What are the ways to reduce the level of dollarization in Georgia, which has become a recognized problem?
This topic has become the subject of debate after the economist Temur Basilia offered to restore the practice of previous years and prohibit the issuance of foreign currency loans. According to him, the previous government withdrew the ban and legalized the right to obtain loans in dollars and euros.
This opinion has caused a lot of comments - some experts consider it necessarily to impose at least restrictions on access to loans in foreign currency, while part is against any artificial restrictions, believing that the reduction of dollarization level is only possible by increasing interest on deposits in national currency.
According to Nato Khaindrava, Director General of the bank "Cartu", the level of dollarization in Georgia is really very high.
Nato Khaindrava does not share the views on the restoration of the practice of the ban on the issuance of foreign currency loans, because, in her words, any additional regulation creates problems to the banking system.
As reported, the current level of dollarization of the Georgian banking system reaches 70%. Dollar loans account for 76% in the business loans portfolio. In general, 63% of loans are issued in dollars.
The percentage of income from deposits in national currency is much higher than in the foreign currency. In particular, the average percentage of the deposits in the lari is 11. 9%, while in dollars and euros - 4, 4%.
However, despite this, investors still prefer to keep their savings in dollars.
The high level of dollarization is considered a problem not only by experts, but also by representatives of the government. In particular, the Georgian Minister of Finance Nodar Khaduri says that the high level of dollarization is a serious problem, but unfortunately, this fact has remained unchanged since Georgia became independent.