IMF further downsizes Georgia’s economic growth forecast to 2.5%

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Photo: jornadadiaria.com

Georgia's economy will increase by 2.5% by the end of 2013, the International Monetary Fund has said in its new October report. In the beginning of 2013, the IMF forecasted a 6% growth of the Georgian economy, though downsized it to 4% in June.

The IMF explains the decline in economic growth in Georgia by slower private investment, weak credit growth, and budget underspending. According to IMF forecast, the Georgian economy will grow by 5% next year. The IMF recommends the Georgian government to timely diffuse internal political tensions in order to restore investors' trust towards the country.

The forecast of Georgia's economic growth lags behind an average indicator of both the region (5.8%) and low-income CIS countries (6%). The IMF forecasts higher economic growth in Azerbaijan, Armenia and Turkey than in Georgia.

According to the IMF report, the unemployment in Georgia will increase by 1.7% compared to the previous year and will reach 16.7%. Moreover, a further increase in this indicator to 17.3% is expected in 2014. According to the IMF, the unemployment will increase at a lesser degree in Azerbaijan, Russia and Turkey than in Georgia.

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