Georgia’s import situation

Georgia’s negative export-import balance has become notorious. It was never positive but now has reached catastrophic proportions. The Russian invasion and the world economic crisis have seriously influenced the structure of both exports and imports.

Forwarding companies say that nowadays the country’s import mainly consists of items of every day consumption and food products. There are almost no other imports except items ordered in advance and already paid for. This pattern is more or less stable, but has shown some peculiar tendencies. The demand for luxury products has greatly decreased. A businessman involved in importing high quality alcohol beverages is complaining that he has had to stop this and switch to bringing in rice, sugar, buckwheat and similar cheap products. This is a sign that the income of the population has decreased considerably and people cannot afford to buy expensive products.

So far the oil products business has remained stable - the crisis has decreased oil product prices. Georgia has resumed oil import from the Black Sea ports blocked during the Russian invasion. But overall all Georgian business based on imports (and others) is experiencing difficult times and worse are ahead. President Saakashvili has already predicted a worsening of the situation in the near future and during the coming six months.

The Cabinet of Ministers has promised to implement serious measures to rescue the country from the economic hardships it is facing. Let us hope they will, and monitor how efficiently the authorities are preparing the country to meet the challenges.