Ministry of Finances to Sequester the Budget on the National Bank’s Expense

Today the Ministry of Finances admitted, that the National Bank would suffer most from the sequester. As it is known, the Ministry had to return to the Bank two trenches of the World Bank of total amount of 80 million Laris (40 million USD). Finance Minister Zurab Nogaideli stated, that in case of sequester, the Government has two choices: either cut budget expenses or not to return the funds to the Bank. The Ministry chose the second option.

Furthermore, the Minister stated, that the Ministry would not be able to return this debt to the Bank even in year 2002. Minister also says, that such policy will not cause devaluation of the national currency. However, it must be mentioned, that recently the Minister has been pledging that sequester would not be necessity as well. Since the restoration of independency of the country, Government’s debt to the National Bank reached 700 million Laris.

In case of Parliament’s approval, 205 million Laris sequester of the budget is expected for September.