Georgia overview

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Dam in Georgia

In Georgia we focus on:

Supporting private sector competitiveness through innovation, enhanced value added and convergence with Deep and Comprehensive Free Trade Area (DCFTA) standards and obligations. We will continue supporting SMEs and the local private sector via the well-developed local banking sector with a focus on high-potential areas such as agriculture, hospitality and innovation where we plan to deploy support in workforce training skills focused on regional inclusion, youth and gender.

Deepening financial intermediation and developing local currency and capital markets to enable the private sector to have better access to finance.

Expanding markets through inter-regional connectivity, expanding Georgia’s potential as a regional link through further modernisation of the country’s infrastructure. The EBRD will explore the financing investments under private-public partnership frameworks that will enable Georgia to take advantage of its geographic position between the South Caucasus, Central Asia and Europe.

Renewable energy, resource efficiency and climate change adaptation to improve competitiveness and resilience of the economy. We will continue supporting the creation of renewable generation capacity in hydropower, wind and possibly solar, as well as building transmission lines to connect with regional markets. A special Energy Efficiency Action Plan will be developed to tackle excessive energy consumption.

As well as being a country where the EBRD works, Georgia is also an EBRD donor. In 2014 Georgia signed a €1 million contribution agreement to the Eastern Europe Energy Efficiency and Environment Partnership (E5P) Fund.  And the second contribution agreement for €2 million was signed in 2020.

The EBRD’s latest Georgia strategy was adopted on 8 December 2021

 

Current EBRD forecast for Georgia’s Real GDP Growth in 2022 8.0%

Current EBRD forecast for Georgia’s Real GDP Growth in 2023 5.0%

Economic growth has been very strong in 2022, at 10.3 per cent year-on-year in the first seven months of 2022. The tourism sector revival continued, with inflows from foreign tourists reaching almost 80 per cent of the level achieved in the first half of pre-pandemic 2019. Double-digit growth was recorded in many other sectors too, including energy, transport, and manufacturing. The inflow of Russian businesses and ICT professionals who found a refuge in Georgia boosted money transfers and further supported the services and hospitality sectors. At the same time, the trade deficit has widened as exports and imports have increased more than 30 per cent year-on-year in the first seven months of 2022, benefiting from the geographical diversification of trade. However, rising current account inflows helped to cover the trade deficit and supported the appreciation of the Georgian lari since the low point in March 2022, and led to an increase of foreign reserves. The appreciation of the domestic currency mitigated some of the pressure from imported prices of food and energy, resulting in a moderation of inflation from the recent peak of 12.5 per cent in June to 10.9 per cent in August 2022. That allowed the National Bank of Georgia to keep the refinancing rate at
 
11.0 per cent since March 2022, after a 300 basis points increase in the preceding 12 months. Amid the high geopolitical uncertainty, the authorities secured a US$ 280 million precautionary Stand-By Agreement with the IMF in June 2022, which creates a more predictable business environment. GDP growth is likely to reach 8.0 per cent in 2022 as negative spillover from the war on Ukraine have not materialised yet, but then moderate to 5.0 per cent in 2023. The risks remain high due to extreme uncertainty and a significant probability of external adverse shocks.
 

Georgia in the EBRD’s 2022-23 Transition Report

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Georgia: key facts

Joined the EBRD on: 4 September 1992

Capital Subscription (€ 000): 30,010

EBRD Governor

Mr Lasha Khutsishvili

EBRD Alternate Governor

Mr Koba Gvenetadze

EBRD Board Director:

Klára Król

EBRD Board Alternate Director:

Antal Nikoletti

 

Georgia: investing for change

Some of Georgia’s many success stories and our role in them

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