**Georgia’s Economy to Remain Robust, But Political Turmoil Takes a Toll**
According to the European Commission’s latest report, Georgia’s economic activity is expected to slow down in 2025 and 2026, but still maintain a strong growth rate of 5-6%. However, the same report reveals that business confidence has taken a hit in the first quarter of 2025, largely due to the ongoing political turmoil in the country.
The European Commission’s projections suggest that despite the deceleration, Georgia’s economy will remain one of the strongest in the region. The report cites factors such as high consumer demand and investment in the tourism industry as key drivers of growth. However, it also notes that the political situation has had a negative impact on business sentiment.
**Business Confidence Plunges**
The decline in business confidence is a worrying sign for Georgia’s economy. According to the European Commission, companies’ expectations about their future performance have worsened significantly since the first quarter of 2024. This downturn reflects concerns about the political instability and its potential impact on trade and investment.
In a comment, economic expert Nino Makashvili said: “The political situation is affecting businesses’ ability to plan for the future. As long as there’s uncertainty around the government’s policies and decisions, companies are less likely to invest and grow.”
**Georgia’s Economic Growth**
While Georgia’s economy has been growing steadily over the past few years, it has faced challenges in recent times. The country’s economic growth rate slowed down in 2022, but it picked up pace again in 2023. Despite the current slowdown, the European Commission expects Georgia to maintain a strong position in terms of economic growth.
In an interview, Georgian economist Irakli Nadiradze said: “Georgia’s economy has shown resilience in the face of global challenges. While the political situation is concerning, it’s essential to remember that our economy remains robust and capable of withstanding external shocks.”
**The Way Forward**
As Georgia navigates its economic growth, policymakers will need to address the current political uncertainty and restore business confidence. The European Commission report serves as a reminder that a stable and predictable environment is crucial for businesses to invest and grow.
Ultimately, the key to sustaining Georgia’s strong economic performance lies in resolving the country’s internal conflicts and creating a more favorable business climate. As such, it remains essential for stakeholders to prioritize dialogue and cooperation to ensure Georgia’s continued growth and prosperity.
