LOCAL ECONOMIC DEVELOPMENT PLAN FOR TBILISI ... - LED

In order to strengthen the foundations of Georgia’s and Tbilisi’s new economic
position and to maximise the effects of the transformation system, it is vital to
introduce the following changes and reforms:
1. The deep reform of Georgian economy resulted in the fact that
environment regulators can facilitate establishing and running business on
the terms equal to those in the developed countries with market economy.
2. Building new transport and telecommunication infrastructures, that will
connect Georgia with the partners in the region and in the world, will make
it possible to export and import goods and services.
3. The reform of the education system and introducing the culture of life long
learning to instruct skilled workforce according to the standards of the
global job market.
4. Investments in technical infrastructure and the city revitalisation make
Tbilisi an attractive place to live and do business.
Phases of the city economy transformation process
Transformation of an industrial town into a postindustrial city is a long-lasting
and complex process. The examples of cities that have already undergone
this process offer experience that is worth using when working on Tbilisi
economic development plan.
In the process of transformation three phases can be distinguished:
• crisis of a traditional industrial town,
• attracting foreign investors to the city,
• inward development based on unique identity and own resources.
The phases can overlap and their duration cannot be determined in advance.
The intensity and directions of changes depend on the local actors, their
cooperation and capability to implement plans.
The first phase include:
• a substantial amount of workforce is made redundant in industry
sector,
• entrepreneurs set up service and trading companies that do not
require much capital,
• deprivation of industrial districts,
• deprivation of housing districts with low skilled communities,
• development of informal sector,
• education sector have no clear perspectives and teaching standards
in new professions.
Finding foreign investors make it possible to introduce to the economy the
elements that in the first phase are available locally, such as:
• capital,
• new technologies in production and management,
• new standards of employees’ recruitment,
• new cooperation links with other national economies,
• new products that are competitive on global markets.