15 Apr 2015 - 18:12
The World Economic Outlook (WEO) has projected Georgia’s real Gross Domestic Product (GDP) will be two percent in 2015 and three percent in 2016 but only reach 5 percent in 2020.
WEO presented the International Monetary Fund (IMF) staff's analysis and projections of economic developments at global level in major country groups and in individual countries.
IMF noted the outlook for advanced economies was "improving”, while growth in emerging markets and developing economies was projected to be lower, primarily reflecting weaker prospects for some large emerging market economies and oil-exporting countries.
"Economies in the Commonwealth of Independent States slowed further in the latter half of 2014, and the outlook for the region has deteriorated markedly,” said the report.
"The downward revisions are driven by Russia, whose economy is now expected to contract by 3.8 percent this year, more than 4 percentage points below the previous forecast, and by 1.1 percent in 2016.”
"Falling oil prices and international sanctions have compounded the country’s underlying structural weaknesses and have undermined confidence, resulting in a significant depreciation of the Ruble. The remainder of the CIS is projected to grow at 0.4 percent in 2015, 3.6 percentage points below the previous forecast. Ukraine’s economy is expected to bottom out in 2015 as activity stabilises with the beginning of reconstruction work, but the economy is still projected to contract by 5.5 percent,” noted the report.
"Elsewhere in the region, lower commodity prices and spillovers from Russia (through trade, foreign direct investment and especially remittances) are also dampening the outlook, particularly in light of existing structural vulnerabilities, resulting in large downward revisions to 2015 growth projections for Armenia, Belarus, Georgia, and Kazakhstan, among others.”
"Armenia and Belarus are projected to enter into recession in 2015, and Georgia’s growth will slow. In all three economies, the downward turns reflect spillovers from Russia. In Moldova, lower credit growth together with lower exports and remittances will result in a small GDP contraction this year,” concluded the report.
Back in November, IMF estimated growth this year in Georgia should reach five percent as the economy recovered from the slowdown in 2013, as well as being supported by stronger consumption, private investment and exports.