Page 33 - GEORptMay20

Citigroup interested in financing Georgia’s public debt
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.
American investment bank Citigroup is interested in investing in financial markets development in Georgia and is willing to buy a volume of the securities issued by the country’s treasury, the bank’s vice chairman Jay Collins said at a meeting with Georgian Prime Minister Giorgi Gakharia at the World Economic Forum in Davos.
Citigroup would discuss with the Georgian government engagement in the process of budget expenditure digitisation using modern accounting and payment systems and share its experience in the field, according to a government release.
The bank also expressed its willingness to participate in refinancing the government's EUR-denominated securities, amounting to €500mn, in 2021.
“There was a great conversation with the Prime Minister of Georgia. We talked about economics and technologies, specifically the technologies used in the government sector for efficiency and effectiveness. We discussed investments and ways in which Georgia could attract more capital investment. We also talked about the financing strategy and the financing of processes in the global markets. Overall it was a brilliant meeting. It makes us happy about everything that is happening in Georgia,” said Citigroup’s Collins after meeting Gakharia.
7.0​ FX
Georgia - Foreign exchange rate
2016
2017
2018
Mar’19
Jun’19
Sep’19
Dec’19
Mar’20
Currency (units per EUR) (average)
2.617
2.832
3.054
3.037
3.132
3.266
3.227
3.360
Currency (units per USD) (average)
2.367
2.509
2.675
2.684
2.777
2.965
2.905
3.041
Georgia’s central bank, EBRD open swap line for mutual support
The European Bank for Reconstruction and Development (EBRD) and Georgia’s central bank (National Bank of Georgia, or NBG) have set up a US dollar-Georgian lari (GEL) foreign exchange (FX) swap facility, enabling the former to secure reliable access to GEL liquidity and continue lending in local currency to companies that are experiencing temporary difficulties.
The parties executed the first transaction on 24 April.
The foreign exchange swap line will support the management of NBG’s FX reserves with additional USD liquidity, which the central bank can draw on when need be.
The NBG made its latest intervention on the foreign exchange market on April 27 by selling $20mn to smooth exchange rate volatility.
33​ GEORGIA Country Report ​May 2020 ​​www.intellinews.com