2018-04-19
As you know, the second review of the EFF (Extended Fund Facility) has been completed successfully.
The IMF's mission visited Georgia, and I would like to emphasize that, as a result of this visit, the fund fully shares and upholds the Georgian Government's economic policy.
I would like to thank every member of the mission for support, also the local office, of course, and its leader Mercedes Vera-Martin whose assistance over the past few years has been invaluable in terms of upgrading fiscal indicators, upgrading the country's sovereign balance, and upgrading the tax balance, of course, all of which is visible as a result of the implementation of successful reforms.
I must say that the cooperation program we enjoy with the International Monetary Fund is based on the Georgian Government's four-point agenda, and the program's implementation has been commended by the fund. The economic growth in 2017 was higher than planned, and early 2018 has been equally positive.
As you know, we finished 2017 with a 5% growth. In early 2018, in the first two months, we had a 4.9% growth, but the February dynamic proved better compared to January, amounting to 5.5%.
Turnover in the private sector grew by 19%, and almost 40,000 jobs were created. It is very important that the private sector plays a vital role in this dynamic.
As for the current account balance, which constantly posed a problem, the current account deficit reached in 2017 one of its lowest in the past few years, making up 8.7% of GDP, which is a result of significant upgrading.
Similarly, a record-breaking result was achieved in 2017 in terms of FDIs amounting to 1 billion 862 million USD, marking a 16.2% year-over-year growth.
As a result of the tax reform, reinvestments amounted to 712 million USD. Reinvestments mean that the money which a company could channel outside the country, as it often happened in the past, remains in the country, thanks to the profit tax reforms, being reinvested in our national economy. We have a 130% growth compared to 2016, which is very important.
Export of goods grew by 28% in the first three months of 2018, and revenues from tourism and remittances are up 28% and 20%, respectively.
Of course, these stable macroeconomic statistics and this positive dynamic are reflected in Georgia's rankings by international rating agencies. In particular, Moody's, one of the top three rating agencies, upgraded Georgia's sovereign credit from Ba3 to Ba2. Fitch, also one of the three, upgraded Georgia's sovereign credit outlook from stable to positive.
All this convincingly confirms that Georgia's economic progress and the course pursued by the Government are on the right track, being designed to reflect this economic growth in the welfare of each household. This is why it is crucially important to continue the process of reforms and do everything to make sure that the economic growth reflects directly in the revenues of every social stratum.
I would like to thank the Government's economic team under the leadership of Dimitri Kumsishvili. It is very important that the economic team is well-coordinated. Equally important is cooperation with relevant parliamentary committees, so that the legislative initiatives referred by us to the Parliament may operate fully along with mechanisms of parliamentary control. I believe that this success is a demonstration of this excellent coordination.