Levan Davitashvili on impact of Trump's 10% tariff on Georgia

Levan Davitashvili, GD Vice Prime Minister of Georgia and Minister of Economy and Sustainable Development declares that despite the impact of recent U.S. tariff rates on Georgia, the country has been recognized as one of the particularly friendly nations benefiting from a reduced tariff rate of just 10%.

Davitashvili emphasized that if these new U.S. tariff rates become a long-term reality and investors take notice, Georgia could see an influx of additional investments.

“This is a significant moment that deserves our attention. The United States has implemented a new tariff policy affecting all countries, and Georgia is no exception. However, certain friendly nations have been identified, and Georgia is among them, benefiting from the lowest tariff rate of ten per cent. So, despite having a tariff on our exports to the U.S., Georgia enjoys this reduced rate.

Examining our trade structure with the U.S., we export approximately $150 million worth of products, the majority of which—over 60 per cent—comprises ferroalloys. Notably, these ferroalloys are exempt from tariffs, meaning we neither gain an advantage nor face a significant obstacle in that regard. For other products that incur the ten per cent tariff, the total additional cost amounts to around $4 million—statistically negligible.

Some economists suggest a potential positive outcome from this situation. For instance, products taxed at ten per cent when exported—such as wine—could be positioned favourably compared to other imported wines. The U.S. imports significant quantities of wine from Europe and various ‘New World’ countries. In this context, a total tax of 14 per cent (a ten per cent tariff plus an existing four per cent) remains advantageous compared to the 30 per cent taxes imposed on products from some other countries. This scenario could create economic incentives for increasing wine exports to the U.S. If this tariff structure remains stable in the long term and investors recognize it, we can anticipate additional investments flowing into Georgia,” stated Levan Davitashvili.