Reforms Lab

GEO/ENG👇🏻

📢USAID- ის ეკონომიკური მმართველობის პროგრამის მხარდაჭერით, საქართველოს პარლამენტმა მიიღო ახალი კანონი სახელმწიფო შესყიდვების შესახებ.

🔍რეფორმების ლაბორატორიამ კანონის წინასწარი ხარჯ-სარგებლიანობის ანალიზი განახორციელა.

🇬🇪🇪🇺აღნიშნული კანონმდებლობის მიღება
კიდევ ერთი მნიშვნელოვანი ნაბიჯია საქართველოს ევროინტეგრაციისკენ!

📢With the support of the USAID Economic Governance Program, the Parliament of Georgia adopted a new law on public procurement.

🔍The Reforms Lab conducted cost-benefit analysis of the law.

🇬🇪🇪🇺Adoption of this law is another important step towards the European integration of Georgia!

📌პარლამენტმა 90 ხმით, მესამე მოსმენით „საჯარო შესყიდვების შესახებ“ კანონი მიიღო.
ვრცლად: https://bit.ly/3XeCT5n

Telavi Municipality hosted a meeting on "Strengthening of Public and Private Partnership (PPP) at the local level", a project being carried out by Reforms Lab with USAID Good Governance Initiative (GGI) support.
USAID Good Governance Initiative in Georgia - GGI საქართველოს რეგიონული განვითარებისა და ინფრასტრუქტურის სამინისტრო

📣 New Post

Impacts of Regional Developments on Georgia’s economy

As 2020 comes to an end, we can definitely conclude that it is an extraordinary year, but not in a positive way. In case of Georgia, the Covid-19 pandemic, which triggered the global economic crisis, was accompanied by tensions in the region. Military escalation in Nagorno Karabakh resulted in the changed geopolitical architecture in the region. Besides, this new emerging reality will have its short-term and long-term effects on the Georgian economy. While the situation is still changing and long-term effects are still to be evaluated, we can now discuss some evident short-term effects for Georgia, taking into account that Georgia is highly dependent economically on the neighboring countries.

There are three main areas of Georgia’s economic cooperation with Azerbaijan and Armenia:

📍 Foreign trade
📍 Investment
📍 Tourism


Foreign Trade 💲
Armenia and Azerbaijan are among the main trading partners for Georgia. As of 2019, neighbors are among the top-5 export destinations. In particular, Georgia’s export to Azerbaijan amounted to 508.7 mln. USD and 432.6 mln. USD to Armenia. Imports from Azerbaijan and Armenia amounted to 558.7 mln. USD and 267.7 mln. USD respectively.

Due to the Covid-19 crisis, in 2020 (10 months), Georgia’s exports to Azerbaijan decreased by 10.5% and amounted to 364.6 mln. USD. While export to Armenia decreased by 53.4% and amounted to 151.7 mln. USD. Economic crisis and regional tensions will affect the economic situation and aggregate demand in both countries and will negatively influence Georgian export in the short-term horizon.



Investments 📊
In terms of foreign direct investment (FDI), over the years, Azerbaijan was Georgia’s top investor country. This was mainly caused by the construction of the Baku-Tbilisi-Ceyhan (BTC) pipeline and some other projects. Therefore, as the BTC project is almost completed, the share of Azerbaijan in total FDI to Georgia dropped from 33.7% in 2015 to only 2.7% in 2019. Accordingly, Azerbaijan dropped from Georgia’s top investor countries.



Tourism 🛬
In terms of tourism development, Georgia relies heavily on neighboring countries. Namely, in 2019, the top-3 countries of international visitors to Georgia included Azerbaijan, Russian Federation, and Armenia. Georgia received the most visitors from Azerbaijan – over 1.5 million people. Armenia was 3rd with 1.4 million visitors.



In the post-Covid era, Georgia should focus on more diversification in various directions, in particular, given the unstable situation in the region and subsequent possible negative effects on the neighbors’ economies and aggregate demand.

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