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On 11 December 2013, the Minister of Finance Nodar Khaduri presented to the Parliament the final draft of the state budget for 2014. Discussing the economic condition in the country and future perspectives, the Minister stated: “In nine months of 2013, the volume of foreign direct investments surpassed the indicator of the same period of the last year by 20 million dollars.”

FactCheck

inquired about the volume and dynamics of foreign direct investments in Georgia and checked the accuracy of Nodar Khaduri’s statement.

In line with the preliminary data

of GeoStat for I, II and III quarters of 2013,foreign direct investment (FDI) in Georgia totalled USD 697 million. The same indicator for the first three quarters of 2012 amounted to USD 678 million. As gathered from this data, the indices of the first nine months of 2013 surpass those of the previous year by USD 19 million which confirms the accuracy of Nodar Khaduri’s statement.

Aiming to shed more light on the matter we analysed each of the three quarters of 2013 separately. In the first quarter of 2013, foreign direct investments in Georgia totalled USD 35 million less than in the same period of the last year. It should be noted, however, that in the second and third quarters of 2013 the volume of FDI registers a growth relative to the same period of the last year as well as to the preceding quarter in 2013.

As reported by GeoStat, FDI in the second quarter of 2013 totalled USD 232 million while the indicator for the second quarter of the last year amounted to USD 218 million and the figure for the first quarter of 2013 stands at USD 226 million. FDI in the third quarter of the current year equalled USD 239 million which exceeds the figure of the preceding second quarter by USD 7 million and the indicators of the relevant period of 2012 – by USD 40 million.

In the third quarter of the current year, the largest share of FDI was allocated in the financial sector, reaching USD 48 million, which makes up 20% of the total volume of FDI. The transports and communication sector received USD 47 million in foreign direct investments, taking up the second position by the share of FDI, followed by the energy sector with USD 33 million.

In the third quarter of 2013 percentages of the largest FDI contributors to Georgia were distributed as follows: the first place is occupied by international organisations with 20%, the second – by the US with 15% and the third and fourth positions are shared by the Netherlands and Turkey, respectively, holding 13% each.

Analysing the dynamics of foreign direct investments made in Georgia in 2011-2013, it becomes evident that in the II, III and IV quarters of 2012, FDI saw a decrease relative to the corresponding quarters of the previous year. A decline in the volume of FDI was observed in the first quarter of 2013 as well while in the II and III quarters of 2013, the volume of FDI was expanding.

xada Conclusion

As gathered from the data of GeoStat, in the first nine months of 2013 the volume of FDI in Georgia amounted to USD 697 million while in the first nine months of 2012 the total amount of allocated FDI equalled USD 678 million

Accordingly, we conclude that Nodar Khaduri’s statement: “In nine months of 2013, the volume of foreign direct investments surpassed the indicator of the same period of the last year by 20 million dollars,” is TRUE.