IMF Allocates USD 113.9 Mln to Georgia for Pandemic Recovery

The Executive Board of the International Monetary Fund (IMF) on December 16 completed the Seventh Review of Georgia’s economic reform program supported by the Extended Fund Facility (EFF), approving the disbursement of some USD 113.9 million to help Tbilisi “meet balance of payments needs stemming from the COVID-19 shock.”

IMF Deputy Managing Director and Chair Tao Zhang noted that the National Bank of Georgia managed to anchor inflation pressures via its moderately tight monetary policy, while also protecting exchange rate flexibility.

Georgia’s monetary stance and foreign-exchange interventions “may need to be sustained to prevent disorderly market conditions and bring inflation towards the 3-percent target,” Zhang said, adding that macroeconomic policy discipline and donor support should maintain foreign exchange reserves “at an adequate level.”

The National Bank of Georgia bank has sold foreign exchange reserves of USD 843,222,000 in 25 auctions held since March.

IMF statement said Georgia’s fiscal response to the COVID-19 pandemic helped relieve its economic and social impact, with the 2021 state budget further aiding the economic recovery.

Moreover, it highlighted structural reforms, including in the judiciary, as a path to improving the business environment and enhancing private sector-led growth.

Under the EFF arrangement, Georgia has so far received special drawing rights to foreign exchange reserve assets of some USD 585.4 million.

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