BAKU, Azerbaijan, June 2
By Tamilla Mammadova - Trend:
The debt of the Georgian government in 2020 will reach 58 percent of GDP, of which 46.2 percent will be external debt, and 11.8 percent - domestic debt, Trend reports citing the annual report of Georgian parliament.
The document explains that this indicator is low compared to the level of public debt, which is defined by the Act on Economic Freedom at 60 percent of GDP.
"Nevertheless, maintaining this indicator in the medium term is fraught with significant risks, and a consolidation policy must be pursued in subsequent years," the report said.
According to the document, in 2021-2024, a sequential reduction in public debt and a decrease in this indicator to 54.5 percent by 2024 are planned.
As reported, revenues to the budget of 2020 will be reduced, in total, to 1.8 billion lari ($56.8 million). The government reduces administrative and capital expenses to 600 million lari ($189.5 million). The document says that premiums in the 2020 budget will not be taken into account.
“Administrative, representation and travel expenses will be reduced as much as possible. In addition to specialized institutions, fuel costs are significantly reduced," the report says.
Together with administrative expenses in terms of current expenses, all programs the delay in the implementation of which will not cause serious damage to the relevant sector will be reduced. Meanwhile, planned cultural, sporting and tourism activities will be limited in line with restrictions imposed due to the pandemic.
"In terms of capital projects, the reduction will mainly affect the tourism infrastructure, as well as those projects in which the share of imports is especially high,” the report said.
According to the document, in 2019, GDP growth amounted to 5.1 percent. Due to the crisis caused by COVID-19, it is expected that in 2020 the economy will shrink by 4 percent. However, it is predicted that in subsequent years this figure will again begin to grow.
“By 2024, nominal GDP will increase to 70.4 billion lari ($22.2 billion), and GDP per capita will increase by 5,500 lari ($1,737.19) and will amount to 18,917 lari ($5,974.99),” the document says.
---
Follow the author on Twitter: @Mila61979356