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Scales of Shadow Economy of Georgia-US Foreign Trading in 2004-2012

14.06.2012

Today the meeting on this issue was held with the diplomatic corps accredited in Georgia. All data were verified and forwarded to embassies.

The booklet is a message to Georgian population which will allow you to again think over the horrible situation current government has created in the country since Rose Revolution.

The booklet was prepared based on the official data provided by the US Census Bureau http://www.census.gov/foreign-trade/balance/c4633.html  and Georgian Ministry of Finances, National Statistic Agency of Georgia.

Official information:

“After the Rose Revolution: according to US data – US export in Georgia amounted to 3008, 7 million USD; according to Georgian data US import to Georgia amounted to 1 662, 4 million USD.”

Georgian side registered 1 346.3 million USD less than US side; that is almost 55.3% of real data.

The Georgian state budget lost at least one billion lari as tax payment for untaxed goods imported from the USA.

For example, in 2011:

• 66.5% of US imported meat products (including chicken meat) was shadowed and only 33.5 % was legalized;

According to US official data, meat (including chicken meat) of total 101, 3 million USD was exported to Georgia from the USA. According to the data of the Ministry of Finances of Georgia (http://www.mof.ge/2066) meat of only 33, 9 million USD was imported from the USA. So, rest 66.5% was smuggled into the country because it was not registered and state budget lost at least 12 million USD as VAT through these operations.

• 98,6% of oil-products was shadowed and 1,4% was legalized

According to US official data various oil-products of 56 685 000 USD were exported to Georgia.

According to Georgian information, various oil-products of about 771 000 USD were imported to Georgia from the USA; that was 74 times less than US data. That means, in 2011 98, 6% of US exported oil-products entered Georgia through smuggling because Georgian side did not register them!

• 89,2 % of alcohol drinks were shadowed and 10.8 % legalized

According to US official data alcohol drinks (except wine) of 4 373 000 USD was exported to Georgia. According to Georgian information, all sorts of alcohol drinks (including wine) of only 4707000 USD was imported from the US that is 9 times less than US data. Consequently, in 2011 89, 2% of the imported alcohol drinks entered Georgia through smuggling because it was not registered by Georgian side.

• 87% of rice business was shadowed and 13% was legalized

According to the US official data, rice of 2036000 USD was exported to Georgia. According to Georgian information, rice of only 2655000 USD was imported from the US that is eight times less than US data. So, in 2011, 87% of the imported rice was smuggled into Georgia because Georgian side did not register it.

According to US data, in 2011 US export to Georgia amounted to 538 million USD and Georgia’s import in the US was 176 million USD. These figures show that negative trading reconciliation with USA amounted to 362 million USD.

According to Georgian data (website of the National Statistic Agency of Georgia, statistic publication “Georgia’s Foreign Trading in 2011, p. 18): “US import in Georgia – 245.8 million USD, Georgia’s export to USA – 143, 5 million USD, negative trading reconciliation – 102,3 million USD.”

In this light, according to official information Georgia has 3.5 times less negative trading reconciliation in comparison with US data. So, shadowed economy amounted to 72%.

You can find full documents on the following links:



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