How the gov't plans to help businesses reopen after coronavirus subsides
Georgian Economy Minister Natia Turnava held a presentation today on how the government is planning to help local businesses. Photo: Ministry of Economy.
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Georgian Economy Minister Natia Turnava held a presentation today on how the government is planning to help local businesses and especially small and medium-sized businesses reopen and overcome economic difficulties caused by the coronavirus pandemic.
Her announcement comes one week after Georgian Prime Minister Giorgi Gakharia presented a plan to gradually open the economy over the next three months, outlining six phases designed to slowly get businesses up and running again.
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Turnava said that as part of the anti-crisis plan, programmes designed for small and medium-sized businesses will be extended.
The following programmes will be extended:
Credit and Leasing Subsidy Programme - the co-financing of subsidising of credit and leasing components will be extended for one year and will equal 36 months (three years) instead of 24 (two years).
Co-financing will be increased by three per cent. The limit will be decreased from 150,000 GEL to 40,000 GEL. The types of activities eligible for co-financing will be increased from 104 to 211. About 300 small and medium-size businesses will be able to use this programme.
Credit Guarantee Programme - the budget of the credit guarantee programme is increasing from 20 million GEL to 300 million GEL and will enable small and medium-sized business to have access to 2.1 billion GEL loan from the commercial banks operating in Georgia.
The state will co-finance 90 per cent of the principal amount of the loan while earlier it was 70 per cent. Before the state was subsidising only new loans while now the existing loans also will be subsidised. The upper limit of the amount of the loan will be increased from 2 million GEL to 5 million GEL. The programme will benefit small companies which annual turnover does not exceed over 20 million GEL.
Micro Grants Programme - the budget of this programme is also increasing and will total 40 million GEL instead of 10 million GEL.
Turnava said that "according to the most conservative forecasts, this year will end at least with -4 per cent growth". However, she said that in 2021 the Georgian economy will likely grow by 4 per cent.
Turnava also spoke about post-crisis plan and outlined several points:
- Development of local manufacturing
- Persuading international businesses to relocate their manufacturing activities to Georgia
- Creating an anti-crisis plan for the tourism industry
Turnava said that the government will also present a post-crisis plan soon.
Click to see Government's anti-crisis economy plan in details.
The Georgian Ministry of Economy is working on renewing a credit guarantee programme that came into force in April 2019 and aims to support small and medium sized businesses which operate in sectors where loan issuance is restricted, or do not have enough property to secure a loan.
The Georgian government has presented a plan to gradually open the economy step-by-step over the next three months. Georgian Prime Minister Giorgi Gakharia said that restrictions on economic activity will begin being lifted starting April 27 and if the coronavirus situation does not worsen in the country in three months Georgian the economy will be fully reopened.
Georgian Prime Minister Giorgi Gakharia announced earlier today how the government intends to help businesses and agriculture during the COVID-19 crisis.
Georgia will spend 3.5 billion (about $1.10b/€1.02b) on its coronavirus anti-crisis plan, Georgian Prime Minister Giorgi Gakharia announced earlier today. "For now, the country will spend GEL 3.5 billion on managing the crisis, of which 1.035 billion GEL will be directed at social support of citizens, 2.11 billion GEL will be directed at the economy and entrepreneurs, while 350 million GEL will be spent on the health care of each citizen", Gakharia said.
Georgia reported 16 new cases of coronavirus increasing the total number of cases to 582 today. A total of 207 people have recovered since February 26 when the country confirmed the first case of the COVID-19. However, two more coronavirus-related mortalities have increased the number of deaths to eight.
Some Japanese, South Korean and German companies have expressed their desire to transfer part of their businesses to Georgia, Economy Minister Natia Turnava has recently stated. Minister Turnava considers that by doing so, global companies would gain a comparative advantage.
Head of the government administration Natia Mezvrishvili said some coronavirus-related restrictions imposed in Georgia may be eased earlier than planned, if the virus is contained. Moreover, the government will be discussing the issue of reopening Tbilisi, Rustavi, Kutaisi and Batumi next week, which have been on lockdown since April 15.
The government of Georgia is working to develop a strategic plan for the revival of the tourism sector: the worst affected of all the country’s major economic sectors by the coronavirus pandemic in Georgia. The goal is to make Georgia one of the first countries able to open its doors to foreign tourists after months of lockdown due to the coronavirus pandemic.
In May several coronavirus-related restrictions will be resumed in Georgia, announced Georgian Prime Minister Giorgi Gakharia today. The plan includes resuming all manufacturing, several categories of retail and wholesale stores and opening the capital city of Tbilisi and smaller towns of Rustavi, Gardabani and Marneuli.
Georgian Prime Minister Giorgi Gakharia considers that Georgia can use the very conditions created by the coronavirus crisis to help in the process of economic recovery.
Farmers which have land plots between 0.25 to 10 hectares will receive 200 GEL for each hectare, said Minister of Agriculture Levan Davitashvili earlier today.
Georgia needs industrialisation of agricultural sector and increased productivity, Prime Minister Giorgi Gakharia said earlier today at a presentation of the government’s agricultural anti-crisis plan.
Farmers which have agricultural registered land from 0.25 to 100 hectares will receive 150 liters of diesel per each hectare 1 GEL cheaper than the market price, said Georgian Prime Minister Giorgi Gakharia earlier today.
Georgia has five new cases of COVID-19 and 14 recoveries including two in the Black Sea region of Adjara, turning the region into a coronavirus-free zone again. Head of the Adjara region government Tornike Rizhvadze announced earlier today that no new cases of the virus have been reported in the region since April 30.
The government of Georgia is announcing amendments to the state programme of 'Produce in Georgia' and a credit guarantee programme to further help local companies start new businesses or develop already existing ones.
A Chinese company is relocating its plastic recycling plant to the Georgian municipality of Khobi within the '100 Investment Offers to Business' programme, announces the Georgian Ministry of Economy.
The United States Agency for International Development (USAID) has met media representatives earlier today to discuss economic development since the COVID-19 pandemic and the steps made by the government to support the economy.
The USAID will increase support for manufacturing, e-commerce, information and communications technology (ICT), and other innovative sectors, said Georgian Economy Minister Natia Turnava earlier today after meeting USAID Georgia Mission Director Peter Wiebler.
About 500 artists in the electronic and club music industry will receive financial assistance from Tbilisi City Hall, which has allocated 2 million GEL in order to help industry players overcome the Covid-19 crisis.
The government of Georgia will help companies that bought or leased state property through auctions and later suffered during the pandemic, announces Georgian Economy Minister Natia Turnava.
In order to overcome challenges caused by the coronavirus pandemic, Georgian Finance Minister Lasha Khutsishvili has introduced new tax initiatives today.