TOP-10 in the economy last week (January 24-29):
1. Georgia-Ukraine Trade Relations
Sanctions are threatening to Russia in response to the aggression against Ukraine. In the case of an invasion, the US warns Russia by suspending the opening of a key gas pipeline, Nord Stream 2. Most of all, the West is threatening Russia with an unprecedented package of sanctions, which means disconnecting from the high security network, or SWIFT (connects thousands of financial institutions around the world), causing severe financial and economic damage to Russia.
Along with the world events, the Georgian Dream and the opposition in Georgia could not agree on the text of the resolution in support of Ukraine, and finally Russia was not mentioned anywhere in the text of the resolution drafted by the government. The current events in the region will obviously have an impact on Georgia as well.
Trade and economic relations between Georgia and Ukraine are as follows: in 2021, exports from Georgia to Ukraine increased by 41% to USD 307 million. Ukraine ranks on the eighth place with USD 92.7 million, while USD 6.4 million was invested in Georgia from Ukraine in 9M21.
2. TBC Capital Report
TBC Capital publishes Monthly Watch on Tourism. According to the report, during the whole year of 2021, the total number of international visitors who visited Georgia amounted to 1,721,242. The results are 78% behind the level of 2019.
However, revenues from international visitors recovered by 38% to the January-December 2019 level.
In December 2021, the number of visitors declined by 70% relative to the same period of 2019, and this outcome is lower than in the previous two months of 2021. Relative to December 2020, the number of visitors increased by 226%, a lower growth rate than in the previous month.
3. Deterioration Of The Economy At The Forefront Of People’s Mind – NDI Poll
Poll results released by the National Democratic Institute (NDI or the Institute) and CRRC Georgia find that Georgians see insufficient progress on the top national issues of concern and think the situation regarding poverty, crime, territorial integrity, and education has gotten worse in the last 10 years. Public concerns are consistent across political affiliation, signaling opportunities for political parties to work together to address the common needs of Georgia’s citizens.
New poll finds that a majority of Georgians do not think anyone - neither government or opposition parties - is acting in their best interest. Georgians also remain skeptical of the newly elected parliament’s willingness to address their concerns. More than half of the population (53 percent) does not believe parliament is passing legislation on issues that matter to them, while 52 percent do not believe an MP will take action if citizens tell him/her about problems in their district. Only a third believes that parliament regularly communicates with the public.
4. How successful the cooperative scheme turned out to be
Since 2015, it has provided GEL 31.3 million in cooperative support programs, but according to the Parliamentary Agrarian Committee, the law has not achieved its goal.
5. Residential Real Estate Price in Tbilisi - National Statistics Office of Georgia
In the fourth quarter of 2021 the Residential Property Price Index (RPPI) in Georgia increased by 2.1 percent compared to the previous quarter, while the annual increase amounted to 1.2 percent. Compared to the 2020 average, the index change amounted to 8.5 percent. The RPPI covers the market of new residential property in Tbilisi, both flats and detached houses segments.
In the IV quarter of 2021 a price increase compared to the previous quarter was registered both in flats (2.3%) and detached houses (1.6%) segments. Compared to the fourth quarter of 2020, the prices also increased in both segments, for detached houses by 1.6 % and for flats by 1.0%. The following graph represents the dynamics of the total RPPI and its sub-indices, as well as the Consumer Price Index.
6. International Aids To Georgia
The European Bank for Reconstruction and Development (EBRD) supported Georgia’s economy to the tune of €295 million in 2021, with investments in infrastructure and energy and financing for small and medium-sized enterprises (SMEs) through credit lines to local banks and trade financing.
The Bank continued to focus its activity on the private sector, which accounted for 79 per cent of its total investment in the country.
7. Audit Service report on the activities of Batumi and Khelvachauri municipalities
The State Audit Office has published a report on the activities of Batumi City Hall and Council for 2019-2020. It turns out that the City Hall has paid 1.5 million GEL to non-staff employees. According to the report, more cars serve to the City Hall than the norm set by the government and the agency spends almost GEL 21,000 more per year.
8. Pension Savings Exceeded GEL 2 BLN
Assets of the Georgian Pension Agency reached GEL 2,046,000,000 as of today. The Agency accumulated GEL 2 billion within 2 years and 1 month after its launch.
GEL 2 billion includes the principal amount of pension savings accumulated by 1.2 million people and the interest accrued on it. The assets in the fund had an average yield of 11% late in 2021.
9. How Much Natural Gas Was Imported in Georgia in 2021?
The volume of Russian natural gas imports to Georgia sharply increased in 2021. Georgia imported Russian gas worth USD 77 million in 2021, which is 108% more comparing to the imports in 2020. Such a large increase in the imports of Russian gas has not been observed in the past years.
In return, natural gas imports from Azerbaijan fell by USD 6.2 million (2.4%) to USD 256 million. If in 2020 the share of Russian natural gas was 12.2% in total imports, the figure reached 23.1% in 2021.
10. New Poti Port Worth of GEL 120 MLN Is Opened
The Prime Minister-in the company of Minister of Economy and Sustainable Development Natia Turnava, US Ambassador Kelly Degnan, and Pace Group's President Ioseb Dolidze-visited the new seaport built through the joint effort of Pace Group and the US International Development Finance Corporation (DFC).
The Prime Minister, in his speech, pointed out that Pace carried out the large-scope construction of Poti's new port, a far-reaching project for the region, since 2020. According to him, hundreds of jobs were created in the process, a crucially important aspect for the region's population amid the pandemic.
93 million USD has been invested into the seaport's construction, with large hydrotechnical facilities built and modern port infrastructure installed.
