Real GDP grew 4.3% y/y in March 2015 and 3.2% y/y in 1Q15
Georgia’s real GDP grew 3.2% y/y in 1Q15 as output expanded 4.3% y/y in March, 4.9% y/y in February and 0.5% y/y in January, according to GeoStat’s rapid estimates. 1Q15 expansion is notable given the high base effect of 1Q14, when GDP grew 7.2% y/y. Growth of the credit portfolio and increased public capital spending supported the expansion, while decrease in external earnings was the major drag on growth, based on 1Q15 preliminary estimates.
Georgia’s population 3.7mn – preliminary results of census
According to the preliminary results of the population census conducted in November 2014, Georgia’s population totaled 3.7mn, which constitutes a 14.7% (641,900 persons) decrease compared to the 2002 census data (4.4mn persons). The major decline of 23.8% in rural population, with urban population shrinking by just 6.3%, changed the rural/urban population composition significantly. Rural population accounted for 42.6% of total (47.7% in 2002) and urban population accounted for 57.4% of total (52.3% in 2002). The final census data, to be published in April 2016, will affect GDP per capita recalculations, employment rate, and Georgia’s international rankings.
International arrivals up 0.4% y/y and up 2.2% m/m in April 2015
Tourist arrivals increased 0.4% y/y (+2.2% m/m) to 394,634 visitors in April 2015, after three consecutive months of y/y decreases in 2015, according to MIA. As a result, tourist arrivals declined by 1.6% y/y in 4M15. Turkey was the top country by arrivals, accounting for 26.2% of total (-1.7% y/y), followed by Armenia (24.6% of total, -1.3% y/y), Azerbaijan (22.8% of total, +8.0% y/y), and Russia (14.8% of total, -0.7% y/y), while arrivals from EU grew 6.8% y/y, reaching 4.7% of total in April 2015.
Loans/deposits continue growing, NPLs are low
Loans and deposits continued growing in March 2015, according to NBG. Excluding the exchange rate effect, the loan portfolio increased 18.2% y/y (+37.1% y/y in unadjusted terms) to GEL 14.6bn (US$ 6.5bn). Deposits grew by 11.5% y/y excluding the exchange rate effect (+29.9% y/y in unadjusted terms), reaching GEL 12.6bn (US$ 5.6bn). In March 2015, non-performing loans reached 3.3% (+0.1ppts m/m and +0.2ppts y/y).
NBG sold US$ 40mn
NBG sold US$ 40mn on the FX market to support the lari on 28 April 2015. It was NBG’s fifth intervention this year after the Bank sold US$ 160mn at four earlier auctions (in total, US$ 60mn higher than the net sales in the same period of last year). The lari has weakened 3.3% against the dollar in April and 23.8% ytd, 14.7% against the Euro and 7.5% against the Turkish lira ytd.
EIB opened a regional office in Tbilisi
The European Investment Bank (EIB) opened its regional representative office for the South Caucasus in Tbilisi on April 30, which underlines Georgia’s regional hub economy status.
