BAKU, Azerbaijan, December 1. Georgia's current account deficit (CAD) is likely to stabilise close to 5% of GDP in 2025-2027, Trend reports citing Fitch Ratings.
"Georgia's current account deficit more than halved to an average of 4.4% from 2022-2024 from an annual average of 9% of GDP in 2015-2019. This was aided by one-off large private money transfers from Russia in 2022-2023. However, in Fitch's view there has been a significant and likely durable increase in service exports including the information and communication technology, travel, financial services and education sectors in recent years. The CAD is therefore likely to stabilise close to 5% of GDP in 2025-2027 (still over 2x the current 'BB' median of 2.4%)," reads the report recently released by the rating agency.
Fitch analysts expect net external debt to decline from 36.2% of GDP to 32% by 2027, still well above the projected 13.4% 'BB' median, given its baseline CAD projections, recovering foreign direct investment (FDI) inflows and a relatively stable exchange rate.
"The economy expanded by 7.8% yoy in 1-3Q25 (2024: 9.7%), and Fitch expects growth of 7.3% in 2025, 5.3% in 2026 and 5% in 2027 (current 'BB' median: 3.8%). Strong increases in productivity and the reduced import-intensity of the sectors driving growth, such as information and communication technology, tourism and transport, will boost medium-term growth prospects (estimated by the authorities at 5%-5.5%). Expected large FDI in the real estate sector, and other large capex projects provide upsides to our projections in the medium term," the report says.