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IMF: The Government of Georgia and the Central Bank should Cooperate

The government of Georgia and the central bank should cooperate – Mark Griffiths, head of the IMF mission, said at a press conference

“Amid solid economic foundation, reform-minded government and the EU Association Agreement, Georgia has good preconditions to overcome the current challenges”- Mark Griffiths said.

Praising government for keeping the budget deficit to 3% of GDP in 2014, well below IMF’s ongoing program target with Georgia, the mission also said that for 2015 the government will need to take measures to keep the budget deficit “under control” as lower than initially forecasted economic growth will result in less than projected tax revenues in the budget. “The government has appropriately taken steps in this direction, including by limiting employee bonuses and by taking efforts to contain administrative spending,”–  Mark Griffiths said.

In addition, he recommended the government to  carry out these  decisions and make changes  to the budget, which implies an increase in taxes and a reduction of expenditure in order to limit the budget deficit.

The head of the mission said that spending on the social safety programs should be maintained and “targeting improved to protect the vulnerable and the poor.