Capital City: T'bilisi
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Economic trends

After suffering severe economic and political turbulence immediately after its independence in 1991, Goorgea’s economic performance has been slowly improving since 2000. The GDP growth rate was 9.4% in 2006, 11% in 2007, with a forecast of 9% in 2008. However, economic development and reforms process is hampered by high level of corruption existing in the country. Political insecurity and inadequate regulatory measures are keeping investors away. There is tension in the provinces of South Ossetia and Abkhazia which are seeking independence. The country faces high budgetary deficit and is financially dependent on the multilateral organizations. Inflation was estimated at above 8.4% in 2008 and unemployment rate remains high at around 12%.

Main branches of industry

Agriculture contributes nearly 16% to the GDP but the yield is very low. The main agricultural produce is tea, citrus fruits, tobacco, wine grapes, and rice. Georgia is rich in minerals, notably manganese (mined mainly at Chiatura and Imeritia), copper, tungsten, marble, and petroleum. Although Georgia has abundant hydroelectric energy, it needs to import bulk of its fuel. The construction of an oil pipeline from the Caspian Sea to a Black Sea terminal at Supsa (in Georgia) is going to bring in substantial foreign investment. The industrial sector is less developed and mainly includes manufacturing of transport equipment, electric motors, iron & steel, aeroplanes, chemicals and textiles. The industrial and mining sectors together contribute around 27% to the GDP. The most dynamic sector is the services industry (particularly hotels, restaurants, transport and telecommunications) and contributes more than 55% to the GDP. The Black Sea shore is full of resorts and spas that attract large number of tourists.

International trade

Georgia is open to international trade. It maintains no currency controls, allows foreign investment in almost all sectors and has implemented an impressive privatization program, including land privatization. The share of foreign trade in county’s GDP touches nearly 90%. Georgia was the second country of the former Soviet Union to join the WTO. However, Georgia has a negative trade balance. Its top three trade partners (both of export and import) are Russia, Turkey and Azerbaijan. The main western business partner is Germany. Georgia mainly exports iron & steel, beverages, aircrafts, and edible fruits & nuts. The commodities mainly imported are mineral fuels & oils, vehicles, nuclear reactors & boilers, electric & electronic equipment, and pharmaceutical products.