Page 23 - GEORptSep20

5.0​ External Sector & Trade
5.1​ Balance of payments, current account
Georgia - External Trade 2013 2014 2015 2016 2017 2018 2019 2020* (Jan-Jul)
External trade turnover ($ mn)
10,933 11,463 9,505 9,459 10,802 12,741 13,315 6,031
Export (FOB) ($ mn)
2,910 2,861 2,205 2,117 2,746 3,380 3,798 1,759
Import (CIF) ($ mn)
8,023 8,602 7,304 7,342 8,057 9,362 9,517 4,272
Balance ($ mn)
-5,112 -5,741 -5,100 -5,225 -5,311 -5,982 -5,719 -2,514
Export excluding re-export ($ mn)
1,812 1,819 1,603 1,620 2,008 2,226 2,324 1,083
Current account BPM6 ($ mn)
-955.5 -1,784.2 -1,767.0 -1,885.8 -1,307.5 -1,192.7 -900.5 /
Current account to GDP (%)
-5.8% -10.7% -12.2% -12.9% -8.8% -7.7% -5.1% /
Source: Geostat
5.1.1 ​Import/export dynamics
Georgia’s trade gap narrows by 33.5% in Q2
The trade deficit of Georgia narrowed by 33.5% y/y in Q2, according to preliminary data from the statistics office Geostat.
But, at $828mn, the trade gap remains particularly wide in the context of uncertain revenues from tourism and shrinking wage remittances this year. Debt-generating external financing (public and private) is robust, preventing a balance of payments (BoP) crisis and exchange rate correction.
Georgia’s exports dropped by 24% y/y to $725mn in Q2. The annual decline was only 5.9% y/y in Q1. On the upside, the exports strengthened in June compared to April and May and posted an annual decline of only 13% y/y. Exports in June amounted to $267mn, which is 13.1% lower than in 2019.
The country’s imports in Q2 contracted by 29.3% y/y to $1.55bn.
In H1, Georgia's exports totalled $1.50bn (-15.6% y/y) and the imports were $3.56bn (-16.5% y/y). The negative trade balance in the period amounted to $2bn.
The country’s current account (CA) deficit is bound to widen this year amid weaker revenues from tourism and remittances caused by the coronavirus (COVID-19) crisis, but significant external financing is likely to keep the balance of payments stable, while the central bank is active in steadily maintaining the exchange rate against weakening.
The International Monetary Fund (IMF) said in April that Georgia’s CA gap would hit 11.3% of GDP this year.
23​ GEORGIA Country Report ​September 2020 ​ ​www.intellinews.com