Government Denies Planning Multi-Currency System

The Georgian government is not considering introduction of a multi-currency payment system, the Georgian Ministry of Finance said in a statement.

“The Georgian Finance Ministry is authorized to announce on behalf of the Georgian government to the attention of our citizens and investors that this type of initiative and reform is not being discussed by the Georgian government and in this regard, our national currency Lari, which is the only legal and reliable mean of payment on the territory of Georgia, does not face any threat and the country will further continue monetary and currency policy in the national currency,” the ministry said.

The statement was made in response to wave of criticism by some economists following remarks by Nona Karalashvili, a senior advisor to the Georgian Prime Minister, who said in an interview with the Georgian bimonthly magazine Liberali (Liberal), that the Georgian government was considering various options to tackle the economic crisis.

“There is no finally elaborated opinion about the matter yet,” she said. “Personally I think that a reform, which will enable foreign investors to invest money in Georgia in a currency they prefer, would bring the most of the results… An investor will not be afraid that he may lose money simply because of changing currency rate. It won’t threaten Lari; this process has in fact already taken place, as prices – for apartments, cars etc. – are already nominated in euros or dollars. Lari will remain in circulation; it will become a secondary currency and after some time it may be removed from the circulation. International Monetary Fund recommends carrying out this reform to many eastern European countries and Georgia.”

The remarks echoes opinion of Kakha Bendukidze, a former state minister for economic reforms, who said the public television in February that introduction of multi-currency system, should be among those drastic reforms required for tackling the crisis.

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