Investment News

Investor.ge provides a brief update on investments and changes in government policy that could impact the business environment. Information in this issue was taken from BM.ge

Central bank holds rate at 8%
The National Bank of Georgia (NBG) maintained its key refinancing rate at 8% at its May 7 meeting, citing a balanced inflation outlook and persistent external risks. Annual inflation stood at 3.4% in April—near the bank’s 3% target—while core inflation was slightly lower at 2.3%. The NBG highlighted that domestic price pressures remained contained, supported by a stable exchange rate and improved production capacity that helped meet growing consumer demand. Despite a one-off increase in bread prices in March and elevated global food prices, inflation remained within a manageable range. The central bank also noted that robust economic growth—averaging 9.3% in the first quarter—was driven by structural reforms and strong consumption, though it warned of potential demand-side pressures in the months ahead.
In maintaining the rate, the NBG emphasized a “cautious approach,” outlining several global risks that could shift inflation dynamics. These include heightened geopolitical uncertainty, international tariff tensions, and potential fragmentation of global supply chains. At the same time, the lari’s appreciation and weaker dollar could moderate imported inflation in a downside scenario. The bank reiterated its commitment to maintaining price stability and signaled that future decisions will be based on updated forecasts and evolving economic risks. The next policy review is set for June 18.

Unemployment rate rises to 14.7% in 1Q25
Georgia’s unemployment rate rose to 14.7% in the first quarter of 2025, up 0.7 percentage points YoY, according to preliminary data from Geostat. The number of unemployed increased by 10.8 thousand (4.7%) to 239.4 thousand, while the number of hired employees rose slightly by 0.6% to 958,300. Self-employment declined 3% to 434,700.
The labor force participation rate fell to 54.8%, while the employment rate decreased to 46.8%. Urban employment dropped by 1 percentage point; rural employment ticked up 0.1 points. The unemployment rate reached 17% for men and 11.6% for women.

Airport traffic up 13% in 4M25
In the first four months of 2025, Georgia’s three international airports collectively served 2.18 million passengers, marking a 13% increase compared to the same period in 2024. Tbilisi International Airport remained the busiest, handling 1.44 million passengers—a 13% rise YoY—and operating 7,283 flights, up 17% from the previous year. Batumi International Airport experienced the most significant growth, with passenger numbers soaring by 43.7% to 233,722 and flights increasing by 36.7% to 1,092. Kutaisi International Airport saw a modest 2.3% uptick in passenger traffic, serving 506,564 travelers, while flight numbers remained steady at 1,533.

Remittances up 6.1% in April
Money transfers to Georgia reached $342.6 million in April 2025, marking a 6.1% increase compared to the same month in 2024, according to data from the National Bank of Georgia (NBG). The growth reflects a rebound in remittance inflows after months of mixed performance, with contributions from key sending countries showing notable shifts.
The European Union remained the leading source of remittances, accounting for approximately 42% of the total volume. The United States was the second-largest source, with transfers rising 15% YoY to $52.3 million. In contrast, remittances from Russia continued to decline—down 12% YoY.
The NBG also reported that the total number of transfers increased. Outflows from Georgia reached $29.8 million in April.

EBRD projects 6% GDP growth in 2025
Georgia’s real GDP growth is forecasted to moderate to 6% in 2025 and 5% in 2026, supported by public infrastructure spending and initiatives in transport, energy, and ICT, says the latest Regional Economic Prospects report released by the European Bank for Reconstruction and Development (EBRD). However, the bank cautioned that risks remain, including political uncertainty, the stalled EU accession process, weakening external demand, and slower credit growth.
The EBRD also noted the NBG’s cautious monetary stance, with a high real interest rate aimed at anchoring inflation expectations while balancing growth and external risks.
Georgia’s economy grew by 9.4% in 2024, up from 7.8% in 2023. The expansion was driven by growth in ICT, education, public administration, trade, and construction. Despite lower migration and fading war-related inflows from Russia, domestic consumption remained strong—supported by wage growth and increased credit activity.

Trade turnover up 15.3% in Jan–Apr 2025
Georgia’s external merchandise trade reached $7.76 billion in the first four months of 2025, a 15.3% increase YoY, according to preliminary data from Geostat. Exports rose by 14.2% to $2.01 billion, while imports climbed 15.7% to $5.74 billion.
The trade deficit amounted to $3.73 billion, making up 48.1% of total trade turnover during the period.

Energy exchange activity increases ahead of July transition
Trading on the Georgian Energy Exchange picked up in May, with 9,676 megawatts of electricity sold as of May 9 at a price of 125 GEL—equivalent to 12.5 tetri per kWh. According to exchange data, trading resumed on May 2 and remains more affordable than balancing electricity, which saw a 17 tetri price hike in March.
The exchange is currently operating under a transitional model, set to end July 1, 2025. Until then, electricity is traded hourly, while balancing electricity is settled monthly. From July, full platform trading will begin, including day-ahead, intraday, and balancing markets.