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Georgian PM’s “convenient” statistics2010-05-05 12:46
It is believed in Tbilisi that Georgian economy has started an upward movement and is now gradually recovering. As Georgian PM Nikolay Gilauri stated 2010 first quarter economic indicators have reached 2008 first quarter figures. Gilauri celebrates the end of the crisis. Is his optimism justified?
According to Nika Gilauri, a positive tendency of growth was registered in all spheres: judging by tax and customs takings, bank loans and deposits. Gilauri's comparison with 2008 is not an incident: the first quarter of 2008 was the time of "economic boom" in Georgia, as Prime Minister called it. Besides Gilauri reported on 4% GDP growth in 2010 expressing confidence that the growth rate will stay on till the end of the year.
However, over the last week this is not the most optimistic statement made by Georgian PM. A few days ago Gilauri referred to another sign of economic recovery - increase in the country's foreign trade turnover to USD 1.36 bn, 15% higher than in the same period last year.
Indeed, following the recession that continued all through year 2009 Georgia's foreign trade turnover is steadily growing with 55% increase in exports and 6% in imports.
Apparently the facts above account for the objective Gilauri sets before the government - to reach a 9% economic growth. "After a difficult period of crisis and a 4% drop, there are positive economic tendencies in 2010 first quarter", - he added.
It is not impossible that optimism of Georgian authorities is connected with sovereign ratings upgraded by Standard & Poor's experts, the international rating agency that in mid April encouraged Tbilisi highlighting that Georgia's relatively low tax and business-friendly regime should continue to enable it to attract investment and help to implement geographical advantages as an important transit "bridge" between Europe and Asia.
Representatives of Georgian authorities were overjoyed by the change in the international agency's rating. Nika Gilauri's press speaker Nikoloz Mchedlizhvili stated that this would make investors and entrepreneurs more confident in the country's future.
Nevertheless, it is still premature to discuss serious progress of Georgian economy with reference to three months' indicators and ratings of the agencies especially when the privatization program is practically flunked and the republic grows more dependent on US and EU donors.
Receiving aid from the West Georgia is postponing problems not solving them. The economic downturn connected with halt on production, lack of solid industries and no mineral resources will hardly be resolved overnight.