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Georgia Economy 1996
Georgia's economy has traditionally revolved around Black Sea tourism;
cultivation of citrus fruits, tea, and grapes; mining of manganese and
copper; and a small industrial sector producing wine, metals, machinery,
chemicals, and textiles. The country imports the bulk of its energy needs,
including natural gas and oil products. Its only sizable domestic energy
resource is hydropower. Since 1990, widespread conflicts, e.g., in Abkhazia,
South Ossetia, and Mingreliya, have severely aggravated the economic crisis
resulting from the disintegration of the Soviet command economy in December
1991. Throughout 1993 and 1994, much of industry was functioning at only 20%
of capacity; heavy disruptions in agricultural cultivation were reported;
and tourism was shut down. The country is precariously dependent on US and
EU humanitarian grain shipments, as most other foods are priced beyond reach
of the average citizen. Georgia is also suffering from an acute energy
crisis, as it is having problems paying for even minimal imports. Georgia is
pinning its hopes for recovery on reestablishing trade ties with Russia and
on developing international transportation through the key Black Sea ports
of P'ot'i and Bat'umi. The government began a tenuous program in 1994 aiming
to stabilize prices and reduce large consumer subsidies.
GDP - purchasing power parity - $6 billion (1994 estimate as extrapolated
from World Bank estimate for 1992)
-
National product real growth rate:
-
National product per capita:
-
Inflation rate (consumer prices):
40.5% per month (2nd half 1993 est.)
officially less than 5% but real unemployment may be more than 20%, with
even larger numbers of underemployed workers
$NA, including capital expenditures of $NA
citrus fruits, tea, wine, other agricultural products; diverse types of
machinery; ferrous and nonferrous metals; textiles; chemicals; fuel
re-exports
Russia, Turkey, Armenia, Azerbaijan (1992)
fuel, grain and other foods, machinery and parts, transport equipment
Russia, Azerbaijan, Turkey (1993); note - EU and US sent humanitarian food
shipments
NA (T'bilisi owes about $400 million to Turkmenistan for natural gas as of
January 1995)
growth rate -27% (1993); accounts for 36% of GDP
heavy industrial products include raw steel, rolled steel, airplanes;
machine tools, foundry equipment, electric locomotives, tower cranes,
electric welding equipment, machinery for food preparation and meat packing,
electric motors, process control equipment, instruments; trucks, tractors,
and other farm machinery; light industrial products, including cloth,
hosiery, and shoes; chemicals; wood-working industries; the most important
food industry is wine
accounted for 97% of former USSR citrus fruits and 93% of former USSR tea;
important producer of grapes; also cultivates vegetables and potatoes;
dependent on imports for grain, dairy products, sugar; small livestock
sector
illicit cultivator of cannabis and opium poppy; mostly for domestic
consumption; used as transshipment point for illicit drugs to Western Europe
heavily dependent on US and EU for humanitarian grain shipments; EC granted
around $70 million in trade credits in 1992 and another $40 million in 1993;
Turkey granted $50 million in 1993; smaller scale credits granted by Russia
and China
coupons introduced in April 1993 to be followed by introduction of the lari
at undetermined future date; in July 1993 use of the Russian ruble was
banned
coupons per $US1 - 1,280,000 (end December 1994)
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