Global Trade Trends and Analysis of Georgia’s Trade

Global trade dynamics are constantly evolving, requiring continuous study to understand both international and local economic processes. Georgia plays a significant role in the global trade network, especially in recent years. In the first nine months of 2024, Georgia’s foreign trade turnover reached $16.779 billion, a 3.7% increase compared to the same period in 2023. Exports amounted to $4.786 billion, reflecting a 4.1% growth, while imports increased to $11.992 billion, marking a 3.6% rise. The negative trade balance stood at $7.205 billion, constituting 42.9% of the total trade turnover.

Georgia’s top ten trading partners account for 69% of its total foreign trade. These countries include Turkey, Russia, the United States, China, Azerbaijan, Germany, Kyrgyzstan, Kazakhstan, Armenia, and Japan. Among export goods, passenger cars ranked first, generating $1.7 billion, representing 36.8% of total exports. Ferrous alloys came second at $227.1 million, followed by natural grape wines at $214.5 million. This data highlights Georgia’s reliance on a few key commodities and trading partners, a trend that has both strengths and vulnerabilities.

Globally, major economies such as the United States, China, and Germany continue to lead international trade, with substantial growth in export and import volumes. China’s trade growth is driven by the export of technological products and increased production capacity. In the United States, trade has expanded significantly in the services sector, while Germany maintains growth in industrial goods exports. The largest economies globally—including China, the U.S., and EU countries—continue to boost trade through the export of digital services and technological products. However, some countries, like Russia, have experienced a decline in trade due to international sanctions and economic instability.

In Asia, India and South Korea have shown significant trade growth. India is emerging as a manufacturing hub, while South Korea retains its leadership in technology and electronics exports. Despite these positive trends, global trade faces challenges such as supply chain disruptions, climate change impacts, and geopolitical conflicts. The COVID-19 pandemic and the Russia-Ukraine conflict have destabilized supply chains, leading to trade restrictions and price increases.

Georgia’s trade reflects global trends but also faces specific challenges. Diversifying supply chains and transitioning to green energy are critical for the country’s long-term economic sustainability. Turkey and China, Georgia’s largest trading partners, play vital roles in its economic development, particularly in energy and industrial sectors. Georgia’s reliance on imports, especially of energy resources, is reflected in its negative trade balance, which remains a significant challenge. However, the 3.7% growth in trade turnover in January-September 2024 indicates progress in overall trade activities.

To enhance its trade position, Georgia must focus on export diversification, improving logistics and transport infrastructure, embracing green energy projects, and strengthening regional partnerships. Georgia’s ability to adapt to global trade challenges while leveraging its regional advantages will determine its success in fostering sustainable economic growth. Addressing its trade deficit and investing in innovation and infrastructure will be key steps toward a more resilient and competitive trade framework. These efforts will not only enhance its role in global trade networks but also ensure a more stable and prosperous economic future.