Defence budget decreases and refocuses

In 2009 the defence budget will be considerably decreased, the first time defence spending will have been decreased by the Rose Revolution administration. Until recently defence was regarded as a priority for the country.

The defense budget was at its highest in 2007 – GEL 1.494 billion. This figure was more than double that of the 2006 budget, GEL 684 million. Initially the 2007 budget was to be GEL 513 million, but it increased bit by bit, with new provisions adding GEL 442 million, then GEL 315 million, then GEL 224 million. The 2008 budget was also substantial, at GEL 1.4 billion, much of this spending now being targeted at reconstructing infrastructure destroyed by the Russians.

The 2009 budget will still be GEL 950 million, and this expenditure will be devoted to modernising the army, a step which involves revisiting existing expenditure assumptions. For example, under the new budget concept Georgia will not purchase tanks, which are offensive vehicles, but instead concentrate on developing a more efficient air defence system, as part of an overhaul of priorities. The debates over the new Government thinking, particularly within the context of ongoing negotiations about the August conflict, promise to be rather interesting.