As the document says, granting the EU candidate status to Georgia has improved the organization's 2024 forecasts. Accordingly, two scenarios have been developed - basic and optimistic. In the latter, the positive impact of the candidate's status is even higher in the short term.

According to the base scenario, the economy of Georgia will grow by 5.4% in 2024. The average exchange rate of GEL/Dollar and GEL/Euro is expected to be within 2.7 and 3.0 this year.

However, in the base scenario, it is written that the average annual inflation is expected at the level of 3.5% and the National Bank will have the opportunity to gradually reduce the monetary policy rate to 8.5% by the end of 2024.

In the optimistic scenario, Galt & Taggart assumes that receiving the EU candidate status will further improve consumer and investor sentiment compared to the assumptions in the baseline scenario.

"According to our optimistic scenario, the economy of Georgia will grow by 6.0% in 2024. The average exchange rate of GEL/USD and GEL/EUR is expected to be within 2.65 and 2.95 this year. Average annual inflation is expected at the level of 3.0%, and the National Bank of Georgia will have the opportunity to gradually reduce the monetary policy rate to 8.0%," the document reads.

As for the risks that could change the economic forecasts, the research organization says that it is still related to the ongoing geopolitical conflicts in the region. However, according to the report, with the existing buffers, the country can cope with potential risks if they materialize.