Ferrous metallurgy of Georgia is represented by two production complexes - the Rustavi plant of a full metallurgical cycle and the Zestafon ferroalloy plant.
The Rustavi Metallurgical Plant began to be built in 1944, in 1950 it was put into operation. Its raw material base is iron ore of the Dashkesan deposit of Azerbaijan, Tkvarcheli and Tkibuli coal, Chiatura manganese. The construction of the plant was caused by the need to provide Transcaucasia with oil country pipes and some types of rolled products and sheets. In addition, the construction of the plant was the basis for the industrialization of Georgia, the creation of national working class cadres in it.
Non-metallic raw material quarries, a coke oven battery, a sintering plant, blast and open-hearth furnaces, rolling mills, units for the production of seamless steel pipes were created as part of the plant. The capacities available at the enterprise were designed for the production of large quantities of coke (350 thousand tons), sinter (1500 thousand), pig iron (740 thousand), open-hearth steel (1500 thousand), pipe blanks (1215 thousand), pipes ( 500 thousand tons). At present, the volume of its output has been significantly reduced (in 1997, for example, it reached only 6.4% of the 1988 level). The most promising direction for the development of the plant is the expansion of pipe production. With commissioning in the late 1980s. in the pipe-rolling shop of the high-temperature thermomechanical processing (HTMT) section, the production of high-strength tubing was started. At present, the demand of the countries of Central Asia and the Middle East for high-strength pipes is great, and this causes the maximum load of the VTMO line.
The plant also operates a unique pipe-rolling plant, which allows Georgia to maintain a monopoly in the CIS for the production of pipes. large diameter(200 -426 mm) for the oil and gas industry.
Together with one of the US companies, a tender was held and a decision was made on the reconstruction and technical re-equipment of the Rustavi Metallurgical Plant. The reconstruction provides for: installation of an electric arc furnace; construction of two powerful lines for the production of tubing and casing pipes; improving the quality of electric steel by applying the technology of direct reduction of iron from metallized pellets.
The 3estafoni ferroalloy plant was established in 1933 to process manganese from the Chiatura deposit, located 28 km from Zestaponi. It produces more than 40 types of products, of which ferromanganese, metal manganese and silicomanganese are especially important.
Non-ferrous metallurgy is represented in Georgia by enterprises engaged in the extraction and enrichment of molybdenum, tungsten, copper pyrite, barite-polymetallic ores. The largest of them is a mining and processing plant based on the Madneulskoye deposit.
Copper, zinc, barite, and lead are mined in the country. The ores contain gold. Since 1993, a license for its extraction has been issued to an Australian company.
Currently,[specify] most industrial enterprises in Georgia are either idle or partially loaded. The main growth of industry in recent years is provided by Food Industry, mining of metal ores (mainly manganese), as well as the production of metal and non-metal products. The total share of these industries in the structure of industrial production (excluding energy) in 2005 was 76%.
The leading industries of Georgia are: food industry (production of tea, wines and cognacs, tobacco products, essential oil crops, canned vegetables and fruits, mineral waters, hazelnuts), light industry (silk, woolen, cotton, shoe, knitwear, clothing production), mechanical engineering (production of electric locomotives, automobiles, machine tools in Tbilisi, Kutaisi, Batumi), ferrous metallurgy (metallurgical plant in Rustavi, Zestafon ferroalloy plant, Chiaturmarganets plant), non-ferrous metallurgy (Madneuli plant), chemical (production of nitrogen fertilizers, chemical fiber, paints, household chemicals - in Rustavi). In 2007, cement exports amounted to $64 million compared to $28.8 million in 2006.
In the structure of industrial production, the largest share is occupied by the processing industry - 69%, the share of production and distribution of electricity, gas and water supply accounted for 24%, the mining industry - 7%.
In 2005, the volume of industrial production increased by 16.4% compared to 2004 and amounted to 2.0451 billion lari (1.1362 billion dollars).
In the first half of 2006, the volume of industrial production amounted to 658 million lari (382.6 million dollars). According to the national statistical classification of species economic activity, during this period, the growth rates of individual sectors of the Georgian industry amounted to: mining and mining - 109.8%, manufacturing - 123.8%, electricity, gas and water supply - 102.4%.
Foreign economic relations
Georgia's foreign trade is characterized by a negative trade balance, imports are several times higher than exports.
Energy
In 2007, electricity production amounted to 8.34 billion kilowatt-hours, and consumption 8.15 billion kilowatt-hours. In 2008, Georgia exported 680 million kWh of electricity (including 216 million kWh to Turkey), imported 758 million kWh (including 669 million kWh from Russia).
