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3.0 Macro Economy
Georgia - Main Macro 2013 2014 2015 2016 Indicators
2017 2018
Q1 Q2 2019 2019
GDP real growth (y/y, %)
3.4 4.6 2.9 2.8 4.8 4.7 4.9 4.5
GDP (per capita, $) 3,599.6 3,676.2 3,766.6 3,864.6 4,046.8 4,345.5 981.0
GDP: Final consumption expenditure, (GEL mn)
23,671.8 25,570.7 27,318.7 28,241.5 30,630.6 32,652.8 8,200.6 8,313.3
GDP: Gross capital formation, (GEL mn)
6,652.9 8,688.8 10,004.3 11,136.5 12,264.8 13,675.7 2,693.8 3,539.9
GDP: Exports, (GEL mn)
11,997.9 12,518.3 14,206.8 14,837.8 19,023.7 22,622.8 5,244.8 6,638.5
GDP: Imports, (GEL mn)
15,475.2 17,627.3 19,774.3 20,187.5 23,559.0 27,385.8 6,394.0 7,465.5
Source: bne IntelliNews, CEIC
3.1 Macroeconomic overview
Georgia’s GDP beats expectations with Q3 acceleration to 5.7%
Georgia’s GDP growth accelerated to 5.7% in the third quarter of 2019, up from 4.5% y/y in Q2 and 4.7% y/y in Q1, according to preliminary data released by national statistics office Geostat on October 31.
However, a deceleration is visible within the quarter, with growth falling from 6.1% y/y in July to 5.8% in August to 5.2% y/y in September. In principle that might be attributed to the sanctions imposed by Russia on Tbilisi following anti-Kremlin demonstrations by Georgians. They translated into in a smaller number of tourist arrivals.
In September, the value generated by construction, transport, trade, manufacturing, hotels and restaurants made the most significant contribution to overall growth.
Mining and quarrying was among sectors making a lower contribution to growth.
Average growth for the first three quarters of the year was 5.0%, compared to 4.8% in the same period of 2018. The government’s fiscal policy is run according to envisaged 2019 growth of 4.5%. That’s broadly in line with the expectations of the international financial institutions (IFIs). The Q3 GDP figures, however, allow for hopes that a better performance will be recorded.
The IFIs have cut their projections for Georgia’s economy after taking into consideration two major drivers: the Russian sanctions (a ban on flights has put pressure on tourism and industries on the same horizontal) and monetary policy tightening pursued by the central bank to curb inflation partly generated by expectations for a weakening of the Georgian lari. The former factor might be removed sooner than expected, however, while the latter depends to a large extent on rhetoric and expectations.
13 GEORGIA Country Report November 2019 www.intellinews.com
