EU allocates macro-financial assistance to Georgia to tackle COVID-19

Finance Materials 25 November 2020 19:02 (UTC +04:00)
EU allocates macro-financial assistance to Georgia to tackle COVID-19

BAKU, Azerbaijan, Nov. 25

By Tamilla Mammadova – Trend:

The European Union (EU) disbursed 100 million euros under its macro-financial assistance (MFA) programs to Georgia, helping its balance of payments and alleviating its budgetary financing needs, Trend reports via the Delegation of the European Union to Georgia.

This support is composed of 75 million euros from a new MFA program announced in April 2020 and aimed at limiting the economic fallout of the coronavirus pandemic. The other 25 million euros come as last disbursement of a previous MFA approved in April 2018. Of the total, 95 million are provided in the form of loans at favorable rates, while the remaining 5 million euros are provided as non-reimbursable grant.

The disbursement of 75 million euros from the COVID-19 MFA program follows the EU’s agreement with the Government of Georgia to conduct reforms in the areas of public finance management, governance (notably to increase the independence, accountability and quality of the judicial system), energy sector and labour market policies.

If these agreed reforms are achieved by the government, a further 75 million euros could be disbursed under this MFA program early 2021.

The second part of the disbursement of 25 million euros comes from the MFA program agreed in April 2018, and is composed of 20 million euros of loans and a grant of 5 million euros. The policy conditions agreed and fulfilled for this second tranche enabled reforms on public finance management, financial sector, social and labor market policies and business environment.


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