Journal number 1 ∘

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„ECONOMICS and BUZINESS“ VOLUM XVI, N1, 2024 C O N T E N T S 2024 Christmas Epistle of the Catholicos-Patriarch of All Georgia Ilia II ECONOMIC THEORY ◊ ECONOMIC POLICY Mikhail Jibuti – Davos 2024 – Envisioning the Anticipated FutureSolomon Pavliashvili, Zurab Garakanidze – The Impact of the Russia-Ukraine War on the EU Gas Spot MarkePaata Koghuashvili, Eter Kharaishvili, Nino Shengelia – From Traditional Agriculture to Industrial (Digital) AgricultureLela Tavdgiridze, Giorgi Katamadze, Maya Bolkvadze – Economic Awareness and Early Childhood Education Yusif Najafzade – Shenzhen s Special Economic Zon (SEZ) – Lessons for Azerbaijan BUSINESS ◊ MANAGEMENT Miron Tugushi – Green Management – the Most Important Condition for the Revival of Green EconomyLeila Kadagishvili – Corporate Social Responsibility in the Context of Stakeholders FINANCE and BANKING ◊ ACCAUNTING, AUDIT

Journal number 1 ∘ Mikhail Jibuti ∘

Davos 2024 – Envisioning the Anticipated Future

https://doi.org/10.52340/eab.2024.16.01.01 ჟურნალი N 1. 2024 Top of Form This report offers an overview of the proceedings of the 54th World Economic Forum (referred to hereafter as the ~Forum~) convened in Davos-Klosters, Switzerland. It delves into topics of interest to Georgian political and academic spheres. Beyond economic and political insights, extracting situational and socio-public implications from the Davos Forum holds significance in comprehending and accommodating prevailing realities. Davos Forum 2024 seamlessly continued the trajectory set in motion in 2023, encapsulating the synthesis of a post-pandemic new reality, characterized by both the aftermath of the pandemic and widespread military-terrorist activities, notably Russia's aggression in Ukraine. This, coupled with the mounting exclusivity in social-humanitarian and economic sciences and national strategies, has led to a pervasive sense of uncertainty, encapsulated in the Forum's overarching theme o

Journal number 1 ∘ Solomon Pavliashvili ∘ Zurab Garakanidze ∘

The Impact of the Russia-Ukraine War on the EU Gas Spot Market

https://doi.org/10.52340/eab.2024.16.01.02 Ahead of the Russia-Ukraine war, global natural gas production in 2021 rose nearly 5 percent to a record 4.04 trillion cubic meters. In 2021, Russian natural gas exports were 202 billion cubic meters of pipeline gas and 39.6 billion cubic meters of liquefied natural gas (LNG). [Russia Struggles to Make Up for Europe's Gap in Natural Gas Exports. https://www.aa.com.tr/en/europe/russia-struggles-to-make-up-for-europes-gap-in-natural-gas- exports/2717651]. Because of the war in Ukraine, Russia stopped exporting essential volumes of natural gas to Europe, which used to account for 40 percent of the EU's supply, causing gas prices in Europe to rise. Georgia, with its strategic location on the eastern coast of the Black Sea, has the potential to create a liquefied natural gas (LNG) hub for transporting gas to European markets bypassing Russia – using existing port facilities in Anaklia, Poti, Batumi, Kulevi (owned by Sokar BST LLC);Recent dev

Journal number 1 ∘ Paata Koguashvili ∘ Eter Kharaishvili ∘ Nino Shengelia ∘

From Traditional Agriculture to Industrial (Digital) Agriculture

https://doi.org/10.52340/eab.2024.16.01.03 The Industrial Revolution led to great changes in the world. New technologies were being developed and introduced at a rapid pace, forever changing the way people lived and worked. One of the areas that underwent significant changes due to the Industrial Revolution is agriculture, which is one of the oldest and most traditional form of use of nature and land by humans. Making changes to the agriculture became possible only under the influence of industrial revolutions. Still, even in the early stages, they were not able to radically and visibly transform this important branch of the economy.One of the most visible effects of industrialization on agriculture is the introduction of new technologies. The interdependence between traditional agriculture and modern industrial sectors of the economy is crucial for the overall economic development of the country. The growth of the agricultural sector depends on the growth of industrial demand for agr

