Fitch Ratings has revised the Outlook on Georgia's Long-Term Foreign-Currency Issuer Default Rating (IDR) to Stable from Positive, and affirmed the rating at 'BB'.
According to the Ministry of Finance, the Fitch report notes the high economic growth of Georgia, according to which the country is expected to grow by 5.8% in 2024, and by 5% in 2025-2026.
"The agency positively evaluates the effective fiscal policy implemented by the government, and also emphasizes the stable banking sector. The current low inflation and the moderate level of government debt are also mentioned, which is quite low compared to countries with a similar rating.
The current BB rating reflects the following factors:
Moderate level of government debt - the debt of the government of Georgia (39.1%) is significantly lower than the median (54%) of countries with a BB rating. The share of domestic debt is gradually increasing in relation to the debt denominated in foreign currency, in accordance with the government's strategy.
Credible Fiscal Policy - Fitch notes that Georgia's budget performance will exceed expectations, as a result of which the budget deficit will decrease from 2.5% in 2023-2024 to 2.1% in 2025. This indicator is significantly lower than the 3% limit.
High economic growth - the country has increased the value added and potential growth rates, especially in the information and communication technology (ICT) construction and tourism sectors, including as a result of migration processes. Growth is expected to be 5% in the medium term, driven mainly by domestic consumption and investment.
In terms of risks, the report indicates the domestic political environment and geopolitical situation in the country, which was reflected in determining the country's perspective from positive to stable," reads the press release of the Ministry.
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