Khatia Dekanoidze: “GEL 15 million is allocated for micro and small grants in 2021 which is six times more as compared to 2020.”

Verdict: FactCheck concludes that Khatia Dekanoidze’s statement is MOSTLY TRUE.

Resume: The Product of Georgia programme was launched on 1 July 2014. Since 2015, a micro and small grants sub-programme was added to the programme which comprises grants issued for micro and small businesses. Initially, the amount of the grant per beneficiary was set at GEL 5,000 and later it was increased to GEL 20,000 and GEL 30,000 in 2020.

Of note is that in 2020, the government allocated GEL 2.5 million for the aforementioned sub-programme whilst allocations increased six-fold in 2021 and reached GEL 15 million.

Analysis

Khatia Dekanoidze, United National Movement MP, made the following statement on Facebook:

“Micro and small grants, which are announced in coincidence with the elections and contain signs of corruption, are often won by people affiliated with the ruling party, family members of election staff or relatives of local officials. In 2021, GEL 15 million is allocated for that programme which is six times more as compared to 2020.”

FactCheck sought to verify the accuracy of the statement.

The Product of Georgia programme was launched on 1 July 2014. At the initial stage, the programme envisioned co-financing of loan interest rates for businesses operating in the industry field. However, numerous sub-programmes, such as micro and small grants, Film in Georgia, co-financing mechanism for hotels, etc., were added to the programme over the years.

The micro and small grants sub-programme has been launched since 2015. The sub-programme has been altered several times. Initially, grants were issued in the amount of GEL 5,000 per one beneficiary with a maximum of three beneficiaries allowed to work together. Since 2018, this unification mechanism has been dropped, although the amount of grants increased to GEL 20,000 and reached GEL 30,000 per beneficiary in 2020. Of additional interest is that the beneficiary has an obligation to commit 5-10% co-funding (the exact amount depends on the region) for the business.

Since 2015 until today, a total of 6,215 grants have been issued as part of this programme whilst GEL 61 million was issued in the form of co-financing.

According to the amendment in the 2021 budget, [1] GEL 15 million is allocated for this programme which is nearly six times more as compared to the GEL 2.534 million planned in the 2020 budget.

Of note is that the last two calls announced for the micro and small grants do indeed coincide with Georgia’s 2018 presidential and 2020 parliamentary elections.

On 11 September 2020, Transparency International – Georgia published a detailed study according to which many beneficiaries of the Product of Georgia programme were businessmen connected with holding membership of or financing the ruling party. In regard to the aforementioned sub-programme, we could not obtain any relevant study about potential corruption or partisan ties and, therefore, FactCheck is unable to assess this particular part of Khatia Dekanoidze’s statement. Therefore, FactCheck concludes that Ms Dekanoidze’s statement in which she said that the budget of that sub-programme increased six-fold and its announcement coincides with the election period is MOSTLY TRUE.

[1]The budget code for micro and small grants: 24.07.03.02.

Transparency International’s report on the Product of Georgia programme.