Andorra uses the euro without having a central bank to act as a lender of last resort, and enhancing the financial sector's access to liquidity--beyond an emergency mechanism and a small repo line from the European Central Bank--is likely to be slower than we previously expected. Furthermore, we think the benefits of a planned EU Association Agreement--such as expanded and diversified exports--will materialize more gradually given delays to the agreement's final approval and the heightened macroeconomic and geopolitical uncertainties in Europe. The government's efforts to improve the granularity of its external data, particularly relating to short- and long-term debt--key to estimating gross external financing needs--will likely take more time than we had previously anticipated, delaying transparency gains and the monitoring