Hydroelectric power plants generate over 80% of electricity in Georgia. The largest power plants are the Tbilisi State District Power Plant, hydroelectric power plants on the rivers Inguri, Rioni, Khrami, Abasha and others.
The Vartsikhe cascade of four HPPs (178 MW), the Lajanur HPP (112 MW), the Gumat HPPs (66.5 MW) and the Rioni HPP (48 MW) were built on the Rioni River, the Namakhvani HPP project (480 MW) has existed since Soviet times. Zhinvali HPP (130 MW) was built on the Aragvi River, Khramskaya-1 (113 MW) and Khramskaya-2 HPP (110 MW) on the Khrami River, Tkibuli HPP (80 MW) on the Tkibuli River.
Currently [specify] Georgia's energy sector is fully privatized. The only exception is the Enguri HPP, which is operated jointly with Abkhazia (while there are no signed legal documents regulating this cooperation: according to an unspoken agreement, 60% of the generated electricity is transferred to Georgia, 40% to Abkhazia). The dam of this station is located in Georgia, and the main units are in Abkhazia. In December 2008, the Ministry of Energy of Georgia and the Russian company Inter RAO UES signed a memorandum on the joint management of the Inguri HPP.
Peculiarities of Georgian Industry
Georgia's industry includes a number of manufacturing and extractive industries.
Remark 1
Today, most of the Georgian industrial enterprises are either idle or only partially loaded. According to statistics, the potential of Georgian enterprises is used only by 20%.
The main industries are food and light, non-ferrous and ferrous metallurgy. During the existence of the Soviet Union, Georgia had a developed industry, specializing mainly in the production of food, coal and iron, oil products, steel pipes, locomotive machine tools, aircraft assembly, and fertilizer production. Among the leading industries in the Soviet period are:
- power industry,
- fuel industry,
- ferrous metallurgy,
- chemical and light industry,
- food industry,
- mechanical engineering.
After the collapse of the Soviet Union, the volume of Georgian industry is reduced by 40%. Thus, in 1998, the volume of industry in Georgia was 16% of the 1990 level. From 1990 to 2005, the share of industry in Georgia's gross domestic product has been declining from 23% to 12%. Nevertheless, if we compare the main industrial growth in recent years, it was provided by the growth of the food industry, the extraction of metal ores, including manganese ore, as well as the production of metal and non-metal products. The share of these sectors in the structure of industry without energy in 2005 was 76%.
Metallurgy and mechanical engineering
Primary processing and extraction of manganese ore was carried out by the Chiaturmarganets company. Manganese ore was supplied to this enterprise from the Chiatura manganese deposit, which is the world's largest producer of manganese concentrates.
Thus, in 2004 the enterprise produced 150,000 tons of manganese concentrate. The main consumer of the products of this enterprise is the Zestafon Ferroalloy Plant. It is a major producer of ferroalloys and a major Georgian exporter.
Remark 2
Ferroalloys are the main export commodity in Georgia, with a share of about 17%.
The largest metallurgical enterprise is the Madneuli Mining and Processing Plant, which mines polymetallic ores coming from the Madneuli deposit. The production volume of the Madneulskoye field is more than 2 million tons per year. Also, this plant produces gold-copper concentrate, the production of this deposit makes up a significant part of Georgian exports.
The control of this plant is carried out by the Russian financial and industrial group Industrial Investors.
The metallurgical plant, which produces pipes and rolls ferrous metals, operates in Rustavi. The volumes of output of machine-building products are small.
Electric locomotives, machine tools and cars are mainly produced in Georgia. The main cities of mechanical engineering are Tbilisi, Batumi and Kutaisi. After the collapse of the Soviet Union, the Kutaisi Automobile Plant stopped its production.
Other industries
If we consider the chemical industry, the largest enterprise in Georgia is the Azot plant in Rustavi, which produces nitrogen fertilizers, paints and varnishes and chemical fibers. Based on local resources, Georgia produces cement, sand-lime bricks and other building materials. As for the food industry, in Georgia it is based on the processing of agricultural raw materials.
It produces wine and cognac, tobacco products, canned fruits and vegetables, mineral water, hazelnuts, tea, essential oil crops. The share of food and beverage production in Georgia is about 30%.
If we consider the light industry, then in Georgia there are silk, cotton, woolen, clothing, shoe industries, and knitwear production.
Fuel- energy complex Georgia imports almost 100% of the consumed oil products, while Azerbaijan accounts for up to 90% of imports.
