Verdict: Archil Talakvadze’s statement is MOSTLY TRUE.

Resume: The Heritage Foundation publishes its Index of Economic Freedom annually. In 2012, Georgia was in 36^th place with 70 points in terms of investment freedom which is one of the components of economic freedom in the ranking. As of 2017, Georgia’s overall points increased to 80 and the country moved up to the 21^st place. In accordance with the latest 2018 report, Georgia’s overall points remained unchanged; however, as a result of changes in other countries’ indicators, Georgia’s ranking worsened by three positions and it now ranks 24^th.

Analysis At the session of the Parliament of Georgia, one of the leaders of the Parliamentary Majority, Archil Talakvadze, stated: “We have improvements in terms of investment protection. In accordance with the Heritage Foundation’s report, Georgia moved up in the ranking from the 36^th to the 21^st

place.”

FactCheck

took interest in the accuracy of the statement.

In April 2018, the Heritage Foundation published its 2018 Index of Economic Freedom. In accordance with the Index, Georgia is ranked 9^th from the 44 countries in our region (Europe) and 16^th from the 180 countries of the world. In accordance with the 2017 Index of Economic Freedom, Georgia was ranked 5^th in the region and 13^th

in the world.

Investment freedom is one of the components of economic freedom. However, it does not refer to the “protection” of an investor as such but measures restrictions imposed upon the inflow-outflow of investments. Generally, whilst speaking about property rights and including the protection of the investor/investment, it is more relevant to pay attention to another component of economic freedom – property rights. Georgia’s indicator in the 2018 Index improved from 55.2 points to 62.8 points as compared to 2017. As a result, the country moved up from the 70^th place to the 50^th. In 2012, Georgia was ranked 71^st

with 40 points.

Georgia’s achievements in terms of the investment freedom component are assessed at 80 points overall and this figure has remained unchanged since 2014. However, changes in the performance of other countries (improvement or deterioration) prompt changes in rankings in spite of the overall points being the same. In 2018, Georgia’s ranking in terms of investment freedom worsened by three positions as compared to 2017 with the country now ranked in the 24^th

place. The tendency of changes in the ranking in the period of 2012-2018 is given in Table 1.

Table 1:

Georgia in the Index of Economic Freedom Ranking

		2012	2013	2014	2015	2016	2017	2018
Index of Economic Freedom	Points	69.4	72.2	72.6	73	72.6	76	76.2
	Ranking Position	34	21	22	22	23	13	16
	Position in the Region	16	11	12	11	12	5	9
Investment Freedom	Points	70	75	80	80	80	80	80
	Ranking Position	36	27	23	23	23	21	24
	Position in the Region	21	19	16	17	18	16	18

Source: The Heritage Foundation

As illustrated by the table, Georgia was in 36^th place in terms of investment freedoms in 2012 and then ranked 21^st

in 2017. In 2018, the former positive tendency which continued until 2017 stopped and Georgia’s position went downhill both in terms of the Index of Economic Freedom and investment freedom. At the same time, of note is that the country’s overall points in the Index of Economic Freedom did increase by 0.2 points; however, it was not enough the keep its previous position in the ranking.

Similar indicators are given in the World Economic Forum’s Global Competitiveness Reports. In accordance with this source, Georgia was ranked 131^st from 144 countries with 3.1 points in terms of property rights in 2012 (2012-2013 accounting period). It ranked 17^th in terms of investment protection with 7 points. In accordance with 2017’s data (2017-2018 accounting period), Georgia is 46^th with 4.7 points in terms of property rights protection and 7^th with 7.7 points in terms of investor protection. Of note is that as compared to the previous period (2016-2017 accounting period), Georgia has fallen back by three positions although it advanced by 13 positions in the ranking of investment protection.