Quarter 4 2022, Macro Review | Georgian economy 2022 – the year in review
10 April 2023

In 2022 Georgia stayed on the path of recovery, exceeding experts’ expectations of economic performance. According to GeoStat’s preliminary estimates, the real GDP continues to show double-digit growth rates, measuring at 10.1% y/y in 2022 – which is remarkably close to the NBG’s real GDP growth expectation of 10% from October 2022. ISET-PI’s real GDP growth forecast from October data came close to the reported actual (11% y/y) albeit slightly overestimating the final yearly results. A series of real shocks (Russia’s war on Ukraine, international sanctions against Russia, large-scale migration from Russia to Georgia, and the accompanying inflows of funds) were the main economic drivers in 2022. A surge in exports, FDI, and capital investment activity resulted in the second consecutive year with a larger than 10% real GDP growth rate.

The GDP expansion process was accompanied by rising inflation. While inflation moderately decreased in the fourth quarter of 2022, reaching 9.8% y/y in December, the yearly inflation remained at double-digit levels, measuring 11.9%. Although imported inflation has been declining, accompanied by the strengthening currency, the high domestic demand still plays a major role in the rising inflation. According to the National Bank of Georgia’s forecasts (February 2023), the average inflation in 2023 will be 5.4%. Moreover, starting from the third quarter, it will be getting closer to the target of 3%.