Slow vaccine rollout and delayed tourism recovery deteriorate economic growth forecast, - Galt & Taggart report reads. According to their predictions, the economy will recover by 3.6% in 2021.
As Eva Bochorishvili, Head of the Galt&Taggart Research Department notes, predictions were more optimistic early in 2021 due to the expectation about vaccine rollout.
According to her, there were expectations that land borders would be opened and that would play an important role in tourism. However, according to Bochorishvili, there are expectations that additional COVID-related restrictions may be imposed, which will change the positive forecasts to pessimistic.
"There are signs of the third wave, some experts suggest that additional restrictions may be needed. This year we have two scenarios of economic growth: 5% growth based on the partial recovery of tourism, and the second is more pessimistic scenario - 3.6% economic growth. At this stage, we think that the probability of making a negative prognosis has increased due to the slow vaccine rollout in Georgia. Consequently, it is difficult to talk about the tourism recovery. Therefore, the pessimistic scenario is more realistic, which implies 3.6% economic growth in 2021, "said Eva Bochorishvili, Head of Galt & Taggart Research Department.
Eva Bochorishvili notes that new lockdown results are not reflected in the forecast of 3.6% economic growth. She notes that the perdition will deteriorate further if the COVID-related restrictions like last year will be imposed again.
“The results of the new lockdown are not reflected in the forecast of 3.6% economic growth. For example, Georgia was losing 16 million GEL on each weekend in winter. Accordingly, this amount will be deducted from the existing economic forecast. Depending on how long the COVID-related restrictions last and if the restrictions will be the same like the last year, we can expect a reduction in the economic growth of up to 2%. That’s why it is very important not to shut down the economy and to follow the rules, " Eva Bochorishvili said.
