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Georgia’s foreign loans: problems

By Messenger Staff
Friday, November 9
The previous United National Movement (UNM) administration used foreign loans to finance many public projects. In particular a considerable amount of money was borrowed to fund infrastructural projects designed to attract voters during the election campaign period. Calculated in comparison with the Georgian GDP the amount of government debt is considerable and as some economic analysts have suggested deeply troubling. Paying off these debts will prove problematic because Georgia's exports (a major source of foreign currency) are low. The previous government covered the interest rates for loans by borrowing more money-if Georgia's creditors come calling then the situation could prove very awkward indeed.