Pylonology ● Georgia`s Market Economy

2026-10-04

A market economy is a system that fosters the development of the rule of law. Following the Baltic states' liberation from the Soviet Union, the establishment of a market economy and European institutions became a key foundation for their integration into the European Union.

The European Union itself constitutes a free-market area. This entails high standards for the protection of private property and the existence of exchanges that operate independently of the state.

The Free Real Estate Market

As of 2022, 83% of agricultural land in Denmark was held by private individuals and another 12% by companies; consequently, the private sector's total share stood at approximately 95%. In contrast, statistics from 2004 indicate that the private sector's share of agricultural land ownership in Georgia was 25.4%.

Furthermore, for the sake of comparison, the average area of ​​agricultural land utilized per farm is as follows:

● Denmark ~71 hectares
● Estonia ~91 hectares
● Georgia ~1.7 hectares

These figures refer to the average area utilized by a farm, rather than the land actually owned by it.

A Free Stock Market

The example of Estonia highlights the importance not only of property rights protection but also of the existence of a capital market. Nasdaq Tallinn (the Estonian stock exchange) is part of the Nasdaq Baltic system, which integrates the capital markets of Estonia, Latvia, and Lithuania into a unified infrastructure.

As of October 2, 2026, there were 30 equity issuers listed on Nasdaq Tallinn: 19 on the regulated market and 11 on the First North alternative market. Their combined market capitalization stood at approximately €5.14 billion. On the same day, the total equity market capitalization of Nasdaq Baltic—comprising the stock markets of Estonia, Latvia, and Lithuania—was €12.03 billion. For comparison,

on the Georgian Stock Exchange (GSE):
● Listed securities: 20
● Shares: 0 listed
● Bonds: 20 listed
● Non-listed shares: 2
● Market capitalization: GEL 478.4 million

Connecting disparate realities requires courage.

Global trade, investment, and logistics generate interest wherever markets are free. Georgia’s market economy is precisely what is needed to link the distinct systems of Asia and Europe—specifically, the connection between administrative and free-market capital models. This is because, within the Caspian and Black Sea region, Georgia maintains free trade and preferential trade agreements with the EU, Turkey, EFTA countries, China, and other trading partners.

The development of a securities market where the stock exchange serves as the venue for investment decisions—a market in which Georgian citizens have equal rights of participation and the government acts as the regulator; Furthermore, the broad and transparent privatization of state assets—carried out at no cost where economically and legally justified—will serve as a guarantee for the restoration of the Silk Road, reviving a concept from the past while creating a new one.

Moreover, for the state, having numerous property owners and shareholders signifies a robust economy. If property rights are protected and ownership is widely distributed—with assets freely usable and transferable—the chain of economic activity might look like this:

Many owners → Broad distribution of property → Increased economic activity → More investors → Expansion of capital markets → More private capital → A deeper, more robust economy.

Trade flourishes where the law ensures freedom of movement.

Where the law paves the way, trade crosses borders.

The state upholds the rule of law, and the law upholds free trade.

Without free trade, there is no Silk Road. The harmonious agenda of the Silk Road is shaped by its gateway, which must be characterized by strongly protected private property and exchanges that align with international best practices.

A free-trade gateway itself requires free and widely distributed ownership as well as a capital market.

Georgia must serve as the Silk Road’s gateway not only geographically but also institutionally—a gateway founded upon protected private property, widespread ownership, a developed capital market, and free trade.

Zurab Maghradze, DBA

 

Sources: dst.dk / iset-pi.ge / gse.ge
nasdaqbaltic.com / nasdaqbaltic.com