Export Diversification of Georgian Firms to the EU Market

This paper aims at analyzing market penetration strategies in the internationalization process, obstacles of Georgian exporter firms to the EU market and to find solutions for a better level of diversification. On June 2014, EU signed Association Agreement (AA) with Georgia, which deepens political and economic ties between the signatories with a long-term perspective of closer political association and economic integration. This is a challenge for Georgia to fasten process of export diversification on the EU market. Main findings of the research is connected to the fact that Association Agreement will influence on export diversification on the EU market, when main obstacles are identified – lack of access on the financial resources, unfavourable tax environment, high competition, scarce commodity range etc. Hence, Deep and Comprehensive Free Trade Area (DCFTA) which is created under the AA will lead Georgia to benefit from new trading opportunities and easier access to the EU market – the largest in the world. Georgian companies and foreign investors will adopt opportunities implied into the Association Agreement gradually.