Journal number 1 ∘ Lela Tavdgiridze ∘ Giorgi Katamadze ∘ Maya Bolkvadze ∘

Economic Awareness and Early Childhood Education

https://doi.org/10.52340/eab.2024.16.01.04 The need to give basic economic information and teach economic concepts to children at an early age is the theoretical and practical basis of many international studies reflected in the works of many researchers;The paper examines regional and global studies on economic education and economic awareness in early education, particularly among preschool children; focuses on theoretical and legal approaches to the age classification of early childhood children based on national and international legislation; identifies the optimal age for the formation, development, and strengthening of economic awareness among preschoolers, and suggests the ways and appropriate educational materials to achieve this goal. The research is based on a complex, interdisciplinary methodology and includes document examination, comparison, classification and systematization, content analysis and data synthesis. In accordance with the objectives of the study we have revi

Journal number 1 ∘ Yusif Najafzade ∘

Shenzhen s Special Economic Zon (SEZ) – Lessons for Azerbaijan

https://doi.org/10.52340/eab.2024.16.01.05 The main purpose of this article is to find out the role of Shenzhen SEZ importance in the Chinese economy. The article explores the reason behind the Chinese economic boom starting from 1980’s. Starting from that period, China has become one of the leading players in the global economy due to Shenzhen immense success. Capital going to the Shenzhen SEZ played essential part for Chinese economy. The article highlights Shenzhen's exceptional success attributed to its strategic location and size. The regression analysis conducted from 1980 to 2019 reveals a strong positive correlation between the number of enterprises in Shenzhen and the capital utilized from Hong Kong and Macao.The article extends its analysis to Azerbaijan, showcasing the country's efforts in establishing Special Economic Zones for economic development. It sheds light on the challenges faced by Azerbaijan, such as economic constraints limiting the expansion of industrial

Journal number 1 ∘ Miron Tugushi ∘

Green Management - the Most Important Condition for the Revival of Green Economy

https://doi.org/10.52340/eab.2024.16.01.06 Green or environmental management, which is often referred to as eco-management, is a component of management theory and practice, the ultimate goal of which is the rational use of resources without harming the natural environment.In the development plans of the country or its regions developed at the beginning of the transition period to Soviet-era and market relations in Georgia, the main attention was shifted to economic and social aspects, and less attention was paid to environmental measures. Currently, the situation in this regard has changed radically, almost no important program or project is developed without environmental impact assessment (EIA), strategic environmental assessment (SEA) and other necessary studies. The amount of funding for environmental measures has also increased, for example, 189.4 million GEL has been allocated from the state budget of Georgia to finance environmental protection programs in 2024, while only 30.9

Journal number 1 ∘ Leila Kadagishvili ∘

Corporate Social Responsibility in the Context of Stakeholders

https://doi.org/10.52340/eab.2024.16.01.07 Corporate social responsibility (CSR) is becoming increasingly important in modern business. In order for a business to reach its long-term, strategic goals successfully in a competitive market environment, it is critically important for a company to care not only for its own profit but also to implement a policy relevant to public goals and interests. CSR is not just the fulfillment of a moral obligation to society or a financial cost to a company. It is a voluntary commitment by the company to act in line with the three main pillars of sustainable development - economic, social, and environmental - and to consider the interests of all stakeholders while doing business. In the modern sense, Corporate social responsibility can to improve the image and reputation of the company, increase the motivation of the workforce, improve customer satisfaction, ensure the long-term viability of the company in the market, build a strong and healthy societ

