Georgia Population and Economic Conditions


In 1921, the year of the country’s entry into the Soviet Union, the residents slightly exceeded 2,500,000; at the end of the 1980s, they reached 5,443,000. Since the achievement of independence (1991), the difficult internal political and economic situation has caused the emigration to Russia and the West of about 800,000 people: the demographic consistency of the country, which at the end of the 1990s was just over 5,000.000 units, in 2006 it had dropped to 4,600,000, showing an average annual rate of decrease greater than 1%.

According to, the population is distributed in the territory with an average density of 66 residents /km and with a rather modest urbanization rate (53%). The only city with metropolitan dimensions and functions is the capital, Tbilisi, which in 2007 had 1,200,000 residents in the entire urban agglomeration.

83% of the population (Georgians proper, Mingreli of the coastal plain, Imeri of the upper basin of the Rion river etc.) belongs to the southern branch, called Cartvelian, of the Caucasian linguistic family. The main ethnic minorities are made up of Azeri (6.5%), Armenians (5.7%), Russians (1.5%), Ossetians, Abhasi, Agiari.

Over 80% of the population is Orthodox Christian; the Muslim component is relevant (10%); the Armenians follow the Armenian Apostolic Church.

Economic conditions

During the period of belonging to the Soviet Union, Georgia experienced a moderate development. Its economy, traditionally agricultural, has also turned towards industry (mechanics, aeronautics, electronics, chemicals, metallurgy, textiles, agri-food). Nonetheless, the country has retained its agricultural vocation, becoming one of the main suppliers of land products (especially citrus fruits, tea and wine products) within the Soviet Union. The Georgia also represented an important destination for Soviet tourism thanks to the variety of the offer (seaside, mountain, cultural). Its economy was closely linked to that of the other members of the Union and the scarcity of energy resources exacerbated its dependence on Soviet partners.

After the achievement of independence, Georgia experienced a period of very serious economic crisis, made particularly difficult by internal political instability and ethnic conflicts with the secessionist minorities of Abhazija and South Ossetia. In 1994, gross domestic product had fallen to 23% of its 1989 value, inflation was reaching record levels and industrial production had fallen to 10% of production capacity. The adoption, since 1994, of extraordinary macroeconomic measures has allowed a slow recovery, also facilitated by the strategic position of the country on the Eurasian energy routes: the Baku- Supsa (inaugurated in 1999) and Baku-Tbilisi-Ceyhan (BTC, inaugurated in 1999) oil pipelines. 2006) and the South Caucasus Pipeline o Baku-Tbilisi-Erzurum (BTE, operational since 2007), parallel to the BTC.

In the first five years of the 21st century. the change in gross domestic product followed a decidedly positive trend, going from 1.9% in 2000 to the peak in 2003 (11.1%). The government in office since 2003, following the so-called ‘Rose Revolution’, launched in 2004 a new economic reform program aimed at reducing poverty and fighting corruption, particularly rooted in Georgian society. The macroeconomic results were brilliant, despite the worsening of relations with Russia, the main supplier of energy raw materials (often used as a geopolitical lever to maintain its influence) and the largest buyer of wines and mineral waters of Georgia (subjected episodically to measures embargo).

The contribution made to the formation of the gross domestic product by agriculture has been decreasing (it fell in 2008 to less than 13%), which however still employs over 50% of the workforce. The main crops are those of citrus fruits, vines, cereals, tea. Mineral resources (coal, manganese) and hydroelectric potential are not negligible. The manufacturing sector, after the collapse of the early 1990s, registered a certain recovery, reaching in 2008 to form 28.4% of the gross domestic product. Many of the sectors that represented the strength of Georgian industry in the Soviet period (metallurgy, mechanics, textiles, aeronautics) turned out to be obsolete and unsuitable to withstand international competition; the agri-food and energy sectors, on the other hand, showed vitality, the latter linked above all to the construction of hydrocarbon transport infrastructures, as well as to the need to reduce dependence on foreign countries. An increasingly important role has taken on the tertiary sector, also to a large extent measure related to the construction of pipelines for the transport of hydrocarbons and the management of related investments from abroad.

Georgia’s main trading partners are Russia, Turkey, Azerbaijan, Germany, USA. Exports are mainly made up of agri-food and metal products; imports mainly include oil and derivatives, natural gas, food products.

Georgia Country Economic Conditions

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