On 21 December, ISET Policy Institute hosted an online event entitled “Impacts of the War in Ukraine on Georgia’s Economy?”. Yaroslava Babych, ISET Policy Institute’s Lead Economist and resident faculty member of ISET, led the event and provided insights on the expectations of the impact war in Ukraine might have on the Georgian economy. The event itself was supported by the Government of Sweden.
Dr. Babych started reviewing the initial expectations such as significant reduction in the real GDP growth rate of Georgia, reduction in trade, fall or stagnation in remittances from Russia, tourism recovery slowdown, moderate migration, GEL depreciation, increased inflationary pressures, disruptions in supply chains to list a few.
Dr. Babych moved on to analyzing Georgia’s economic dependence on both Russia and Ukraine before the war by presenting statistics from various sectors. Dr. Babych also highlighted the implications EU-imposed sanctions on Russia can have on Georgia’s economy in the short and long run. The first part of the seminar was finalized with an overview of the data accumulated in 9 months of the war that caused large-scale migration from Russia to Georgia accompanied by new business registrations and what it might mean for the economy in the long run.
Davit Keshelava, Deputy Practice Head for Macroeconomic Policy of the ISET Policy Institute, led the second part of the presentation dedicated to the transportation and logistics in the context of the war in Ukraine and its impact on the transportation and logistics sector in Georgia as well as in the broader region. Dr. Keshelava emphasized the emerging role of Georgia as a part of the middle corridor from China to Europe in avoiding disruptions in different supply chains.