IMF explains the slowdown in the economy of Georgia in 2013 by political factors

Slowdown in the economy of Georgia in 2013 was caused by political uncertainty, reduced government spending and reduced  growth in the leading economies of the region – says the representative of the International Monetary Fund in Georgia Azim Sadykov.

According to him, 2013 was a transition period and its  calm and democratic completion was the greatest achievement in this period as well as the  initialing of the Association Agreement with the EU.

Sadykov notes that in 2013 the economy grew by 2,5-3 %. In his words, during the year the IMF revised its forecasts for Georgia several times.

"Economics is not an exact science. Often there are processes that cannot be predicted in advance. Sometimes the best and most optimal forecast is made based on available information , but things could change tomorrow and you have to revise the forecast. The same happened now. Our initial forecast for economic growth was much higher than 2,5-3 %. It happened because we assumed a more speedy conclusion to a period of political uncertainty" the representative of the IMF notes.

 Azim Sadykov called budget for 2014 a continuation of socially oriented policy.

"Social spending increased by 20 % , although the government did not take on additional responsibilities. Such a sharp increase in costs is due to the fact that now, unlike in 2013, the government t expects fulfillment of social obligations for the entire year. For example, in 2013 a program of universal health care began in July, and now will operate all year round. The same situation is with pensions, which were increased only in September 2013. In general, we support the growth of social spending. We recommend that the increase in social obligations was as maximally target, since it would make more efficient use of the limited funds that are in the budget of the country" Sadykov adds.

Adapted from