structural:summarization, structural:scholar_edition
Economy

Archaeological research demonstrates that Georgia has been involved in commerce with many lands and empires since ancient times, largely due its location on the Black Sea and later on the historical Silk Road. Gold, silver, copper and iron have been mined in the Caucasus Mountains. Georgian wine making is a very old tradition and a key branch of the country's economy. The country has sizeable hydropower resources. Throughout Georgia's modern history agriculture and tourism have been principal economic sectors, because of the country's climate and topography.

For much of the 20th century, Georgia's economy was within the Soviet model of command economy. Since the fall of the USSR in 1991, Georgia embarked on a major structural reform designed to transition to a free market economy. As with all other post-Soviet states, Georgia faced a severe economic collapse. The civil war and military conflicts in South Ossetia and Abkhazia aggravated the crisis. The agriculture and industry output diminished. By 1994 the gross domestic product had shrunk to a quarter of that of 1989.

Since the early 21st century visible positive developments have been observed in the economy of Georgia. In 2007, Georgia's real GDP growth rate reached 12 per cent, making Georgia one of the fastest- growing economies in Eastern Europe. Georgia has become more integrated into the global trading network: its 2015 imports and exports account for 50% and 21% of GDP respectively. Georgia's main imports are vehicles, ores, fossil fuels and pharmaceuticals. Main exports are ores, ferro-alloys, vehicles, wines, mineral waters and fertilizers. The World Bank dubbed Georgia "the number one economic reformer in the world" because it has in one year improved from rank 112th to 18th in terms of ease of doing business, and by 2020 further improved its position to 6th in the world. As of 2021, it ranked 12th in the world for economic freedom. In 2019, Georgia ranked 61st on the Human Development Index (HDI). Between 2000 and 2019, Georgia's HDI score improved by 17.7%. Of factors contributing to HDI, education had the most positive influence as Georgia ranks in the top quintile in terms of education.

Georgia is developing into an international transport corridor through Batumi and Poti ports, Baku–Tbilisi–Kars Railway line, an oil pipeline from Baku through Tbilisi to Ceyhan, the Baku–Tbilisi–Ceyhan pipeline (BTC) and a parallel gas pipeline, the South Caucasus Pipeline.

Since coming to power the Saakashvili administration accomplished a series of reforms aimed at improving tax collection. Among other things a flat income tax was introduced in 2004. As a result, budget revenues have increased fourfold and a once large budget deficit has turned into a surplus.

As of 2001, 54 per cent of the population lived below the national poverty line but by 2006 poverty decreased to 34 per cent and by 2015 to 10.1 per cent. In 2015, the average monthly income of a household was 1,022.3 ₾ (about $ 426). 2015 calculations place Georgia's nominal GDP at US$13.98 billion. Georgia's economy is becoming more devoted to services (as of 2016, representing 59.4 per cent of GDP), moving away from the agricultural sector (6.1 per cent). Since 2014, unemployment has been gradually decreasing each year but remained in double digits and worsened during the COVID-19 pandemic. A perception of economic stagnation led to a 2019 survey of 1,500 residents finding unemployment was considered a significant problem by 73% of respondents, with 49% reporting their income had decreased over the prior year.

Georgia's telecommunications infrastructure is ranked the last among its bordering neighbors in the World Economic Forum's Network Readiness Index (NRI) – an indicator for determining the development level of a country's information and communication technologies. Georgia ranked number 58 overall in the 2016 NRI ranking, up from 60 in 2015. Georgia was ranked 65th in the Global Innovation Index in 2023, down from 48th in 2019.