International rating agency Moody’s has affirmed Georgia’s long-term issuer credit rating at Ba2, whilst upgrading the country’s outlook from negative to stable.
According to the rating agency, Georgia’s strong economic performance mitigates domestic and geopolitical risks, serving as the main catalyst for the upgraded outlook.
Furthermore, the report highlights that ongoing cooperation with international financial institutions continues to foster highly effective fiscal and monetary policies.
“We expect Georgia’s economic growth to remain strong, driven by broad-based economic activity, solid domestic consumption, and sustained investment. Robust economic growth and prudent public debt management will continue to bolster the country’s fiscal resilience. Moreover, Georgia’s strategic location and its pivotal role in the Middle Corridor will help attract investment flows from across the region and further afield. These inherent strengths are reinforced by the high efficacy of its fiscal and monetary policies,” Moody’s noted.
Moody’s also emphasised that the National Bank of Georgia (NBG) has successfully implemented several key recommendations outlined by the International Monetary Fund (IMF).
“In terms of monetary policy, several measures recommended by the IMF have already been implemented. These include ensuring that a majority of non-executive members sit on the National Bank’s Board, capping discretionary financial transfers to the government and restructuring the organisation’s internal framework. Furthermore, the National Bank of Georgia is currently developing a legal framework to introduce a collegial decision-making model and enhance the qualifications of board members, in strict alignment with IMF guidelines,” the Moody’s Ratings report stated.
According to the National Bank of Georgia (NBG), Moody’s concluded that Georgia’s buoyant economic expansion, steadfast fiscal discipline and declining public debt are significantly solidifying the nation’s credit sustainability. Reflecting this momentum, the agency has upgraded its economic growth forecast for Georgia to 6.4 per cent.
