Saba Buadze: “Today, Russia accounts for 64% of exported wine.”

Verdict: FactCheck concludes that Saba Buadze’s statement is TRUE.

Resume: According to the data of external trade portal of the National Statistics Office of Georgia, from January to May 2023, the total value of Georgia’s wine export was USD 78.6 million. Of this amount, wine valued at USD 52.4 million was exported to Russia which constitutes 66.6% of the country’s total wine export.

In the same period of the previous year, the value of wine exported from Georgia was USD 60.3 million and wine valued at USD 33.6 million was exported to Russia. Therefore, Russia’s share in Georgia’s total wine exports amounted to 55.7% in the first four months of 2022. As we see, wine export to Russia (in monetary value) increased by 56% in the first four months of this year as compared to the same period of 2022 whilst Russia’s share in total export during the reporting period rose by 10.9 percentage points.

There is a growth in a year-by-year period. In 2022, the total value of wine exported to Russia was USD 160.9 million which is 22.8% more (USD 131 million) as compared to 2021. Russia’s share in total export increased by six percentage points in 2022 as compared to 2021.

Therefore, FactCheck concludes that Saba Buadze’s statement is TRUE.

Analysis

A member of Tbilisi Municipal Council and Chairperson of Lelo – Partnership for Tbilisi faction, Saba Buadze, on air on TV Pirveli’s talk show Reaktsia, stressed the growth of export to Russia and stated: “Today, Russia accounts for 64% of exported wine.”

According to the data of external trade portal of the National Statistics Office of Georgia, the total value of Georgia’s wine export was USD 78.6 million in January to May 2023. Of this amount, wine valued at USD 52.4 million was exported to Russia which constitutes 66.6% of the country’s total wine export.

In the same period of the previous year, the value of wine exported from Georgia was USD 60.3 million with wine valued at USD 33.6 million exported to Russia. Therefore, Russia’s share in Georgia’s total wine exports amounted to 55.7% in the first four months of 2022. As we see, wine export to Russia (in monetary value) increased by 56% in the first four months of this year as compared to the same period of 2022 whilst Russia’s share in total export during the reporting period rose by 10.9 percentage points.

Table 1: Georgian Wine Export to Russia in 2022-2023 (Four Months), USD Million

Source: External Trade Portal

In order to have a whole picture about the export of Georgian wines, it is relevant to analyse the previous years’ statistics as well.

Table 2: Georgian Wine Export in 2012-2022, USD Million, Million Bottles

Source: National Statistics Office of Georgia

An analysis of wine export statistics shows that the growth or the reduction of Georgian wine export depend precisely on the Russian factor. As we know, Russia banned the import of agricultural products (including wine) from Georgia in 2006 pursuant to the decree of chief sanitary inspector of Russia on the ground of poor quality. This embargo resulted in a significant drop in Georgian wine exports. In 2006, the value of Georgian wine export was USD 41 million, although it decreased to USD 29 million in the next year.

In the discussed period, Russia’s share in total export was the lowest in 2012 (34%) which was precipitated by the trade ban. Georgian wine export to Russia was restored in 2013. In 2013-2014, Georgia’s wine export increased significantly, largely as a result of lifting the embargo on the import of Georgian wines to Russia (USD 128 million in 2013 and USD 185 million in 2014). In 2015, the reduction of Georgian wine export was again caused by the Russian factor. That year, instability in Russia and Ukraine was strongly reflected on Georgian wine export and resulted in a 30% drop in exports (USD 96 million). The events unfolding after 20 June 2019 (Russia’s threat to impose sanctions on Georgian goods) once again demonstrated that Russia is an unreliable trade partner which often uses trade relations with Georgia for political purposes. This is also confirmed by Russia’s recent decision to restore direct flights to Georgia.

Given these circumstances, the aim of the Government of Georgia should be cutting economic dependence on Russia. However, an observation of Georgian wine export proves completely opposite – we do not reduce our dependence on Russia but, on the contrary, increase it. Growing dependence on Russia’s unstable and unpredictable market cannot bring economic or political benefits to the country, neither in the short-term nor in the long-term perspective.

Therefore, considering the aforementioned factors, Saba Buadze’s statement is TRUE.