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According to Geostat’s rapid estimates, real GDP grew by 3.4% in March, while the growth rate for Q1 stood at 2.3% year over year. The estimated first quarter growth was 0.5 percentage points less than ISET-PI’s GDP forecast for the quarter. We have updated our forecast for Q2 based on the new information and lowered it from 5% to 4.2%; at the same time, the Q3 forecast was revised upward to 4.3%.
Different international and domestic financial institutions have slight variations in their forecasts for Georgia’s year-over-year real GDP growth rate in 2016. The ADB and IMF both reduced their forecasts by 0.5%, now predicting 2.5% annual growth. In contrast, EBRD revised its forecast upward to 3.4% (coinciding with the value predicted by the ISET-PI forecast model), while the World Bank annual forecast stood at 3%. The National Bank of Georgia predicted 3% growth earlier in the year, and ISET-PI (in our “middle-of-the-road” scenario forecast) predicted a 3.4% real GDP increase in 2016. Download the full report
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According to GeoStat estimates, real GDP grew by 2.6% year over year in February 2016. This growth rate is an improvement over the 0.8% growth observed in the previous months. Still, in order to reach the predicted quarterly 2.9% growth (the ISET-PI forecast for Q1 real growth), the economy would have to have expanded by at least 5.4% in March. While the actual growth for March is likely to be lower than that figure, the increases in the consumer and business confidence indices (CCI, BCI) in the last month can be interpreted as good signs for the economy going forward. The resilience to macroeconomic shocks which the Georgian economy exhibited in 2015-2016 provides a good foundation for the country’s long-term development plans. Download the full report
