GEORGIA: PROBLEMS OF INCREASING NATIONAL ECONOMIC SELF-SUFFICIENCY (Sectoral-Structure Aspect)
Keywords:
Georgian economy, national economic self-sufficiency, sectoral structural policy.Abstract
This article examines the problems of increasing the self-sufficiency of the Georgian economy through an improvement in its sectoral structure, diversification and expansion of exports, and increased import substitution. In this context, the author explores the concept of structural effect (mainly its sectoral-structure aspects) and the methods of its evaluation. The focus here is on evaluating the level of national economic self-sufficiency.
The level of self-sufficiency of the Georgian economy is studied in terms of broad sectors (groups of industries), and ways to improve its sectoral structure (through accelerated growth of priority sectors/industries) are suggested on this basis. The author charts ways to improve the strategy and instruments of Georgia’s sectoral structural policy, taking into account the opportunities provided by the provisions (guidelines, prescriptions) of the Association Agreement between the European Union and Georgia.
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Most of the reasons for the decline in agriculture are set forth in our works: V. Burduli, “Genezis i puti preodoleniia agrarnogo krizisa v Gruzii,” Proceedings of International Scientific-Practical Conference Dedicated to the 90th Birth Anniversary of Professor George Papava “Actual Problems of Economies of Post-Communist Countries at Current Stage,”Tbilisi, 2013, pp. 20-27; R. Abesadze, V. Burduli, Strukturnye i innovatsionnye problemy ekonomicheskogo razvitiia,Publishing House of Paata Gugushvili Institute of Economics, Tbilisi State University, Tbilisi, 2014, Chapter VII, §7.2, “The Causes of the 2006-2012 Agricultural Crisis in Georgia,” pp. 206-216, and others.
I. Garibashvili, “The Country’s International Competitiveness Is Very Weak,” available at [http://www.radiokalaki.
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V. Burduli, R. Abesadze, “Sectoral, Technological, and Institutional-Organizational Structures of the Georgian Economy: Development Issues in the Context of Globalization,” The Caucasus & Globalization, Vol. 7, Issue 1-2, 2013;
Burduli, “Ways of Development of the Sectoral and Technological Structure of the National Economy under Globalization,”
Ekonomisti, No. 3, 2012 (in Georgian); R. Abesadze, V. Burduli, op. cit., and others.
T. Beridze, “National Economic Model: An Alternative to Globalization?” The Caucasus & Globalization, Volume 1 (3),2007, p. 61.
Ibidem.
V. Burduli, R. Abesadze, op. cit.
“OESR: Uskorenie rosta VVP v RF vozmozhno lish v sluchae strukturnykh reform,” Novosti Google, 19 Novem-ber, 2013.
V. Obolenskiy, “Vneshneekonomicheskie sviazi Rossii: nekotorye uroki globalnogo krizisa,” Voprosy ekonomiki,No. 5, 2012.
National Accounts of Georgia 2011. Statistical Publication, National Statistics Office of Georgia, Tbilisi, 2013, p. 26.
Ibid., p. 28.
The problems of agriculture and related industries are examined in detail in some of our works (see, for example:
. Burduli, op. cit., and others). That is why in this article the reasons for the decline in this sector and the ways to revive agricultural production are described only briefly, to the extent necessary to maintain the logic of this study.
Calculated based on data from the table, “Industry: Output by Economic Activity,” Statistical Yearbook of Georgia 2012, National Statistics Office of Georgia, Tbilisi, 2013, pp. 140-141.
Naturally, construction does not contribute to exports.
In order to compare exports and imports with local production, statistical data for aggregated commodity groups were converted from U.S. dollars to Georgian lari (GEL) at the 2011 exchange rate of 1.65 lari per dollar.
External Trade of Georgia 2012. Statistical Publication, National Statistics Office of Georgia, Tbilisi, 2013, p. 136.
Statistical Yearbook of Georgia 2012, pp. 250-255.
Ibid., p. 153.
R. Abesadze, N. Arevadze, “The Georgian Economy at the Turn of the 1990s,” Proceedings of Paata Gugushvili Institute of Economics of TSU, Vol. IV, Tbilisi, 2011, pp. 236-237 (in Georgian).
R. Abesadze, N. Arevadze, op. cit., pp. 236-237.
Statistical Yearbook of Georgia 2012, pp. 140-141.
Ibid., pp. 250-255.
It is unclear under which heading its products are included in statistical reports: as chemical, polymer or metallurgical products.
R. Abesadze, N. Arevadze, op. cit., pp. 236-237.
Statistical Yearbook of Georgia 2012, pp. 140-141.
