Oil Report

Georgia's economic growth slows to 4.9% year on year in H1

TBILISI, July 31 (Reuters) - Georgia’s economy expanded 4.9% year-on-year in the first half of 2019, down from 5.7% in the same period of 2018, preliminary data showed on Wednesday.

In June gross domestic product grew by 5.0% compared with the same month a year ago, after expanding 4.7% year-on-year in May. In June 2018 GDP had grown by 4.0% year-on-year.

The fastest growth in June was registered in trade, transport, real estate, construction, industry and services. The financial sector declined.

Georgia’s economy expanded 4.7% in 2018, down from 5% in 2017.

The government expects growth this year of at least 5%, although the central bank governor Koba Gvenetadze told Reuters this month that GDP might be reduced by more than 1% this year because of a dispute with neighbouring Russia and amid anti-government protests.

Fitch Ratings said in June that Russia’s decision to ban flights to Georgia would weigh on Georgia’s growth and current account because of its impact on tourism. Georgia got around $3 billion in revenues from tourism in 2018.

Fitch upgraded Georgia’s long-term foreign currency rating to “BB” from “BB-” with a stable outlook in February. (Reporting by Margarita Antidze; Editing by Alison Williams)