Economist Giorgi Khishtovani sharply criticizes the ruling party’s initiative to create an Economic Development Bank, arguing that the government is effectively inserting itself into the country’s lending system and “turning Georgia’s entire monetary-credit framework upside down.” Speaking to BMG, he said the process appears disorganized, unplanned and unprofessional, as new details contradict earlier statements almost daily.
According to Khishtovani, the government's shifting narrative raises serious concerns. Initially, officials claimed the new institution would not issue loans - yet later confirmed it would. At first, they suggested the National Bank would not regulate the institution, which Khishtovani calls illogical if the new body functions as a bank and engages in lending. This, he says, signals the state’s direct involvement in sectoral lending through a newly created bank.
He warns that the risks extend far beyond governance issues. Khishtovani does not rule out the possibility that the government could eventually direct pension fund assets - including citizens’ savings - into sectors financed by the new bank. Such a move, he argues, could expose pension savings to politically driven or high-risk projects, creating not only reputational risks for the country but also potential financial losses for the population.
Khishtovani stresses that without clear rules, transparency and professional planning, the Development Bank could have serious negative consequences for Georgia’s economy. The ruling party plans to merge the Georgian Development Fund and “Enterprise Georgia” into the new institution. Despite claims that it will not be a “classic bank,” Prime Minister Irakli Kobakhidze has confirmed it will perform bank-like functions, including issuing loans.
