Georgia: First Review Under the Stand-By Arrangement and Request for Modifications of Performance Criteria and Structural Benchmarks-Press Release; Staff Report; Staff Statement; and Statement by the Executive Director for Georgia

IMF Staff Country Reports, December 23, 2022

Source details

Canonical URL: Georgia: First Review Under the Stand-By Arrangement and Request for Modifications of Performance Criteria and Structural Benchmarks-Press Release; Staff Report; Staff Statement; and Statement by the Executive Director for Georgia

The Georgian economy has performed strongly in 2022.
Adverse spillovers expected from the war in Ukraine have not materialized thus far.
Drivers of stronger-than-expected outcomes:
- Buoyant tourism revenues.
- A surge in war-related immigration and financial inflows.
- A rise in transit trade through Georgia.
Macroeconomic effects observed:
- Lifted growth and fiscal revenues.
- Strengthened the current account balance and the lari.
- Supported reserve accumulation.
Inflation remains elevated, reflecting still high commodity prices and strong domestic demand.

2023 projections:
- Growth and inflation are expected to moderate in 2023.
- Factors cited for moderation: subsiding external inflows, less favorable global economic and financial conditions, smaller fiscal deficits, and a sufficiently tight monetary policy stance.
2024 projections:
- Growth is projected to converge to its potential rate in 2024.
- Inflation is forecast to fall to the NBG’s target in 2024.