Chief of Presidential Staff Arveladze will replace Irakly Okruashvili, who tendered his resignation Friday after just seven days in charge of the Economics Ministry.
Arveladze, 28, an ally of Western-leaning President Mikheil Saakashvili in the 2003 "rose revolution", is also the Secretary General of Georgia's ruling party, National Movement-Democrats, and an international law expert.
Okruashvili, 33, known for his strong-worded remarks about Russia, was appointed economics minister on November 10 in a reshuffle seen as a move to defuse an acute diplomatic crisis with Moscow.
As a Defense Ministry "hawk", Okruashvili often made harsh statements causing outrage in Moscow. He promised to celebrate New Year in the breakaway pro-Russian republic of South Ossetia, and said Russia was doomed to defeat in any potential warfare with Georgia.
Many saw the appointment as economics minister of Okruashvili - who wielded considerable power in domestic and foreign affairs - as a demotion. In the past, Okruashvili held several other top posts.