Georgia, IMF agree on $285m program to stabilize financial market

Georgia and the International Monetary Fund (IMF) have agreed on a 285-million-U.S. dollar program to support the country's economic reforms and stabilize its foreign exchange rate, Caucasus Business Week reported Thursday.

The IMF reached a staff agreement with the Georgian government on a three-year Extended Fund Facility (EFF), the report quoted Mercedes Vera-Martin, the head of the IMF mission to Georgia as saying.

Georgia's central bank governor Koba Gvenetadze said the agreed fund would be used to boost the country's currency reserves, so as to maintain stability of the devaluing Lari.

The agreement will be subject to approval by the IMF Executive Board in April.

Thanks to a rise in exports and remittances, Georgia's growth accelerated to 5.2 percent year-on-year in January, the National Statistics Service said Tuesday. However, the IMF predicts the country will grow by only 3.5 percent in 2017.

Vera-Martin called on the Georgian government to address such problems as high underemployment, a narrow production base and inequality between rural and urban areas.

Encouraged by the IMF deal, Lari bounced sharply against dollar, regaining 2.6 percent in value on Thursday.

Source: Xinhua