The competitiveness level of Georgian mineral water and its promoting ways (ქართული მინერალური წყლების კონკურენტუნარიანობის დონე და მისი ამაღლების გზები)

Abstract

The article assesses the competition and competitiveness in the mineral water sector of Georgia. Competition is analyzed according to competitiveness indexes and factor analysis. The paper examines the peculiarities of the dynamics of Georgian mineral water exports. Biblio graphic research has been conducted on the issue of competition and competitiveness. Competition in the mineral water sector is assessed by the Concentration Index. The Herfindahl-Hirschman index (HHI) is calculated to determine the level of monopolization of the market. Product competitiveness is justified by calculating the Revealed Comparative Advantage Index (RCA) and the Relative Export Advantage Index (RXA). The econometric model examines the cause-and-effect relationship between competitiveness and exports and reveals a positive impact. Mineral water production is one of the leading sectors in Georgia, which significantly contributes to the economic development of Georgia. Priority for mineral water production is determined by a number of advantages. These are: wealth of natural resources, lack of seasonality, low prices, high quality and, most importantly, return on investment in a short time. Based on the analysis of the level of competition in the Georgian mineral water sector, it is concluded that the sector is competitive and the market is not monopolized. The article evaluates the results of the market power of the industry. The impact of market power on the pricing mechanism is determined. At the same time, the most acute problems of competition are identified and modern challenges are analyzed. In accordance with the problems and challenges identified in the paper, conclusions are made and recommendations are proposed. In response to the current challenges, it is desirable for the public and private sectors to jointly develop a common vision for export support programs. However, programs should reflect long-term plans and not one-time benefits. It should be noted that more diversification of mineral water export is needed.