EU ‘respects’ Georgian gov’t decision not to take EU loan, but notes Georgia may not have been eligible

The EU delegation to Georgia has responded to the Georgian government’s recent refusal to take the second tranche of the EU’s 150 million euro loan, stating that they ‘respect’ the decision, but noting that the country has been unable to completely fulfil preconditions that would have been needed to receive the second instalment.

At a briefing late yesterday, the EU embassy said that the Georgian government has not yet taken genuine steps to improve issues in the country’s judiciary, increase its accountability and quality.

Georgian Prime Minister Irakli Garibashvili stated yesterday that the reasons behind the refusal were the positive moves in the state economy and the government’s intention to gradually pay the country’s more than 20 billion USD foreign debt. 

• PM Garibashvili: 'We have decided not to take the second part of the EU loan, as we have started reducing foreign debt'

The Georgian NGOs have stated that the government’s refusal to take the loan amid the ‘severe epidemiological and economic situation’ in the country equalled the ‘deviation from the country’s Euro-Atlantic course’.

The opposition parties claimed that the EU would not have issued the loan at all because of the ruling Georgian Dream party’s withdrawal from the April 2021 EU-mediated agreement and that the Georgian government ‘just made the statement on the refusal to take the loan before the EU  announced its denial.’ 

???????? Preparing for an interview on #EU's €150 million assistance to #Georgia. Unfortunately @GovernmentGeo didn't fulfill conditions listed in #MoU for the second tranche (€75mill): judicial reform, etc. You can't decline what you were not eligible for. We stand with people of ???????? pic.twitter.com/kMEzTyKctH

— Viola von Cramon (@ViolavonCramon) August 31, 2021

The ruling Georgian Dream MP Archil Talakvadze says that “statements that the Georgian government is refusing to carry out some reforms through not-taking the EU-loan or it is the signal that the country is changing its course are absurd and speculations.’ 

• The EU-mediated agreement, which was signed by the ruling party and the majority of opposition parties back in April 2021, aimed to resolve a six-month political standoff in the country which began after the 2020 parliamentary elections. 
• Per the agreement the signatories took on responsibility to ensure large-scale electoral and judicial reforms in the country. 
• The ruling party withdrew from the agreement in July 2021 ‘because of the refusal of the main opposition party, the UNM, to join the agreement and consistent violation of the agreement by other opposition parties.’ 
• However, the GD vowed to implement all the reforms stipulated in the agreement. 
• The initiator of the agreement, European Council President Charles Michel, met with Georgian PM Garibashvili earlier this month, at which time he stated that the ‘deadline for the disbursement of macro financial assistance is looming and it is time for the Georgian government to demonstrate its commitment to the agreements and notably the reform agenda.’ 
• Garibashvili responded that the Georgian government remained committed to the agreement and that a big portion of the reforms have already been carried out.