Issue 35: Construction – III q 2014

In the first three quarters of 2014, the construction sector has the largest share (1.2%) in the growth rate of the gross domestic product (GDP) (5.9%).

In the first three quarters of 2014, the construction sector has significantly activated. The foreign direct investments (FDI) have largely expanded (312.7%), compared to the same period of the previous year. In the period of January-October 2014, the volume of loans to this sector has also grown (2.0%). The product value in this sector has largerly increased (28.1%).

Source: GeoStat

In the first three quarters of 2014, construction sector has expanded (16.3%; 135.7 mln. GEL), compared to the corresponding period in 2013. It has been persistively increasing in the II quarter (17.9%), as well as in the III quarter (17.8%) of 2014, compared to the respective quarters last year.

In last quarter of the year, output of construction sector decreases, compared to preceding quarters, since activity in construction sector is subject to seasonality. Therefore, this year we can expect the same pattern.

In the first three quarters of 2014, the turnover in the construction sector increased (33.3%; 551.9 mln. GEL), as well as in the III quarter of 2014 (45.1%; 304.0 mln. GEL), compared to the same periods in 2013. In the III quarter of 2013, the turnover in this sector by the size of enterprises was distributed accordingly: large (77.7%), medium (13.2%), small (9.1%).

Noteably, the share (2.9 percentage points) of the medium sized enterprises increased, while the share of the large (-1.8 percentage points) and small enterprises (-1.1 percentage points) decreased.

In the first three quarters of 2014, the production value in the construction sector reached 2 418.0 mln. GEL which is significantly larger (28.1%; 530.0 mln. GEL), compared to the same period in 2013. The largest share (91.1%) in the production value belongs to the construction of buildings.
In the III quarter of 2014, the production value in the construction sector has increased (49.8%; 350.0 mln. GEL), compared to the same period in 2013. In this period, the share in the production value of the construction sector by the size of enterprises is the following: large (73.2%), medium (14.6%) and small (12.2%).

 Source: GeoStat

Soruce: GeoStat

In the first three quarters of 2014, FDI in construction sector has the second largest share in total volume of FDI (22.5%; 207.6 mln. USD) after the transport and communication sector (27.5%). In this period, share of FDI in construction is significantly larger (15.1 percentage points), compared to the corresponding period in 2013. During this period the absolute value of FDI in construction also increased (312.7%; 157.4 mln. USD), compared to the same period of 2013.

In the III quarter of 2014, construction sector had the largest inflow of FDI (181.4 mln. USD). This will have a positive impact on the volume of this sector in the next time period, because the investments are characterized by the time lag.

In the first three quarters of 2014, the loans to the construction sector equals to 408.0 mln. GEL, which is the 7.2% of the total volume of loans to the national economy both in the national and foreign currencies.

In the first three quarters of 2014, the loans to the construction sector decreased (-7.8%; -34.7 mln. GEL). However, in Jan-October 2014, the amount of loans to this sector increased by 2.0% (7.9 mln. GEL), compared to the same period of 2013.

Source: GeoStat

Source: GeoStat

In the III quarter of 2014, both the number of persons employed in the construction sector and their average monthly remuneration increased.

In the first three quarters of 2014, the sector employed 10% of total number of persons employed in the business sector.

In the III quarter of 2014, number of persons employed in construction is 56 937 people, which is higher (12.7%; 6 400 people), compared to the same period in 2013.

In the III quarter of 2014, the average monthly remuneration in the construction sector reached 1 183.1 GEL which is much higher, compared to the same period of 2013 (14.7%; 151.83), as well as compared to the II quarter of 2014 (4.6%). This is the highest average monthly salary ever recorded in this sector.

In 2013, in the construction sectors the product turnover by regions is distributed as follows: Tbilisi (64.8%), Adjara (14.4%), Samegrelo-Zemo Svaneti (3.4%) and Imereti (3.3%), and others (14.1%).

The largest regions by the number of persons employed are the following: Tbilisi (60.4%), Adjaria (13.3%) and Imereti (5.8%). The number of employed people increased only in the regions of Mtskheta-Mtianeti (41.5%) and Adjara (7.2%), while this indicator declined in all other regions, compared to the previous year.

In 2013, the largest regions by the average monthly remuneration are the following: Samtskhe-Javakheti (1642.4 GEL), Tbilisi (964.2 GEL) and Kvemo Kartli (903.4 GEL). The average monthly remuneration increased in the following regions: Samtskhe-Javakheti (240.9%), Racha-Lechkhumi and Kvemo Svaneti (34.3%), Mtskheta-Mtianeti (33.9%).

 Source: GeoStat