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IMF Names Georgia’s Economic Sustainability to Be Reflection of Strong Economic Policy Efforts

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BM.GE
29.06.18 14:58
604

The ongoing economic recovery makes it possible to implement such reforms that promote sustainability towards foreign shocks and increase higher and inclusive economic growth – this is the evaluation of the second report of the current program supported by the International Monetary Fund's Advanced Financing Mechanism. In addition, according to the document, economic growth in Georgia was preconditioned by strengthened foreign positions resulting from the growth of export, tourism and money transfers.

As a result of the implemented economic policy, the IMF gave even better estimation compared to its preliminary assessment for 2018 – the economic growth is by 0.6% higher comparted to the forecasted indicator and equals to 4.8%. In addition, in the medium term, the structural reforms are expected to lead to an average 5.2% economic growth. The document provides positive assessment of other macroeconomic indicators as well.

The International Monetary Fund highlights that the Georgian economy has shown a relatively high level of sustainability towards the foreign shocks of 2014. The fund confirms that the sustainability of the economy reflects the strong economic policies of the economy. The report also noted that the Georgian side provided implementation of the recommendations issued by the Fund in 2016 as well as the effective management of fiscal deficit. The 2017 budget has made it possible to increase public investments by reducing current expenditures and indirect taxes. The banking sector has maintained stability, which is largely the result of stronger prudent regulations and supervision.

The IMF also stresses the need for elimination of structural problems by the Government through acceleration of the infrastructure projects and improving the level of education. The Foundation welcomes this decision and confirms that additional investments in infrastructure and education are needed to eradicate structural problems and to improve potential economic growth.

The IMF reports and assessment specially highlights the successful reforms implemented by the Government in order to provide economic development, the important steps forward and the positive outcomes of those reforms.