The Georgian government proposed state budget for 2016 will set next year’s economic growth forecast at 3%, PM Irakli Garibashvili said at a government session on September 23.

The government was initially expecting 5% growth this year, but it had to cut it to 2%.

Real GDP growth stood at 3.2% y/y in the first quarter of 2015 and at 2.5% y/y in the second quarter. Georgia’s economy grew 4.8% in 2014.

Next year’s budget deficit will be 3%, Finance Minister Nodar Khaduri said.

PM Garibashvili also said that inflation forecast will be set at 4.5% in the draft of 2016 state budget, which has yet to be submitted to the Parliament for consideration.

Georgia’s annual inflation accelerated to its highest rate in four years at 5.4% in August from 4.9% in July, according to the state statistics office.