The Government of Georgia will approve the draft amendments to the 2022 budget today.
According to the preliminary data, the volume of expenses will increase by about one billion GEL and it will exceed GEL 20 billion. Deputy Minister of Finance Giorgi Kakauridze declares, that the budget deficit, which has been planned at 4.4% for this year, will be further reduced and the government holds negotiations about it with the IMF.
"We are considering important topics with the IMF, among them is the reduction of the fiscal deficit, which will already be reflected in the budget changes presented by the government. It will be sent to the Parliament tomorrow. Deficit reduction will be one of the main directions. We will talk about specific numbers after the presentation of the budget. There are also negotiations with the IMF on the management model of state-owned enterprises, along with this, there are talks on specific models for energy sector support schemes, although it is difficult to speak in this direction in advance, because we have to agree with the fund on which model will be more correct for our country and specific steps have already been taken according to that model taken," said Giorgi Kakauridze.
Before the pandemic, Georgia's budget deficit was below 3% and in 2019 it stood at 2.1%. In 2020, like other countries, Georgia's budget deficit also increased. During the first wave of the pandemic, the government took on USD 2 billion in external debt, resulting in a budget deficit of 9.3%. As a result of these loans, the government gave billions of GEL in social assistance and subsidies during the pandemic. However, due to the record growth of the deficit, the state promised to reduce its level to 3% within the next 3 years. In 2021, the budget deficit was reduced to 6.7%, and the 2022 budget was planned for a deficit of 4.4%.
