Page 16 - GEORptAug20

Georgia think tank sees 8% GDP decline and 17.7% unemployment in “least pessimistic” scenario
Georgian think tank PMC Georgia Research has estimated in​​a report​that the country’s GDP will drop by 8% this year under a baseline (“least pessimistic”) scenario, while it would plunge by 12.9% under the “pessimistic” scenario.
Weaker tourism and remittances are two drivers hitting the country’s economy. In March, compared to March 2019, the number of tourists coming to Georgia decreased by 56.1%, while remittance inflows dropped by 9%. Further declines in these figures are expected in the coming months.
The government, in line with the International Monetary Fund (IMF), projected a 4% GDP decline this year, which corresponds to the “optimistic” scenario drafted by PMC Research.
If the optimistic scenario holds true, Georgia’s real economy is expected to shrink by 4.3%, a more severe decline than seen in 2009 (-3.7%), the report read.
Regarding the average unemployment rate in 2020, in the optimistic scenario, PMC Research expected a rate of 14.1% (up from 11.6% in 2019), while for the less pessimistic scenario the figure would be 17.7% and for the very pessimistic scenario 22.7%.
Additionally, it is likely that the negative impact of the coronavirus (COVID-19) pandemic will change the structure of the labour force in Georgia. The self-employed, which represented 44% of the Georgian labour force in 2019, will be particularly vulnerable to the changes.
In the optimistic scenario, PMC Research forecast a 6.3% decrease in the total number of employed persons in Georgia, while job losses were forecast to be greater in the less pessimistic scenario (9.8%) and in the very pessimistic scenario (14.4%).
16​ GEORGIA Country Report ​August 2020 ​ ​www.intellinews.com