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Bidzina Ivanishvili Lays Blame for Currency Crisis on NBG President

According to Georgia’s former PM  Bidzina Ivanishvili, the nation-wide monetary crisis was brought about by the mistakes and inactivity of Giorgi Kadagidze, President  of the National Bank who was appointed by the National Movement party.

As Ivanishvili remarks in his special statement, the recent developments confirm that the country is facing false expectations, speculations and unrest cause by the National Movement members and experts blaming the government, while the country’s monetary policy is determined by the National Bank.

Ivanishvili claims that it was the National Bank’ obligation to manage the situation and avoid negative developments; he also claims that Giorgi Kadagidze’s inactivity and mistakes caused the current crisis.
“The central banks of other countries spent a significant part of their reserves in order to avoid sharp fluctuations in the exchange rate (Armenia – 34%, Moldova – 30%) and their currencies are stable today. As for Georgia’s National Bank, it has spent only 5% of its reserves (120 million GEL), which turned out to be a completely futile action.

Since autumn of 2014, events have developed in accordance with the external factors characteristic of the rest of the countries in the region,“- Ivanishvili said.

According to him, the dollar exchange rate, which has increased against almost all currencies, including the euro, and difficult economical-political situation in the region have significantly influenced the exchange rate.

“From my point of view and according to the position of international financial organizations, there is a floating exchange rate in Georgia, which represents the most optimal option for its economy. Correspondingly, the exchange rate fluctuated; devaluation was followed by growth and so on. The GEL changeability corresponded to the flexibility parameters of more stable currencies and it was a healthy reaction to the changes in external economic circumstances.

The government of Georgia, aiming to reduce the negative influence of external factors, cut the budget deficit from 3.9% to 2.9% in 2014 (300 million GEL). The GEL exchange rate actually stabilized at the end of 2014 and in January 2015”- said Ivanishvili.
InterPressNews was provided with the statement by Society 20/30.