Page 18 - GEORptNov21

IMF says Central Asian, Caucasus nations taking uneven and fragile path towards recovery from COVID-19 crisis
IMF projects Georgian economy to grow 7.7% in 2021, 5.8% in 2022
said the ratings agency.
To note, Moody's lately affirmed the government of Georgia's Ba2 local and foreign currency long-term issuer ratings and foreign currency senior unsecured rating. The outlook remained stable.
The International Monetary Fund (IMF) said on October 19 that countries in the Middle East, Central Asia and South Caucasus have emerged from the COVID-19 shock but remain on an uneven and fragile path towards recovery.
IMF projects growth for the Caucasus and Central Asia region at 4.3% this year and 4.1% next year, following a 2.2% drop in 2020. Differing vaccination rates were seen as exacerbating inequality and poverty in the region. Moreover, rising inflation due to higher commodity prices and pandemic-related supply shortages may lead to limits on supportive monetary policies, the Fund said.
"With uneven vaccination rollouts, the recovery in the Middle East and Central Asia is expected to be multi-speed and fragile, and countries need to maintain focus on managing the pandemic," the IMF said.
"In addition to the limited fiscal policy space, countries now face the added burden of diminishing monetary space, given rising inflation ... Central banks have the difficult task of curbing rising inflation without choking the fragile recovery," the IMF said.
"A tightening in global financial conditions could lead to capital outflows and higher sovereign spreads, exposing particularly those with lower reserves and weaker external accounts", the Fund added.
The International Monetary Fund (IMF) projects the Georgian economy to grow 7.7% in 2021 and 5.8% in 2022, reads the latest WEO report, titled World Economic Outlook: Recovery During a Pandemic.
With these indicators, Georgia will have one of the highest economic growth rates in the region of the Middle East and Central Asia.
Georgian Economy Minister Natia Turnava said that according to the latest IMF report Georgia will maintain its leading position in terms of economic growth both in the region and in Europe for the next six years.
We will have the highest economic growth rate of 5.8%, almost 6% per year. This will allow us to overcome the negative effects of the pandemic very quickly, to overcome poverty and to make our economy more diversified and stronger", said Turnava.
The Fund expects the economic rebound to help the government bring public debt down from over 60% of GDP to 55.3% of GDP at the end of the year, compared to a slight deterioration (60.8% of GDP) envisaged under the previous forecast in April.
Robust growth in remittances and exports, and early signs of a faster than expected rebound in tourism have supported the recovery and should contribute to a narrowing of the current account deficit (to 9.9% of GDP) compared to its elevated 2020 level, according to the IMF.
18 GEORGIA Country Report November 2021 www.intellinews.com