Government submitted to the Parliament draft of amendments to the 2011 state budget revising upwards forecasted tax revenues by GEL 350 million and also envisaging funding to cover planned increase of monthly minimal pensions to GEL 100 starting from September.

The draft also aims at reflecting into the budget planned issuance of Eurobond to refinance the previous, five-year USD 500 million Eurobond, issued by Georgia in 2008.

According to the draft the government also plans issuing GEL 100 million treasury bills on the domestic market.

After approval by the Parliament, the draft will revise total 2011 budgetary revenues from initially planned GEL 5.955 billion to about GEL 6.304 billion and budgetary expenditures will be increased from initially planned GEL 5.7 billion to GEL 5.95 billion.

The draft also envisages revising forecasted 2011 economic growth from 4.5% to 5.5% and forecasted annual inflation rate from 7% to 8%. Georgia’s real GDP grew 6.4% in 2010 and annual inflation hit 13.7% in February; the government hopes that the inflation will slow down to a single-digit in the second half of this year.

According to the proposed draft the government plans issuing Eurobonds with worth of GEL 900 million (about USD 527 million); the sum, according to the government, will only be used for refinancing the previous USD 500 million Eurobond issued in 2008.

As a result of the planned budgetary amendments the Ministry of Healthcare and Social Protection will receive most of the additional funding in an amount of GEL 86 million of which GEL 55 million will be used for increased monthly pensions from September. The ministry’s total funding, as a result, will be increased to GEL 1.692 billion.

Additional GEL 63 million (of which GEL 15 million is a loan from int’l financial institutions) will go to finance various regional and infrastructure projects.

Additional GEL 9 million will be allocated to the Ministry of Agriculture increasing its total funding for this year to GEL 78.1 million and additional GEL 30.9 million will go to the Ministry of Economy and Sustainable Development, making its total funding GEL 106.3 million.

The proposed draft also envisages increase of funding for some other ministries, including:

• Ministry of Regional Development and Infrastructure – GEL 864 million (initial funding for 2011 was GEL 864 mln);
• Ministry of Education and Science – GEL 555 million (initial 2011 – GEL 550.8 mln);
• Justice Ministry – GEL 70.7 million (initial 2011 – GEL 68.7 mln);
• Finance Ministry – GEL 204.7 million (initial 2011 – GEL 202.3 mln);
• Ministry of Culture and Protection of Monuments – GEL 54.8 million; (initial 2011 – GEL 53 million);
• Ministry in charge of prison system – GEL 106.5 million (initial 2011 – GEL 105.5 mln);
• Office of the State Minister for Integration into European and Euro-Atlantic Structures – GEL 1.47 million (initial 2011 – 1.3 mln);
• Office of the State Minister for Reintegration Issues – GEL 1.2 million (initial 2011 – GEL 1 million);
• Office of the State Minister for Diaspora Issues – GEL 788,000 (initial 2011 - GEL 623,000).

Last time 2011 state budget was amended on March 22 to adjust it in line with restructuring of several ministries, which was approved earlier this month.