BAKU, Azerbaijan, Dec. 7
By Maryana Akhmedova – Trend:
Georgia’s economic activity has been growing steadily over the recent years, with annual real GDP growth balancing around 5 percent from 2017 through 2019, Trend reports via joint publication by the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD).
According to the report, the monetary policy pursued by the National Bank of Georgia has maintained control over inflation, which has boosted the Central Bank's credibility over the past decade.
“The size of the tourism sector gained importance, representing about 8.4 percent of value-added in GDP in 2019 and contributing directly to close to 12 percent of total employment in 2019,” the report said.
However, due to the COVID-19 pandemic, a significant decrease in tourism and remittances contributed to a sharp slowdown of Georgia’s economic recovery, affecting the GDP decline of 6.1 percent in 2020, the report said.
According to the EIB and the EBRD, the Georgian economy remains heavily dollarized, however, noticeable de-dollarization could be observed in recent years.
“Against this backdrop, sound fiscal, monetary and supervisory policies in Georgia should remain an anchor to preserve domestic macro-financial stability,” the publication said.
The budget deficit has increased significantly as a result of the COVID-19 pandemic, while prudent fiscal policy is expected to maintain a manageable level of public debt, the EIB/EBRD report concluded.
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