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Comparison of Georgian Regions in terms of Business Development

September 16, 2016


Georgian regions differ from each other heavily in terms of social and economical aspects. The cause of such unevenness is in there geographical zoning, demographics, local economies' structural crisis after the collapse of commanding economy and the unequal infrastructure development levels.


The largest region in Georgia is Kakheti, and the smallest one is Guria, arable lands are spread more or less in parallel of their total territories (except from predominantly high mountainous regions). Economic profile goes inline, e.g. the regions where most of the arable lands are concentrated the agriculture is more developed.



The most populous regions are: Imereti, Kvemo Kartli and Adjara, however the high number of population in these regions are supported with somewhat more developed urban zones (Kutaisi, Rustavi, Batumi).


In order to compare the regions in terms of business activities we took the Geostat's statistics of Business Sector Turnover for 2015. It describes the business development level in the regions quite accurate since it does not capture the households output.


These charts show quite clearly the business is highly under-developed in Georgian regions. Share of all regional businesses into the total business turnover is circa 30 per cent, 70 per cent of it counts after the capital city - Tbilisi which is extremely disproportionate towards the population and jobs allocation; almost 50 per cent of jobs allocated in the agriculture, which in turn produces only 9 per cent to GDP. Some of the regions are under the critical conditions, Racha-Lechkhumi and Kvemo Svaneti is facing the economic devastation which causes the depopulation, other mountainous regions are into similar situation.


The current picture shows much similarity to South Asian countries in the beginning of their industrialization and rapid growth. Maybe it is already a time to rethink whole regional policies and in contrary to trying to lift up agriculture everywhere and keep population in place try to develop regional urban zones where the displaced population from rural areas could find jobs close to their natural habitats.


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