2022-11-28
I wish to start the meeting with a discussion of the draft budget for the following year. We had the final review at the Economic Council on Friday and the ultimate Draft Budget will be submitted to the Parliament of Georgia on November 30, 2022. It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
As the Head of Government of Georgia noted, the economic growth projection will be adjusted to 10% instead of the originally projected 8.5%, which means that for the second year in a row the country will have its economic growth in double digits.
"Let me greet and welcome you all. I wish to share information with the general public on significant topics. I believe that we made interesting decisions and wish to brief our society about them.
We will be adjusting our economic growth projections from 8.5% to 10% this year. It means that for the second year in a row we are having a double-digit economic growth resulting from our prudent economic policies. I wish to remind everyone that almost 80 BLN GEL will be the Gross Domestic Product (GDP). It means that per capita GDP will reach about 7500 USD, which is a great progress for the past two years, of course. Also, I wish to say that during the last year almost over 100 000 new jobs were created. Unemployment indicator has gone down to its historic minimum. Poverty has also declined as well. We have growth in every direction, be that tourism, export or domestic production. In a nutshell, we have positive indicators in every direction.
By taking into account the actual tax collections, we are increasing the plan for the fiscal revenues into the consolidated budget in 2023 with about 390 MLN GEL. In addition, a plan for the loan repayment and other revenues will be increased with about 270 MLN GEL. Considering the aforesaid, our resources will increase in the coming year with 660 MLN GEL and the consolidated budget will end up being 25 BLN GEL as a result" noted the Prime Minister of Georgia.
Allowances to socially vulnerable children used to be 50 GEL 2 years ago. It will increase to 200 GEL from July 1, 2023. It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today as well.
According to the Head of Government of Georgia, 65 MLN GEL will be spent in support of socially vulnerable children in the country.
"I wish to single out several interesting aspects and once again share information with you on the social security initiatives. We intend to increase the social allowances next year in every direction, be that pensions, allowances to persons with disabilities and others. We will add support for socially vulnerable children to the above and it will be increased. It was not envisaged in the previous Draft Budget for 2023. You may well be aware that 50 GEL was paid out per child 2 years ago, if I am not mistaken, and it will become 200 GEL from July 1, 2023. Each child will be earmarked 200 GEL a month and, what is most important, 65 MLN GEL will be spent next year towards this end" noted the Prime Minister of Georgia.
We will be doubling the support of private sector employees during the maternity leave and will be paying 2000 GEL instead of 1000 GEL from January 1. It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
According to the Head of Government of Georgia, school teachers will be getting full salary during their maternity leaves from 2023 in line with the decision made prior.
"So-called maternity leave was a rather challenging issue. I was asked to address it at the Parliament as well. We discussed the matter and decided to double the support during the maternity leave for the private sector employees as well. From January 1 they will also be getting 2000 GEL, instead of 1000 GEL. You may remember that we considered an increase for school teachers and they will be getting a full salary while on maternity leave from the coming year. Now the private sector employees will be getting this support in the volume of 2000 GEL instead of 1000 GEL, per our decision" stated Irakli Garibashvili.
We intend to start a Program for Construction and Rehabilitation of Kindergartens. It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
According to him, the program will be carried out in three stages. First phase will start on January 1, 2023 and 100 MLN GEL will be channeled for the funding of the program. It will cost 1.3 BLN GEL in total.
"Once again, I wish to single out several important aspects. You may recall that budget allocations for the education sector were increased with 400 MLN GEL. Within this earmarking we plan to construct and rehabilitate 500 school buildings, but will be allocating over 150 MLN GEL in addition for the education system. I wish to share information about a vital decision. You may well be aware that kindergartens are in a very shabby condition all over the country. Irakli Karseladze has scrutinized the topic under my instructions and identified 885 kindergartens in need of construction and rehabilitation. Thus, we decided to start a Program of Kindergarten Construction and Rehabilitation. It will also consist of three stages and the first one will start on January 1, 2023. Funding for the first phase will reach 100 MLN GEL, while the entire project will require 1.3 BLN GEL to fully rehabilitate or construct the new kindergartens all over the country. You may well be aware that a similar program has been launched for the construction and rehabilitation of school buildings. It will start from January 1 and about 800 sites are included in the program. We are starting with 500 school buildings from next year, which is important for our future generations. Our children should grow in a healthy and truly sound environment. It should start with kindergartens and apply to schools and higher education institutions.
