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Monday, 24 October 2016


Asian Bank to solve Georgia’s gender problems

2010-10-15 14:49

8832.jpegTwo pleasant events took place in Georgia this week:  USD100 mln allocation by the Asian bank, and assignment of Ba3 level with "stable" outlook by Moody's Investors Service rating agency. All this happened immediately after Georgian PM Nikoloz Gilauri's return from the USA. Now the government is looking forward to spending the amount. Though appropriation of this panhandled money looks somewhat discouraging.


Indeed, the USA is a dream country where all wishes come true with a wave of the wand from Washington. Apparently, Nika Gilauri did his best to cajole the US government into giving generous gifts. Now he can be proud of a memorandum on attraction of a huge investment flow to Georgia signed with a US bank as well as a document abolishing a USD 200 mln financing limit for the Caucasian republic by OPIC, a US corporation. Besides, Gilauri's long-term siege helped him get the promise by the leaders of International Finance Corporation (IFC) that Sakartvelo's agricultural sector will be financed.

Still, not only investment rating and tax system must be reconsidered to attract serious investors to Georgia. It is also important to raise the credit rating in national currency. Here too the PM has done a lot. Moody's views the Transcaucasian republic as a financially reliable issuer unable to pay off the debts because of a tight economic situation. However, the proposed forecast is positive with an outlook for stability in Georgia.

Other agencies - Standard & Poor's and Fitch - keep silent for now. Sovereign ratings they assigned maintain B+/Stable/B+ and B+/Stable/B accordingly. "Positive review of ratings is important to Georgia: if in future the government decides to issue Eurobonds, which is part of our plan, a lower interest rate will be secured at the world's financial markets", - Gilauri informed. According to him, raising Georgia's credit ratings will help private sector to get finance on more favorable terms.

Why does the government hold back the rating agency's recommendations from Washington? Because Tbilisi stubbornly resists settlement of relations with Moscow. However, when the US magic wand loses its spell, Georgian leaders will have to pay for their shameless desires.

But it won't happen soon: for the time being the United States of America set great store on Tbilisi as a buffer zone through which it's easy to keep playing with Russia and exchange acrid remarks in foreign policy. So it's easier to give the child the toy he wants to be kept at play.

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