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TBC Research: Remittance inflows increase in Georgia

Business Materials 12 October 2019 18:45 (UTC +04:00)
Remittance inflows increased by 7.8 percent year-on-ear in August 2019 in USD terms in Georgia, somewhat improved growth compared to previous two months, Trend reports via the TBC Research Group at Georgian TBC Bank
TBC Research: Remittance inflows increase in Georgia

Baku, Azerbaijan, October 12

By Tamilla Mammadova – Trend:

Remittance inflows increased by 7.8 percent year-on-ear in August 2019 in USD terms in Georgia, somewhat improved growth compared to previous two months, Trend reports via the TBC Research Group at Georgian TBC Bank.

When expressed in euro and lari terms, the annual growth rates stood at higher 11.8 percent and 24.5 percent, respectively. The increase was mostly driven by the inflows from the EU (+24.3 percent year-on-year in USD) on the back of traditional source countries like Italy (+25.6 percent year-on-year in USD) and Greece (+16.9 percent year-on-year in USD).

Among the other EU countries, remittances from Poland (+69.1 percent year-on-year in USD), Germany (+28.9 percent year-on-year in USD) and France (+44.5 percent year-on-year in USD) also increased significantly.

As expected, remittance inflows started to recover from Turkey, following the declining tendency over the last 12 months. The improvement is likely to continue thanks to the low base effect and signs of recovery in Turkey. Also, the growth continued from other major countries of origin, such as Israel (+8.1 percent year-on-year) and the US (+1.5 percent year-on-year).

At the same time, remittance inflows from the CIS went down by -4.9 percent year-on-year in USD terms, mostly due to the declining trend from Russia (-14.5 percent year-on-year in USD).

Continued improvement of the trade balance supports the view that the external sector is reasonably strong. Exports of goods went up by 12.4 percent year-on-year in USD terms (+16.5 percent year-on-year in EUR and +29.7 percent in lari) or by $34 million in absolute terms.

Over the trailing 12 months ending in August 2019 exports growth amounted to 13.4 percent year-on-year in USD terms (+19.2 percent in euro and +23.6 percent in lari. Over the same period, imports declined moderately by 3.7 percent year-on-year (-0.1 percent in euro and +11.2 percent in lari) or by $28 million in absolute terms.

Over the last 12 months as of August imports was down by 1.6 percent year-on-year in USD terms (+3.4 percent year-on-year in euro and +7.1 percent year-on-year in lari), contributing to a sizeable improvement of the trade balance.

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