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Quarterly Macroeconomic Review - I Q, 2018


  • With regard to the real sector, according to preliminary estimates, average growth of real GDP amounted to 5.2% in Q1 2018. In Q1, average annual inflation totaled 3.3%, which slightly exceeds the National Bank target (3%).
  • Concerning the fiscal sector, in Q1 2018, consolidated budget revenues increased by 6.5% YoY, while expenses and acquisition of non-financial assets rose by 9.9%. As of Q1, public debt in nominal terms increased by 13.5% YoY. Domestic debt grew by 8.8% YoY, while external debt – by 14.2%.
  • As for the external sector dynamics, in Q1 2018, external trade of goods was 23% higher YoY, including a 28% increase in exports and a 22% increase in imports. A positive trend has emerged since Q4 2016 – the growth rate of exports remains high and, in the 1stquarter, exports reached one of the highest values compared to the respective period of previous years. In Q1, total international reserves also grew by 6.6% YoY and reached USD 3,019 million. In the 1st quarter, the exchange rate of GEL (period average) against USD rose by 4.4% QoQ, and by 4.8% YoY.  
  • In the matter of the monetary sector, in Q1 2018, market interest rates on loans rose by 0.8 pp QoQ and reached 13.6%. In the 1st quarter, commercial bank loans increased by 21.1% YoY, while deposits in USD made up 62.8% of the total.
  • Out of social and labor market indicators, in Q4 2017, the number of business sector employees increased by 39,300 YoY and reached 660,100. In Q1 2018, expenditure on education increased by 6% YoY and totaled GEL 270 million, while healthcare expenses rose by 1%, reaching GEL 249 million.