EBRD supports local currency lending
05 May, 2011

European Bank for Reconstruction and Development (EBRD) upholds lending in Georgian national currency so as to diminish country’s dollarization and dependence on external financing. The Ministry of Finance of Georgia and the National Bank of Georgia (NBG) have signed a Memorandum of Understanding with the EBRD on April 25, 2011 to launch the EBRD’s Local Currency Lending Programme in Georgia.
Under the Program the EBRD can provide local currency loans to eligible banks, microfinance institutions and priv

ate sector local enterprises at interest rates that aim to catalyse the local currency loan market in Georgia, the EBRD press speaker informed Georgian Journal. 
The Memorandum of Understanding sets out the framework for promoting of local currency financing in Georgia as part of the EBRD’s major Local Currency and Local Capital Markets Development Initiative.
The EBRD’s Board of Directors approved the Programme in February 2011 to help reduce foreign currency risk and dependence on external financing, which emerged as key vulnerabilities in the EBRD region during the recent global financial and economic crisis.
The Initiative aims to promote the use of local currency both through increasing the use of transactions in local currency and through policy dialogue so as to ensure long-term, sustainable and liquid local currency and local capital markets.
“The Georgian authorities would like to confirm their intention to implement reforms and strengthening the country’s capacity to intermediate savings and investments through the use of local currency – the Georgian Lari. Larization is an opportunity for individuals to take loans and open deposits in the desired currency. Dollarization carries many problems for the country’s economy. The goal of the NBG is to make long term and low interest GEL loans more accessible,” Giorgi Kadagidze, President of the NBG said.
“We will support the authorities not only by providing local currency loans, but we are also ready to offer technical cooperation and policy advice, particularly in the legal and regulatory area and on debt and equity capital market infrastructure,”Olivier Descamps, EBRD Managing Director for Turkey, Eastern Europe, the Caucasus and Central Asia, said.
The program for Georgia forms part of a targeted local currency risk-sharing programme for the Early Transition Countries* (ETC), supported by the EBRD and international donor countries through the ETC Local Currency Risk-Sharing Special Fund which will participate in the loans. The EBRD Shareholders Special Fund (SSF), the US Treasury and the ETC multi-donor fund have already committed to contribute to the ETC Local Currency Risk-Sharing Special Fund to support this programme, while discussions with other bilateral donors are underway.

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19.09.2018
20.09.2018
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1
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2.6188
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3.4414
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GEL Exchange
USD
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USD
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EUR
1
EUR
3.0593
GBP
1
GBP
3.4414
RUB
100
RUB
3.8673
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