Categories: Georgia

Georgia’s GDP declined by 5.3% in August 2020

The FINANCIAL — National Statistics Office of Georgia published data of rapid estimates of economic growth. Estimated real Gross Domestic Product  (GDP) declined by 5.3 percent in August 2020 YoY. Asian Development Bank’s new report says that Georgia is forecast to return to the economic growth of 4.5 % in 2021 thanks to expected recoveries in tourism, private consumption, investment and net exports. In Q2 2020 the nominal GDP amounted to GEL 11 210.0 million.

Estimated real gross domestic product (GDP) declined by 5.3 per cent in August 2020 year-on-year and by 5.6 per cent in the first eight months of 2020 year-on-year, show the latest data from the National Statistics Office of Georgia (Geostat). In August 2020 estimated real growth compared to the same period of the previous year was negative in almost all activities, other than mining and quarrying, reported.

Earlier this month, Geostat also published preliminary data of Gross Domestic Product of Georgia (2020 II quarter). In Q2 2020 the nominal GDP amounted to GEL 11 210.0 million. The real Gross Domestic Product (GDP) declined by 12.3 percent YoY, while the GDP deflator increased by 6.3 percent.

The largest shares of GDP by activity are held by Trade (14.6 percent), Real estate activities (12.7 percent) and Agriculture, forestry and fishing (10.2 percent), followed by Manufacturing (9.9 percent), Public administration and defense; compulsory social security (7.5 percent), Construction (6.8 percent), Transportation and storage (6.1 percent), Education (5.6 percent). Revised data will be published on November 16, 2020.

A new Asian Development Bank (ADB) report, the Asian Development Outlook 2020 Update said that Georgia is forecast to return to the economic growth of 4.5 percent in 2021 thanks to expected recoveries in tourism, private consumption, investment, and net exports, following a contraction this year due to the coronavirus pandemic. In ADB’s flagship annual publication the bank forecasts a 5.0% contraction in economic growth in 2020 in view of the adverse effects of COVID-19 on the economy and investment climate, but a rebound in 2021. Real gross domestic product (GDP) declined by an estimated 5.8% in the first half of this year against 4.8% growth in the same period of 2019.

The report forecasts inflation in Georgia to reach 6.0% and 4.5% in 2020 and 2021, respectively, higher than the bank’s previous estimates in its Asian Development Outlook, released in April. In the first half of 2020, inflation was 6.4%, up from 3.6% last year, reflecting price increases of 13.6% for food, 4.3% for other goods, and 2.2% for services. Core inflation reached 6.6% and the producer price index rose by 10.1%.

Georgia advanced to 8th position in world economic freedom ranking


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