Page 29 - GEORptAug19

Akaki Zoidze, head of the parliament’s health committee and a lawmaker of the ruling Georgian Dream party, played down the impact of the smuggling, saying that the illegal market covered less than 1% of total sales.
"In the regional context we see that the excise taxes in Armenia, Russia and Azerbaijan are radically low. The difference is more than one dollar [per package]. This fact is quite a great temptation for people engaged in illegal trade. Accordingly, the share of illegal trade may increase. This process has already begun in recent years. Illegal trade and consumption on the lower-end products have reflected in our sales,” he said.
Zoidze added that consumers were obtaining raw tobacco, which is seven to eight times cheaper than imported cigarettes, but was not subject to quality checks. Smuggling and use of raw tobacco would significantly affect the government’s budget, the lawmaker noted.
Cigarette prices increased by an average of 50 tetri ($0.19/€0.16) in Georgia following amendments to the tax code that came into play on January 1.
Meanwhile, privatisation plans for Georgia Post was undergoing preliminary procedures, Economy Minister Natia Turnava said on June 19. In response to a reporter’s question as to whether national railway company Georgian Railway will be privatised, she said the government has no such plans.
6.2 Debt
Georgia - Gross external debt
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
Gross external debt ($ mn)
16,042 16,660 16,881 17,250 17,759 17,416 17,225 17,818 17,828
2011 2012 2013 2014 2015 2016 2017 2018
Gross external debt (% GDP)
81.1 84.6 83.2 84.6 109.0 110.4 114.4 109.6
source: CEIC, World Bank
The gross external debt of Georgia amounted to $17.8bn as of end-December 2018, rising from 17.2bn in the third quarter of 2018. External debt averaged $11,420.4mn from 2007-2017, according to the National Bank of Georgia. It accounted for 109.6% of GDP. Gross external debt include both public sector (general government, public corporations and national bank) and private sector (banking and other sectors) external debt.
Georgia’s government debt is expected to inflate to 3.5% of GDP in 2017-2019, in part due to the depreciation of the Georgian lari and the high level of dollarisation of Georgia's external debt. External government debt is expected to peak at 43% of GDP in 2018.
The country's high current account deficit, which reached 13% of GDP at end-2016, is one of the important sources of external debt.
29 GEORGIA Country Report August 2019 www.intellinews.com