Global Finance magazine has released the names of Central Bank Governors who earned the highest and lowest grades in the Central Banker Report Cards 2024.
According to the publication, NBG acting president Natia Turnava earned the lowest grade "D". Grades are based on an “A+” to “D” scale for success in areas such as inflation control, economic growth goals, currency stability and interest rate management. The managers of those central bankers who have been on the position for a short time ( (less than one year) are eveluated with a TETS score, which means that not enough time has yet passed for the evaluation. Natia Turnava had this assessment in Global Finance's 2023 report, which was published on September 24 of last year, because for the mentioned period, Turnava had only started working as the acting president of NBG. In 2022, Global Finance assessed the activity of Natia Turnava's predecessor Koba Gvenetadze with an A- grade; Gvenetadze also had an A- grade in 2021 and 2020; in 2019; in 2018. The governor of the Central Bank of Georgia has been participating in Global Finance's rating since 2018.
According to the publication, Natia Turnava is formally appointed governor and the NBG has been dragged into Georgia’s increasingly bitter political divisions.
"Acting head of the National Bank of Georgia (NBG) since June 2023, amid controversy over what was regarded as a highly political appointment, Natia Turnava has yet to be formally appointed governor. But that has been the least of her problems, as she and the NBG have been dragged into Georgia’s increasingly bitter political divisions.
Questions were raised over her judgment in September 2023, when she failed to enforce international sanctions on Georgia’s former prosecutor general Otar Partskhaladze—who has close connections to Russian President Vladimir Putin—claiming that the freezing of a Georgian individual’s assets could be enforced domestically only by a Georgian court. Her controversial stand led to three top-level resignations from the NBG and a rebuke from Georgian President Salome Zurabishvili, who called on her to resign.
Turnava has also been obliged to spend foreign currency to prop up the lari last May, despite fierce opposition from all other political parties, the president, and the EU, which subsequently suspended membership negotiations with Georgia. This was at the height of antigovernment demonstrations against the country’s so-called foreign agents law. According to Fitch Ratings, international reserves dropped from a peak of $5.4 billion in August 2023 to $4.6 billion in June of this year, that decline beginning soon after the start of Turnava’s tenure.
She has done nothing to dispel concerns about her conduct last September, and her closeness to the governing Georgian Dream party has undermined confidence.
In June, Fitch Ratings warned that “perceived risks to the independence of the NBG could erode policy credibility, potentially weakening the capacity of Georgia’s small, open and dollarized economy to respond to external shocks.”
As regards monetary policy, the NBG has followed a broadly tight strategy, with rates cut to 8% in May, against inflation of 2% at that time, although high levels of dollarization impact policy transmission. Inflation peaked at 2.2% in June, then subsided to 1% by August", - the publication writes.
The 'Central Banker Report Cards 2024' by New York-based Global Finance Magazine, a comprehensive assessment of the performance of central banks worldwide, highlights the complex challenges faced by these institutions over the past year.
The Central Banker Report Cards, published annually by Global Finance since 1994, grade the central bank governors of nearly 100 key countries, territories and districts, as well as the European Union, the Eastern Caribbean Central Bank, the Bank of Central African States and the Central Bank of West African States.
