TBILISI, DFWatch–The European Bank for Reconstruction and Development (EBRD) has downgraded its prognosis for Georgia’s economic growth in 2013 from 3 to 2 percent.
EBRD said a few days ago that the GDP growth will also be reduced from 5 to 4 percent and the level of inflation to 0 percent.
The bank explains that Georgia’s economic growth slowed down due to lower public and private investment and ‘policy uncertainty related to the post-election political transition and the presidential elections.’
“Under-spending of the capital budget by the government and contraction of private investments have contributed to a recession in construction and a marked slowdown in the industrial sector,” the EBRD report reads. “Agriculture and trade has been buoyant, after Russia started to re-open access of Georgian foodstuffs to its market.”
Economic growth is expected to accelerate by four percent in 2014, according to the London-based development bank.
The report says economy in the region will increase by 1 percent instead of 3. The lowest rates are expected in Ukraine (-0.5 percent), Belarus (0.5 percent), Georgia (2 percent), Armenia (2.5 percent), Moldova (2.5 percent), Azerbaijan (4.5 percent). Russia’s economy is expected to increase by 1.3 percent in 2013 and Turkey’s by 3.7 percent.