Journal number 1 ∘ Levan Sabauri ∘ Nadezhda Kvatashidze ∘

Management Reporting Preparation Issues

https://doi.org/10.52340/eab.2024.16.01.08 In recanted years, the International Accounting Standards Board (IASB) has been actively working on the issues of preparation and submission of management reports, including assessment of the performance and sustainability of management. As a result of the long-term research, the Board l has developed a package of documents that includes the Project "Performance management – disclosure of information – usefulness and reconciliation". This document describes recommendations for users of management reporting for submitting transparent and useful information in line with financial reporting information. In addition, the European Commission Directive introduced the European standards of reporting in the field of sustainable development. Purpose and objectives: To introduce and review the new IASB recommendations and sustainability standards for the preparation and presentation of useful information to users of management reporting, wh

Journal number 1 ∘ Maya Gogokhia ∘

On the Issue of the Mutual Connection between the Securities Market and Economic growth

https://doi.org/10.52340/eab.2024.16.01.09 On the one hand, the level of economic development of the country creates the prerequisites for the development of the stock market, and on the other hand, the securities market itself is an important factor in the development and growth of the real economy.The mechanisms of the financial system are complex and varied. The list of securities and functions of the financial market is extensive. Among them we can highlight: the function of corporate control, the function of implementing risk management; function of stimulating entrepreneurship: function of promoting trade in goods, services, contracts. The principles of creating a single defragmented market are being implemented by regulators.The securities market will transform into a global market. The trading process becomes continuous. Nowadays, public trading on the stock exchange is becoming optional.Growth theorists have focused on the relationship between financial systems and economic g

Journal number 1 ∘ Marina Tabatadze ∘

Issues of Optimizing the Use of State Budget Funds in Georgia

https://doi.org/10.52340/eab.2024.16.01.10 Effective management of the state budget is an important factor of the country's financial stabilization and correct forecasting, its basis is the introduction of modern management principles of the budget system, the formation of an institutional and legal base corresponding to European standards. The article discusses the role of the budget system in the unified process of managing the economy of Georgia and certain features of its functioning, the issues of optimization of vertical budget segmentation and proper coordination.On the basis of the Law on Budgetary Systems, government reserve funds have been created within the state budget of Georgia since 2005 to cover unforeseen expenses. The operation of this fund is one of the important issues of the state budget, as, along with the fiscal burden, the Reserve Fund plays a significant role in financial support for the main priorities of the state’s social policy.Despite the compliance

Journal number 1 ∘ Tengiz Verulava ∘

Primary Health Care Financing Methods in Georgia: Challenges and Prospects

https://doi.org/10.52340/eab.2024.16.01.11 Most of the cases of medical services are performed at the ambulatory-polyclinic level. Outpatient-polyclinic medical services represent the most massive type of services that the majority of the population applies to. Ambulatory-polyclinic medical services, as a rule, begin and end the patient's referral to the health care system, it has significant opportunities for efficient use of financial resources. Therefore, the selection of payment methods for primary care is of particular importance. The following main methods of financing primary health care are used: lump-sum payment method, fixed-salary payment method, fee-for-service method.In order to promote the development of primary health care in Georgia, it is necessary to pay family doctors and nurses properly. In many countries, the primary health care team is funded by motivation, which means not only stimulating the acceptance of as many patients as possible, but also the quality of th

Journal number 1 ∘ Tamar Barbakadze ∘

Examining the Degree of Awareness Among Taxpayers Regarding the Tax System in the Context of Georgia

https://doi.org/10.52340/eab.2024.16.01.12 The research titled "Examining the Degree of Awareness Among Taxpayers Regarding the Tax System in the Context of Georgia" explores the complex relationship between tax legislation, taxpayer awareness, and economic development. This study identifies a crucial junction in Georgia's fiscal policy, emphasizing the need for an optimal balance between legislative reforms and taxpayer comprehension. Despite Georgia's efforts to align its tax system with European standards, the research reveals a significant gap in taxpayer awareness, potentially hindering the success of reforms and broader economic development goals.In the introduction, the pivotal role of the tax system in a country's economic and financial infrastructure is highlighted. Georgia, in its pursuit of an attractive and favorable tax environment, has implemented tax reforms to simplify tax administration and harmonize legislation with EU standards. However, the study brings attention t

Economics and Business Referential and Reviewed International Scientific-Analytical Journal of Ivane Javakhishvili Tbilisi State University, Faculty of Economics and Business

