It has been a difficult few months for the Georgian economy. Russia’s economic slowdown, fuelled by plunging oil prices, the tumbling rouble and Western sanctions over the conflict in eastern Ukraine, has sent shockwaves across all former Soviet republics. And despite its strained political relationship with Moscow, Georgia is no exception.
Remittance flows into Georgia, more than half of which come from Russia, have been one casualty. In February 2015 they were down by 21.7% when compared to the same month a year earlier. Foreign trade is another victim – because of a fall in bilateral trade with Russia, but also because many of Georgia’s other trading partners, such as Ukraine, Azerbaijan and Armenia, have been hit by the problems in Russia. Foreign trade in Georgia dropped by 9% year on year in January and February, according to official data, with exports to Commonwealth of Independent States (CIS) countries diving by 53% by this measure.
