BAKU, Azerbaijan, June 19
By Tamilla Mammadova – Trend:
Infrastructure spending and continued export gains boosted growth in 2019 in Georgia, according to the published Asian Development Outlook Supplement for the next two years, Trend reports citing report of Asian Development Bank (ADB).
As reported, inflation accelerated with currency depreciation. Growth is projected at zero in 2020 with continued monetary tightening and the effects of COVID-19 before recovering in 2021 on stronger demand and foreign investment.
"Monetary tightening is projected to slow inflation in both years. Having narrowed in 2019, the current account deficit will narrow further by 2021 with a continued decline in imports. Promoting technological innovation would spur business development," the report said.
The report also provides an overview of the Georgia's sectors for 2018-2019. The growth is estimated to have accelerated from 4.8 percent in 2018 to 5.1 percent in 2019, reflecting record spending on public investment and a sharp rise in exports. On the supply side, service growth accelerated from 5.6 percent in 2018 to 6.8 percent in 2019 on strong 15.2 percent expansion in information and communication technology; 14.1 percent in arts, entertainment, and recreation; and 9.1 percent in tourist related accommodation and food services. Industry expanded by 2.7 percent, with gains in electricity and gas utilities by 5.5 percent and construction by 4.1 percent.
Agriculture production decreased by 1 percent on low investment in the sector. On the demand side, preliminary data show growth in public investment more than doubling from 9.2 percent in 2018 to a record 25.1 percent. Expansion in net exports accelerated from 11 percent in 2018 to 14.5 percent as growth slowed in consumption from 5.1 percent to 2.4 percent and in private investment from 6.5 percent to 4.7 percent.
"Average inflation nearly doubled from 2.6 percent in 2018 to 4.9 percent with currency depreciation and prices rising sharply toward year-end. Food prices jumped by 8.2 percent, and excise tax increases boosted prices for alcoholic beverages and tobacco by 16.3 percent. Core inflation, excluding food and nonalcoholic beverages, tobacco, energy, and regulated utility tariffs, was 2 percent," the report said.
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