Privatisation of Government buildings will help stabilise Lari
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The Georgian Government is offering short-term, mid-term and long term plans as possible ways to stop the national currency depreciating any further against the greenback.
One idea – to privatise Government buildings – would bring about $300-350 million USD into the Georgian economy.
The country’s Economy Minister, Giorgi Kvirikashvili, and Finance Minister, Nodar Khaduri, met representatives of Georgia’s business community at Tbilisi Marriott Hotel today and discussed the Government’s plans to stabilise the falling Lari.
The Ministers said the Government’s plans would be introduced in the near future.
"The short-term plan is about speeding up privatisation. The same plan includes raising the awareness of Georgia and attracting more tourists. The Ministry of Economy is working in this direction,” Khaduri said.
"As for the Ministry of Finance, we need to look at the budget. Costs which were allocated for implementing infrastructural and investment projects will not be reduced,” he added.
Georgia’s Economy Minister presented the list of assets that will be sold and privatised. He said some businessmen at today’s presentation had already expressed interests towards the assets.
"Privatisation of several assets is a real investment in the country. This way we expect to mobilise about $300-350 million USD. Besides, we will make significant steps in order to improve the legislation for the business society and attract more investments in the country,” Kvirikashvili said.
The list of assets to be privatised includes:
- Historical building of the National Bank of Georgia,
- Ministry of Economy building,
- Former Bobokvati presidential residence in Adjara at the Black Sea shore,
- Tskneti Governmental residential buildings at the prestigious resort near Tbilisi,
- Thermal power plant,
- National Lottery Company.
The building of the Ministry of Economy may be transformed into hotel.
Meanwhile, NBG president Giorgi Kadagidze announced the country’s imports would soon be affected by the depreciation of the Lari.
"The GEL has depreciated by 30 per cent [against the USD]. But it has not fully influenced the import rate yet. However, this will inevitably happen and it means that import volumes will decrease,” Kadagidze says.
The demand for foreign currency will also go down due to import reduction, he said.
He also stressed the necessity for Georgia’s national currency to become stable as soon as possible.
On another note, Kvirikashvili said the Georgian economy will grow by two percent instead of five in 2015.
As of today the official NBG exchange rate saw $1 US dollar at 2.2619 GEL.
Meanwhile the price of $1 US dollar was teetering between 2.34 and 2.38 GEL in Tbilisi’s exchange booths. Today there were not any fluctuations and the exchange rate remained unchanged.
According to exchange booth employees, the demand for GEL and the US dollar was almost equal. They said locals were "actively buying dollars” as the month comes to an end and they have to pay taxes.
The Government of Georgia is pledging to do everything it can to avoid price increases on the cost of goods and services due to the ongoing depreciation of the national currency.
Georgia’s Government will have to "tighten its belts” as the country’s national currency, the Lari, continues to fall, Prime Minister says.
"We are dealing with a currency crisis not an economic crisis” says Georgia Minister of Finance Nodar Khaduri.
Consultations between the Georgian Government and the business society are continuing as the authorities take action to curb possible negative effects of the depreciating value of the Lari against the US dollar.
Georgia’s Economy Minister Giorgi Kvirikashvili has some ambitious ways to help the country break free from current economic crisis.
An international hotel chain will open its doors in Georgia’s capital city and offer luxury service that can cater for hundreds of guests.
Investors are invited to go online and bid for a central city building that is currently being used by Georgia’s Ministry of Economy.
The building of the Georgia’s Ministry of Economy and Sustainable Development has been sold for just under $9.5 million USD.
The Ministry of Economy will offer 100 state-owned buildings to investors for privatisation this month, said Georgian Economy Minister Natia Turnava earlier today.