Georgia’s economy continues to go from strength-to-strength, expanding by 4.7% year-on-year during the first eight months of 2017, official data shows. This is a large increase on the figures from the same period in 2016, which showed growth of only 2.7%.
Reasons given for the large increase include higher exports, remittances from abroad, plus tremendous growth in the country’s tourism industries.
For the whole of 2016, Georgia’s economy expanded by 2.2%, with the government originally forecasting growth of 4% for all of 2017.
In June, Georgia’s Economy Minister told Reuters that the economy had a good chance of exceeding the official forecast due to increased private sector developments and government spending on infrastructure projects. Currently, the Georgian government is forecasting growth of 4.5% for the year.
In light of the new figures, the International Monetary Fund has also revised its figures upwards. Earlier this year, the IMF was forecasting 3.5% growth in 2017 and 4.0% in 2018. Their revised forecasts have been increased to 4.3% in 2017 and 4.2% in 2018.
Ms. Mercedes Vera Martin of the IMF said that an improved external environment and strong growth in the tourism and service sector were boosting the economy.
“We also see that domestic demand in Georgia is becoming much more dynamic and consumption and investment becoming quite mobilised,” Ms. Vera Martin added.
In April, the IMF disbursed $40.7 million the first tranche of a loan programme to Georgia. The IMF’s Executive Board will meet in November in consider a second tranche of loans.
The country’s current account deficit is narrowing, projected at 10.4% in 2017, down from 12.8% in 2016.