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.

Georgia has contributed €1 million to the Eastern Europe Energy Efficiency and Environment Partnership Fund.  Georgia is both a donor and a beneficiary of the fund.

The EBRD’s latest Georgia strategy was adopted on 14 December 2016

 
 

Georgia's policy response to the coronavirus crisis

The EBRD is monitoring Georgia's policy response to the coronavirus pandemic. Our biweekly publication identifies the major channels of disruption as well as selected impact and response indicators.

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Current EBRD forecast for Georgia’s Real GDP Growth in 2020 -5.0%

Current EBRD forecast for Georgia’s Real GDP Growth in 2021 3.5%

Preliminary indicators show that Georgia’s economy reached the trough of the cycle in April 2020 when GDP contracted by 16.6 per cent year-on-year. In the first seven months of 2020, output is estimated to have declined by 5.8 per cent year-on-year. The speed of economic recovery depends mainly on the return of tourism. While domestic lockdown
measures introduced in March 2020 were largely lifted in June, international borders stayed by and large closed, with the exception of regular flights to three European destinations, which restarted in August. The number of foreign visitors fell by 76 per cent year-on-year in January-August 2020. The impact on the hospitality sector has been somewhat softened by the increase in domestic tourism.
 
Remittances fell by 20 per cent year-on-year in March-May before strongly recovering by 22 per cent in June-August. Inflation reached 6.9 per cent year-on-year in April 2020, driven by the pass-through of sharp currency depreciation in March to domestic prices. As the rate of price increases moderated to 4.8 per cent in August 2020, enabling the National Bank of Georgia to loosen of monetary policy. The policy rate was lowered three times in 2020, to 8.0 per cent in August. International reserves increased to an all-time high of US$ 3.9 billion by the end of August on the back of official financing, including disbursements under the augmented IMF programme. GDP is expected to contract by 5.0 per cent in 2020 followed by a recovery of 3.5 per cent in 2021, provided the tourism sector posts a strong recovery next year and other risks remain contained.
 

Georgia in the EBRD’s 2020-21 Transition Report

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