Money transfers to Georgia decreasing

Money transfers from foreign countries into Georgia in January 2009 were worth USD 51.2 million, USD 7.3 million less than in January 2008. As the National Bank of Georgia informs this is the lowest figure since 2001.

The figure primarily reflects decreases in money transfers from Russia. In January 2009 USD 27 million was transferred from Russia whereas in January 2008 this figure was USD 35.6 million.

Money transfers in 2007 were worth USD 866 million, in 2008 they reached USD 1 billion. It is predicted that in 2009 the inflow of transfers will further slow down due to the global financial crisis, as most of the amounts transferred were from countries where Georgians have gone to work and assist their families. In 2008 for instance USD 633 million was transferred from Russia into Georgia, but today crisis is raging in Russia and Georgians there are not in the best conditions. The other countries apart from Russia from which Georgia receives significant money transfers are the USA, Ukraine, Greece, Italy, Turkey and Spain.

Economic expert Davit Narmania thinks that these transfers play a primarily social rather than economic role. This money was not invested in the economy directly as it was mostly used by recipient families to satisfy their everyday needs. Of course, the decrease of this kind of inflow will decrease the purchasing capacity of the population and make life for these families harder.