The FINANCIAL — Verdict: Dimitri Kumsishvili’s statement is TRUE.
Summary: In 2017, investments worth USD 62.7 million were made in Georgia from the UAE. With this indicator, it became Georgia’s 7th largest investor country. Azerbaijan is on the first place in the ranking. Investments worth USD 482 million were made by Azerbaijan.
The first investment from UAE was made in 2003 and the cumulative amount of investments since them until 2017 amounts to USD 885 million. With this indicator, the UAE is on the 6th place among the investor countries, falling behind Azerbaijan, the United Kingdom, the Netherlands, Turkey and the United States.
Analysis: On April 9, 2018, the Minister of Economy of Georgia, Dimitri Kumsishvili, stated that the United Arab Emirates are the on the 7th place by investments made in Georgia. Kumsishvili also added that, currently, the investments from the UAE exceed USD 800 million.
National Statistics Office of Georgia publishes the statistics about the foreign direct investment made in Georgia. According to Geostat, investments worth USD 1,862 million were made in Georgia in 2017. This number is unprecedently high in absolute terms.1 Investments constitute 12.4% of the 2017 GDP, which is the third highest point in the reporting period and only lags behind 2006 and 2007 indicators.
In 2017, Azerbaijan held the first place among the top 10 investor countries, with the investments worth USD 481 million. Azerbaijan was followed by Turkey, UK, Netherlands, Czech Republic, USA and UAE. Investments worth USD 62.7 million were made in Georgia from the UAE in 2017, which placed the country on the 7th position. Panama, China and Cyprus complete the top 10. It is noteworthy, that Russia was on the 12th place.
The first investment from the UAE to Georgia, worth USD 290 thousand, was made in 2003. In 2004, UAE did not invest any funds in Georgia. The most investments in the reporting period (2003-2017) from the UAE were made in 2008 – USD 307 million, whereas the highest growth was recorded in 2007, when, compared to the previous years, the amount of the inflowing investments grew 287 times. Such a growth rate, besides the high indicator of investment, was mostly due to low base effect.
Since 2009, the investments from UAE to Georgia have been shrinking until 2012. In 2013-2017, excluding 2014, the dynamic of the inflow of investments from the UAE was constantly increasing. The 2017 indicator is the second largest after the 2013.
In parallel with the investments, position of the UAR in the list of investing countries was changing, too. In 2008-2009, the country was investing the most in Georgia. Therefore, the 2017 indicator is not the highest in terms of the UAE’s position in the list, nevertheless, it does reflect the positive tendency.
In 2003-2017, in total, the UAE invested more than USD 885 million in Georgia. The UAE is on the 6th position among the investor countries with this indicator. In the given period, the most investments in Georgia were made by Azerbaijan – USD 2.5 billion. The United Kingdom invested USD 2.4 billion in Georgia. The Netherlands, Turkey and the United States complete the top five investor countries’ list. Russia is on the 8th position in the given ranking, lagging behind the Czech Republic. It is noteworthy, that the EU countries invested USD 7 billion in Georgia in 2003-2017, which exceeds the amount received from the CIS by USD 600 million. With this indicator, the EU is on the first position by country groups.
1 – Importantly, Geostat edited the foreign direct investment indicators twice, in November 2017 and March 2018, following the recommendations from the International Monetary Fund (IMF). Therefore, the hitherto historical quantitative indicator of investments decreased by USD 262 million.
1 – In 2004, Georgia did not receive any investments from the UAE.