Resume: As per 2018 data, both nominal and real GDP per capita in Georgia amounts to nearly USD 4,700, whilst in terms of purchasing power parity (PPP), they are 12,000 and 10,650 international dollars, respectively.
Taking 2013-2018 years, with the aforementioned figures Georgia stably outperforms Armenia only, whilst significantly lagging behind Turkey and Russia. Azerbaijan also does have a stably better performance, with 2016-2017 nominal GDP per capita being the only exception, whilst taken other aggregates, Azerbaijan has substantially better indicators. Therefore, Georgia is not the leader in terms of GDP per capita and of four countries, is ahead of Armenia only.
Despite the fact that given the context, it is most likely that the Minister of Economy and Sustainable Development refers Georgia’s neighbour countries as a region, FactCheck has also analyzed that region (developing countries of the Middle East and Central Asia), which International Monetary Fund considers Georgia to belong to. Of Georgia’s neighbour countries, only Azerbaijan and Armenia are in that group (31 countries). Number of countries from that group outperforms Georgia in terms of income per capita, including Algeria, Iraq, Azerbaijan, Lebanon, Libya, Oman, Kazakhstan and Turkmenistan. Therefore, it is groundless to speak on Georgia’s leadership in this case too.
In regard to claim that Georgia will remain the leader in the future as well, FactCheck usually refrains to make conclusions about forecasts. However, under the current estimates of the economic growth, Georgia cannot become the leader in terms of GDP per capita neither among the neighbour countries nor in the region defined by the International Monetary Fund.
Analysis
The Facebook post published by the Prime Minister of Armenia, Nikol Pashinyan, which stated that Armenia had surpassed Georgia in terms of GDP per capita, was widely commented in Georgia. In this context, in response to the criticism from the opposition, the Minister of Economy and Sustainable Development and Deputy Prime Minister of Georgia, Natia Turnava stated that Georgia is the leader in the region in terms of GDP per capita.
The term “region” incorporates specific uncertainty in itself, because usually it is uncertain which countries does the author of the statement brings in that group and based on what principle. However, given the context, in this case it is logical to assume that the Minister refers to Georgia’s neighbour countries as a “region”. At the same time, additional comment brings clarification that the Minister does not mean GDP purchasing power parity, since she names USD 4,700 in case of Georgia, which corresponds both real and nominal Georgian GDP per capita. The respective data for the neighbour countries is given at graph 1 and graph 2.
Graph 1: Real GDP Per Capita
Source: World Bank
Graph 2: Nominal GDP Per Capita
Source: World Bank
Notwithstanding what indicator was the Minister referring to, whilst comparing the countries, the fact that level of prices between the countries differs significantly should be taken into account. Therefore, assessments how high or low GDP per capita is in a specific country should be based on taking that aspect into consideration. For instance, with USD 1,000 one can purchase much less goods and services in the US as compared to Georgia. Therefore, a person in Georgia with USD 1,000 income is much “wealthier” as compared to a person with the same USD 1,000 income in the US. To take this aspect into account, in order to compare countries’ figures different GDP indicator was introduced – GDP at purchasing power parity (GDP PPP). The respective data about Georgia and neighbour countries is given in graph 3 and graph 4.
Graph 3: Real GDP Per Capita at Purchasing Power Parity (GDP PPP)
Source: World Bank
As illustrated from the third graph, in terms of real GDP PPP the picture remains unaltered and of neighbour countries, Georgia is stably ahead of Armenia only, whilst significantly lags behind Azerbaijan, Russia and Turkey. There is the same picture in terms of nominal GDP PPP (graph 4). Therefore, Georgia is not the leader by this indicator as well.
Source: World Bank
Despite the fact that given the context, it is most likely that the Minister of Economy and Sustainable Development refers Georgia’s neighbour countries as a region, FactCheck has also analyzed that region (developing countries of the Middle East and Central Asia), which International Monetary Fund considers Georgia to belong to. Of Georgia’s neighbour countries, only Azerbaijan and Armenia are in that group (31 countries). Number of countries from that group outperforms Georgia in terms of income per capita, including Algeria, Iraq, Azerbaijan, Lebanon, Libya, Oman, Kazakhstan and Turkmenistan.
