LOCAL ECONOMIC DEVELOPMENT PLAN FOR TBILISI ... - LED

A thorough analysis of the tourist, construction, industry and trade clusters gives a clear
picture of the situation and the processes that are taking place in the local economy of
Tbilisi. The importance of the examined clusters can demonstrated by means of the
following conclusions:
- the examined clusters generate locally almost 80% of the national turnover in these
clusters;
- the employment in the examined clusters accounts for 50% - 80% of the total
employment in Georgia;
- a significant rise in the turnover volume (it almost doubled both nationally and in Tbilisi) is
a common tendency for all the clusters, particularly in the observed period of 2004-2006;
- due to the dynamic growth of the examined markets a change in the employment took
place in each of them in the period of 2004-2006. The number of the jobs in the
construction cluster almost doubled (not in the last year, though). After the period of falling
figures since 2004 the industry cluster has been providing 10% more jobs annually and it
is a cluster that generates the highest employment among the examined markets. Also
the employment in the hotel industry has been growing since 2003 at a rate of 10% per
year. The market of trade, repair of vehicles, personal and household goods, after a
period of 2001 – 2005 when the employment was growing, has reduced its workforce
below 25 000 people, i.e. to the level similar to 2003;
The sector of strategic importance for the city economy is the banking sector. Although,
when compared to other analyzed industries, it does not generate many jobs, but it
employs staff that is better qualified and better paid than other business sector
employees. This is why a descriptive analysis of the banking sector in Georgia and Tbilisi
has been carried out as well. In 1994 a reform of banking sector, introduction of a two-tier
banking system (National Bank of Georgia and the commercial banks). Commercial
bank’s total assets comprise 31% of GDP and liabilities comprise 24%. The perspectives
of Georgia becoming the financial centre for the region and regional banking would create
a larger pool of capital to finance internal projects in Georgia.
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