Electricity industry of Georgia
Georgia's power industry is based on three thermal and six hydraulic power plants. More than 80% of electrical energy is generated here at hydroelectric power plants.
The energy systems of Georgia operate in parallel with the Azerbaijani energy systems. Georgia has its own electric power base, which is represented by the Tbilisi State District Power Plant, hydroelectric power plants on the rivers Inguri, Rioni, Abasha, Khrami, and others. These bases are able to fully cover the state's need for electricity.
A large hydropower complex is located on the Inguri River, the cascade of which includes the large Inguri hydroelectric power station and the cascade of Perepednye hydroelectric power stations. In addition, in Soviet times, the construction of the Khudon hydroelectric power station began, with a capacity of 700 megawatts. Operation is associated with corresponding difficulties due to the fact that a part of the complex has been under the control of Abkhazia since the end of the 20th century.
About 20% of Georgia's generating capacity is regulated Russian company Inter RAO UES. Also, this company owns 70% of the shares of Telasi JSC, which is the largest distributor of electricity in Georgia.
Georgia produces electricity for export and import. Earlier, Georgia and Russia signed an agreement on the mutual exchange of electrical energy, according to which Georgia received energy from Russia in autumn and winter, and returned the consumed volume to Russia in summer and spring.
In 2008-2009 Georgia imports energy to Russia. Due to the rise in the level of reservoirs in Georgia, electricity imports have been stopped since 2009 and exports to Russia have begun. At the beginning of September 2009, the export of electricity to Turkey also stops.
In the article we will talk about the economy of Georgia. In fact, this country is curious about many other things, but today we will consider this particular aspect. It is very curious, in fact, on what the financial well-being of the inhabitants of this country is based.
Before 1992
The economy of Georgia as part of the USSR quickly switched to industrialization. Over a period of approximately 50 years, the national income of Georgia has increased almost 90 times! This is an incredible figure that was achieved precisely under Soviet rule. During the 1970s, the same figure was three-fourths of the Union average. Gradually, the country developed from agrarian to industrial and post-industrial form. By 1990, about 40% of the total population was employed in the service sector, and about 26% in industrial production. At that time, coal, pig iron, fertilizers, steel pipes, petroleum products, locomotives and parts for aircraft assembly were actively and in large quantities produced here. Before the collapse of the USSR, Georgia's foreign trade turnover was greater than the economic product produced. Food and agricultural products were exported. The bulk of imports were consumer goods and various energy resources.
Until 2004
The Ministry of Economy of Georgia went through a huge crisis after the collapse of the USSR. This whole situation was further aggravated due to the fact that Zviad Gamsakhurdia, the president of the country, announced a strict ban. He touched upon the fact that trade cannot be carried out between Russia and Georgia. The economy suffered greatly from this, but, apparently, then this was not a paramount task. In 1992 alone, Georgia's industrial production fell by 40%.
By 1994, the crisis was already in all industries. Construction and forestry, as important components of the country's economy, ceased to function. At the same time, output in other industries declined substantially until the 1990s. New currency unit almost immediately depreciated against the background of the fact that the production and transport infrastructure destroyed not by the day, but by the hour. The situation was aggravated by the decrease in the number of tourists who did not want to visit the country after the conflict with Abkhazia. Wage people fell by about 10 times, all massively left Georgia. Most people went to Russia, some - to the countries of the European Union. Since 1994, the country began to receive loans from the IMF. Only after that, by 1996, the situation improved slightly. In 1995, the government set itself a clear goal of overcoming the crisis. Debts were returned, inflation was brought down. New deals were made.
The recovery of the economy largely depended on external financing. Moreover, economic policy has improved significantly. Again, during the crisis in Russia in 1998, the Georgian economy suffered, but relatively little.
Period 2010-2014
In 2003, the Rose Revolution took place. As a result, Mikheil Saakashvili became the president of the country, who signed many lucrative contracts. Georgia's economy under Saakashvili quickly began to develop. In 2004, Kakhi Bendukidze was appointed Minister of Economy. A talented economist gave a new impetus to development. Soon a tax reform was signed, according to which about 20 taxes were reduced to 7 main ones. A tax amnesty has been established for the period up to this year. Many of the largest enterprises were sold. The economy of Georgia has become much stronger due to the fact that foreign investors began to invest money here. However, later it played a cruel joke.
Experts said that such economic growth was possible not because of domestic production, but solely because of outside help. The Minister of Economy of Georgia did not take this into account. A number of real problems have not been resolved (lack of jobs, productive business, restoration of the proper level of education and science, etc.).
