06.May .2020 18:35

Government continues restriction of PF’s activities – the IMF’s conditions

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Conditions defined within the framework of the program between Georgia and the International Monetary Fund have been published, which Georgia plans to protect. According to the document, the PF’s gross acquisition of financial and non-financial assets will be limited to zero except for existing commitments in ongoing projects.

According to the document, the Ministry of Finance will provide to the IMF detailed information on the Partnership Fund’s quarterly acquisition of financial and non-financial assets within four weeks of the end of each quarter.

“The Ministry of Finance will notify the IMF about transactions required by preexisting contractual obligations within 10 days of their occurrence and provide the necessary documentation establishing such obligation. The authorities will continue to limit operations of the Partnership Fund, as envisaged under the program.

No new investments nor net borrowing have taken place; and the authorities are hesitant to provide budget support. The exercise classifying SOEs into general government or corporations (end-March 2020 SB) concluded that the PF was a general government (GG) entity and that the authorities should include it in the GG reporting starting in 2021. We will continue to limit the Partnership Fund (PF) operations.

Given that the PF does not follow commercial objectives, we are limiting the PF’s gross acquisition of financial and non-financial assets, other than cash and bank deposits, to zero except for existing commitments in ongoing projects (continuous performance criterion). Accordingly, the PF will not undertake any new projects nor engage in any net borrowing (continuous performance criterion)”, the document reads.