TBILISI: Georgia’s economy is now seen growing by 3 percent in 2015, more than previously projected, helped by foreign direct investment expected to reach at least $1.7 billion, the country’s economy minister said.
Serious problems in the economy had prompted a cut in the official growth forecast to 2 percent from 5 percent which was confirmed by parliament in July. It also approved a 160 million lari ($67 million) reduction in budget spending.
The former Soviet republic, which is traversed by pipelines carrying Caspian oil and gas from Azerbaijan to Europe, has suffered from a plunge in the Russian rouble and a decline in exports and remittances.
“Gross domestic product grew by 2.8 percent in January-August 2015 and we now expect 3 percent growth by the end of this year,” Dmitry Kumsishvili told Reuters.
He said that, despite difficulties, Georgia expected to attract at least $1.7 billion of FDI that would help to secure 3 percent growth.
“In terms of FDI this year, we expect not less than what we got in 2014, not less than $1.7 billion,” Kumsishvili said.
“We signed many projects this year, that’s why we are optimistic in terms of FDI.”
Georgia attracted $530 million in FDI in the first half of this year, up from $505 million in the same period last year. FDI totalled $1.758 billion in 2014.
Kumsishvili said the country’s hydropower sector, tourism, food processing were seen as the most attractive for foreign investors.
