EBRD Sees 4.5% Growth in Georgia in 2019, Warns on External Shocks

Georgia’s economy is expected to expand by 4.5% this year, supported by external demand, growing exports and tourism, the European Bank for Reconstruction and Development said.

Georgia’s economy expanded 4.7% in 2018, down from 5% in 2017. The government expects growth this year of at least 5%, driven by tourism, infrastructure, energy, finance and manufacturing. Georgia serves as a transit route for Caspian Sea oil and gas and has a growing tourism sector.

“We forecast Georgia’s real GDP to grow by 4.5% in 2019 and by the same rate in 2020,” Sergei Guriev, the EBRD senior economist, said in emailed answers to Reuters questions.

“External demand is likely to stay main growth driver on the back of continuously expanding exports of goods and a booming hospitality sector.”

Exports benefit from ongoing geographical diversification as free trade agreements grow, Guriev said, and private consumption should remain sound, supported by rising real income, remittances from abroad and strong credit growth.