EBRD Publishes Economic Assessments of Eastern European Countries

On May 15, the European Bank for Reconstruction and Development (EBRD) published a report titled “Regional Economic Prospects 2024,” which provides estimates of economic development in Eastern Europe and the former Soviet Union. In particular, analysts of the Bank, headquartered in London, revised their forecasts of Russia‘s gross domestic product (GDP) growth upward to 2.5%, while in the previous report, presented by the EBRD in September 2023, the Bank’s experts estimated Russia’s GDP growth in 2024 at 1%. The change was attributed to a “production boom” in the defense sector, as well as Russia’s intensified economic and trade exchanges with China and “many other partner and neutral countries.” The EBRD experts have practically returned to “the level that preceded the start of the military operation of Russian troops in Ukraine.” Nevertheless, the EBRD forecasts “a slowdown from 2023,” with Russian GDP growth in 2025 likely to slow to 1.5%.

The GDP growth forecast for Belarus was also revised upwards from the previous +1.3% to +2.8%: “As extensive sanctions are likely to hamper Belarus’s economic development in the short to medium term, it is envisaged that growth will rise to 2.8% in 2024 and slow to 2.2% the following year.”

As for Ukraine‘s economic prospects, EBRD analysts left the forecasts unchanged from the previous report: +3% in 2024 and +6% in 2025. “The recovery of exports and the expansion of military production in Ukraine is likely to contribute to economic growth in the country,” the EBRD experts wrote, emphasizing, however, that “multiple risks to the Ukrainian economy, primarily related to damage to port and electricity infrastructure, remain very high.”

For the three former Soviet countries of the Caucasus – Armenia, Azerbaijan, and Georgia – EBRD analysts forecast growth of between 3.1% and 6.2 percent. The bank estimates that Armenia‘s GDP will grow by 6.2 percent in 2024 and is expected to slow to 4.8 percent next year. Economic risks in the country, the report says, “stem mainly from geopolitical uncertainty.” At the same time, it is emphasized that increased government spending aimed at facilitating the integration of refugees from Nagorno-Karabakh will “support the growth” of the national economy.”

Azerbaijan‘s gross domestic product will grow by 3.1% in 2024. Previous forecasts for the country’s economic growth indicated +2.4. However, growth is expected to slow to 2.7 percent in 2025. The report notes that Azerbaijan’s economic growth “accelerated from mid-2023 to the first quarter of 2024 due to increased European demand for oil and gas” exported by Azerbaijan. At the same time, “the main risks are associated with the vulnerability of the economy based on hydrocarbon exports due to price fluctuations on world markets and instability of the geopolitical situation in the region.”

Finally, Georgia‘s gross domestic product growth is expected to reach 5.2% in 2024 and slow to 4.6% in 2025. According to the bank, the main risks for the Georgian economy are always geopolitical instability in the region. “The potential progress associated with EU candidate country status, on the other hand, could create a more stable environment and stimulate economic reforms to support growth,” the EBRD experts emphasized.

To download the EBRD report (PDF in English) from the Pluralia website, please follow the link