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.
In 2015 Georgia increased its contribution 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
Current EBRD forecast for Georgia’s Real GDP Growth in 2019 4.5%
Current EBRD forecast for Georgia’s Real GDP Growth in 2020 4.5%
The Georgian economy remains on the path of strong economic growth. Economic output expanded by 4.7 per cent in 2018, driven largely by growth in trade, real estate, transport and financial intermediation. The hospitality sector continued to boom, supporting overall economic performance; the share of tourism-related services in the whole economy increased from an average of 7.3 per cent in 2015-17 to 8.1 per cent in 2018. However, output of the construction sector declined by 3.1 per cent, marking the first contraction in the sector since 2013. Supported by a growing network of free trade agreements, exports of goods increased by 22.6 per cent in 2018 and by 13.2 per cent in the first two months of 2019, both in nominal US dollar terms. In 2018, inflows of remittances increased by 13.1 per cent, amounting to 10.9 per cent of GDP and supporting household consumption. Combined with thriving tourism and rising exports of goods, this caused a narrowing of the current account deficit to 7.7 per cent of GDP in 2018. At the same time, foreign investment into Georgia decreased by 34.9 per cent compared to 2017, hitting a five-year low at 7.3 per cent of GDP. This came on the back of completion of the South Caucasus Pipeline Expansion (SCPX – the gas pipeline connecting Azerbaijan and Turkey), the transfer of several enterprises to domestic ownership and debt repayments between connected companies. Despite the decline, FDI remained the main source of currency inflows, nearly offsetting the current account deficit. Balance of payments dynamics supported the currency which, while subject to seasonal variations, remained resilient to negative developments in regional economies. High-frequency indicators point to economic growth of 4.1 per cent year-on-year in the first two months of 2019. We forecast Georgia’s real GDP to grow by 4.5 per cent in 2019 and by the same rate in 2020.
Georgia in the EBRD’s 2018-19 Transition Report