National Bank and dollarisation of the country

The National Bank of Georgia (NBG) wants to decrease the tendency of dollarisation of the economy. President of the NBG Giorgi Kadagidze recently stated that it should try to stimulate the issuing of bank loans in the local currency, the GEL.

NBG recently appointed Professor Leonardo Leiderman of Tel-Aviv University to apply his expertise to the abovementioned task. He thinks that all financial operations in the country can be conducted in the local currency but this is very long process. In Israel the economy was 80% dollarised, and to reduce this dollarisation by 50% took Israel 20 years.

Georgia is 75% dollarised at present and the general situation in the country is pretty complicated. Despite the fact that the dollar rate is falling on world markets in Georgia it is stable.