Economic Monitor Issue 14 | June 2021

Overview

  • Moderate GDP recovery of 3.5% in 2021, after drop by 6.2% in 2020
  • Outlook for 2021 subdued due to lockdown in Q1-2021 and limited prospects for tourism
  • Current account deficit over 10% of GDP in 2020/2021, due to weak tourism revenues
  • Lari depreciated by 14% in 2020, but relatively stable around GEL/USD 3.30 in 2021
  • Inflation on the rise on back of Lari depreciation (pass-through) and higher commodity prices
  • Reaction by NBG: policy rate up by 1.5 pp in 2021; current rate: 9.5%
  • Remittances continue positive trend from second half of 2020; stabilising factor
  • Government continues to provide sizeable COVID-19 fiscal stimulus (2.3% of GDP in 2021)
  • Successful recent placement of USD 500 m Eurobond (5-year maturity, yield: 2.875%)
  • IMF programme successfully completed, new programme still in discussion

Topics

Blueberries. Nascent boom but strong regional focus on Russia
Electricity. Import dependency and Enguri renovation
COVID-19. Overview of cases and vaccinations

Download Economic Monitor 14/2021