Georgia’s Finance Minister Nodar Khaduri has claimed that the government does not plan to borrow from the IMF, but instead seeks to attract additional financing from other donors in order to suspend the national currency devaluation that has now reached 2.17 against the dollar.
Government seeks ways to borrow money
By Tea Mariamidze
Tuesday, February 24
“We will discuss the ongoing economic processes with the IMF representatives who are in Georgia. We are not going to borrow money from them… We plan to receive finances for additional infrastructural projects from the Asian Development Bank, World Bank and European Bank for Reconstruction and Development,” Khaduri said.
The IMF representatives have informed us that they were about to study the current economic situation in Georgia and problems concerning the Lari.
Several days ago the government stressed that it “would tighten belts” and reduce administration expenses responding to the Lari downfall.
Khaduri excluded a salary and staff reduction.
“There are lots of other administrative expenses that might be cut,” he said. Minister of Infrastructure Davit Shavliashvili anticipated that the cut might concern bonuses. The Ministry of Finance must reveal a plan to reduce expenses in two weeks.
The government members have also commented on the change in the economic growth indicator for 2015 that had been announced at 5%.
“I think real economic growth should be expected to reach around 2-2.5% in 2015,” Minister of Economy Giorgi Kvirikashvili said, noting that the government would do its best to avoid an increase in prices.
Analysts claim that the country is at the edge of inflation and predicts an increase in electricity and gas prices.
“We should know that the gas and electricity prices will increase. The government will try to delay the process temporarily, but foreign companies will not work on loss for a long time. The only thing that might create balance in the situation is export, but we have nothing to export,” explained analyst Gia Khukhashvili.
Georgia’s Energy and Water Regulatory Commission states that the gas and power provider companies have not asked them for a rise in prices. Government members also stress that no increase is feasible in the near future.