former Soviet Union. Following its independence, however, Moldova has been affected by an economic crisis resulting from its transition towards a market economy. As a result, the supply of equipment necessary for agricultural production had been cut off and the percentage of agriculture in the whole economy continued to decline. Currently, as a result of the promotion of the privatization of farmland, small and medium-scale farmers possessing farmland have begun to purchase and lease properties in a number of locations. These farmers, however, are of low income and are offered no credit system to assist purchase agricultural machinery. As a result, it is currently difficult for them to procure agricultural machinery and adopt new technologies by their own.
It is expected that this grant aid will improve food productivity in Moldova and therefore contribute to the reduction of poverty as well as the economic and social development in the country.

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Moldova covers a land area of 33,840 square kilometers, has a population of approximately 3.79 million people (World Bank, 2007), and a Gross National Income (GNI) per capita of 1,260 USD (World Bank, 2007).

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