Trade with the EU is on the rise, whilst CIS share in trade declines
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On 20 December 2017, the Prime Minister of Georgia, Giorgi Kvirikashvili, stated: “Trade with the EU is on the rise and the EU is Georgia’s top trade partner. Export to the EU countries has increased by 20%. The share of the CIS member state is total trade volume declines, which means more diversification for our trade and even better insurance against any kind of external shock.”

FactCheck took interest in the accuracy of the statement.

National Statistics Office of Georgia publishes Georgia’s trade statistics. According to the information of the National Statistics Office of Georgia, in January-November 2017, Georgia’s total trade turnover reached USD 9.6 billion, which is 13% more as compared to the same period of 2016.

In accordance with the aforementioned statistics, in 2017 Georgia mostly traded with the CIS countries¹, as total trade share with that group of states constituted 27.4% of Georgia’s total trade turnover. At the same time, total amount of money received from trading with EU member 28 states constituted 26.8% of Georgia’s total trade turnover. In the same period of 2016, trade with the EU countries was more vigorous as compared to CIS member countries and exceeded the share of the latter by USD 94 million.

Georgia’s total trade turnover with the CIS member states as well as EU countries has been increased as compared to January-November 2016. However, income received from trade with CIS member countries is increased by 33%, whilst the same figure in regard to EU states is 3%. This means that increased trade turnover in 2017 as compared to 2016 was by 77% a result of intensified trade relations with the CIS member countries.

 

Table 1: Georgia’s Foreign Trade Statistics (USD million)

2012 2013 2014 2015 2016 2017
Import from the EU 2,429 2,266 2,372 2,081 2,215 1,986
Export to the EU 0,353 0,607 0,624 0,645 0,572 0,580
Trade with the EU 2,782 2,873 2,996 2,726 2,787 2,566
Import from the CIS 1,893 1,985 1,987 1,908 1,908 1,994
Export from the CIS 0,657 1,020 0,917 0,385 0,320 0,630
Trade with the CIS 2,550 3,004 2,904 2,293 2,228 2,623

Source: National Statistics Office of Georgia

 

Conclusion

Deteriorated trade relations can become a reason for an external shock for a country. At the same time, deepened trade relations with stable and developed economies reduce the probability of an external shock. Therefore, in this part, Giorgi Kvirikashvili  has made a proper emphasis:  declining share of CIS member countries in Georgia’s trade turnover, in light of improved economic relations with the EU does indeed ensure stable foreign trade for Georgia.

However, according to the National Statistics Office of Georgia, in January-November 2017, top trade partner for Georgia was CIS member countries’ group. The EU ended up at a second place among top trade partners, although it was only marginally lagging behind the EU member countries, whilst in 11 months of 2016, trade with the EU was larger as compared to trade with the CIS. In January-November 2017, export to the EU has been increased by 23%, although share of CIS member countries in Georgia’s foreign trade is increased – in 2016 it was 23%, whilst in 11 months of 2017 it is 27%.

Therefore, FactCheck concludes that Giorgi Kvirikashvili’s statement is HALF TRUE.

 

[1] Data published by the National Statistics Office of Georgia includes Ukraine as the CIS member state, notwithstanding Ukraine’s decision to leave CIS in 2014. However in the given article, trade figures with Ukraine are not considered together with the other CIS member countries.

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