Textile and fashion
Georgia has a rich history in the apparel and textile sectors, dating back to Soviet times, when the country was one of the most developed regions in textile and apparel manufacturing in comparison to other nations.. Georgia was producing high quality silk and wool blend fabrics. After the collapse of the Soviet Union, Georgia’s textile and apparel sectors fell on difficult economic times. The sector emerged in 2004. Turkish investors, interested in the skilled and competitive labor cost, cheap land, low energy costs, good transportation links, attractive business environment found in Georgia, began investing in apparel sector.
Georgia offers to investors a politically stable investment destination, efficient, pro-business and corruption-free government, enlargement of market size by Free Trade Agreements, competitive cost of labor and energy, entry gate in the region, solid sovereign balance sheet, stable banking sector. As per World Bank Doing Business Survey, the country has a perfect score in terms of hiring and firing manifestation.
Georgia has FTA (Free Trade Agreement) with Turkey and CIS countries (Russia, Ukraine, Kazakhstan etc.), DCFTA (Deep and Comprehensive Free Trade Agreement) with EU was singed on June 27, 2014, GSP agreement with USA, Norway, Switzerland, Canada, Japan. Georgia is a member of World Trade Organization. In Georgia there is a competitive Labor Cost and availability of skilled workforce and customized trainings. For investors low production costs are very attractive too. In Georgia there is a good Transportation Links to CIS Countries, Europe and Asia.
Considering the political stability, sturdy legal framework, comparatively low corporate tax, good geographical position (Georgia has the shortest transport route from Europe to Azerbaijan, Armenia, Iran and Central Asian countries), strong entrepreneurship and availability of low cost skilled labourers, Georgia is the much liked destination for investing in textile. Average monthly salary in apparel industry for blue-collar workers is 265 USD/month.
Georgia has attracted investments from neighbouring countries including Turkey. As a matter of fact, Turkey is one of the biggest investors in Georgian textile, as Turkish firms consider Georgia as an export base that can provide access to European Union market, market of the
Commonwealth of Independent States (CIS) and the United States of America. There are Seven large Turkish manufacturers on the market, ten large Georgian manufacturers and more than 200 micro enterprises.
United Kingdom, Germany and Ukraine are the main importers of Georgian textile and apparel. Georgia is producing apparel for international brands including Tommy Hilfiger, Zara, Moncler, Marks & Spencer, Koton, Puma, Mexx, Next, George, Miss Etam, Lotto, Per Una, Autograph, Lebek, Hawes & Curtis, Dainese, Primark etc. These achievements have opened new avenues for the country's textile and with this the Georgian textile and apparel industry has already embarked on a successful itinerary.
The proceses contain cut, make, trim (CMT), made to order, boutique and high-end fashion. The country also offers many business opportunity in apparel production, brand development and technical textile. There is a wide range of textile products that Georgia is producing and these include denims, t-shirts, jackets, sweaters, coats, blazers, trousers, sportswear, uniforms for the ministry of defence, finance, environment and other organisations. The growth in the sector has led to jobs in textile sector as well. It has also been observed that the employment in the Georgian textile industry has shown a tendency to increase in recent years.
There are five state owned Vocational Education Training Centers around Georgia (Tbilisi, Kutaisi, Poti, Ozurgeti and Batumi) providing professional courses in cutting, sewing, constructing cloth, technical fashion design and other practical subjects used in the apparel/textile Industry. Most of the course’s fees is financed by the Government of Georgia. In case of investor’s request, customized training is available for new companies/factories.
The initiative under the name “Produce in Georgia” has it’s mission, that is to support manufacture and agriculture industries. Government offers Subsidies for loan interest payment – Free lands/buildings for factory construction.
There are four Free Industrial Zones (FIZs) in Georgia. They are operating in Poti (sea port), Kutaisi (second largest city) and Tbilisi (capital city). If a company produces goods for export in FIZ, it is exempted from all taxes except Personal Income Tax (20%), which is paid from employees’ salaries.