{"id":196992,"date":"2025-03-13T16:23:10","date_gmt":"2025-03-13T12:23:10","guid":{"rendered":"https:\/\/forbes.ge\/saqarthvelos-bizneslandshaphti-ekonomikur-zrdas-politikuri-samushao-dzalisa-da-struqturuli-barierebi-emuqreba\/"},"modified":"2025-03-13T16:32:28","modified_gmt":"2025-03-13T12:32:28","slug":"georgia-s-business-landscape-economic-growth-faces-political-workforce-and-structural-barriers","status":"publish","type":"post","link":"https:\/\/dev.forbes.ge\/en\/georgia-s-business-landscape-economic-growth-faces-political-workforce-and-structural-barriers\/","title":{"rendered":"Georgia\u2019s Business Landscape: Economic Growth Faces Political, Workforce and Structural Barriers"},"content":{"rendered":"<p>Despite continued economic growth in 2023 and early 2024, businesses in Georgia are facing number of challenges, primarily driven by political uncertainty and workforce shortages, according to the newly released EU Business Climate Report Georgia 2024. The survey, conducted among up to 200 companies with European links, highlights concerns that could hinder long-term economic stability.<\/p>\n<p><strong>Key Challenges Facing Businesses in Georgia<\/strong><\/p>\n<p>The report underscores three critical obstacles affecting businesses:<\/p>\n<ol>\n<li>Political Instability: The stalled EU accession process since June 2024, coupled with upcoming parliamentary elections, has impacted business environment \u2013\u201376.7\u00a0% of companies cite instability as a major concern<\/li>\n<li>Workforce Deficit &amp; Skills Gap: Nearly half of surveyed companies report skills shortages leading to 5-40% underperformance, with an estimated annual GDP loss of 26%.<\/li>\n<li>Exchange Rate Fluctuations: Currency instability continues to challenge businesses in financial planning and investment decisions.<\/li>\n<\/ol>\n<p>Additionally, concerns over corruption and regulatory inefficiencies have been raised by businesses, particularly in relation to tax policies, public procurement, and the judicial system, further complicating the investment climate.<\/p>\n<p>One of the most important findings is the severe shortage of skilled labor, which has led to an annual income loss of\u00a0<strong>55.6 billion GEL\u00a0<\/strong>across businesses. High emigration and mismatched education programs further worsen this issue. Despite its cost, investing in internal workforce training has shown a positive return for businesses proving that workforce development is a key driver of resilience.<\/p>\n<p><em>Impact of Workforce Shortage:<\/em><\/p>\n<ul>\n<li><strong>GDP loss<\/strong>: -26% annually<\/li>\n<li><strong>Value added shortfall<\/strong>: -21.2B GEL<\/li>\n<li><strong>Unrealized business income<\/strong>: -55.6B GEL<\/li>\n<\/ul>\n<p>Meanwhile, while the EU remains Georgia\u2019s largest trade partner, exports to the EU fell by 18% in 2023(Geostat figures), primarily due to:<\/p>\n<ul>\n<li><strong>High compliance costs<\/strong>\u00a0for EU standards<\/li>\n<li><strong>Lack of accredited laboratories<\/strong>\u00a0for European certification<\/li>\n<li><strong>Limited understanding of regulatory frameworks<\/strong>\u00a0among businesses<\/li>\n<\/ul>\n<p>Additionally, SMEs, despite showing growth, still struggle with low economic contribution, and their access to EU markets remains challenging.<\/p>\n<p>The report calls for accelerated judicial and education reforms to enhance business confidence. Education institutions must work closely with the private sector to align skills development programs with market needs. Meanwhile, improving economic policies and trade infrastructure will be crucial to sustaining Georgia\u2019s EU market integration efforts.<\/p>\n<p>In conclusion, the findings of the\u00a0<strong>EU Business Climate Report Georgia 2024<\/strong>\u00a0paint a complex picture. While economic growth continues, it is overshadowed by political uncertainties, workforce shortages, and trade barriers. To maintain momentum, Georgia must address these structural issues\u2014particularly workforce development\u2014to secure long-term stability and EU market access.<\/p>\n<p>Read the full <a href=\"https:\/\/eu4georgia.eu\/wp-content\/uploads\/EU-Business-Climate-Report_2024-1.pdf\">report<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Despite continued economic growth in 2023 and early 2024, businesses in Georgia are facing number of challenges, primarily driven by political uncertainty and workforce shortages, according to the newly released EU Business Climate Report Georgia 2024. The survey, conducted among up to 200 companies with European links, highlights concerns that could hinder long-term economic stability. [&hellip;]<\/p>\n","protected":false},"author":797,"featured_media":196994,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1747],"tags":[],"class_list":["post-196992","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","has-thumb"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Georgia\u2019s Business Landscape: Economic Growth Faces Political, Workforce and Structural Barriers &#8226; Forbes Georgia<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/dev.forbes.ge\/en\/georgia-s-business-landscape-economic-growth-faces-political-workforce-and-structural-barriers\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Georgia\u2019s Business Landscape: Economic Growth Faces Political, Workforce and Structural Barriers &#8226; Forbes Georgia\" \/>\n<meta property=\"og:description\" content=\"Despite continued economic growth in 2023 and early 2024, businesses in Georgia are facing number of challenges, primarily driven by political uncertainty and workforce shortages, according to the newly released EU Business Climate Report Georgia 2024. 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