Page 34 - GEORptSep18

S&P affirms Georgia’s BB-/B saying growth set to remain strong
Fitch's expectations.
Still, Fitch pointed out that Russia and Turkey are Georgia's second and third largest trading partners, accounting for 14.5% and 7.9% respectively of total exports in 2017, as well as being “important sources of remittances, foreign direct investment (FDI), and tourism revenues”.
Georgia has a “track record of macroeconomic resilience against regional shocks” Fitch pointed out in the statement, noting the country’s governance and business environment indicators that are above the current medians of its 'BB' category peers.
On the other hand, according to Fitch, Georgia’s external finances remain significantly weaker than the majority of its ‘BB’ rated peers. It points to the country’s large current account deficits and low external liquidity that leave the open economy vulnerable to external shocks.
S&P Global Ratings on May 4 affirmed the ‘BB-/B’ ratings of Georgia and said the outlook was stable. Georgia's growth is set to remain strong and its IMF programme should mitigate balance of payment risks and act as a fiscal policy anchor, the rating agency said.
The update refers to the country's long and short-term foreign and local currency sovereign credit ratings.
Preliminary data showed GDP accelerated through the first quarter of this year, rising from 4.4% in January and 5.5% in February, to average at 5.2% y/y for the quarter. The expansion in March was driven by a rise in activity in manufacturing, transport, real estate and trade, and “other community, social and personal service activities”.
The statistics office also released preliminary data on Georgia’s external trade, showing that exports were up 28.4% to $740.3mn, while imports rose 21.6% to $2.0834bn.
8.5 Fixed income
8.5.1 Fixed income - bond news
Microfinance institution Crystal’s bonds admitted to Georgian Stock Exchange
Kutaisi-based microfinance organisation JSC MFO Crystal’s GEL10mn (€3.5mn) two-year bonds were admitted to the Georgian Stock Exchange on May 17.
Crystal made its debut bond issue in December 2017, which was the first local currency bond offering in Georgia’s microfinance sector. The firm said at the time of the issue that it planned to list the bonds on the local exchange.
The bonds, which mature on December 28, 2019, have been admitted to the exchange’s category B listing under the ticker #CRS01J , the Georgian Stock Exchange a nnounced .
Crystal’s main focus is on micro entrepreneurs and farmers living and working in regions and remote areas, with just under 29% of its portfolio extended to borrowers outside urban areas as of 2017. It has 50 regional branches across
34 GEORGIA Country Report September 2018 www.intellinews.com