ISSN 1987-5789 ESSN 2587-5426 doi 10.52340	Journal number 1 ∘ *** „ECONOMICS and BUZINESS“ VOLUM XVI, N1, 2024 C O N T E N T S 2024 Christmas Epistle of the Catholicos-Patriarch of All Georgia Ilia II ECONOMIC THEORY ◊ ECONOMIC POLICY Mikhail Jibuti – Davos 2024 – Envisioning the Anticipated FutureSolomon Pavliashvili, Zurab Garakanidze – The Impact of the Russia-Ukraine War on the EU Gas Spot MarkePaata Koghuashvili, Eter Kharaishvili, Nino Shengelia – From Traditional Agriculture to Industrial (Digital) AgricultureLela Tavdgiridze, Giorgi Katamadze, Maya Bolkvadze – Economic Awareness and Early Childhood Education Yusif Najafzade – Shenzhen s Special Economic Zon (SEZ) – Lessons for Azerbaijan BUSINESS ◊ MANAGEMENT Miron Tugushi – Green Management – the Most Important Condition for the Revival of Green EconomyLeila Kadagishvili – Corporate Social Responsibility in the Context of Stakeholders FINANCE and BANKING ◊ ACCAUNTING, AUDIT Journal number 1 ∘ Mikhail Jibuti ∘ Davos 2024 – Envisioning the Anticipated Future https://doi.org/10.52340/eab.2024.16.01.01 ჟურნალი N 1. 2024 Top of Form This report offers an overview of the proceedings of the 54th World Economic Forum (referred to hereafter as the ~Forum~) convened in Davos-Klosters, Switzerland. It delves into topics of interest to Georgian political and academic spheres. Beyond economic and political insights, extracting situational and socio-public implications from the Davos Forum holds significance in comprehending and accommodating prevailing realities. Davos Forum 2024 seamlessly continued the trajectory set in motion in 2023, encapsulating the synthesis of a post-pandemic new reality, characterized by both the aftermath of the pandemic and widespread military-terrorist activities, notably Russia's aggression in Ukraine. This, coupled with the mounting exclusivity in social-humanitarian and economic sciences and national strategies, has led to a pervasive sense of uncertainty, encapsulated in the Forum's overarching theme o Journal number 1 ∘ Solomon Pavliashvili ∘ Zurab Garakanidze ∘ The Impact of the Russia-Ukraine War on the EU Gas Spot Market https://doi.org/10.52340/eab.2024.16.01.02 Ahead of the Russia-Ukraine war, global natural gas production in 2021 rose nearly 5 percent to a record 4.04 trillion cubic meters. In 2021, Russian natural gas exports were 202 billion cubic meters of pipeline gas and 39.6 billion cubic meters of liquefied natural gas (LNG). [Russia Struggles to Make Up for Europe's Gap in Natural Gas Exports. https://www.aa.com.tr/en/europe/russia-struggles-to-make-up-for-europes-gap-in-natural-gas- exports/2717651]. Because of the war in Ukraine, Russia stopped exporting essential volumes of natural gas to Europe, which used to account for 40 percent of the EU's supply, causing gas prices in Europe to rise. Georgia, with its strategic location on the eastern coast of the Black Sea, has the potential to create a liquefied natural gas (LNG) hub for transporting gas to European markets bypassing Russia – using existing port facilities in Anaklia, Poti, Batumi, Kulevi (owned by Sokar BST LLC);Recent dev Journal number 1 ∘ Paata Koguashvili ∘ Eter Kharaishvili ∘ Nino Shengelia ∘ From Traditional Agriculture to Industrial (Digital) Agriculture https://doi.org/10.52340/eab.2024.16.01.03 The Industrial Revolution led to great changes in the world. New technologies were being developed and introduced at a rapid pace, forever changing the way people lived and worked. One of the areas that underwent significant changes due to the Industrial Revolution is agriculture, which is one of the oldest and most traditional form of use of nature and land by humans. Making changes to the agriculture became possible only under the influence of industrial revolutions. Still, even in the early stages, they were not able to radically and visibly transform this important branch of the economy.One of the most visible effects of industrialization on agriculture is the introduction of new technologies. The interdependence between traditional agriculture and modern industrial sectors of the economy is crucial for the overall economic development of the country. The growth of the agricultural sector depends on the growth of industrial demand for agr Journal number 1 ∘ Lela Tavdgiridze ∘ Giorgi Katamadze ∘ Maya Bolkvadze ∘ Economic Awareness and Early Childhood Education https://doi.org/10.52340/eab.2024.16.01.04 The need to give basic economic information and teach economic concepts to children at an early age is the theoretical and practical basis of many international studies reflected in the works of many researchers;The paper examines regional and global studies on economic education and economic awareness in early