On Thursday 12 April, the EU Council of Ministers adopted a decision granting a third macrofinancial assistance operation for Georgia, for €45 million, to help the country cover its financing needs, and to support its economic stabilisation and structural reform programme.
"Georgia's economy is considered to be vulnerable due to a large current account deficit and high external debt, whilst its foreign reserves have become inadequate", the Council states in a press release.
Macrofinancial assistance is financial aid granted by the EU to partner countries experiencing balance of payment difficulties, and is accessible to countries benefiting from IMF support.
This is the third operation for Georgia since the military conflict between this country and Russia in August 2008. The first two macrofinancial assistance operations were for €46 million each.
Payments of this assistance, to which the European Parliament gave its green light on 14 March (see EUROPE 11981), will be subject to Georgia's respect for democratic mechanisms and the rule of law, as well as its guarantee to respect human rights. The respect of these conditions is monitored by the Commission and European External Action Service.
Disbursements will also be subject to the economic policy followed and to financial conditions. These will focus on structural reforms and sound public finance, and will include a timetable for their fulfilment. They will be laid down in a memorandum of understanding between Georgia and the Commission, and implementation will be monitored by the Commission.
The EU is also providing Georgia with assistance as part of its neighbourhood policy. Georgia joined the EU's Eastern Partnership in 2009. Furthermore, the EU and Georgia are linked by an association agreement, which entered into force on 1 July 2016, and which provides for the gradual introduction of free trade provisions. (Original version in French by Emmanuel Hagry)