Georgian PM highlights National Bank, Govt’s efforts in keeping inflation below target level despite shocks

Georgian Prime Minister Irakli Kobakhidze on Friday said the country had managed to keep inflation below the target level over the past 19 months “despite the global inflationary shocks amid challenges such as COVID-19 pandemic and ongoing war in Ukraine”.

Speaking at an event dedicated to Banker's Day, Kobakhidze praised "joint efforts" of National Bank of Georgia and commercial banks which have contributed in creation of the country's banking sector as "truly exemplary in the region”, while also emphasising the “very important role” in the effective collaboration between the central bank and the Government.

We have a correct economic, effective monetary policy and as a result of all this, we have a healthy macroeconomic environment in our country. In the last four years, we have achieved very high economic growth, we are in first place in Europe in terms of economic growth”, he said.

Over the past three years, the average growth has been 9.7 percent, and this year we have a very high rate. Of course, the banking sector and the activities of the National Bank have a special role. Stability of prices in the country, stability of the exchange rate of national currency, low current account deficit is also ensured”, he added.

The head of the Government also pointed out Georgia represented the first country in the wider region to submit an application to join the Single Euro Payments Area, a payment integration initiative of the European Union for simplification of bank transfers denominated in euros.

The PM emphasised  the financial sector’s adherence to international sanctions, imposed on Russia for its invasion of Ukraine, stating both the central bank and the broader financial system had complied with the sanctions regime, following extensive monitoring, proving the country had a “proper attitude towards this issue from all points of view”.

The regulations and supervisory framework of the National Bank are fully in line with advanced international practice”, he said.

The PM also honoured prominent 19th century public figure Ilia Chavchavadze on birthday anniversary, who co-founded the first Georgian bank together with Dimitri Kipiani, a Georgian statesman, publicist, writer and translator.

Kobakhidze thanked financial professionals for their contributions, stressing the “importance of their work in benefiting the country's economic progress”.