GDP Forcast

Details: Created: 09 June 2020

ISET-PI has updated its Georgian real GDP growth rate forecast for the second and third quarters of 2020. Here are the highlights of this month’s release:

Geostat has released its rapid estimate of real GDP growth for the first quarter of 2020, which stands at 1.5%.

The estimated real GDP declined by 16.6% in April 2020 yearly and by 3.6 percent in the first four months of 2020. In April, the estimated real growth compared to the same period of the previous year posted negative in almost all activities, except mining and quarrying. Moreover, VAT payers’ turnover, used in rapid estimations of economic growth, dropped by 32.8% annually over the same period.

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Details: Created: 27 April 2020

ISET-PI has updated its Georgian real GDP growth rate forecast for the first and second quarters of 2020. Here are the highlights of this month’s release.

Geostat has released its rapid estimate of real GDP growth for February 2020. The estimated growth stands at 2.2%, while the average real GDP growth for January-February 2019 reached 3.7%.

ISET-PI predicted 4.7% and 5.4% growth for the first and second quarters of 2020 respectively, based on February 2020 data. This data does not yet fully account for the negative impacts of COVID-19 pandemic on the national economy.

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Details: Created: 31 March 2020

ISET-PI has updated its Georgian real GDP growth rate forecast for the first and second quarters of 2020. Here are the highlights of this month’s release:

The annual real GDP growth for 2019 amounted to 5.2%, while the real GDP growth rate reached 5.1% year-on-year for January 2020.

Before taking into consideration the negative consequences of COVID-19 on the real GDP growth forecast, ISET-PI predicted 4.7% and 5.4% growth for the first and second quarters of 2020 respectively, based on data from January 2020.

Consequently, the annual growth in 2020 was expected to be 4.8% in the worst-case scenario, and 5.9% in the best-case or an average long-term growth scenario. Our middle-of-the-road scenario (based on the average growth in the last four quarters) predicted a 5.2% increase in real GDP.

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GDP Forecast Methodology

The Georgian Index of Leading Economic Indicators provides current-quarter and one-quarter-ahead GDP forecasts for those who need to make business and policy decisions and cannot wait until the official statistics are announced several months later. According to methodology, our forecast is similar to those conducted by leading research institutes around the world. In particular, ISET-PI adapted the methodology that was originally developed by the New Economic School to forecast GDP for the Russian Federation. We would like to acknowledge the help of Prof. Konstantin Styrin (NES) who agreed to share his MATLAB code with ISET-PI, and the assistance of Dr. Andrei Sarychev in modifying and adapting the code for Georgia‘s needs.