The European Bank for Reconstruction and Development (EBRD) has cut its 2020 economic growth forecasts for Armenia, Azerbaijan, and Georgia as they are hit by the coronavirus crisis, but expects a recovery in the South Caucasus countries next year, Reuters reported. 

For Armenia, the EBRD forecast the economy would shrink 3.5% in 2020 as a result of the combination of global uncertainty and falling demand due to the coronavirus crisis and volatility in commodity prices, but then expand by 5.5% in 2021.

As forecast earlier, Armenia’s 2020 growth would be 5.0% this year, but the economy would be affected “directly via a decrease in exports, which are dominated by copper and other mining products, and indirectly through economic links with Russia, including a likely downturn in remittances.”

What comes to Georgia and Azerbaijan, according to the report, Georgia’s GDP's growth is expected to fall 5.5% in 2020, before rebounding to around 5.5% in 2021.  

GDP in oil-rich Azerbaijan is expected to fall by 3% in 2020 amid falling external and domestic demand but should grow by 3% next year, the EBRD, which earlier predicted Azerbaijan’s growth at 2.4% in 2020.