On 30 April, representative of the Parliamentary Majority, Davit Onoprishvili, delivered a speech at the plenary session of the Parliament emphasising economic growth indicators. The MP stated: “Growth in the GDP; that is, in the economy, amounted to 8.3% in the month of March. Starting from November 2013, economic growth has been consistently high, varying between 7%-8%. It is safe to say that, at the very least, this growth rate will ensure the annual growth of 5% envisaged in the state budget. As for the economic growth registered in the first quarter, it equals 7.4%. An indicator of this magnitude has not been recorded in the first quarter of the year over the course of the last six years.” FactCheck took interest in the MP’s statement and verified the accuracy of the indicated facts. In line with the preliminary data of GeoStat, the estimated real Gross Domestic Product (GDP) growth rate amounted to 8.3% in March of 2014 as compared to the same period of the preceding year. In his statement the MP notes that in the aftermath of November 2013, the rate of economic growth fluctuated between 7% and 8%. In November of 2013 the GDP growth rate equalled 7.8% as compared to the same period of the previous year. In December of 2013 this indicator reached 8.4% while in the month of January the figure decreased to 7.8%. In February of 2014 the indicator of economic growth equalled 5.4%.

According to the MP, the growth registered in the first quarter of 2014 was the highest indicator recorded over the course of the last six years. We analysed the GDP growth rates of the first quarters for the years from 2009 through 2014. In line with the preliminary data of the first quarter of 2014, the rate of economic growth equals 7.4%. In the first quarter of 2013 the GDP growth rate amounted to 2.4% (preliminary data) while in the same period of 2012 the indicator stood at 6.6%. In the first quarter of 2011 the economic growth rate was 5.8%, in 2010 – 3.7% and in 2009 the indicator equalled -4.8%. As can be gathered from these indices, over the course of the last six years (first quarters), in the first quarter of 2014 we witness the highest growth rate of the GDP.

It must be noted that government officials contend that the high growth rates observed in the fourth quarter of 2013 and the first quarter of 2014 are the results of the so-called base effect. The base effect in business and economics, which is the same as the low initial amount effect, is the tendency for a small absolute change from a low initial amount to be translated into a large percentage change. Accordingly, in the given case, the opponents refer to the low growth rates of the Georgian real GDP starting from the fourth quarter of 2012 through the third quarter of 2013 and based upon this fact explain the high rates registered in the fourth quarter of 2013 and the first quarter of the current year. Conclusion In line with the preliminary data of March of 2014, the rate of economic growth has amounted to 8.3%, precisely as indicated by the MP. In November of 2013, the GDP growth rate stood at 7.8%, in December – at 8.4%, in January of 2014 – at 7.8% and in February – at 5.4%. The Deputy also noted that in the period between November 2013 and March 2014, the GDP growth rate varied around 7%-8%. The data given above demonstrates that this part of the MP’s statement is not entirely true. However, the average indicator for the five months reveals that the average economic growth was higher than 7%. The MP is correct in the second part of his statement. According to the preliminary data of GeoStat, in the first quarter of 2014, economic growth equalled 7.4% and this figure is higher than the GDP growth rates of the first quarters of the previous six years. In its research about the accuracy of Davit Onoprishvili’s statement, FactCheck did not delve deeper into the analysis of the base effect’s possible impact upon economic growth as we deem it inadvisable to make a final judgement on the given matter at this stage. Consequently, we conclude that the MP’s statement:  “Starting from November 2013, economic growth has been consistently high, varying between 7%-8%... In the first quarter of 2014, economic growth equalled 7.4%. An indicator of this magnitude has not been recorded in the first quarter of the year over the course of the last six years,” is MOSTLY TRUE.