“As an economist, I am worried that Georgia's debt exceeds 60% of GDP”, the Chairman of the Budget and Finance Committee, Irakli Kovzanadze said.
According to the law, in the case of exceeding the debt ratio of 60%, the government is obliged to submit a plan on how the debt will be reduced in the coming years.
"We will reduce the deficit every year for the next 3 years, by observing these parameters we will reduce the debt to 57.5%. This is within the frame of the law, however, it is still a high rate and we need to reduce the debt by a greater amount. The sad reality is that 80% of Georgia's debt is foreign debt. I do not remember a successful country that owes even more than 30-40% of the foreign debt. If there is debt, everyone's have domestic debt, including the US; Japan or other countries.
Today, a debt ratio of more than 60% of GDP is too risky for Georgia, so we need to reduce it. According to our scenario, we are coming down to a debt level of 57%. This reduction is due to the fact that the financing of infrastructure projects is gradually decreasing," said Kovzanadze.
