Who should be supervising the activities of commercial banks in Georgia? Currently this responsibility lies with the country’s National Bank. However, the Georgian parliament will soon be deciding on a new legislation, which, if passed, could take away the supervisory role from NBG and transfer it to an independent agency reporting directly to the prime minister. At the same time, the President of Georgia, Giorgi Margvelashvili vowed to veto the bill, if it is passed by the Parliament, citing economic concerns.
So, why does this particular p...
ISET Economist Blog
A blog about economics in the South Caucasus.
Jun
12
Mar
04
The recent bouts of sharp lari depreciation caused much anxiety among the Georgian population, prompting fears of inflation, loan defaults, and bank failures, on the one hand, and the typically Georgian political speculations over “who is to blame”, on the other.
In and of itself, a moderate lari depreciation is not necessarily a bad thing for the Georgian economy. It makes Georgia cheaper and more competitive relative to the rest of the world, reducing the current account deficit and carrying a promise of future investment and jobs. That said, a deep an...
Feb
06
LEGISLATING GEORGIA’S WAY INTO THE EUROPEAN COMMUNITY – LESSONS FROM RECENT HISTORY
On September 1, 2014, the Georgian society woke up to a very unpleasant reality – after years of extremely welcoming visa regime which put the country on the map as an attractive tourist and foreign direct investment destination, a new migration law regulating foreigners admission and stay in Georgia came into effect. Business owners, foreign students, employees of large and small companies, and even residents of Georgia’s border areas found themselves in a very uncertain...
Jan
23
According to the latest GEOSTAT figures, merchandize exports from Georgia decreased by 1.63% between 2013 and 2014. This is certainly not great news for the country, but does it imply that Georgian goods have become less competitive on the world market? Recent trade data suggest that this is not necessarily the case.
The first thing to note is that much of the decline in exports is related to one particular activity – the re-exports of Georgian cars to Azerbaijan and Armenia. Beginning in 2009, this business has become a “cash cow”, capitalizin...
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