The Commission has signed a Memorandum of Understanding on 31 August with Georgia for Macro-Financial Assistance (MFA) of up to EUR 45 million to help Georgia cover part of its external financing needs and support economic reforms. While Georgia has made significant progress, the country's economy faces regional economic risks, as well as its own economic imbalances. The MFA programme is designed to help the country cover part of its financing needs and support the implementation of structural reforms. Up to EUR 10 million will be provided in the form of grants and the remaining EUR 35 million in medium-term loans, under favourable financing conditions. The assistance will be distributed in two tranches provided Georgia complies with specific policy conditions. Disbursements are also dependent on the fulfilment of the political precondition, which requires Georgia to continue to respect effective democratic mechanisms, including a multi-party parliamentary system and the rule of law, and to guarantee the respect for human rights.