Apple iPad marketing strategy in Georgia and regional markets

Apple's iPad

Georgia suffered severe political and economic turbulence during the years following the re-establishment of its independence in 1991 (Suny, 1994). In the mid-1990s Georgia began to experience modest but increasing levels of GDP growth and foreign investment. Until 1998 Georgia's economy grew on average 7%. This growth was attributable to the introduction of a new, stable currency, reduced rates of inflation, and the re-establishment of both economic and political stability (Gregson, 2008).

Economic growth and reform slowed in 1998, due to the Russian financial crisis, drought, and political events, including a major outbreak of hostilities in Abkhazia and an assassination attempt against the President. However, the period also saw completion of the first major infrastructure project, the Baku-Supsa early oil pipeline. Growth through 2002 was positive, and Georgia's economic performance is slowly improving, with GDP growth of 3% in 1999, 2% in 2000, 4.5% in 2001, 5.3% in 2002, and 8.3% in the first nine months of 2003. Despite these setbacks, Georgia led the former Soviet Union in developing the legal infrastructure necessary for an attractive investment climate (White, Miller & Meichtry, 2008). Georgia maintains no currency controls, allows foreign investment in all but a few sectors deemed strategically important, and has implemented an impressive privatization program, including land privatization.

However, during the early 21 ist Century, Georgia has been experiencing positive developments in their economy (Gregson, 2008). During the year 2007, Georgia's readl GDP had reached 12%, making it Eastern Europe's fastest growing economy. Apple's iPad shows to have a lot of market potential in Georgia, also in the rest of Eastern Europe.

Foreign direct investment (FDI) has declined in recent years to $61.8 million in 2001, compared to $83.65 million in 1999. Key sectors of economic activity in Georgia include energy, agriculture, trade, tourism, and transport, as well as significant projects in the food processing and telecommunications industries. The United States is the largest foreign investor in Georgia, annually contributing between 20%-34% of overall FDI in recent years. The construction of the Baku-Tbilisi-Ceyhan oil pipeline, which began in April 2003, and the Shah Deniz gas pipeline, expected to begin in 2004, will offer opportunities for investors in the energy sector as well as related infrastructure which includes technology and other developments. Additional privatization is planned in the energy sector, including power distribution outside of Tbilisi and hydropower facilities.

Privatization is the only means to generate the capital needed to rehabilitate the economic sector. Due to a lack of investment, Georgia's transportation and communication infrastructure remains in very poor condition. The Ministry of Transport and Communication's agenda to privatize the telecommunications industry has been hampered by the lack of bidder interest. Because of this lack of interest, there is no known competition, and being as it is Eastern Europe's fastest growing economy, its profitability is high.