Gov't announces 3.5 bln GEL anti-crisis plan
PM Gakharia pointed out that this amount does not cover the post-crisis economic recovery period. Photo: Gakharia/Facebook.
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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 3.5 billion GEL 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.
He pointed out that this amount does not cover the post-crisis economic recovery period.
The crisis management had a number of major challenges, including the rapid spread of the pandemic, which means taking care of the lives and health of citizens and then saving the economy. These are two fronts. We all understand that winning on any of these fronts alone makes no sense for the long-term development of the country. We are in a situation where we have to understand that we have to win in both directions", said Gakharia.
Support for people who have lost their jobs:
People who lost their jobs because of the coronavirus crisis or are on unpaid leave will receive 1,200 GEL (about $376.77/€349.37) over the course of six months, which is 200 GEL (about $62.79/€58.23) per month. This assistance will apply to 350,000 citizens of Georgia. A total of 460 million GEL (about $144.43m/€133.92m) is allocated from the budget.
Employer will receive a state subsidy for each maintained job:
- Over the course of six months, salaries up to 750 GEL (about $235.48/€218.35) will be fully exempt from income tax - the budget for which is 250 million GEL (about $78.49m/€72.78m).
- People employed in the informal sector or the self-employed will receive a one-time assistance of 300 GEL (about $94.19/€87.34) if they can substantiate claims of job loss – the budget for this is 75 million GEL (about $23.55m/€21.84m).
In six months, 600 GEL (about $188.38/€174.68) in assistance will be given to:
- Families with a rating score of 65,000 - 100,000. This will benefit about 70,000 families and 45 million GEL (about $14.13m/€13.10m) is allocated for it.
- Families with a rating score of 0 - 100,000 and have three and more children under the age 16. This will benefit about 21,000 families. The budget for this assistance is 13 million GEL (about $4.08m/€3.78m).
- Persons with severe disabilities and children with disabilities. About 40,000 citizens will benefit and 25 million GEL (about $7.85m/€7.28m) will be spent on this assistance.
Introduce the rule of indexation of pensions from January 2021:
- The annual increase in pensions will be higher than inflation
- Pension increase will not be less than 20 GEL, and for pensioners aged 70 and above less than 25 GEL
- Decision to increase pension by 30 GEL for retirees aged 70 and above from July 1 remains in force
- About 410,000 pensioners will benefit from this initiative
Financial assistance will be transferred from May, said Gakharia.
First phase of the anti-crisis plan
This is the second phase of the government’s anti-crisis plan; in the first, several measures were taken to ease the burden caused by the coronavirus crisis.
- Gov’t presents coronavirus anti-crisis plan for Georgian business: What support can business expect?
The measures taken by the government during the first phase included:
- Covering utility fees, including sanitary service, gas and water bills for three months (March, April, May) for households which consume less than 200 kWh of electricity and 200 cubic meters of natural gas per month. The electricity concession applied to 1.2 million households, while the natural gas concession applied to 671,000 families.
- Subsidies for nine food products were introduced to prevent price inflation, while banks allowed loan deferments for a period of three months.
- The government waived property and income tax for four months for 4,500 businesses in the tourism sector, and 10 million GEL was spent to co-finance the loans of 850 small hotels.
Click to see Government's anti-crisis economy plan in details.
This report focuses on the social assistance portion of the anti-crisis plan – Agenda.ge will shortly release a separate report on how the Georgian government intends to support businesses.
What support can business expect?
The government of Georgia has presented an anti-crisis plan for Georgian businesses in order to ease the burden caused by the coronavirus crisis. The government responded to the demand of the hotels, restaurants, tourist agencies and tour operators in Georgia and decided to postpone payment of property and income tax by four months.
The impact of the coronavirus is rippling through the Georgian economy, but it might take a few months to fully see the fallout in data that track economic performance in Georgia.
The government of Georgia will unveil an anti-crisis economic recovery plan on April 24, 2020, which will include measures for targeted social and business support.
The European Union, Asian Development Bank, the European Bank for Reconstruction and Development, European Investment Bank, German Development Fund, French Development Agency will support the Georgian economy with $1.5 billion by the end of 2020, announced Georgian Prime Minister Giorgi Gakharia today.
Georgia has reported a sixth coronavirus-related death today. Director of the First University Clinic Levan Ratiani said the 83-year-old man who died this morning had several underlying diseases. Meanwhile, 29 more people have tested positive for COVID-19 in Georgia since yesterday, increasing the total number of cases to 485.
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.
