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Lari not expected to regain its former strength

By Gvantsa Gabekhadze
Friday, December 5
The Georgian Lari is continuing to depreciate in value against the US dollar and is currently the lowest it has been in four years.

As of December 4, 1 GEL was valued at $1.92 USD.

Since November 18, the value of the Georgian currency against the US dollar has dropped 5.4 percent.

Minister of Finance, Nodar Khaduri, states that the current situation will be improved.

However, he says that the Lari rate will not go back to the level it was before.

Khaduri stresses that the Lari devaluation was caused by outside factors and the fluctuation will not cause any harm to the state budget.

He stressed that analysts are mistaken when they accuse the ministry and the National Bank in terms of the current developments.

Member of the opposition UNM Zurab Japaridze appealed to the government not to spend money on bonuses and salary supplements when the state economy is going down. He admitted that the unfavorable situation was due to the government’s unreasonable policy.

The non-parliamentary Labour Party has demanded the removal of the government’s economic team.

Majority members share the vision that the Lari devaluation is because of foreign factors. However, some members of the majority like Zakaria Kutsnashvili appeal to the Ministry of Finance and the National Bank to use their instruments to rescue the situation.

A statement concerning the issue was made by the founder of the Georgian Dream coalition Bidzina Ivanishvili, who said that such a process is taking place in many countries currently and there was nothing alarming about it.

Analyst Paata Shesheilidze believes that the whole government and the Prime Minister are responsible for the current situation regarding the Lari. He says that various unreasonable steps taken by the government, like boosting loans, the suspension of selling land to foreigners and setting restrictions for them, spending money on less important projects and some other irrational policies pushed the recent downfall in the economy.

“The Lari rate is dependent on political solutions. The Lari is not free from political influences. Thus, forecasting what might happen is impossible,” he says.