Georgia-The Economy

In the Soviet period, Georgia played an important role in supplying food products and minerals and as a center of tourism for the centralized state economy. However, the republic was also heavily dependent on imports to provide products vital to industrial support. In the post-Soviet years, the Georgian economy suffered a major decline because sources of those products were no longer reliable and because political instability limited the economic reorganization and foreign investment that might support an internationalized, free-market economy. The net material product ( NMP--see Glossary) already had declined by 5 percent in 1989 and by 12 percent in 1990, after growing at an annual rate of 6 percent between 1971 and 1985. In late 1993, Shevardnadze reported that industrial production had declined by 60.5 percent in 1993 and that the annual inflation rate had reached 2,000 percent, largely as a result of the economic disruption caused by military conflict within Georgia's borders.

Data as of March 1994