IMF Mission Assesses Fiscal Situation in Georgia

The IMF mission, which visited Georgia on June 1-7 to review recent developments and continue discussions for the second review under the government?s IMF-supported economic program, noted that ?Georgia?s macroeconomic performance continues to be strong with real GDP growth of 6.2 percent in 2004.?

According to the statement issued by the IMF Tbilisi office on June 8, fiscal performance in 2004 was impressive, especially the improvement in revenue collections stemming from stronger tax enforcement.

?Preliminary indications are that this performance has continued in early 2005,? the statement reads.

The IMF Mission also discussed with the Georgian authorities the concern about inflation. The mission welcomed the authorities’ commitment to keeping inflation at single-digit rates and its willingness to take necessary fiscal actions if inflationary pressures intensify in the coming months.

?During the visit, the mission reached understandings on an economic program for 2005. Based on these understandings, the mission intends to propose to IMF management and the Executive Board that the second review under the PRGF arrangement be completed. Approval of the review would enable Georgia to draw an amount equivalent to about US$20 million,? the statement says.

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