In addition, over 30 MLN GEL will be channeled for equipping schools with computer labs, which is very important" added the Prime Minister of Georgia.
According to the Head of Government of Georgia, 200 MLN GEL will be allocated for tourism and namely for a Program of New Travel Destinations within Georgia. Also, police will get 35 MLN GEL in addition.
It is well known to us all that tourism is one of the prime sources of economic growth in our country and one of the key priority directions. Some months ago we started working on defining new travel destinations. Under my instructions, this program is already developed. Specific plan will be presented to the general public in a while and it includes both existing and new locations. We will be starting to develop new travel destinations from next year. It will include the full rehabilitation of the existing ones and we will be allocating 200 MLN GEL towards this end. It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
As he noted, 170 MLN GEL will be allocated in addition to finance infrastructure projects in Tbilisi.
"An additional 170 MLN GEL will be allocated to finance infrastructure projects in Tbilisi. Also, we increased the budget allocation for the Ministry [of Regional Development and Infrastructure of Georgia] of Irakli Karseladze with another 30 MLN GEL. Culture and sports will get 55 MLN GEL and our praiseworthy police will be getting 35 MLN GEL in addition.
These are the main directions of our new budget allocations and additional resources, which we mobilized in the volume of 660 MLN GEL. Of course, needs were much higher and line ministries had specific plans submitted, but at this point in time we deemed these projects and programs essential to be done and financed for the benefit of our country and our people at large" noted the Prime Minister of Georgia.
We expect over 400 MLN GEL next year in addition. Within this scope, we will be reducing the budget deficit to 3.1%. It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
According to the Head of Government of Georgia, the budget deficit was 4.4% at the beginning of the year, but it will shrink to 3% now.
"We expect 400 MLN GEL in addition this year. Within this scope, we will be reducing the budget deficit to 3.1%. Let me remind you that it was 4.4% at the beginning of the year, but we will be reducing it to almost 3% now" added the Prime Minister of Georgia.
We are launching a wide-scale project. It will involve the construction of residential blocks for internally displaced persons (IDP). We intend to meet the housing needs of 7000 IDP households. It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
According to him, over 50 MLN GEL will be allocated this year towards this end.
"We are launching a wide-scale project. It will involve the construction of residential blocks for internally displaced persons (IDP). We intend to meet the housing needs of 7000 IDP households. This year we will be allocating over 50 MLN GEL towards this end" noted the Prime Minister of Georgia.
With an aim of tourism enabling, we plan to bring world-class celebrities of stage to our country during the coming two years. I refer to performers and artists. It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
According to him, world-class performers will hold concerts in the country in June, July, August and early-September.
"With an aim of tourism enabling, we plan to bring world-class celebrities of stage to our country during the coming two years. I refer to performers and artists. World-class entertainers will hold concerts in the country in June, July, August and early-September at stadiums and Black Sea Arena. We will be allocating 70 MLN GEL towards this end. We have relevant funds. This project will be financed in the coming two years and I believe that it will attract additional travelers. I think it will end up being an interesting program.
These are the main changes related to budgets of both current and next years. You may well be aware that the Draft Budget for 2023 will be submitted to the Parliament of Georgia on November 30 and I hope to get the support of our legislators" stated the Prime Minister of Georgia.
According to him, title ownership of apartments was considered by the Executive Government at its meeting today.
"I wish to tell you very briefly that we will be discussing the title ownership of apartments at the Executive Government Meeting today. Residential units will be given to 85 households, as they did not have title ownership on them" noted the Head of Government of Georgia today.
