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EBRD updates GDP growth forecast for Georgia

Georgia Materials 17 May 2022 09:45
EBRD updates GDP growth forecast for Georgia
Aygun Maherramova
Aygun Maherramova
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BAKU, Azerbaijan, May 17. Georgia’s GDP growth is expected at 3 percent in 2022, Trend reports via Regional Economic Prospects from the European Bank for Reconstruction and Development (EBRD).

According to EBRD, Georgias’s economic recovery in 2021 was stronger than expected, with GDP growth reaching 10.4 percent. The recovery was mainly based on revived trade, manufacturing and information and communications technology (ICT) services on the production side and rising household consumption and net exports on the demand side.

The present forecast has improved compared to the estimates from March 2022 when the Bank predicted Georgia’s GDP growth at 2 percent.

Georgia has a high export share to Russia, Belarus and Ukraine (approximately 23 percent in 2021), and foreign direct investment (FDI) might be negatively affected by rising security risks in the region. As a result of these factors, moderate GDP growth of 3 percent is expected in 2022, before strengthening to 5 percent in 2023.

While risks remain high, the new three-year $289 million Stand-By Agreement with the IMF, expected to be approved by the IMF Board in May 2022, would further support macroeconomic and financial stability.

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