Fitch Ratings, a global credit rating agency, has projected that the Georgian economy will grow by 8.7 percent in 2024, followed by a moderation to 5.3 percent in 2025 and 5 percent in 2026. The agency also forecasts inflation to rise to an average of 2.1 percent in 2025 and 2.3 percent in 2026.

The agency identified several key factors contributing to Georgia’s economic performance, noting that the country experienced robust economic growth, with real GDP increasing by 10 percent from January to October 2024, compared to 7.8 percent in 2023. Fitch attributed this growth to the strong performance of the services sector, particularly in tourism and information and communications technology (ICT), as well as positive results in construction and exports.

Fitch also emphasized the resilience of Georgia’s relatively diversified economy, suggesting it would remain relatively unaffected by the ongoing political crisis. The agency highlighted that the large-scale influx of Russian and Ukrainian immigrants since 2022 had provided a lasting boost to potential growth, particularly in the construction and ICT sectors.

Regarding inflation, Fitch reported an average of 1 percent from January to November 2024, which is below the target of 3 percent, driven by modest domestic price increases. However, the agency anticipates inflation to rise in the coming years, with potential risks arising from the depreciation of the Georgian national currency, the lari.

Fitch Ratings also revised its outlook for Georgia’s long-term foreign-currency issuer default rating, shifting it from stable to negative, while reaffirming the IDR at 'BB'.

On the fiscal front, Fitch noted Georgia's strong record of budgetary performance. It projects that the general government deficit will decrease from 2.7 percent of GDP in 2024 to 2.5 percent in 2025, and further to 2.3 percent in 2026, remaining well below the 3 percent deficit ceiling. Additionally, Georgia’s debt levels appear moderate, with gross general government debt at 38.1 percent of GDP as of May 2024, well below the 'BB' median of 55.2 percent. The agency forecasts that this debt will average 38.7 percent in 2025-2026, well within the 60 percent debt ceiling, though risks related to exchange rate depreciation persist.

However, Fitch expressed concerns about Georgia’s political environment. The country is ranked in the 61st percentile of the World Bank Governance Indicators, indicating moderate institutional capacity and rule of law, but with political risks heightened by the ongoing unresolved conflict with Russia.