Agriculture Minister: ‘gov't will subsidise increase in food prices again if necessary’
In spring of this year the government of Georgia subsidised nine food products and allocated 10 million GEL from the budget for this reason. Photo: Nino Alavidze/Agenda.ge.
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Georgian Agriculture Minister Levan Davitashvili says that if necessary the government will subsidise the increase in food prices again.
If we see a critical need, we may need to intervene to balance these market processes...Let's see how the lari exchange rate goes, the external factor is also very big, which is related not only to economic but also political factors. We must act according to the situation. I think the state will respond with full responsibility to protect the interests of the population", Davitashvili said.
In spring of this year the government of Georgia subsidised nine food products and allocated 10 million GEL from the budget for this reason. The products subsidised were: rice, pasta, sunflower oil, flour, sugar, wheat, buckwheat, beans, milk powder and its derivatives.
The latest inflation data from the National Statistics Office of Georgia (Geostat) shows that in August 2020 the prices of food and non-alcoholic beverages have decreased in Georgia month-on-month by 0.5 per cent. As for annual inflation, prices increased in the group of food and non-alcoholic beverages (+9.2 per cent), alcoholic beverages and tobacco (+8.9 per cent).
Meanwhile, the lari (GEL) has been continuing to lose value against the US dollar and as the National Bank of Georgia explains the reason is an increased number of new coronavirus cases in Georgia and the upcoming parliamentary elections.
As of today, 1 USD costs 3.3203 GEL, while 1 EUR costs 3.8708 GEL.
Georgian Agriculture Ministry will spend 16 million GEL ($4.86 mln/€4.42 mln) to make sugar, oil and pasta stocks in the country due to the coronavirus outbreak.The ministry will buy 5,000 tonnes of sugar, 500 tonnes of pasta and 1.5 tonnes of sunflower oil.
A price restraint mechanism is ready and has been agreed upon between business and the government. Specifically, prices for nine products will not increase in Georgia, said the Prime Minister’s Spokesperson Irakli Chikovani earlier today.
The National Bank of Georgia (NBG) sold $40 million during its foreign exchange auction today. The average weighted bid rate was 3.2641. The NBG Head Koba Gvenetadze said last week that the central bank will sell more than $200 million by the end of this year.
Georgian Prime Minister Giorgi Gakharia announced today that 42,000 farmers will be exempt from paying irrigation taxes in 2020.
A state subsidy will increase from 10 to 15 GEL per 50 kilograms of wheat flour in Georgia in order to avoid an increase in bread prices during the coronavirus pandemic in the country.