IMF Publishes Fiscal Transparency Evaluation for Georgia
IMF News, September 27, 2017
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Bibliographic details
- Published: September 27, 2017
Overview
- Press Release No. 17/370
- Date: September 27, 2017
- IMF Communications Department; MEDIA RELATIONS; PRESS OFFICER: Wiktor Krzyzanowski; Phone: +1 202 623-7100; Email: MEDIA@IMF.org
- The International Monetary Fund (IMF) published a Fiscal Transparency Evaluation report for Georgia, carried out in December 2016 by the IMF’s Fiscal Affairs Department at the request of the Government of Georgia.
- The report assesses Georgia’s fiscal transparency practices against the standards set out in the IMF’s Fiscal Transparency Code.
Overall assessment
- Georgia meets the good or advanced level practice on 18 of 36 principles.
- Georgia meets the basic standard on a further 10 principles.
- The report finds that many elements of sound fiscal transparency practices are in place in Georgia.
Key strengths identified
- Fiscal reports are published in a frequent and timely manner and include extensive information on the use of public resources.
- Budget documentation:
- Presents medium-term macroeconomic forecasts and spending plans.
- Is prepared in accordance with a clear organic budget law.
- Is subject to independent scrutiny.
- Government discloses and assesses key risks to public finances, publishing:
- Advanced macroeconomic risk analysis.
- Debt sustainability analysis.
- An assessment of the fiscal risks from major public corporations and power purchase agreements.
Main shortcomings highlighted
- Fiscal reports and statistics do not provide a complete picture of general government activity.
- Central government annual consolidated financial statements are not subject to independent audit.
- There is no reporting on compliance with fiscal rules.
- Mechanisms to mitigate fiscal risks related to public corporations and power-purchase agreements are not yet fully developed.
- Efforts are underway to address these and other shortcomings.
Key recommendations to strengthen fiscal transparency
- Expanding the coverage of the key fiscal reports and the government finance statistics to consolidate the own-funded activities of legal entities of public law;
- Producing annual consolidated general government sector fiscal reports and enhancing the accuracy and coverage of balance sheet information;
- Subjecting the annual consolidated central government financial statements to independent audit as soon as practicable;
- Publishing information on the revenue foregone by tax expenditures;
- Reviewing the fiscal rules and regularly reporting on compliance with those rules;
- Providing more explanation of the macroeconomic forecasts and reconciling new macroeconomic and fiscal forecasts with prior forecasts;
- Tightening the criteria for drawing on budget contingency provisions; and
- Strengthening controls on lending and equity injections to public corporations and placing limits on liabilities from public private partnerships.
Authorities’ response and outlook
- The Georgian authorities welcomed the report’s findings and its publication.
- The implementation of reforms planned by the authorities, and recommended in this report, will result in further improvements in fiscal transparency in Georgia in the coming years.
Additional reference
- Further information about the IMF’s Fiscal Transparency Code and Georgian Fiscal Transparency Evaluation can be found at: http://www.imf.org/external/np/fad/trans/
Source: Press Release No. 17/370, September 27, 2017, IMF Communications Department.