MINISTRY OF ECONOMY
AND SUSTAINABLE DEVELOPMENT
OF GEORGIA

“Capital market reform is one of the main structural reforms implemented by the Ministry of Economy and Sustainable Development together with the National Bank and other partner agencies. It is fundamental for rapid economic development that there are diversified financial instruments in the country that bring the development of the capital market” – Deputy Minister of Economy and Sustainable Development Irakli Nadareishvili stated at the presentation of the State Capital Market Support Program.

The official presentation of the program was held by the Enterprise Georgia Agency and it was attended by representatives of public and private structures, donor organizations and the banking sector. The Agency's partner in the implementation of the program is the USAID Financial Innovation Program. The director of the Agency, Mikheil Khidureli, introduced the program in detail to the audience.

“The team of our Ministry has been actively working on the capital market and pension reform in recent years - a new legislation on investment funds has been established, the pension reform has been launched and is proceeding very successfully, a number of new instruments have been created: covered bonds, the securitization law, the voluntary pension so-called third pillar, etc. However, for the success of the reform at this stage, it is important to stimulate and support the market with specific tools, we consider this to be the next phase of the reform” –Irakli Nadareishvili noted.

As for the objectives of the program - the new direction of the Enterprise Georgia Agency is aimed at improving access to finance for small and medium-sized businesses and promoting the capital market by stimulating the placement of securities. In 2024, the Agency will help companies issue bonds, which will attract additional investment resources of up to 150 million GEL on the stock market.

The program envisages that the Agency will give an opportunity to the entrepreneurial entities whose accumulated total income of the previous business year does not exceed 60 million GEL to participate in the co-financing and technical assistance components of the program. In addition, the USAID’s Financial Innovation Program provides a co-financing component for companies with revenues of more than 60 million GEL and/or operating in the financial sector. According to this program, it is also planned to support business entities with revenues up to 60 million.

The Deputy Minister of Economy emphasized that it is important for medium-sized businesses to have more financial knowledge about the possibilities of attracting alternative financing. According to Nadareishvili, the development of the capital market has a very long and detailed action plan, including the promotion of equity investment funds and the improvement of the pension reform - the relevant package of changes will be sent to the Parliament in the next few days.

This year, in order to develop the capital market, the Enterprise Georgia Agency plans to implement a number of events that will contribute to the development of alternative financing mechanisms. Along with the co-financing of bond issues, it will be the development of investment funds and the promotion of asset-based financing.

“I am sure that this will open important new opportunities for Georgian entrepreneurs in terms of business financing and development” – Irakli Nadareishvili commented.