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    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 18,184
 2011 2012 2013 2014 2015 2016 2017 2018
 Gross external debt (% GDP)
81.2 84.6 83.2 84.7 109.4 110.7 114.8 109.7
 source: CEIC, World Bank
       The gross external debt of Georgia amounted to $18.2bn as of second quarter of 2019, rising from 17.8bn in the previous quarter. 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.
 7.0​ FX
  Georgia - Foreign exchange rate
 2013
  2014
   2015
  2016
   2017
  2018
   Mar’19
 Jun’19
   Sep’19
   Currency (units per EUR) (average)
    2.209
2.346
    2.520
2.617
    2.832
3.054
 3.037
    3.132
 3.266
 Currency (units per USD) (average)
  1.663
  1.766
   2.270
  2.367
   2.509
  2.675
   2.684
  2.777
   2.965
       Georgia’s central bank sells $40mn to forestall weakening of lari
   Georgia’s central bank has sold $40mn on the foreign exchange market to smooth exchange rate volatility. It sold $38mn with the same objective in early August.
Central bank representatives said that the intervention was intended to enhance the impact of tightened monetary policy, explaining that the reasons behind such decision were inflation expectations stemming from the depreciation of the Georgian lari (GEL).
The monetary board of the central bank summoned an extraordinary meeting on September 25 to hike the refinancing rate for the second time in September. It was raised by 50bp to 7.5%.
Since the previous board meeting, held on September 4, the nominal effective exchange rate of the GEL has remained undervalued, while inflationary
 33​ GEORGIA Country Report​ November 2019 ​ ​www.intellinews.com
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