March 2018 | Agri Review
20 March 2018

During the last decade, the real GDP of Georgia has been steadily increasing, while the share of agriculture has been decreasing. The share of agricultural output in total GDP decreased from 6.7% in 2016 to 6.2% in 2017. Agricultural output decreased in absolute terms as well by 2.6% in 2017 compared to 2016.

In spite of the low share in GDP, employment in the agricultural sector is rather high. Given that in rural areas employment opportunities other than in agriculture are quite limited, most the self-employment in rural areas is likely to happen in the agricultural sector. Self-employment figures range from 42% to 44% during 2010-2016.

As to investments, the share of FDI in agriculture constituted 0.2% of total FDI in 2017. While the total FDI in 2017 was higher than in 2016, FDI in agriculture has significantly decreased (by 56.6%). The highest FDI in agriculture was observed in the third quarter of 2017, while there was divestment (negative FDI) in the fourth quarter of 2017. Since FDI in agriculture is mostly driven by the acquisition of land, recent restrictions on foreign ownership of agricultural land might be one cause of the reduction.

The price levels in the country have increased both on a monthly and annual basis. The highest increase in annual prices was observed for fruit and grapes which became more expensive by 22.3% compared to February 2017.

During February 2018, Georgia’s agricultural exports (including food) amounted to 49 mln USD, which is around 27% of the total Georgian export value. While comparing this indicator to February 2017, it is 6% higher. As to imports, in February 2018 Georgia’s agro import stood at 85 mln USD, which constitutes 16% of total Georgian imports. Year over year (compared to February 2017), imports increased by 23%.