education, particularly among preschool children; focuses on theoretical and legal approaches to the age classification of early childhood children based on national and international legislation; identifies the optimal age for the formation, development, and strengthening of economic awareness among preschoolers, and suggests the ways and appropriate educational materials to achieve this goal. The research is based on a complex, interdisciplinary methodology and includes document examination, comparison, classification and systematization, content analysis and data synthesis. In accordance with the objectives of the study we have revi Journal number 1 ∘ Yusif Najafzade ∘ Shenzhen s Special Economic Zon (SEZ) – Lessons for Azerbaijan https://doi.org/10.52340/eab.2024.16.01.05 The main purpose of this article is to find out the role of Shenzhen SEZ importance in the Chinese economy. The article explores the reason behind the Chinese economic boom starting from 1980’s. Starting from that period, China has become one of the leading players in the global economy due to Shenzhen immense success. Capital going to the Shenzhen SEZ played essential part for Chinese economy. The article highlights Shenzhen's exceptional success attributed to its strategic location and size. The regression analysis conducted from 1980 to 2019 reveals a strong positive correlation between the number of enterprises in Shenzhen and the capital utilized from Hong Kong and Macao.The article extends its analysis to Azerbaijan, showcasing the country's efforts in establishing Special Economic Zones for economic development. It sheds light on the challenges faced by Azerbaijan, such as economic constraints limiting the expansion of industrial Journal number 1 ∘ Miron Tugushi ∘ Green Management - the Most Important Condition for the Revival of Green Economy https://doi.org/10.52340/eab.2024.16.01.06 Green or environmental management, which is often referred to as eco-management, is a component of management theory and practice, the ultimate goal of which is the rational use of resources without harming the natural environment.In the development plans of the country or its regions developed at the beginning of the transition period to Soviet-era and market relations in Georgia, the main attention was shifted to economic and social aspects, and less attention was paid to environmental measures. Currently, the situation in this regard has changed radically, almost no important program or project is developed without environmental impact assessment (EIA), strategic environmental assessment (SEA) and other necessary studies. The amount of funding for environmental measures has also increased, for example, 189.4 million GEL has been allocated from the state budget of Georgia to finance environmental protection programs in 2024, while only 30.9 Journal number 1 ∘ Leila Kadagishvili ∘ Corporate Social Responsibility in the Context of Stakeholders https://doi.org/10.52340/eab.2024.16.01.07 Corporate social responsibility (CSR) is becoming increasingly important in modern business. In order for a business to reach its long-term, strategic goals successfully in a competitive market environment, it is critically important for a company to care not only for its own profit but also to implement a policy relevant to public goals and interests. CSR is not just the fulfillment of a moral obligation to society or a financial cost to a company. It is a voluntary commitment by the company to act in line with the three main pillars of sustainable development - economic, social, and environmental - and to consider the interests of all stakeholders while doing business. In the modern sense, Corporate social responsibility can to improve the image and reputation of the company, increase the motivation of the workforce, improve customer satisfaction, ensure the long-term viability of the company in the market, build a strong and healthy societ Journal number 1 ∘ Levan Sabauri ∘ Nadezhda Kvatashidze ∘ Management Reporting Preparation Issues https://doi.org/10.52340/eab.2024.16.01.08 In recanted years, the International Accounting Standards Board (IASB) has been actively working on the issues of preparation and submission of management reports, including assessment of the performance and sustainability of management. As a result of the long-term research, the Board l has developed a package of documents that includes the Project "Performance management – disclosure of information – usefulness and reconciliation". This document describes recommendations for users of management reporting for submitting transparent and useful information in line with financial reporting information. In addition, the European Commission Directive