The Governor of the National Bank of Georgia, Natia Turnava, took part in a high-level roundtable for central bank governors from Central Asia and the Middle East, held in the United States as part of the Spring Meetings of the International Monetary Fund and the World Bank.

The discussion focused on “Managing Macroeconomic and Financial Stability Risks during a Regional Conflict” and was opened by Jihad Azour, Director of the IMF’s Middle East and Central Asia Department.

During the session, Natia Turnava shared her perspectives on managing macroeconomic and financial stability risks amid regional conflicts, particularly in light of heightened global uncertainty driven by ongoing geopolitical tensions in the Middle East.

“First and foremost, I would like to emphasize that prudent and consistent economic policy is the foundation of economic resilience. The stronger the underlying fundamentals of the economy, the better it can withstand external shocks. When inflationary risks emerge and the central bank demonstrates - through sound policy - that it can maintain price stability despite these shocks, the risk of such shocks evolving into broad-based and persistent inflationary processes is significantly reduced,” said Natia Turnava.

Turnava also noted that forward-looking monetary policy decisions have become more challenging amid elevated uncertainty, as supply-side inflationary shocks have become more frequent. In this context, she underscored the importance of complementing baseline projections with comprehensive risk scenario analysis and making decisions based on a structured assessment of risks.

“For this reason, starting from early 2025, we have formally transitioned to a risk management approach in the formulation of monetary policy. Under this framework, in addition to the central scenario, our policy decisions are informed by the analysis of alternative risk scenarios. This approach entails a systematic assessment of risks and transparent communication on how policy would respond to different possible developments. Such a framework enhances predictability and improves market understanding of policy,” said Natia Turnava.

The Governor positively assessed IMF-led discussions of this kind, noting that they provide an important platform for central bank leaders to exchange views on enhancing policy effectiveness in an increasingly uncertain and risk-prone global environment.