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a result, employment is concentrated in larger and relatively older firms. “Georgia has done a tremendous job in creating the environment for firm entry, but more reforms are needed to help firms increase productivity, grow, and thrive in an increasingly competitive global environment,” commented Mohamed Ihsan Ajwad, World Bank Senior economist and one of the lead authors of the report.
“Our analysis shows that small and individual firms fail to grow to medium-sized firms.”
The “missing middle” is revealed by employment data. While individual firms represented over 70% of total registered firms, they accounted for just 11% of employment in registered firms. Private sector employment is concentrated in small firms with fewer than 20 employees, or large firms with more than 100 employees.
World Bank economists also point out that while Georgia has made considerable progress putting business-friendly policies in place — the country soared to ninth place on the latest Doing Business index — “political instability remains a significant challenge for firms”.
4.4.2 Retail sector dynamics
Retail sales rises 16.4% y/y in 2Q18
Retail sales in Georgia increased 16.4% y/y in the second quarter of 2018, slightly down from 16.7% y/y rise in the previous quarter, according to CEIC data.
In 2017, retail trade turnover reached GEL9,929.8mn, up from GEL8,101.9mn last year. Retail sales, which has been growing at a strong double-digit pace for several years, grew by only 8-9% in 2015-16 as wage growth slowed and unemployment rose.
Retail sales y/y in Georgia averaged 17% from 2000 to 2018.
23 GEORGIA Country Report November 2018 www.intellinews.com