Due to the hostilities in Ukraine, and the economic sanctions imposed on Russia, the European Bank of Reconstruction and Development (EBRD) has updated its forecast for Georgia’s GDP growth for 2022 - 2023, Trend reports via the Bank’s Regional Economic Update.
Thus, Georgia’s GDP growth is estimated at 2 percent for 2022 (compared to -3.5 percent, according to November 2021 forecast), and at 4.5 percent for 2023.
According to the EBRD, the countries of Central Asia and the Caucasus may be additionally influenced by restrictions on the convertibility of the Russian ruble and decreased air connections between Russia and the surrounding countries which will impact the remittances inflow and trade turnover.
“Georgia also has high export shares to Russia (25-30 percent), which would likely be affected by the expected downturn of the sanctioned Russian economy. Georgia may additionally suffer from a slowdown in tourism from Russia and Ukraine, strongly affecting an already battered hospitality industry,” the Bank said.