A number of opposition parties have slammed the Georgian government’s recently announced anti-crisis plan aimed to counter the coronavirus pandemic. On Friday, Georgian government introduced a plan to gradually open the economy step-by-step over the next three months. The plan includes supporting business owners, commercial banks, agriculture and economic of the country during the crisis.
Georgian Prime Minister Giorgi Gakharia announced earlier today how the government intends to help businesses and agriculture during the COVID-19 crisis.
The United States Agency for International Development (USAID) is helping the government of Georgia develop a post-coronavirus recovery plan that focuses on increased employment opportunities, announces the United States Embassy in Georgia.
3 possible scenarios from PMCG
PMCG Research has developed three possible scenarios for the development of the coronavirus crisis in Georgia, each of which correspond to different periods of time for which containment measures remain in place.
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.
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.
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 will compensate people who lost their jobs while on leave due to pregnancy, childbirth, childcare or adoption of a child amid the coronavirus crisis.
How does the gov’t plan to support the construction sector?
The Prime Minister of Georgia Giorgi Gakharia has presented a fourth anti-crisis plan today worth 434 million GEL aimed at supporting the construction and development sector of Georgia. He said that the construction and development sector was one of the fastest growing sectors which employed 120,000 people in 2019.
The Georgian government is working with experts from the University of Cambridge and the University of London as well as Deloitte analysts and local experts to create a post-crisis economic plan and decide what steps they should take in order to improve the Georgian economy after the coronavirus lockdown.
One-fifth (20.5% = 762,621) of the Georgian population, who are of retirement age, are at high or moderate risk in terms of the new coronavirus pandemic, reads the Georgian government’s report about the measures taken against the Covid-19.
Georgian Prime Minister Giorgi Gakharia has presented the anti-crisis budget for 2020 at the Inter-Agency Coordination Council today in response to the before sending it to the Parliament of Georgia later today. "The reason and purpose of our meeting today is the anti-crisis budget for 2020. We all understand very well that the epidemic has pushed the country back economically. Today the budget will be presented to parliament and you are all here to discuss it and change our opinions", Gakharia said.
The government of Georgia will take a new loan worth 4.47 billion GEL to handle the crisis caused by the coronavirus pandemic, according to the anti-crisis budget for 2020 presented today.
The 2020 budget will decrease financing of the president’s administration, the gov’t administration and the parliament amid the coronavirus pandemic.
As of now about 132,000 self-employed people have registered in total to receive one-time assistance of 300 GEL from the government of Georgia in light of the coronavirus pandemic.
The number of people who will receive 1,200 GEL in state support due to having experienced a loss of income during the coronavirus pandemic has increased, says the Revenue Service.
The Georgian parliament has approved the anti-crisis budget, which reflects additional necessary expenditures of 3.4 billion GEL needed to combat the coronavirus and treat patients, the Georgian Ministry of Finance announces.
International economists delivered a presentation on the global pandemic and its aftermath on the economy to the Georgian government today, saying the steps taken by the Georgian government to improve the business environment and increase investment attractiveness are 'right and important', announces the government of Georgia.
What support can Georgian citizens expect?
The government of Georgia has announced the third phase of its anti-crisis plan in order to ease the burden caused by the coronavirus crisis.
Families will receive one-time assistance of 200 GEL per child from the state, announces Georgian Prime Minister Giorgi Gakharia.
The government of Georgia's financial assistance significantly has contributed to poverty alleviation, says a microsimulation model report on the pandemic’s effect on the population and child poverty presented by UNICEF and the Georgian government today.
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 Georgian government has announced a 100 million GEL ($32.46 mln/€27.48 mln) tender to ensure the completion of unfinished construction projects. The government will then sign a sale option agreement with the winners of the tender and purchase not more than 30 per cent of the total living space of each building.
The Georgian government will continue subsidising pre-existing bank loans for companies in the hotel industry over the next six months, said PM Giorgi Gakharia earlier today.
Georgian Economy Minister Natia Turnava says that the increased rate of foreign direct investment in the second quarter of 2020 proves that despite the pandemic the Georgian economy is gradually recovering.
About 100,000 people have lost their source of income in Georgia during the coronavirus pandemic, said Deputy Finance Minister Giorgi Kakauridze earlier today.
The Georgian Foundation for Strategic and International Studies (Rondeli Foundation) conducted a study titled ‘Impact of Anti-pandemic Restrictions and Government Anti-crisis Measures on Employment, Incomes and the Poverty Level in Georgia’ during the Covid-19 pandemic and has now released its report.
The State Audit Office will study the effectiveness and compliance with the law of the anti-crisis plan of the government implemented during the Covid-19 pandemic.