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It’s time Kobalia opened the money-box2010-10-11 20:18
According to the information provided by the country's National Bank, Georgia's net international investment position is negative. For instance, by the end of quarter II of this year, it was minus 11,4 billion dollars, which by 5,5 percent exceeds the last-year figure and is by 1,7 percent greater than in quarter I of this year. If, considering the situation, direct investors and Mikheil Saakashvili do not string up Veronika Kobalia on economical gibbet, then, she must have been born under a lucky star.
The curtain is slowly drawn and we may watch the second act of the economic play staged in Georgia by Minister of Economy and Sustained Development together with her subordinates. According to the script, Georgia's total assets by the end of quarter II of this year equaled 3 billion dollars, of which 61,7 percent were comprised by reserve assets: their volume reached 1,9 billion dollars by the end of June.
It seems to be an enigma why the country's international marketable assets, which are under control of the Ministry of Finance and can any time be used for sponsoring the deficit balance of payments and regulating the national currency rate, are still not spent on settlement of external debt obligations.
Although such reserves are just the second protection echelon for the balance of payments, it looks like time has come for Mrs. Kobalia to take the "secret" key and unlock the safe with the state stash, so long as the Georgian government is not ready to venture national currency devaluation in order to boost its own export, while attracting additional external credits seems to be impossible: international financial organizations have been "stripped" by Georgia to the maximum.
Meanwhile, its total obligations by the end of this June exceeded 14,4 billion dollars. For instance, obligations to direct investors grew by 6,4 percent and amounted to 7,5 billion dollars, while obligations by portfolio investments totaled the amount of 870,1 million dollars, where state Eurobonds account for 500 million dollars. These governmental securities issued in April 2008 actually make up another 500 million dollars devoured by the abyss of the Georgian economy.
By the way, in 2013, the republic is going to face another Day X: it will have to repay to the creditor-countries, for example, Russian Federation. As is known, Georgia's state budget is significantly smaller than the amount of external debt. There is nowhere to take currency notes from and the hope of foreign investors' assistance is quickly fading away.