Georgia The Underground Economy
Jewelry-making and gun-repair stand in Tbilisi
Courtesy A. James Firth, United States Department of
Agriculture
Economic statistics for Georgia are difficult to evaluate for
both the Soviet era and the post-Soviet period, primarily because
of the country's large underground economy. Traditional Georgian
familial and clan relations have intensified the economic
corruption that infused the entire communist system. Local elites
in the communist party joined with underground speculators and
entrepreneurs to form an economic mafia. Repeated efforts to
eradicate this phenomenon, including an aggressive effort by
Shevardnadze in the early 1970s, apparently had little impact. In
the postcommunist period, struggles for economic control among
competing mafias have been an important part of the political
conflict plaguing Georgia.
Data as of March 1994
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