Discusses key economic indicators and trade statistics, which countries are dominant in the market, the U.S. market share, the political situation if relevant, the top reasons why U.S. companies should consider exporting to this country, and other issues that affect trade, e.g., terrorism, currency devaluations, trade agreements.
Last Published: 8/4/2017
Georgia is a small transitional market economy of 3.7 million people with a per capita GDP of $3,853 (2016).  Georgia is located at the crossroads between Europe and its strategic location makes it a natural logistics and transit hub along the “New Silk Road” linking Asia and Europe via the Caucasus. 
 
The Georgian economy is growing steadily, but external shocks in the region, such as the Russia-Ukraine conflict and related international sanctions, and lower commodity prices that affect key trading partners, have had a negative impact on Georgia’s economy and contributed to a relatively low growth rate - 2.9 percent in 2015 and 2.7 percent in 2016.
 
In June 2014, Georgia signed an Association Agreement (AA) and Deep and Comprehensive Free Trade Area (DCFTA) with the European Union.  Through reduced tariffs and the removal of technical barriers to entry, the DCFTA gives Georgian products access to over 500 million people in the EU.  Reciprocally, products from the EU now enjoy easier access to the Georgian market.  The government is in the process of approximating EU legal and regulatory standards
 
Following the launch of the U.S.-Georgia Strategic Partnership Commission (SPC) in 2009, the U.S. Department of State holds regular meetings with its Georgian counterparts across various working groups.  One of these dialogues is the Economic, Energy, and Trade Working Group which aims to coordinate Georgia’s strategy for development in these areas and to explore ways to expand bilateral economic cooperation.  In addition to the SPC, in May 2012, the U.S. and Georgia launched a High-Level Trade and Investment Dialogue to encourage bilateral trade.
 
Georgia’s successful economic reforms are reflected in its rankings by reputable international organizations.  Since 2003, the World Bank has recognized Georgia as one of the world’s fastest reforming economies and as a leader in fighting corruption.  Georgia ranks 16th in the 2016 World Bank’s Ease of Doing Business index, 13th in the 2017 Economic Freedom Index, and 59th out of 128 global economies in the Global Competitiveness Report. Georgia has the lowest corruption rate in the region according to Transparency International and International Credit Rating Agencies (Fitch, Moody’s Investors Service and Standards and Poor’s) rated Georgia as a stable country.  Judicial reform is a top Georgian government priority.
 
At present, Georgia’s main export markets are Russia (9.8%), Turkey(8.2%), China(8.0%), Bulgaria(7.9%), and Azerbaijan (7.3%). Canada (18.2%), Turkey (13.7%), Ireland (8.6%), Russia (6.9%), and China (5.6%), are Georgia’s main sources of imported goods.  Oil and gas imports are the primary imports from Azerbaijan. Georgia’s main imports are petroleum products and natural gas, automobiles, medicines, sugar, turbines for power generation, and wheat.  After years of declining domestic manufacturing, most consumer goods are imported from abroad as well.  The majority of inputs are imported.
 
The Georgian government does not control the separatist territories of Abkhazia and South Ossetia, which have been occupied by Russia since the 2008 Georgia-Russia war.  The situation along the administrative boundary line (ABL) between Georgian‐controlled territory and the separatist regions remains tense, with ongoing borderization efforts and continued detentions of those allegedly “illegally” crossing the ABL.

 

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Georgia Trade Development and Promotion