Giorgi Kadagidze took charge of the National Bank of Georgia (NBG) in February 2009, at the height of an exchange rate and economic crisis triggered by the unfortunate confluence of the global financial squeeze and the country’s war with Russia in the previous year. The managed exchange rate had just been devalued, and Mr Kadagidze further liberalised the exchange regime, while avoiding any bank bail-outs.
In the three years since, inflation has averaged just 5.3%, inside the NBG’s 3% to 6% target, and the economy grew by 6.8% in 2011 – far outpacing International Monetary Fund expectations of 5.5%. The exchange rate is back in an appreciating trend, already stronger than immediately after the devaluation. Georgia’s sovereign ratings were upgraded by two agencies in 2011, and official foreign exchange reserves have more than doubled since Mr Kadagidze took charge.
