Banks' assets have increased by billion - Rating

The negative trade balance was USD 3 037.1 million in January-April 2024 and its share in external trade turnover constituted 46.3 percent.In January-April 2024 the share of the top ten trading partners by exports in the total exports of Georgia amounted to 79.8 percent. The top partners were Kyrgyzstan (USD 291.6 million), Russia (USD 230.4 million) and Kazakhstan (USD 208.3 million).In the first quarter of 2024, the share of outgoing freight represents 29.4 percent of the railway transported freights, while the share of incoming freight was 70.6 percent.In the first quarter of 2024, the sender country of 53.5 percent of total incoming rail freight was Russian Federation, 22.9 percent was sent by Azerbaijan. The share of other countries sending cargo was less than ten percent each (23.6 percent combined).In the first quarter of 2024, Russian Federation was the final destination for 10.2 percent of total outgoing freight. The share of other receiving countries was less than ten percent each (89.8 percent combined).The breakdown of the total transit freight2 by the final destination country was as follows: Netherlands – 16.2 percent, Turkey – 8.1 percent, China - 7.9 percent, Italy – 3.3 percent, Ukraine – 3.3 percent, Romania – 2.4 percent, and elsewhere was for the rest. In the same period, Brazil was the sender country of 2.7 percent of the total transit freight, China – 1.5 percent, Ukraine – 1.4 percent, Greece – 1.3 percent, USA – 1.1 percent, and elsewhere was for the rest.In the reporting period, 32.7 percent of the total freight were metal ores and other mining and quarrying products, 28.4 percent were coal, crude oil and oil products and natural gas, and 9.0 percent were food products, beverages and tobacco.The distribution by type of goods was different in the case of freights transported domestically in the first quarter of 2024, as the share of metal ores and other mining and quarrying products equaled 61.2 percent of total, and the share of coal and lignite; crude petroleum and natural gas amounted to 12.6 percent, while the share of other nonmetallic mineral products amounted to 11.6 percent.In the first quarter of 2024, the number of passengers transported by the Georgian Railway decreased by 1.4 percent compared to the corresponding period of the previous year and amounted to 465.9 thousand persons. At the same time, passenger turnover decreased by 6.0 percent and amounted to 128.3 million passenger-kilometer.In the first quarter of 2024, the number of passengers transported within the country amounted to 462.1 thousand persons, which represents 99.2 percent of the total number of passengers carried and 0.5 percent less than the same figure to the corresponding period of 2023. At the same time, the number of passengers transported internationally amounted to 3.8 thousand, which is 50.7 percent less than the corresponding figure of the previous year. The country of embarkation was Armenia for 56.1 percent of internationally transported passengers while the country of disembarkation was Armenia for 43.9 percent of international transported passengers (no passengers were transported from/to any other neighboring country in 2024)

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In the first quarter of 2024, the sender country of 53.5 percent of total incoming rail freight was Russian Federation, 22.9 percent was sent by Azerbaijan. The share of other countries sending cargo was less than ten percent each (23.6 percent combined).In the first quarter of 2024, Russian Federation was the final destination for 10.2 percent of total outgoing freight. The share of other receiving countries was less than ten percent each (89.8 percent combined).The breakdown of the total transit freight2 by the final destination country was as follows: Netherlands – 16.2 percent, Turkey – 8.1 percent, China - 7.9 percent, Italy – 3.3 percent, Ukraine – 3.3 percent, Romania – 2.4 percent, and elsewhere was for the rest. In the same period, Brazil was the sender country of 2.7 percent of the total transit freight, China – 1.5 percent, Ukraine – 1.4 percent, Greece – 1.3 percent, USA – 1.1 percent, and elsewhere was for the rest.In the reporting period, 32.7 percent of the total freight were metal ores and other mining and quarrying products, 28.4 percent were coal, crude oil and oil products and natural gas, and 9.0 percent were food products, beverages and tobacco.The distribution by type of goods was different in the case of freights transported domestically in the first quarter of 2024, as the share of metal ores and other mining and quarrying products equaled 61.2 percent of total, and the share of coal and lignite; crude petroleum and natural gas amounted to 12.6 percent, while the share of other nonmetallic mineral products amounted to 11.6 percent.In the first quarter of 2024, the number of passengers transported by the Georgian Railway decreased by 1.4 percent compared to the corresponding period of the previous year and amounted to 465.9 thousand persons. At the same time, passenger turnover decreased by 6.0 percent and amounted to 128.3 million passenger-kilometer.In the first quarter of 2024, the number of passengers transported within the country amounted to 462.1 thousand persons, which represents 99.2 percent of the total number of passengers carried and 0.5 percent less than the same figure to the corresponding period of 2023. At the same time, the number of passengers transported internationally amounted to 3.8 thousand, which is 50.7 percent less than the corresponding figure of the previous year. The country of embarkation was Armenia for 56.1 percent of internationally transported passengers while the country of disembarkation was Armenia for 43.9 percent of international transported passengers (no passengers were transported from/to any other neighboring country in 2024)

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In January-April 2024 the share of the top ten trading partners by domestic exports in the total domestic exports of Georgia amounted to 71.5 percent. The top partners were Russia (USD 189.4 million), Türkiye (USD 106.3 million) and China (USD 68.2 million).In January-April 2024 wine of fresh grapes reclaimed the first place in the list of top export items, equaling USD 126.2 million, or 15.7 percent of total exports. The exports of ferro-alloys totaled USD 82.3 million and their share in the total exports amounted to 10.2 percent. The exports of natural or artificial mineral and aerated waters, not containing sugar, occupied the third place, standing at USD 50.9 million and constituting 6.3 percent of the total exports.

