Georgia Economic Forecast

Georgia Economic Outlook

July 7, 2020

Annual growth slumped to an over three-year low of 2.2% in the first quarter (Q4 2019: +5.1% year-on-year) and will have deteriorated even further in the second quarter, hit by Covid-19 fallout. Strict containment measures introduced in March hampered domestic activity in Q1, while the external sector was devastated by extinguished foreign demand and disrupted global supply chains. Turning to Q2, activity contracted at an unprecedented rate in April–May; strict lockdown restrictions forced the widespread closure of non-essential businesses, undermined consumer spending and likely smothered investment activity. Similarly, merchandise exports continued to dive through May. Although the country has been easing restrictions over the past month, authorities delayed the opening of international borders to 31 July, boding ill for the key tourism sector.

Georgia Economic Growth

The economy is seen shrinking markedly this year, as the Covid-19 pandemic disrupts activity at home and abroad. Deteriorating labor market conditions and postponed spending are set to weigh on household consumption, while downbeat business sentiment will likely curb investment activity. Increased pressure on both fiscal and external positions are additional risks ahead. FocusEconomics panelists project GDP to shrink 4.4% in 2020, which is up 0.6 percentage points from last month’s forecast, and expand 4.9% in 2021.

Georgia Economy Data

2015 2016 2017 2018 2019
Population (million)
GDP per capita (USD)4,0164,0614,3614,7184,767
GDP per capita (EUR)3,6183,6683,8663,9994,275
GDP (USD bn)14.915.116.217.617.7
GDP (EUR bn)13.513.714.414.915.9
Economic Growth (GDP, annual variation in %)
Fiscal Balance (% of GDP)-1.2-1.5-0.5-0.8-1.8
Public Debt (% of GDP)36.840.339.939.941.2
Money (annual variation of M2 in %)-3.814.827.915.9-  
Inflation Rate (CPI, annual variation in %)
Policy Interest Rate (%)8.006.507.257.009.00
Exchange Rate (vs USD)2.402.662.592.682.86
Exchange Rate (vs USD, aop)2.272.372.512.532.82
Exchange Rate (vs EUR)2.612.813.103.063.21
Exchange Rate (vs EUR, aop)2.522.622.832.993.15
Current Account (% of GDP)-11.8-12.5-8.1-6.8-5.1
Current Account Balance (USD bn)-1.8-1.9-1.3-1.2-0.9
Trade Balance (USD billion)-4.0-3.9-3.8-4.1-3.7
Exports (USD billion)
Imports (USD billion)
Exports (annual variation in %)-24.4-5.224.623.412.2
Imports (annual variation in %)-15.8-3.29.415.51.9
International Reserves (USD)
External Debt (% of GDP)102105107101105

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Georgia Facts

Value Change Date
Exchange Rate2.860.0 %Jan 01
Stock Market0.10.55 %Jan 07

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