BAG Index: According to Surveyed Companies, Current Business Conditions Improved in Q2 2026

15 Jul '26

The Business Association of Georgia (BAG) publishes the results of the BAG Index research for the second quarter. According to the report, the business climate indicator increased by 5.1 points compared to the previous quarter, reaching 47.6 points. Notably, the evaluation of current conditions by the surveyed companies improved by 11.4 points, while expectations increased by 10.1 points.

Among sectors, the highest business climate indicator was recorded in the service sector, where both current business conditions and expectations are the most positive.

According to the business survey in Q2 2026, two factors emerged as equally hindering business operations: a shortage of specialists, and legal and administrative barriers. Significantly, the impact of legal and administrative barriers increased by 6 percentage points compared to the previous quarter, while the shortage of specialists decreased by 3 points. During the same period, the problem of weak demand intensified (by 11 percentage points), whereas the issue of exchange rate volatility of the GEL eased significantly, dropping by 7 percentage points.

By sector, the shortage of specialists and workforce affects the construction sector the most, while legal and administrative barriers remain a major challenge for the service and trade sectors.

Overall, 57% of surveyed companies reported factors hindering their business activity in the current quarter. This figure has decreased by 2 percentage points compared to the previous quarter.

For information, the BAG Index is based on evaluations from members of the Business Association of Georgia and their affiliates, conducted by the Business Association of Georgia and PMC Research Center using the methodology of the German ifo Institute for Economic Research.

The full research report can be viewed at the link