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Kvrivishvili told the Imedi TV channel that hosting the event for the first time in the country would be “an important opportunity” to represent Georgia’s tourism potential.She noted “a number of” international journalists and high-ranking delegations would visit Georgia on the sidelines of the Tourism Day celebrations, which would positively impact the sustainable development of tourism and promoting the country.Kvrivishvili also highlighted the recent “most significant event” of the Asian Development Bank - the 57th annual meeting - hosted in Tbilisi from May 2 to 5 “with great dignity” amid the rallies against the controversial transparency of foreign influence law, stressing the country had gained “the greatest experience in properly managing crises”.“Our hospitality has been evaluated very positively [by ADB and the annual meeting participants]”, the Deputy Minister noted.“The most important thing is stability and peace, and our [ruling] team will do its utmost to ensure peace, stability and freedom in the country and that all current processes are carried out in the country through democratic processes”, Kvrivishvili emphasised, noting by this foundation it was possible to achieve the double-digit economic growth over the past years.Maintaining stability has played an important role in increasing investments, bringing more tourists into the country and “ultimately affecting” the well-being of “every citizen of Georgia”, she added.

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In an interview with Imedi TV channel, Turnava noted the agitation on the price changes was “largely artificial and there is no real economic reason behind it” and as she explained, the price of bank shares on the London Stock Exchange was “characterised” by “volatility”.“For example, in February 2022, when the Russia-Ukraine war started, [...] there was a 40 percent drop in stock prices, and a more immediate drop than we’ve seen in these few days, and it didn’t shake our banking system either, because it [Georgia’s banking system] is very strong, well capitalised, [with] sufficient liquidity buffers, [and] profitable”, she emphasised.Turnava pointed out that short-term price fluctuations would not have an impact on the solvency of Georgia’s banking system and its resilience to “shocks”, also stressing that Georgian banks had liquid assets of ₾16.7 billion (about $6 bln) and could “deal with any serious crisis”.

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Bank of Georgia Group (BGEO LN) shares closed at GBP 41.40/share (- 16.19% w/w and -14.46% m/m). More than 984k shares traded in the range of GBP 38.50 - 50.20/share. Average daily traded volume was 129k in the last 4 weeks. The volume of BGEO shares traded was at 2.16% of its capitalization.TBC Bank Group (TBCG LN) closed the week at GBP 26.60/share (- 11.33% w/w and -8.90% m/m). More than 1.3mn shares changed hands in the range of GBP 24.65 - 30.85/share. Average daily traded volume was 136k in the last 4 weeks. The volume of TBCG shares traded was at 2.34% of its capitalization.Georgia Capital (CGEO LN) shares closed at GBP 10.14/share (-13.04% w/w and -21.88% m/m). More than 878k shares traded in the range of GBP 9.20 - 11.70/share. Average daily traded volume was 102k in the last 4 weeks. The volume of CGEO shares traded was at 2.06% of its capitalization.

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Many chose to relocate to the Caucasus and Central Asia, taking advantage of linguistic and cultural proximity and the relative ease of gaining residence and opening bank accounts. The smaller CCA countries, in particular, saw larger increases in the share of Russian migrants relative to their overall populations, with new arrivals in 2022 accounting, for instance, for 3 per cent of Georgia’s population and 2.5 per cent of Armenia’s Growth in the Caucasus is forecast to be moderate at 4.1 per cent in 2024 before settling closer to 3.5 per cent in 2025, a level in line with estimates of medium-term potential growth.For instance, Georgia is estimated to have received more than 20,000 Russian tech professionals and more than 21,000 legal entities (firms) were established by Russian entrepreneurs between March 2022 and July 2023. . Given the relative ease of opening bank accounts in the region, around 500,000 bank accounts have been opened by Russian visitors and migrants to Kazakhstan since the start of the war, while 100,000 have been opened in Georgia.The main risks arise from geopolitical instability in the region and domestic political polarisation. Potential progress concerning the country’s EU candidate status, in contrast, could create a more stable environment and stimulate growth-supporting reforms.

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If we consider from the point of view of the countries, the first place in the volume of remittances is still maintained by the Russian Federation - $49,129,400, however, the incoming remittances from this country have been steadily decreasing in recent months. For example, if $67.6 million was transferred from Russia in January, this figure was $54.6 million in February, and $52.9 million in March.The second largest volume of remittances is the USA, from which $46.3 million entered Georgia in April. This volume is almost $2 million higher than the similar indicator of March.Italy is in third place, from which $45.8 million was received in April, Greece is in fourth place with $21.9 million, and Germany is in fifth place with $20.7 million.In the analyzed period, remittances from Georgia totaled $30.4 million. Accordingly, the positive balance in remittances amounts to $248 million.

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