BAKU, Azerbaijan, August 26. The Asian Development Bank (ADB) remains optimistic about Georgia’s economic prospects despite regional challenges, said Lesley Bearman Lahm, ADB Country Director for Georgia, in an interview with Trend.
Lahm provided insights into the ADB’s projections for Georgia’s economic growth, inflation rate, and monetary policy, while also discussing the bank’s financing plans for the coming years.
"ADB recognizes Georgia’s strong track record of impressive macroeconomic performance, ensuring resilient economic recovery and price stability following COVID-19 and the Russian invasion of Ukraine," Lahm stated. She highlighted Georgia’s V-shaped recovery post-pandemic, marked by two consecutive years of double-digit growth in 2021 and 2022, alongside a low inflationary environment and continued robust growth in 2023 and 2024, with a growth rate of 9.3 percent to date.
However, Lahm acknowledged the challenges ahead, especially given the geopolitical tensions and economic developments in the wider region. "Though revenue from tourism continues to remain strong, increasing by 1.5 percent in the first quarter of 2024 year-on-year and demonstrating 40 percent growth compared to the pre-pandemic level in 2019, we have observed a 36-percent decline in money transfers in the same period, along with a 10-percent annual decline in exports," she explained. These export challenges were attributed to a slowdown in vehicle re-exports and weak global demand for ferroalloys.
Despite these headwinds, Lahm noted that Georgia’s unemployment and poverty rates have dropped to historically low levels, with unemployment at 14 percent and poverty at 11.8 percent. "The IMF recently recognized Georgia as one of the best performers globally in terms of job creation and unemployment reduction, assessing the past 10-year unemployment trend across countries," she added. Nonetheless, Lahm emphasized the need for Georgia to continue implementing structural reforms to diversify its economy, enhance labor productivity, and support technological innovation.
Looking ahead, Lahm outlined the ADB’s financing plans for Georgia, which are aligned with the country’s National Development Strategy, Vision 2030. "The 5-year partnership strategy that ADB has endorsed for Georgia directly supports three major priorities – economic development, social policy and human capital development, and public administration," she said. ADB’s focus will be on promoting regional cooperation and integration, private sector-led growth, and sustainable development.
"We will continue to help Georgia expand its multi-modal transport network, strengthen the population’s climate- and disaster-resilience, and scale up clean energy generation and trade," Lahm noted. ADB’s support will also extend to strengthening national social protection systems, pension reforms, and capital market development, as well as enhancing vocational education and training alongside the country’s general education system through ongoing and planned projects.