Commission proposes €46 million macro-financial assistance to Georgia
Azerbaijan, Baku, Jan.13 /Trend/
The European Commission has proposed to provide macro-financial assistance to Georgia of up to €46 million as part of a comprehensive EU package to boost Georgia's economic recovery in the wake of the August 2008 conflict with Russia and the global financial crisis, says a Commission press release on Thursday.
Half of the assistance (€23 million) would be disbursed in the form of grants and the other half in the form of loans.
Once endorsed by the European Parliament and the Council, the assistance should be disbursed in two instalments, tentatively in the second and the fourth quarter of 2011. The assistance is conditional on the respect of the adjustment programme agreed between Georgia and the International Monetary Fund (IMF), as well as the implementation of reform measures to be agreed between the EU and Georgia.
This assistance is part of a comprehensive EU package of up to €500 million to support Georgia's economic recovery pledged at the October 2008 International Donor Conference in the aftermath of the August 2008 conflict with Russia. This proposal would be the second part of the macro-financial assistance pledged by the EU at that conference. The first part, also amounting to €46 million, was successfully implemented in 2009-2010.
The EU macro-financial assistance will contribute to cover Georgia's external financing needs in 2011, the press release said, adding that after having been hit by the double shock of the conflict with Russia of August 2008 and the global crisis, the Georgian economy is showing signs of recovery.
Macro-financial assistance (MFA) is an exceptional EU crisis response instrument available to EU neighbours, conditional on satisfactory progress under an economic programme supported by IMF financing. Its operations are approved by the European Parliament and the Council. Since 1990, 55 MFA decisions have been approved, with total commitments amounting to €7.4 billion.