Georgia's better-than-expected economic performance in 2015.
Preliminary statistics released on January 29 indicate that the Georgian economy grew by 2.8% last year, following 4.6% growth in 2014. Assuming the headline figure is accurate, it points to a slowdown that is mainly attributable to impacts from economic recession in Russia. Georgian exports fell last year, owing to reduced demand in key markets, and the inflows of remittances sent home by expatriate workers declined. Both these factors contributed to pressure on the lari.
Increased political uncertainty ahead of October parliamentary elections could undermine growth by deterring investors.
As economic problems in Azerbaijan and Armenia reduce export opportunities, the search for new markets will intensify.
High dollarisation of the banking sector will be a risk as households and businesses find it hard to repay loans.
