President Calls on Govt to Present ‘Currency Stabilization Plan’

President’s administration said the government has failed to live up to its pledge to present “currency stabilization plan” by March 5.

“Regrettably, no such plan has yet been presented. Therefore we want to remind the stakeholders about their political responsibility and duty before the public to present currency stabilization plan,” Giorgi Abashishvili, an adviser of President Giorgi Margvelashvili, said at a news conference on March 6.

After the opposition UNM and Free Democrats parties requested the President last week to convene a special session of the parliament to discuss economic situation, Margvelashvili met Economy Minister Giorgi Kvirikashvili and Finance Minister Nodar Khaduri on February 25. After that meeting the President said that it was reasonable to give time to the government at least till March 5 to present the plan as it was still working with the IMF mission, which at the time was visiting Tbilisi.

“At that meeting the members of the Georgian government’s economic team promised the President and the society that they would have submitted a concrete plan of economic stabilization by March 5, which should have been developed in cooperation with the International Monetary Fund and the National Bank of Georgia, but regrettably no such plan has yet been presented,” the President’s adviser said.

The government said it would cut administrative spending to limit increase of budgetary deficit as economic growth is expected to slow from government’s initial target of 5% to 2%. On March 5 the government instructed state agencies to present their administrative spending cut schemes before March 16. Finance Minister Nodar Khaduri said that after gathering all the information about precise figures on planned spending cuts, it will become possible to launch working on revision of this year’s budget, “if of course there is a need for that.”

The government also said last week that it would step up privatization of state assets, which it said, among other measures, will help to “stabilize” national currency lari (GEL), which lost 29% of its value against U.S. dollar in a period between November and February 26, when USD/GEL rate was at 2.2635. Although GEL gained since then at 2.1078, it again fell in last two days and was trading at 2.1740 per U.S. dollar as of March 6, compared to 1.75 in early November, before it started depreciation.

This post is also available in: ქართული (Georgian) Русский (Russian)