According to the unemployment rates, Georgia is the regional leader and holds second place in terms of annual inflation. Nika Shengelia, the Doctor of Economics, delivered information about the numbers. One year after the pandemic got declared, he discussed the region's economy by inflation, interest rates, and unemployment. Shengelia explained to report.ge that the annual inflation rate in Georgia was 7.2% in March, while the core inflation rate was 6.9% compared to the same period last year. Unemployment, according to the latest data, equals 18.5%, while the current interest rate is 8.5%.
"In Azerbaijan, as of February 2021, annual inflation was 3.7%, consumer inflation was at 4.9%, the unemployment rate was around 5%, and the country has a 6.25% interest rate. In Armenia, as of February 2021, annual inflation was at 5.3%, consumer inflation was 7.8%, core inflation was 4.7% in January 2021, and the unemployment rate (in the 3rd quarter of 2020) was 18.1%. The country has a 5.5% interest rate. In the Russian Federation in February 2021, the annual inflation rate was 5.67%, consumer inflation was 7.62%, and core inflation was 5.04%. Unemployment was at 5.7%; the country has a 4.5% interest rate. As of February 2021, the annual inflation rate was 15.67% in Turkey, core inflation was 16.21%, and consumer inflation was 18.4%. Unemployment has risen to 12.2% in January 2021, and the country has a 19% interest rate," Shengelia said.
Based on the above data, if we take the top three with a high annual inflation rate, Turkey is in first place with 15.61%, Georgia in second place with 7.2%, and then Russia holds third place with an inflation rate of 5.67%.
According to unemployment rates, Georgia leads the region with 18.5%, followed by Armenia with 18.1% and Turkey with 12.2%.
According to the interest rate, Turkey has a high-interest rate in the region - 19%, followed by Georgia, where the figure is 8.5%, and Azerbaijan - 6.25%.
Inflation in Georgia, as Nika Shengelia says, will increase further.
"In 2021, the inflation rate will not return to the target; no one should expect that. We will have high inflation, an increase in the refinancing rate. We do not rule out that the NBG will make the refinancing rate 9-10%, making the loan even more expensive for the business, which will affect prices. The National Bank will have to intervene; it would have been better to do it earlier; it will have to spend more in reserves. Many factors are working on the GEL exchange rate now - psychological, budget non-compliance, unemployment, investments, and others, whether they want to or not, they supply the dollar, which further devalues the exchange rate," Nika Shengelia told report.ge.
