Lasha Kavtaradze, economist at Galt & Taggart, says the slowdown in Georgia’s economic growth in June was anticipated. After a strong 7.5% growth in April and May, GDP growth eased to 6.3% in June. Galt & Taggart forecasts 7.5% annual growth and 6.8% growth for the second quarter.
"Slower growth was expected," says Kavtaradze. “The economy grew by 9.8% in Q1, and 7.1% in Q2. For our annual forecast to materialize, the economy needs to grow by 6.8% in the second half, which is a natural slowdown.”
He notes that growth is mainly driven by strong consumption, with investments also making a positive contribution. Business lending and government infrastructure projects, planned at 8% of GDP, are supporting economic activity.
Meanwhile, turnover among VAT-paying businesses grew 8.7% year-on-year in June, reaching 14.8 billion GEL, but this growth rate has also slowed compared to previous months.
Kavtaradze emphasized that while growth is moderating, it still aligns with expectations from other institutions like the IMF (7.2%) and the National Bank (7.4%).
