Georgia Economic Forecast

Georgia Economic Outlook

July 3, 2018

Georgia’s economy began the year at a robust pace, with preliminary results showing annual GDP growth of 5.3% in the first quarter, just a notch below the previous quarter’s three-and-a-half-year high. Strong growth in Q1 was underpinned by healthy consumer spending bolstered by easing inflationary pressures, as well as a robust external sector amid surging demand from Georgia’s key trading partners—particularly Turkey and Azerbaijan. The economic momentum appears to have carried over into the second quarter. Household consumption likely continued to benefit from lower inflation through May and nominal exports jumped 50.2% annually in the month against the backdrop of the ongoing pro-trade policy push by the country’s government.

Georgia Economic Growth

Tighter labor market conditions and moderating inflationary pressures, coupled with lower interest rates, should buoy domestic demand this year. Economic growth will be further buttressed by a sturdy external sector, with strong export growth seen carrying over into the second half of the year. Our panelists expect GDP to grow 4.6% in 2018, unchanged from last month’s forecast, and 4.6% again in 2019.

Georgia Economy Data

20132014201520162017
Population (million)3.83.73.73.73.7
GDP per capita (USD)4,2984,4293,8023,9464,284
GDP per capita (EUR)3,3073,2353,4133,5523,756
GDP (USD bn)16.316.514.114.615.8
GDP (EUR bn)12.512.112.713.113.9
Economic Growth (GDP, annual variation in %)3.44.62.92.84.8
Fiscal Balance (% of GDP)-1.1-2.0-1.1-1.4-0.9
Public Debt (% of GDP)34.735.641.444.644.9
Money (annual variation of M2 in %)33.29.1-2.512.929.4
Inflation Rate (CPI, annual variation in %)-0.53.14.02.16.0
Policy Interest Rate (%)3.754.008.006.507.25
Exchange Rate (vs USD)1.741.882.402.662.59
Exchange Rate (vs USD, aop)1.661.762.272.372.51
Exchange Rate (vs EUR)2.392.282.612.813.10
Exchange Rate (vs EUR, aop)2.212.342.522.622.83
Current Account (% of GDP)-6.3-11.3-12.7-13.2-9.0
Current Account Balance (USD bn)-1.0-1.9-1.8-1.9-1.4
Trade Balance (USD billion)-5.1-5.7-5.5-7.7-5.3
Exports (USD billion)2.92.92.22.12.7
Imports (USD billion)8.08.67.79.98.0
Exports (annual variation in %)22.5-1.7-22.9-4.129.0
Imports (annual variation in %)-0.47.2-10.127.5-19.0
International Reserves (USD)2.62.52.32.62.8
External Debt (% of GDP)82.684.7108109109

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Georgia Facts

ValueChangeDate
Exchange Rate2.460.0 %Jul 17
Stock Market0.50.55 %Jul 17

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