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Georgian economy contracts at annual 5% rate in January-September

TBILISI, Oct 30 (Reuters) - Georgia’s economy contracted at an annual 5% in the first nine months of 2020, down from a growth rate of 5% in the same period of 2019, as measures to curb the spread of the coronavirus took their toll, preliminary data showed on Friday.

In September alone, gross domestic product (GDP) shrank by 0.7% year-on-year after contracting 5.3% in August. In September last year, GDP grew by 5.2%.

The fastest growth last month was seen in processing - mainly of food - metals mining, trade and the financial sector. Activity declined in transport and storage, construction, food delivery, arts, entertainment, science, information and communication.

Georgia’s economy expanded 5.2% in 2019, up from 4.8% in 2018. This year the government had expected it to grow by 4.5% before the coronavirus started to spread, but it is now forecast to contract by 4%.

International financial institutions, which have also revised growth forecasts downwards, have pledged support, and some have disbursed funds to help Georgia cope with the impact of the pandemic.

The European Bank for Reconstruction and Development (EBRD) said earlier this month that it expected Georgia’s economy to shrink by 5% in 2020, hit hard by the pandemic’s effect on travel and tourism, before rebounding by around 3.5% in 2021.

Georgia has reported 37,263 cases of the virus and 285 deaths. (Reporting by Margarita Antidze; Editing by Jan Harvey)

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