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Georgia’s economy expected to shrink

Business Materials 26 February 2021 09:47 (UTC +04:00)
Georgia’s economy expected to shrink

BAKU, Azerbaijan, Feb.26

By Tamilla Mammadova – Trend:

The Parliamentary Budget Office in Georgia has released its forecast for the economic growth in the first quarter of 2021, Trend reports via Georgian government.

According to the document, in the first three months of the current year, Georgia’s economy is expected to shrink by 4.6 percent.

The forecast of the budget office is based upon certain assumptions. In particular, tourism is expected to decline by 85 percent in the first quarter of 2021 that will have a significant impact on the economic downturn.

A volume of investments is also expected to reduce. according to the forecast, exports and imports of goods will fall but compression of exports will be greater than the decline in imports.

The only thing that will increase in the three months of the year is consumption. According to the forecast of the Budget Office, the consumption will increase especially for food products.

Georgia's economy fell by 7.9 percent in December 2020 due to a new lockdown, forcing thousands of businesses and services to close.

The decline also affected the results of 2020 as a whole and Georgia's gross domestic product fell by 6.1 percent.

According to the quarters, the results for 2020 were:

1Q2020 - 2.3 percent growth;
2Q2020 - 13.2 percent drop;
3Q2020 - 5.6 percent drop;
4Q2020 - 6.5 percent drop.

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