BAG Index: Current Business Situation Has Improved

18 Jun '25

The Business Association of Georgia has completed work on the BAG Index survey and is publishing the results for the second quarter of 2025. According to the survey results, the current business situation improved by 4.6 points compared to the previous quarter. This was largely driven by increased sales in the current quarter, reported by 54.6% of surveyed companies.

The employment figures are also noteworthy: in the second quarter of 2025, 28% of surveyed companies stated that their employee count had increased. Meanwhile, looking ahead to the third quarter of 2025, 35% of surveyed companies expect an increase in headcount. Similar to the previous quarter, the highest growth in the number of employees during the current quarter was recorded in the construction/development sector.

Regarding expectations, the construction/development sector also stands out with the most positive outlook for the third quarter.

Notably, the proportion of companies citing factors hindering their business operations decreased by 7 percentage points in the current quarter. Among these factors, a shortage of specialists and legal and administrative barriers featured prominently; however, issues stemming from national currency exchange rate volatility dropped by 29 percentage points, which can be attributed to the stability of the Lari exchange rate.

It should also be noted that among legal and administrative barriers, administrative issues were cited most frequently - an indicator that rose by 8 percentage points compared to the previous quarter's data.

It is worth highlighting that compared to the previous quarter, the share of companies seeking financing during the second quarter increased by 10 percentage points. The rise in current sales and positive expectations for sales and employment growth in the upcoming quarter can be seen as indicators that businesses are attempting to realize their development and expansion plans through additional financing.

As a reminder, the BAG Index is a joint product of the Business Association of Georgia, the PMC Research Center, and the IFO Institute for Economic Research, published quarterly by the Business Association of Georgia.

The research report can be viewed at the link.