introduced the European standards of reporting in the field of sustainable development. Purpose and objectives: To introduce and review the new IASB recommendations and sustainability standards for the preparation and presentation of useful information to users of management reporting, wh Journal number 1 ∘ Maya Gogokhia ∘ On the Issue of the Mutual Connection between the Securities Market and Economic growth https://doi.org/10.52340/eab.2024.16.01.09 On the one hand, the level of economic development of the country creates the prerequisites for the development of the stock market, and on the other hand, the securities market itself is an important factor in the development and growth of the real economy.The mechanisms of the financial system are complex and varied. The list of securities and functions of the financial market is extensive. Among them we can highlight: the function of corporate control, the function of implementing risk management; function of stimulating entrepreneurship: function of promoting trade in goods, services, contracts. The principles of creating a single defragmented market are being implemented by regulators.The securities market will transform into a global market. The trading process becomes continuous. Nowadays, public trading on the stock exchange is becoming optional.Growth theorists have focused on the relationship between financial systems and economic g Journal number 1 ∘ Marina Tabatadze ∘ Issues of Optimizing the Use of State Budget Funds in Georgia https://doi.org/10.52340/eab.2024.16.01.10 Effective management of the state budget is an important factor of the country's financial stabilization and correct forecasting, its basis is the introduction of modern management principles of the budget system, the formation of an institutional and legal base corresponding to European standards. The article discusses the role of the budget system in the unified process of managing the economy of Georgia and certain features of its functioning, the issues of optimization of vertical budget segmentation and proper coordination.On the basis of the Law on Budgetary Systems, government reserve funds have been created within the state budget of Georgia since 2005 to cover unforeseen expenses. The operation of this fund is one of the important issues of the state budget, as, along with the fiscal burden, the Reserve Fund plays a significant role in financial support for the main priorities of the state’s social policy.Despite the compliance Journal number 1 ∘ Tengiz Verulava ∘ Primary Health Care Financing Methods in Georgia: Challenges and Prospects https://doi.org/10.52340/eab.2024.16.01.11 Most of the cases of medical services are performed at the ambulatory-polyclinic level. Outpatient-polyclinic medical services represent the most massive type of services that the majority of the population applies to. Ambulatory-polyclinic medical services, as a rule, begin and end the patient's referral to the health care system, it has significant opportunities for efficient use of financial resources. Therefore, the selection of payment methods for primary care is of particular importance. The following main methods of financing primary health care are used: lump-sum payment method, fixed-salary payment method, fee-for-service method.In order to promote the development of primary health care in Georgia, it is necessary to pay family doctors and nurses properly. In many countries, the primary health care team is funded by motivation, which means not only stimulating the acceptance of as many patients as possible, but also the quality of th Journal number 1 ∘ Tamar Barbakadze ∘ Examining the Degree of Awareness Among Taxpayers Regarding the Tax System in the Context of Georgia https://doi.org/10.52340/eab.2024.16.01.12 The research titled "Examining the Degree of Awareness Among Taxpayers Regarding the Tax System in the Context of Georgia" explores the complex relationship between tax legislation, taxpayer awareness, and economic development. This study identifies a crucial junction in Georgia's fiscal policy, emphasizing the need for an optimal balance between legislative reforms and taxpayer comprehension. Despite Georgia's efforts to align its tax system with European standards, the research reveals a significant gap in taxpayer awareness, potentially hindering the success of reforms and broader economic development goals.In the introduction, the pivotal role of the tax system in a country's economic and financial infrastructure is highlighted. Georgia, in its pursuit of an attractive and favorable tax environment, has implemented tax reforms to simplify tax administration and harmonize legislation with EU standards. However, the study brings attention t