Trade deficit down 13.5% y/y in February 2016, excluding one-offs
In February 2016, exports decreased 5.1% y/y to US$ 158.7mn, imports fell 11.1% y/y to US$ 515.1mn (excluding donated C-hepatitis medicine), and the resulting trade deficit shrank 13.5% y/y to US$ 356.4mn, according to GeoStat. Significantly reduced car re-exports (-43.4% y/y) and nut exports (-49.0% y/y) were the major commodities weighing on export growth, while copper ores (+163.8% y/y), wine (+54.8% y/y), gold (+70.0% y/y), and spirituous beverages (+133.0% y/y) posted robust increases.
Gases (-31.3% y/y), cars (-40.2% y/y), petroleum (-17.1% y/y), copper ores (+1.1% y/y), and pharmaceuticals (-30.2% y/y, excluding C-hepatitis medicine) represented the top 5 imported commodities in February 2016.
Real GDP up 2.9% y/y in 4Q15 and up 2.8% y/y in 2015
Real GDP increased 2.9% y/y in 4Q15, according to GeoStat’s preliminary figures, bringing the 2015 annual growth figure to 2.8%, unchanged from rapid estimates. The growth base in 4Q15 was diversified, with all sectors posting increases other than manufacturing (-4.6% y/y) and trade (-1.8% y/y). As in previous quarters, construction generated double-digit growth at 12.2% y/y, led by the new gas pipeline construction by BP and increased public capex. Mining (+23.5% y/y), hotels and restaurants (+8.8% y/y), operations in real estate (+8.5% y/y), financial intermediation (+8.4% y/y), and communications (+7.4% y/y) were other growing sectors in 4Q15.
NPLs at 3.3% in February 2016
In February 2016, the loan portfolio grew 4.5% y/y, excluding the exchange rate effect (+14.1% y/y and +0.1% m/m in unadjusted terms), to GEL 16.2bn (US$ 6.5bn). Deposits grew 7.7% y/y, excluding the exchange rate effect (+18.0% y/y and +0.5% m/m in unadjusted terms), reaching GEL 14.6bn (US$ 5.9bn). NPLs remain under control at 3.3% in February 2016, up 0.1ppts y/y and up 0.2ppts m/m.
NBG bought US$ 10mn
NBG intervened on the FX market with a purchase of US$ 10mn on March 21, 2016. This was NBG’s second intervention (total purchase of US$ 15mn YTD) on the purchasing side since August 2014, aimed at curbing the appreciation of the national currency, which strengthened 4.5% w/w and 3.4% YTD against the US$.
Nikora Trade LLC bond issuance
On March 18, 2016, Nikora Trade LLC, a wholly-owned subsidiary of JSC Nikora, successfully completed its first ever bond offering. JSC Galt & Taggart served as the sole placement agent for the US$5 million, two-year issuance. Nikora Trade LLC is the largest food retail chain operator country-wide, currently represented by 203 stores. The company’s stores are located in every district of the capital and in 6 regions of the country – the widest geographic coverage among peers (see details on the fixed income page).
