ADB: Investments in recovered territories helped construction rise by 5.2%, reversing 5-year sector decline

Investments in the recovered territories during the 44-day war of 2020 helped construction rise by 5.2%, reversing a 5-year sector decline in Azerbaijan, Report informs, referring to the Asian Development Outlook 2022 Supplement.

Azerbaijan’s economy expanded by 7.2% in May 2022, reflecting high growth in the non-oil sector.

Sub-regional growth projections are revised up for the Caucasus and Central Asia, from 3.6% to 3.8% for 2022 and from 4.0% to 4.1% for 2023.

This mainly reflects improved outlooks for Armenia, Azerbaijan, Georgia, and Tajikistan, which have all withstood the economic fallout from the war in Ukraine better than expected.

That said, growth in these economies may decelerate in the coming months amid the uncertain geopolitical environment.

“Incoming money transfers associated with a large influx of foreign visitors, including those diversifying businesses because of sanctions against the Russian Federation, increased private consumption and helped lift the services sector,” reads the report.

Georgia’s economy grew by 14.4% in Q1, driven by services, manufacturing, and utilities. Money transfers from abroad surged by 54.3% as tourist arrivals rose by 258% year on year in the first 5 months of 2022. In May, money transfers from the Russian Federation increased nearly tenfold due to the influx of its citizens.