10 Lari (birth of Christ) – Georgia

In the year 2000, Georgia’s currency situation was defined by the stable, yet still fragile, dominance of the lari (GEL), which had successfully replaced the catastrophic hyperinflation of the interim coupon currency by 1995. Under the rigorous supervision of the National Bank of Georgia (NBG) and its then-President, Irakli Managadze, a tight monetary policy and a de facto peg to the US dollar were maintained. This stability was a hard-won achievement, providing a crucial anchor for an economy still recovering from civil strife and the collapse of the Soviet Union, though it came at the cost of limited control over independent monetary policy.

However, this stability existed within a context of severe economic challenges. Georgia remained one of the poorest post-Soviet states, with a narrow production base, widespread poverty, and a significant shadow economy that limited the formal use of the lari in many transactions. External debt was crippling, and state finances were weak, reliant on international financial institutions like the IMF and World Bank for critical support. Their programs mandated strict fiscal discipline as a condition for loans, directly influencing the NBG's ability to manage the currency.

Consequently, the primary risks to the lari in 2000 were not market-driven fluctuations but structural and fiscal vulnerabilities. Any loss of confidence, potentially triggered by a failure to meet international obligations or a political shock, could have threatened the peg. Therefore, the currency's stability was paradoxically both Georgia’s key macroeconomic success story and a symptom of its deep dependence on external aid and stringent reform programs to maintain equilibrium in a still-fragile economic environment.