What is it about?
In this article we have overviewed the present conditions of Georgia and proposed some ideas about how to turn Georgia from a backward country into a developed one. The article, “Market foundation for sustainable economy growth and energy policy (Georgian Case)”, highlights the importance of the strong and reliable energy system for sustainable economic growth, their interaction, the luck of market tools and market price (capitalization) and energy problems in Georgia, including the dysfunctions of regulatory Commission. At the same time, we have highlighted and presented the negative gap between the per capita GDP and energy consumption rates in Georgia and the developed countries, like Switzerland, the US and the Europe. Also, it had investigated the ways how to encourage economic growth in energy sector in Georgia based on modern market tools.
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Why is it important?
Finally, once again we stress the need for a direct link between economic growth and business-friendly source of energy access, which is prerequisite for production facilities to be competitive and attractive investment point of production. In addition, we would like to notice the necessity to diversify the energy sources to ease the economic backwardness and reduction of economic growth. It is vital to have the fair energy tariffs to create the competitive production in economy. In that field the Regulatory Commission (GNERC) has the legal power and functions to improve the quality of the sector’s investment attractiveness.
Perspectives
The mission of research proposal is to find out the real solution to rapidly developed countries like Georgia based on modern capital market tools. Economic progress and improving living standards of the population depends largely on the provision of high economic growth. That issue itself heavily depends on energy sources. To illustrate wide gap between the developed economy and the weak one, let us compare the current level of per capita GDP of Switzerland to Georgian one: an average income of middle-income Swiss citizen (58,996.90 USD) is more than 2 years’ (24 months) income of Georgian citizen (2254.38 USD) . If we look closely on per capita GDP in Georgia [3], its figures do not show the rapid growth tendency to narrow negative gap in development: (Figure 1). The only proven way to change situation drastically is the stable economic growth and attraction of investment. In our research, we think Georgian energy objects and its investment potential are the key to drive Georgia out of poverty and stimulate the rapid economic growth.
Dr David Aslanishvili
Caucasus University
Read the Original
This page is a summary of: Market Foundation for Sustainable Economy Growth and Energy Policy (Georgian Case), Modern Economy, January 2016, Scientific Research Publishing, Inc,,
DOI: 10.4236/me.2016.73034.
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