Georgia has been formed as a regional hub for re-exporting used cars since 2005. Vehicles are imported from Japan and the USA and then sold to the local as well as regional markets. Vehicles are major export commodities of Georgian foreign trade.
Aleksandre Vekua, Head of Sales Department of Caucasus Auto Import told Business Morning, that re-export volume was 45% down in 2020 y-o-y, which was due to the increase of customs duty rates in Armenia. In addition, he noted that new markets have appeared for vehicle exports from Georgia.
“Absence of Armenian market was a big blow for our business. Excluding Armenian factor, the re-export decline would be around 20%. However, we still adapted to the situation quite quickly.
2020 was full of challenges, but we had overcome them, as the sector quickly launched remote sales. We continued cooperation with other neighboring countries Azerbaijan and Ukraine. The dynamics of trading countries have changed and demand has emerged from such markets as Iraq, Moldova and the Russian Federation, which creates grounds for optimistic expectations that Georgia will keep the role of re-exporting hub in the region for the coming years”, - Vekua noted.
According to Vekua, the fact that Georgia still keeps the role of re-exporting hub in the region is a merit of the Black Sea.
In 2017-2020 the country has an average income of 500 billion GEL from car re-exports. Revenue from re-exports in 2019 was $ 834 million, while in 2020 it was $ 437 million.
