IMF updates world economic outlook
On 16 April 2024, the IMF released an updated global economic outlook. According to IMF, the global economy expanded by 3.2% in 2023 and is expected to maintain this pace in 2024 and 2025. Notably, 2024 growth has been revised upwards by 0.1ppts from previous forecast. Despite significant central banks’ interest rate hikes aimed at restoring price stability, the global economy has displayed remarkable resilience. The IMF also forecasts a steady decline in global inflation rates, from 6.8% in 2023 to 5.9% in 2024 and 4.5% in 2025, with advanced economies returning to their inflation targets sooner than emerging market and developing economies. For Georgia, IMF forecasts 5.7% growth for 2024 and 5.2% for 2025.
Trade deficit decreased by 25.2% y/y in Mar-24
In Mar-24, both goods exports and imports reduced mostly due to the last year’s high base effect. Exports decreased by 4.4% y/y to US$ 522.4mn, after growing 2.0% y/y in previous month. Imports decreased markedly by 17.0% y/y to US$ 1.1bn, following a 6.9% y/y growth in previous month. Consequently, the trade deficit decreased by 25.2% y/y to US$ 622.5mn in Mar-24.
The top 5 exported commodities were cars (+3.6% y/y), wine (+63.7% y/y), ferro-alloys (+200.5% y/y), spirits (+39.0% y/y) and mineral waters (+36.6% y/y) in Mar-24. A 10.8% of exports were directed to the EU (-42.6% y/y), 66.2% to the CIS (+7.1% y/y) and 23.0% to other countries (-4.1% y/y).
The top 5 imports were cars (-50.8% y/y), petroleum (+10.0% y/y), gases (+16.1% y/y), pharmaceuticals (+14.3% y/y) and phones (-42.8% y/y) in Mar-24.
Overall, in 1Q24, trade deficit narrowed by 2.5% y/y to US$ 2.0bn, as exports decreased by 9.3% y/y to US$ 1.3bn and imports were down by 5.3% y/y to US$ 3.4bn.
Money transfers stood at US$ 278.5mn in Mar-24
Money transfers were down by 36.5% y/y to US$ 278.5mn in Mar-24, after falling by 29.0% y/y in previous month, due to the last year’s high base and normalization in transfers from Russia. From top countries, transfers reduced from Russia (-76.3% y/y, accounting for 19.0% of total), Kazakhstan (-32.2% y/y, 4.2% of total) and Türkiye (-19.5% y/y, 3.0% of total). In contrast, there were substantial increases in remittances from EU (+9.9% y/y, 42.6% of total), USA (+24.4% y/y, 16.1% of total) and Israel (+12.5% y/y, 7.6% of total).
Overall, in 1Q24 remittances decreased by 35.8% y/y to US$ 806.0mn.
Producer price index increased by 4.0% y/y in Mar-24
Annual PPI for industrial goods increased by 4.0% in Mar-24, after increasing by 2.0% y/y in previous month. The annual growth was primarily driven by a rise in prices in the manufacturing sector (+2.7% m/m), followed by electricity supply (+11.1% m/m).
