March 13, 2020 / 2:03 PM / 23 days ago

Georgia sets measures, allocates funds to support economy amid coronavirus risks -PM

TBILISI, March 13 (Reuters) - Georgia’s government will support the economy as the coronavirus epidemic hits by providing tax incentives for the tourism sector and deferring payment of interest on bank loans to entrepreneurs and individuals, Prime Minister Giorgi Gakharia said on Friday.

The ex-Soviet country of 3.7 million has 25 cases of coronavirus, the highest number in the South Caucasus region.

“We’ve drafted a plan, a list of measures, and their implementation is expected to create additional financial resources in the economy of one billion lari ($345 million),” Gakharia told a briefing.

He said the further spread of coronavirus may threaten this year’s economic growth forecast of 4.5% but did not specify how far short gross domestic product might fall.

Gakharia said all enterprises linked to the tourism sector would be granted income and property tax breaks until Nov. 1, while a refund of value-added tax (VAT) for companies would be doubled to 1.2 billion lari from 600 million lari. Individuals and tourism-related companies will be permitted to defer interest payments on bank loans for four months.

“In addition, the government allocates 300 million lari in capital expenditure and infrastructure projects,” the prime minister said.

He said the funds would come from the state budget and private companies — in particular, the Cartu Fund, privately owned by Georgia’s richest man Bidzina Ivanishvili, who is a leader of the ruling Georgian Dream Party.

“In addition, negotiations with international financial institutions have already been started for soliciting financial resources from their special allocations,” Gakharia said.

$1=2.9 lari Reporting by Margarita Antidze; Editing by Catherine Evans

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