Between February 29 - March 7 2008, the mission of the International Monetary Fund (IMF) visited Georgia. The mission evaluated the economic situation in Georgia and the prospects for 2008. The members of the mission had meetings with Georgian authorities as well as representatives of the private sector.
The mission noted the remarkable growth of the Georgian economy in 2007. The real GDP growth exceeded 12%. This growth was mainly due to the private capital inflow in the country, which constituted over 20% of GDP and included a significant section of foreign direct investments. Notwithstanding the difficulty to foresee the inflow of the private capital, the current trends suggest that this tendency will continue. Accordingly, the mission expects the real growth of the Georgian economy to be about 9% in 2008.
During 2007, inflation rose 11%. The mentioned increased inflation was partly the result of a rise in the price of food and oil in the world market. It was also caused by a softened monetary policy which dominated in 2007. The mission welcomes the goal of the Georgian government to decrease the inflation to 8% by the end of 2008. It also supports the government objectives to achieve moderate growth of monetary indicators, keep limited inflation, and attain more flexible currency exchange rates.
One of the most important tasks for 2008 will be to realize the plan outlined by the Georgian government for the implementation of a stricter fiscal policy.
The IMF mission gave its assessment and recommendations regarding the macroeconomic and financial reforms package introduced to the parliament, the independence of the National Bank of Georgia, etc.
The missions next visit is planned in June, 2008.
