Resume: In the amended version of (the second submission) of the 2019 draft state budget, the incomes budget line increased by GEL 357 million and the expenditures budget line increased by GEL 268 million as compared to the initial version. As a result, budget incomes now reach GEL 12,969 million and expenditures amount to GEL 12,998 million. The GEL 29 million difference between incomes and expenditures accounts for a decreased[1] balance.

Of the total growth in revenues, GEL 145 million is for debt service; that is, for changes in the debt service budget line. The amount of growth of the domestic debt remains unaltered and constitutes GEL 500 million. The GEL 145 million difference is fully for foreign debt growth with this figure having increased to GEL 1,805 million. Therefore, in accordance with the 2019 state budget, the growth of total financial obligations (domestic and foreign together) amounts to GEL 2,305[2] million.


During the discussion on Georgia’s 2019 state budget, United National Movement MP, Roman Gotsiridze, stated that GEL 145 million of the GEL 357 million growth in the budget accounts for a growth in debt.

The aforementioned statement was made at the discussion on the amended draft of the state budget. The MP referred to changes in budget lines as compared to the initial draft. The Government of Georgia submitted the first draft of the 2019 state budget to the Parliament of Georgia on 1 October 2018 and the amended draft on 2 November 2018. Of note is that the Government of Georgia introduced a number of social projects during this time which were not envisioned in the first draft of the state budget.

Table 1:Georgia’s 2019 State Budget Lines (GEL Thousand)

Name I Submission II Submission Difference
Incomes 12,611,650 12,968,500 356,850
Revenues 10,281,650 10,473,500 191,850
Decrease in non-financial assets 60,000 70,000 10,000
Decrease in financial assets 110,000 120,000 10,000
Growth of financial obligations 2,160,000 2,305,000 145,000
Expenditures 12,729,700 12,997,585 267,885
Expenses 9,279,052 9,421,540 142,488
Increase in non-financial assets 2,082,279 2,224,376 142,097
Increase in financial assets 434,490 417,790 -16,700
Decrease in financial obligations 933,879 933,879 0
Change in Balance -118,050 -29,085 88,965

Source: Ministry of Finance of Georgia

As illustrated by the table, budget incomes are set to increase by GEL 357 million. Of this amount, GEL 192 million and GEL 145 million are allocated for the growth of revenues and debt, respectively. The growth of non-financial and financial assets will each increase by GEL 10 million. Of the increased incomes, only GEL 268 million will be used to increase expenditures whilst GEL 89 million will be transferred to the budget balance.[3] In particular, the budget balance will decrease by GEL 29 million instead of the previously planned GEL 118 million.

The growth of expenditures (GEL 268 million) is primarily stipulated by the GEL 50 assistance package for socially vulnerable children[4] which comprises GEL 70 million, equipment purchase for the Ministry of Defence – GEL 92 billion as well as funding for the Ministry of Environmental Protection and Agriculture’s programmes – GEL 34 million.[5] Funding for the gasification of regions and entrepreneurship support will each increase by GEL 10 million.

[1] Money which is deposited in the budget’s account for the given period.

[2] It is also planned to pay obligations in the amount of GEL 934 million. As a result, the net growth of financial obligations constitutes GEL 1,371 million.

[3] Use or accumulation of money in the budget’s account.

[4] GEL 20 cash assistance + GEL 30 food voucher.

[5] Including GEL 10 million for measures to fight stink bugs.