Based on this month’s data, we expect annual growth in 2016 to be 2.7% in the worst-case or “no growth” scenario, and 4.1% in the best-case or “average long-term growth” scenario. Our “middle-of-the-road” scenario (based on the average growth in the last four quarters) predicts a 3.4% real GDP increase in 2016.

On June 15, 2016, ISET held a press conference to discuss recent economic indicators of Georgia. In the second quarter of 2016, the two most important economic barometers of consumer and business sentiment in Georgia – the Business Confidence Index (BCI) and the Consumer Confidence Index (CCI) continued to steadily improve.

The growth forecast for the 2nd quarter of 2016 was revised downward from 5.0% to 4.2%. Our first prediction of GDP growth for the third quarter is 4.3%. Meanwhile, Geostat has updated its GDP growth estimate for the first quarter of 2016. The Q1 growth rate stands at 2.3%, which is 0.6 percentage points below the forecast.

We started forecasting the annual growth rate at the beginning of 2014 (see our January 2014 and February 2014 publications for a note on methodology). Based on this month’s data, we expect annual growth in 2016 to be 2.0% in the worst-case or “no growth” scenario, and 4.5% in the best-case or “average long-term growth” scenario.

According to Geostat estimates, Georgia’s annual real GDP growth in 2015 was 2.8%. ISET-PI’s annual GDP growth forecast of 2.9% annual growth (since September 2015) thus turned out to be quite accurate, just 0.1 percentage points above the official estimate.