The economic crisis of 2008 had a negative impact on the country. However, by 2010, the previous level was reached and the country returned to normal. In 2011, the government signed the Act economic freedom, which significantly reduced the ability of the state to intervene in the management of the economy.
Modernity
As for the modern period, the Georgian economy continues to grow, but this growth is of low quality. This means that there is no investment in promising industries, no job growth or an increase in the field of work for small and medium businesses. Investments are directed to the export area. Although the proportion of people employed agriculture, increased significantly, the country did not distinguish itself by impressive exports. If the quality of growth does not change, experts believe, it will soon stop.
Industry
The main branches of production are light and food industries, non-ferrous and ferrous metallurgy. The main growth is provided by the food industry, and the extraction of metal ores also plays a role. However, most of the country's large enterprises are still idle or have a partial load.
The food industry is based on the processing of agricultural raw materials. Georgia is also famous for its delicious alcoholic drinks and mineral waters. The engineering industry occupies less than 1% of the country's economy. Even the chemical industry (production of nitrogen fertilizers, paint and varnish products and chemical fibers) occupies more than 5%.
Fuel and energy complex
What else is Georgia famous for? The economy and standard of living here are good, but not at the expense of the country's internal development. Russia supplied gas to Georgia at rather high prices, so in 2006 the president announced that a gas supply contract would be concluded with Azerbaijan.
The basis of the country's electric power industry is the work of hydroelectric power stations and thermal stations. But as factories shut down en masse, the energy complex is in decline. Economic policy in this regard, it is inefficient, since the companies are owned by Georgian businessmen and international complexes. All this leads to problems in the management of huge resources.
Transport
More than 60% of all traffic in the country falls on automobile transport. The maximum volume of cargo turnover is for rail transport. The participation of the country in regional projects for energy transit. At the end of 2017, it is planned to open a new transport line for the transportation of goods from China and Central Asia. Note that construction and attempts to open this path have been dragging on since 1993.
Active but gradual reconstruction is underway on the Azerbaijan-Turkey road.
The merchant fleet of the country is 144 vessels. Ports are located in 5 major cities(Sukhum, Batumi, Supsa, etc.). There are 30 airports in Georgia.
International trade
The Georgian economy in the field of foreign trade is not very successful. It should be noted the negative trade balance. The government failed to arrange foreign relations so that Georgia is more export oriented. This is due to the fact that all the forces went to the establishment of work in the food industry. Georgia exports the largest volumes of ferroalloys and raw gold.
The main buyers are Azerbaijan, Canada, Turkey, Bulgaria and Ukraine. In terms of imports, the country purchases fuel, equipment, vehicles, pharmaceuticals. The main suppliers are Ukraine, Turkey, Germany, Russia and China. The country receives the lion's share of electricity and wheat from Russia.
Summing up the article, let's say that the Georgian economy has a positive, but unreliable dynamics.
TBILISI, May 19 - News-Georgia. The National Statistical Service of Georgia has published foreign trade data for January-April 2017, , exports from Georgia amounted to $788 million, which is 30% more than in 2016.
According to Sakstat, Georgia's main export product is copper alloys and concentrates, accounting for 17.6% of exports.
The list of ten main export products from Georgia is as follows:
1. Copper alloys and concentrates – $138 million, up 22% year-on-year. The share in total exports is 17.6%. Two thirds of copper alloys exported from Georgia are re-exports. During the same period, copper alloys were imported in the amount of 113 million dollars.
2. Ferroalloys - $110 million, up 150% from last year. Share in total exports - 14%
3. Cars (re-export) -47 million dollars, compared to last year, a decrease of this indicator by 2% was recorded. Share in total exports - 6%
4. Medicines - $43.8 million, up 59% from last year. Share in total exports - 5.6%
5. Export of wine - $41 million, an increase of 44% compared to the same period last year. Share in total exports - 5.2%
6. Spirits - $30.7 million Growth compared to last year was 28%. Share in total exports - 3.9%
7. Mineral waters - 30 million dollars, an increase of 13% compared to last year. Share in total exports - 3.8%
8. Nitrogen fertilizers - $24 million, down 27% from last year. Share in total exports - 3.1%
9. Gold - $23 million, down 5% year-over-year. Share in total exports - 3%
10. Hazelnut and Walnut - $21 million Compared to last year, the product's export performance decreased by 52%. Share in total exports - 2.8%
11. Exports of all other goods amounted to 275 million dollars, an increase of 43%. Share in total exports - 35%
The Ministry of Economy of Georgia expects that in parallel with the increase in external demand, exports will also grow, which will be supported by free trade agreements signed by Georgia with the European Union, China and a number of other countries.