Bolnisi

Bolnisi is a municipality with one of Georgia’s most important economic potentials. It is well-known for natural conditions for agricultural and mining production, historical monuments and multiethnic culture and traditions. Bolnisi is rich with natural resources. Gold, silver, copper, barite, basalt, tufa and mineral waters are available in large amounts on the territory of the municipality. Fees for the use of these natural resources, together with property tax, are the biggest part of local budget revenue and main factors for the municipality’s financial independence. In addition, Bolnisi is one of Georgia’s six municipalities that do not get an equalization transfer from central government. The biggest payers (mining companies) to local budget are “RMG kooper” and “RMG GOLD”. Their annual payments amount to 70% of the municipality’s budgetary revenues. Main field of economy of Bolnisi municipality by annual turnover and income is a mining industry which includes mining production, heavy industry, production of construction and finishing materials. By employment indicator, agriculture is the municipality’s main field of economy with 68% of employed persons involved in this sector. According to the National Statistics Office of Georgia, number of functioning enterprises in Bolnisi municipality has increased by 53% in 2017 comparing to 2014; and their number amounted to 583, out of which 569 is a small enterprise, 12 – medium and 2 – large.

The fast increase in number of enterprises in 2014-2017 occurred in the following economic fields: agriculture/forestry – 140%; restaurants – 67%; property operations – 54%; transport and communications – 43%; manufacturing industry – 38%. In parallel to the growth in number of enterprises, production value and income of functioning enterprises in the municipality have also been increasing. According to the National Statistics Office of Georgia, production value has increased by 58% and turnover of enterprises – by 85% in 2016 comparing to 2014. This increase is partly connected to the increase of production value in agriculture, and to the development of construction business as a result of the growth in a number of infrastructural projects in the municipality.

Number of employed persons in Bolnisi municipality amounts to 46,9% of its entire population. Most of the employed persons are involved in agriculture. Other important sectors of employment are: heavy and light industry (13%), education (5%), trade (4%), construction (3,1%) and others (6,9%). Despite the fact that the municipality has a big potential for tourism development in terms of attracting internal and international tourists, Bolnisi is not considered as an active touristic center due to lack of marketing instruments and low tourism infrastructure. Existing touristic service points (café/bars, restaurants, hotels, food facilities) in the municipality do not satisfy the existing demand. Based on current tendencies in tourism sphere, touristic flow is expected to grow in the coming years that will make imbalance between demand and supply even more obvious and large-scale.

Bolnisi is considered to be an agricultural municipality with huge potential due to fertile lands and favorable climate. These conditions make it possible to harvest two or three times a year. However, there are risks of damage to agricultural crops due to natural disasters (heavy rain, hail, wind). These risks are insured by state and private insurance companies. Moreover, there are risks of pollution of environment and agricultural soils by mining activities. The mining company has developed a 3-year action plan for reducing the environmental pollution, implying activities worth of €10mln.

Due to the absence of agricultural infrastructure and marketing facilities, agricultural potential has not been fully utilized. One of the hindering factors for the sector development is a lack of information and knowledge available to farmers on new technologies, demands of export markets and international standards. Amount of agricultural land of municipality is 28,575 hectares, out of which 17,000 is an arable land, 1336 hectares – mowing land and 8857 – pasture, while 1382 hectares are covered by perennial plants. Currently, only about 50%-60% of arable land has irrigation, therefore around 30% of arable land remains unused. Municipality’s harvested production goes mostly to agricultural markets of Tbilisi and Rustavi. Only a small portion of locally-produced goods is exported to Armenia. Important part of the produced goods is sold as a raw material, and their manufacturing or packaging is done in the neighboring regions. It is noteworthy that in the communities populated by ethnic Azerbaijanis, the harvest is taken mostly by women.

There are 10 small enterprises for milk production and 2 medium-sized enterprises for egg and meat production functioning in the municipality. They produce 2,500 tons of cheese, 15mln eggs, 200 tons of poultry and hundreds of tons of pork on average annually. Winery-winegrowing is one of the most important and fast-growing fields of agriculture in Bolnisi. Tendency of last 3 years and the research of local winemakers show that up to 20 new cellars were created in the municipality. Promotion of winery sector was facilitated by success of local wine on various festivals and the increase of demand on the product. In parallel to the increase of demand on local wine, the growth in number of family cellars is expected in the following years because the winery business is becoming more popular and trendy in Bolnisi. Restoration-renewal of old German cellars has been done systematically (there around up to 400 buildings with old German cellars in Bolnisi). Additionally, new family cellars and winemaking facilities are being built now.

Local Economic Development Plan 2019-2020

PROJECT FACTSHEET