Audit Service of Georgia: Total cost of servicing and paying off state debt up
BAKU, Azerbaijan, May 27
By Tamilla Mammadova – Trend:
All loan agreements signed by Georgian government in 2019 have variable interest rates, which further increases the risk of fluctuations in the cost of servicing external debt, Trend reports via the annual report, presented by the Audit Service of Georgia.
The report says that in 2019, as a result of the growth of the public debt portfolio, the depreciation of the lari and the change in interest rates compared to 2018, the total cost of servicing and paying off the state debt increased by 386.6 million lari ($121.5 million) for both external and internal loans and amounted to 2.90 million lari ($911,485).
As reported, in 2019, as in previous years, the actual balance of public debt exceeded the original budget law by 836 million lari ($262.7 million).
As in 2018, the largest share of public debt servicing expenses in 2019 (57 percent) accounted for by servicing domestic debt, mainly due to 6-month, 12-month, and 2-year treasury obligations.
In 2019, the progress in 11 investment projects financed with external debt in the amount of 243 million lari ($76.3 million) was 0 percent. According to the report, there is some delay in the implementation of investment projects.
"In 2019, the utilization rate of 11 investment projects was zero, and of 27 projects it was less than 70 percent. As a result, out of the total tax liabilities paid during the year (4.8 million lari) within the framework of investment loans, 1.2 million lari ($377,166) was paid for 9 investment credits with less than 70 percent utilization,” the audit report reads.
According to the audit office, it is important for the project implementing agencies to ensure the timely and efficient use of the allocated loans.
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