TBILISI, August 6 – The International Monetary Fund expects Georgia’s economy to grow by 6% in 2025. However, many fear that inflation, particularly in food, may take away much of the potential benefit for the wider population.
Inflation in Georgia rose to 4.3% year-on-year in July, the highest level recorded since May 2023, driven primarily by soaring food prices. The increase is putting significant pressure on low- and middle-income households across the country.
According to Georgia’s national statistics office, food prices surged by 10.4% over the past year, with particularly sharp increases in key staples. Vegetables rose by 25.5%, while oil and fat products went up by 17%. Health-related goods and services also saw a 9.5% price increase over the same period.
Experts warn that while the headline inflation figure may seem moderate, the real burden falls disproportionately on lower-income households, many of whom spend over 60% of their income on food. Economist Soso Berikashvili noted that the current spike in food prices “is a serious problem” for a country where a large share of the population has limited means.
Analysts say the only long-term solution is increased employment and higher household incomes. Ramaz Gerliani, head of the Center for Economic Transformation, emphasized the importance of aligning workforce skills with market demands, noting a persistent mismatch between employer needs and available labor.
While Georgia has implemented a number of state programs to boost small business development and improve access to credit, observers say more structural reform is needed. Paata Bairakhtari, another economic analyst, warned that despite improved inflation control compared to global peers, the dominance of monopolies and limited access to affordable financing have stifled inclusive economic progress. (Rezonansi/Keto Gogokhia.)
