BAKU, Azerbaijan, Sept. 22
Tamilla Mammadova – Trend:
The Georgian economy is expected to grow by 8.5 percent in 2021 driven by an expansion in agriculture, industry, and services and the gradual lifting of restrictions imposed due to the coronavirus pandemic, Trend reports via the Asian Development Bank (ADB) annual economic publication.
In addition, the Georgian economy is projected to grow further by 6.5 percent in 2022.
The report noted the country’s strong rebound from a 6.2 percent contraction last year to register a growth of 12.7 percent in the first half of 2021 following significant government support to firms and households, and sizable assistance from development partners.
Growth in private consumption, a 15 percent rise in net exports of food, beverages, and industrial supplies, and public investment spending equaling 8 percent of gross domestic product (GDP) all contributed to Georgia’s economic growth. Foreign exchange inflows are expected to accelerate following the reopening of land borders in June.
Yet, inflation rose following rapid price increases which began in March for food, health care, transport, and utilities due to higher import prices and the removal of subsidies for certain items. ADB forecasts inflation to accelerate to 9.5 percent in 2021 and slowing to 4 percent next year.
The current account deficit narrowed slightly from the equivalent of 11.2 percent of GDP in the first quarter of 2020 to 10.7 percent at the same point this year, mainly from higher exports of copper ore and concentrate wine and spirits. Accordingly, ADB projects a faster narrowing of the current account deficit in both 2021 and 2022.
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