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. Last Updated: 07/27/2016

Red Cross in Georgia Says Harsh Reforms 'Can Kill'

TBILISI -- The International Red Cross on Monday said tough market policies are threatening Georgia's poor, who lack proper access to food, warmth and shelter.


"The phrase 'economy in transition' is often used to describe Georgia," said Michael Stone, who heads the Red Cross mission in Georgia. "We want to remind the world that transition can kill."


Georgian President Eduard Shevardnadze last year bowed to pressure from the International Monetary Fund to a program of tough market economic reforms.


As a result of the IMF reforms, Georgia no longer suffers from hyperinflation. But ordinary Georgians have seen prices skyrocket way beyond their means.


On the eve of a conference sponsored by the United Nations to assess aid needs for the troubled Caucasus Mountains region, Stone said hundreds of thousands of Georgians had to make it through this winter without proper food, heat and basic health care.


"Our fear is that their lot may actually be worsened by tough economic decisions -- that they will be left, literally and figuratively out in the cold," Stone said.


The Georgian government, however, defended the economic reform program and announced that Monday it received $41 million from the IMF, the first installment of a $246 million credit to be disbursed over three years.


"It's a very important event for Georgia because the IMF understands that the course of economic reform here is going well," said Temur Basilia, presidential adviser on the economic reforms.


Last September, the government introduced a new currency, the lari, which has held constant at about 1.3 to the dollar, and helped stabilize the economy after old coupon denominations had become virtually worthless.