Galt & Taggart Investment Bank forecasts possible coronavirus impact on Georgian economy

Business Materials 28 March 2020 09:21 (UTC +04:00)
Galt & Taggart Investment Bank forecasts possible coronavirus impact on Georgian economy

BAKU, Azerbaijan, March 28

By Tamilla Mammadova – Trend:

Galt & Taggart Investment Bank calls on Georgian government departments to take active fiscal and monetary measures, in particular, soften credit regulations, distribute social vouchers, and temporarily stop paying to the pension fund, Trend reports citing Galt & Taggart report.

Among the measures proposed by financiers are social support of vulnerable segments of the population, financing of utility tariffs, a 50 percent reduction in property taxes, attraction of international financing, review, and in some cases, cancellation of business regulations, softening financial conditions for banks (capital requirements, etc.), simplification of banking regulations, support of strategically important sectors of the economy.

In addition, the study recommends that the government develop a new economic model that takes into account the global situation.

In particular, it is recommended to identify those sectors of the economy where there is production potential for the local market and export.

Galt & Taggart also considers it necessary to stabilize the national currency exchange rate by reducing imports by $2.6 billion and attracting foreign investment by $1 billion.

The investment bank also assesses the possible impact of coronavirus on the Georgian economy in three scenarios - optimistic, pessimistic and medium.

According to the pessimistic scenario, Georgia’s economy will fall by 6 percent in 2020, with annual losses of $ 4.4 billion.

The optimistic scenario provides for losses in the economy at the level of $1.7 billion dollars, and the medium scenario at the level of 3.1 billion.