According to the Prime Minister of Georgia, alleged information exists on misleading customers at PSP Pharmacies on Turkish manufactured medication. If such practice prevails, rather strict follow-up measures will be taken in each individual case.
One alarming piece of information reached me a few days ago. I wish to name the company. PSP Pharmacy has allegedly been misleading customers. Namely, when an individual wants to buy a specific pill - and I know that it is a notorious instruction, which is reported and needs to be double-checked, of course - the salesperson asks whether the customer wants a high-quality and expensive one or a low-quality Turkish medication. It is a deception of customers, of course. It is straightforwardly outrageous. How can a person act so obscenely and mislead a customer - pensioner and many other vulnerable individuals who try to buy essential medication. At any rate, what does it matter, who enters the pharmacy. Such malpractices need follow-up measures. I did have a conversation on this with Zurab Azarashvili [Minister of Health]. If cases like these continue, each will have very serious response measures. It is unacceptable and categorically forbidden. As we get it, these 200 MLN GEL are a missed opportunity for pharmaceutical companies and an owner of this group included, who intended to generate this much as sales revenues. We know that it is not pleasant information for them, but our main duty is to care for people and I wish to remind everyone, including the opposition and opponents. We need to do whatever people need. That is why, this process will not be halted by anyone! It was announced by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
As he also noted, Zurab Azarashvili [Minister of Health] is actively working on the price reduction on medication and almost 200 MLN GEL will be saved by our population under the initiative of the Prime Minister of Georgia by opening-up the Turkish pharmaceutical market for imports.
"And lastly, I wish to share one more piece of information with you. Zurab Azarashvili [Minister of Health] is actively working on the price reduction on medication.
This reform was launched in January of last year. Back then, with my initiative a Turkish pharmaceutical market was opened for import of high-quality medication with Good Manufacturing Practice (GMP). It was successfully implemented. You may recall that a lot of people were very skeptical towards it and did not believe in the success of the reform. I also remember that one of the large importers - owner of a pharmaceutical company - was criticizing this program. I understand that it was quite a blow on them, as our population will be saving about 200 MLN GEL per year as a result of the reform - only as a result of this specific decision.
Greater competition has been witnessed in the country as high-quality Turkish medication got imported and significantly dropped the cost of out-of-pocket purchases. You may also remember a lot of specific cases, when medication costs reached 200-300 GEL a piece. They became much cheaper and are not sold at 30, 40 or 50 GEL" noted the Prime Minister of Georgia.
The Head of Government of Georgia spoke at the meeting today on the Employment Program of Socially Vulnerable Groups of Population, thereby noting that about 30 000 people got employed. According to the Prime Minister of Georgia, at least 200 000 socially vulnerable but otherwise capable individuals exist in the country and that it is the intention of the Government to have them all employed.
According to the Prime Minister of Georgia, it is essential for the socially vulnerable people to not only get engaged in public works, but to gradually transition to capacity building through vocational skills.
"Several months ago, we launched a new initiative. It envisaged the employment of socially vulnerable groups of population. This is a European model and practice. About 30 000 socially vulnerable individuals are already employed. This is not a lot, but is far from being a small indicator either. Nevertheless, resources are much higher. Socially vulnerable, but otherwise capable individuals are about 200 000 or 300 000 in the country. It may be said that at least 200 000 are identified. Our aim and goal is to have them all employed not only in public works, but to have them gradually transition into businesses and capacity development through vocational skills. This is our main priority" noted the Prime Minister of Georgia.
According to the Head of Government of Georgia, the private sector is understaffed and business owners have also spoken with him on this topic.
"I wish to touch on another sensitive topic. Irrespective of the fact that so many jobs were created, a lot of employers - including those in the construction and other sectors - are greatly understaffed. Over 100 000 jobs were created, but demand in the labor force is much higher. Much greater number of people may get employed in the country. I personally had a discussion with businesses. I met them several weeks ago and they all said that it is essential to increase the labor source. How can the Government do that? Of course, we stand ready to have a more active communication with businesses and work in a more coordinated manner" concluded Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
Press Service of the Government Administration