Georgia records decrease in budget deficit

Business Materials 14 September 2021 07:45 (UTC +04:00)
Georgia records decrease in budget deficit

BAKU, Azerbaijan, Sept.14

By Tamilla Mammadova – Trend:

The government debt of Georgia amounted to 29.6 billion lari ($9.5 billion) as of June 30, 2021, which is about 55 percent of the country's GDP for the last year, Trend reports via Transparency International Georgia (TI).

In the first six months of 2021, the government borrowed 3.5 billion lari ($1.1 billion) but repaid 2.2 billion lari ($708.6 million) in the same period;

In the first half of 2021, 921 million lari was allocated for new programs related to COVID-19, but in fact, 822 million lari ($264.7 million) was spent. Some 425 million lari ($136.9 million) was spent on healthcare, including 96 million lari ($0.9 million) on the purchase of vaccines.

Up to 350 million lari ($112.7 million) was spent on social assistance; the largest amount – 142 million lari ($45.7 million) was spent on compensation for the temporarily unemployed, and 105 million lari ($33.8 million) was spent on subsidies for utility bills.

Among all categories of Budget Expenses, Social Security had the highest fulfillment rate - 99.7 percent. These expenses also include healthcare costs, the programs of which were performed at a high rate.

According to TI, although the amendments to the 2021 state budget have reduced the budget deficit from 7.7 percent to 6.9 percent of GDP, the deficit remains very high and the government must make savings on unnecessary spending by the end of the year. Reducing the deficit will have a positive effect on macroeconomic stability, decrease price levels, and negative pressure on the lari exchange rate.


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