The Impact of Covid-19 on the Economy of Georgia and Neighboring Countries

Abstract

Given the context of the devastating socio-economic impact of the Covid-19 pandemic being acutely felt in the entire world, the present study examines the processes taking place in the economies of Georgia and its bordering countries during the pandemic. The article analyzes the fact that in 2020 the GDP of the stated region of study decreased significantly, which was completely compensated the following year, and there was an increase in most countries. Furthermore, the peculiarity of Georgia and its neighboring countries in the research period is impacted by the sanctions imposed on the Russian Federation after the annexation and occupation of territory in Ukraine in 2014 and the low oil prices in 2014-2021, as well as the record high prices imposed by Russia in February 2022 due to the full-scale war in Ukraine. Taking these sanctions into account, the economic development prospects of the Russian Federation have decreased, which certainly has a impact on the development opportunities of the entire region.

An analysis of GDP of Georgia, GDP by regions, GDP of the Russian Federation, GDP of the regions of the Russian Federation bordering Georgia, GDP per capita, GDP of the Republic of Turkey, and GDP per capita in dynamics are included in the article.

It is concluded that the integration of modern digital technologies has been the key factor in keeping business in a more or less healthy state and reducing the spread of negative economic consequences of Covid-19.