European partners help Moldova acquire new locomotives. Railway improvements to boost trade opportunities for local businesses

New rolling stock acquired by Moldova’s state-owned railway company (CFM) will deliver important benefits for the country’s trade, its economy and for people’s lives.

Twelve modern diesel locomotives purchased thanks to joint financing from the European Union (EU), the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD) arrived in Chisinau on 14 July. The engines will consume less energy than the current stock and ensure safer, more efficient transport of goods and passengers within Moldova and to its trading partners abroad.

The new rolling stock was manufactured in Nur-Sultan, Kazakhstan, by GE Transportation, now a division of the US company Wabtec, a leading supplier of freight car and locomotive products. GE Transportation was contracted following a tender held by CFM in 2018 in line with EBRD procurement policies and rules.

Igor Dodon, the President of Moldova, expressed gratitude to the representatives of the EBRD and the EIB in Moldova, and to the head of the European Union Delegation to Moldova, for the constant support they provide through various projects that finance strategic sectors. The head of state noted that the efficient management of Moldovan railways is a priority to re-energise the country’s economy.

The acquisition of the locomotives is part of a large project financed by the EBRD, EIB and EU that also includes the rehabilitation of railway infrastructure and comprehensive reform of CFM to improve safety, efficiency and corporate governance.

The tender for the upgrade of railway infrastructure is currently underway and the company is implementing an action plan to improve corporate governance. In addition, Moldova’s parliament is due to adopt a new Railway Code, legislation based on EU directives that aims to bring the country’s railway sector in line with the Association Agreement with the EU. 

The total project cost is €110 million, of which €5 million is an investment grant from the EU’s Neighbourhood Investment Facility and the remainder from loans by the EBRD and EIB.

The EU is Moldova’s largest donor and has to date provided over €1 billion in grant funding.

The EIB is the European Union’s bank. As the largest multilateral borrower and lender by volume, the EIB provides finance and expertise for sound and sustainable investment projects that contribute to furthering EU policy objectives. More than 90 per cent of EIB activity is focused on Europe but it also supports the EU’s external and development policies .

The EBRD is a multilateral development bank and a leading institutional investor in Moldova. It has so far invested over €1.3 billion through 130 projects there. The Bank also helps the Moldovan authorities to design policies that improve the business climate in the country.