Ibid., pp. 140-141.
External Trade of Georgia 2012. Statistical Publication, pp. 37-39, 58.
Ibid., pp. 85-88, 121.
Statistical Yearbook of Georgia 2012, pp. 140-141.
External Trade of Georgia 2012, p. 137.
Statistical Yearbook of Georgia 2012, pp. 140-141.
Ibid., pp. 250-255.
D. Mirtskhulava, “Khudoni HPP Will Pay $410 Million in Corporate Tax to the Budget over 20 Years,” 30 September,2013, available at [http://www.bpn.ge/ekonomika/1270-davith-mirckhulava-khudonhesi-biujetshi-20-tselitsadshi-410-milioni-dolaris-mogebis-gadasakhads-sheitans.html?lang=ka-GE] (in Georgian).
Ibidem.
“Rokfellery reshili izbavitsia ot neftianykh aktivov,” 23 September, 2014, available at [www.interfax.ru/
usiness/398170]; “Rokfellery reshili investirovat v VIE,” available at [http://greenevolution.ru/2014/09/24/rokfellery-reshili-investirovat-v-vie/].
V. Burduli, “Vzaimosviaz razvitiia tekhnologicheskikh ukladov i transformatsii ekonomicheskikh system,”
Proceedings of International Scientific-Practical Conference Dedicated to the Foundation of Paata Gugushvili Institute of Economics “Actual Economic Problems under Globalization” (21-22 October, 2011), Tbilisi, 2011, p. 24.
“Teper akkumuliatory rabotaiut v chetyre raza dolshe,” 24 July, 2014, available at [www.gazeta.ru/
cience/2014/07/28_a_6148149.shtml]; “Uchonye sdelali revoliutsionnyi proryv v zariadke akkumuliatorov,” available at [http://appress.com/science/7043-uchenye-sdelali-revolutsionnyi-proryv-v-zaryadke-akkumulatorov].
Ibidem.
R. Abesadze, V. Burduli, Structural and Innovation Problems of Economic Development, Chapter VII, “The Need
for Coordinated Development of Related Branches of Industry and Agriculture;” V. Burduli, op. cit., and others.
See, for example: K. Kveladze, “Policy of Innovations in Tourism Development,” Proceedings of International Scientific-Practical Conference Dedicated to the 90th Birth Anniversary of Professor George Papava “Actual Problems of Economies of Post-Communist Countries at Current Stage”(in Georgian).
T. Beridze, op. cit.
This article examines the sectoral structure only by economic activity, but structural content can also be viewed from other angles such as the distribution of enterprises by size.
V. Burduli, “Industrial Policy: Institutional Framework and Economic Implementation Mechanism,” Proceedings of the Georgian Academy of Sciences. Economic Series, Nos. 1-2, 1996; V. Burduli, “Foreign Economic Relations and Industrial Policy,” Politics, No. 3, 1999 (both in Georgian).
See, for example: O. Ananyin, R. Khaitkulov, D. Shestakov, “Vashingtonski konsensus: peizazh posle bitv,” World Economy and International Relations, No. 12, 2010, pp. 17, 29.
See, for example: A. Kalinin, “Postroenie sbalansirovannoi promyshlennoi politiki: voprosy strukturirovania tselei,zadach, instrumentov,” Voprosy ekonomiki, No. 4, 2012.
Ways to coordinate the location of multinational enterprises in Georgia were discussed in our article: V. Burduli,R. Abesadze, op. cit.
V. Papava, “Georgia’s Economy: Post-Revolutionary Development and Post-War Difficulties,” Central Asian Survey,Vol. 28, No. 2, June 2009.
“Bidzina Ivanishvili Believes There Is Speculation Over Economic Recession,” available at [www.interpressnews.
e], 4 September, 2013 (in Georgian).
Ibidem.
N. Glazyrin, “Ob innovatsionnykh sotsialno-proizvodstvennykh kompleksakh,” Ekonomist, No. 1, 2008, p. 47.
A more detailed analysis of the problem of improving the fiscal mechanism is given in: V. Burduli, A. Abesadze,op. cit.
I. Garibashvili, op. cit.
T. Karchava, “Co-Investment Fund Has Already Accumulated $6 Billion,” 30 September, 2013, available at [www.
or.ge/view.php?for_id=27126&cat=1]; “Co-Investment Fund: We Will Finance All Good Projects,” 7 October, 2013; E. Tukhi-ashvili, “Direct Investment in the Country Will Amount to $6 Billion,” available at [www.kvirispalitra.ge/economic/18928-thanainvestirebis-fondi-yvela-karg-proeqts-davafinansebt.html] (all in Georgian).
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