In Moldova, severe droughts caused annual losses of $19 million a year, during 1996-2004. The current total cost of inaction regarding adaptation to climate change in the country in the sectors of forestry, agriculture, water, health, energy, buildings is estimated at US$ 600 million, which is equivalent to 6.5% of the Gross Domestic Product (GDP). This value is expected to double in real terms by 2050 to about US$1.3 billion.

In its updated National Determined Contribution submitted in the context the Paris Agreement, Moldova has committed to unconditionally reduce greenhouse gas emissions (GHG) emissions by 70% by 2030 compared to 1990.

Therefore, the Ministry of Environment has initiated the drafting of a climate framework law, aiming to establish an efficient system for planning, monitoring, improvement and reporting on policies and measures of relevance for greenhouse gas emissions (GHG) emissions’ reduction and adaptation to climate change. The preparation of the new law is carried out with the support of the EU4Climate Project, funded by the European Union and implemented by the United Nations Development Programme (UNDP).

The climate framework law will simplify and make more efficient Moldova’s reporting to the United Nations Framework Convention on Climate Change, the Paris Agreement and the Energy Community Treaty.

The law will include references on achievement of climate neutrality objective by 2050 (reducing as much as possible the GHG emissions and compensating those that are produced) and the intermediate target of reducing net and the GHG emissions by sectors by 2030. The law should also introduce measures for a biding target for carbon sink up to 2030 as a significant contribution to the climate neutrality pathway. Furthermore, it will contribute to climate impact quantification and adaptation planning to boost resilience of Moldova's community and economy.

Thus, the law should ensure basis for the implementation and evaluation of policies and measures for the GHG emission reduction and adaptation, which Moldova has committed to in its NDC and policy documents. It should set up a mechanism that will encourage cleaner production processes, reducing potential impacts of the EU's Carbon Border Adjustment Mechanism. The mechanism will be equivalent to the EU's emissions trading system but adjusted to national circumstances.

The Law will ensure designing of a robust, efficient, and purposeful monitoring and reporting system, that will also assist the country in:

1. Preparation and implementation of low carbon strategies and the adaptation plans;
2. Reporting on policies, measures, actions and plans, and projections of GHG emissions;
3. Reporting information on progress in implementing and achieving NDC and National Energy and Climate Plan;
4. Establishing national inventory system for estimating anthropogenic GHG emissions by sources and removals by sinks not controlled by the Montreal Protocol, and for reporting and archiving inventory information;
5. Reporting on climate change impacts and associated loss and damages as well as adaptation and on financial, technology transfer and capacity-building support needed and received.
6. Helping drivers choose new cars with low fuel consumption by label showing a car's fuel efficiency and CO2 emissions. 

The law will rely on existing institutional and governance structure as much as possible, so as to reduce the burden. It will explore mechanisms for more efficient participation of interested stakeholders into planning, implementation and evaluation of policies and measures. 

With a total budget of €8.8 million, the EU4Climate project is caried out during 2019-2022 and has the following components: (i) updating the Nationally Determined Contributions to the Paris Agreement; (ii) developing National Low-emission Development Strategies by 2050; (iii) the introduction and strengthening of the framework for the monitoring, reporting and verification of greenhouse gas emissions; (iv) alignment with the acquis communautaire in the field of climate; (v) integrating the climate dimension into sectoral policy documents, raising awareness and developing sectoral guidelines for the implementation of the Paris Agreement; (vi) attracting investment in climate change; (vii) better planning for adaptation to climate change.