Georgian lari falls to half-year low amid mass protests
TBILISI. Dec 2 (Interfax) - The Georgian national currency fell to its lowest level since mid-June at the close of Monday's trading amid ongoing mass protests in Tbilisi and major cities across the country.
As of December 3, the official exchange rate was 2.8478 lari per $1, the National Bank of Georgia (NBG) said. The lari fell 2.4% compared to the previous trading session on Friday following a 1.7% decline over the previous two weeks.
According to NBG data, the lowest exchange rate this year of 2.8693 lari/$1 was recorded on June 14. The lari subsequently strengthened until October, when it began to weaken due to the preparations for, holding and aftermath of a parliamentary election, which was not recognized by the EU or the U.S.
It was earlier reported that the NBG carried out a record volume of foreign exchange interventions to stabilize the lari in October 2024, selling $591.2 million on the market. As a result, Georgia's international reserves fell 13% or $627.5 million in October ahead of the elections, reaching a 28-month low of $4.085 billion as of October 31. Reserves have decreased 18.5% or $924.7 million since the start of the year.
The NBG has not reported any further foreign exchange interventions following the October 26 parliamentary election, which was won by the ruling Georgian Dream party.
On November 28, Georgian Prime Minister Irakli Kobakhidze announced that the government was suspending EU accession talks until 2028. Georgia obtained EU candidate status in December 2023.
Mass protests began to take place in Tbilisi and other major cities following the prime minister's statement.
Georgia's top foreign policy priority remains EU integration, Kobakhidze said at the first meeting of the new government on December 2. "According to our government program, by 2028, Georgia must fulfill more than 90% of its obligations under the Association Agreement with the EU and the free trade agreement, and these obligations will definitely be met," Kobakhidze said.
He said he hopes for a significant reset in Georgia's relations with the EU and the U.S. "On January 20, the inauguration of U.S. President Donald Trump will take place, meaning that both the U.S. and the EU will have new leadership under whom we believe a reset in relations is possible," Kobakhidze said. The deterioration of relations with the West was not Georgia's fault, he said.
