Developments in Georgia

Updated: 22 January 2018

Georgia has carried out reforms promoting economic development, democracy and rule of law. However, unemployment and poverty remain major challenges.

Georgia regained its independence in 1991 and was thereafter characterized by internal divisions and conflicts for a number of years.

With the dissolution of the Soviet Union, the Georgian regions South Ossetia and Abkhazia claimed to break out and form their own states. Russia has been supporting the breakout regions and in 2008, the conflict between Georgia and Russia escalated into a short but full-scale war. After the war, Russia has recognized Abkhazia and South Ossetia as independent states.

The relationship between Georgia and Russia has remained tense, which has contributed to instability in the region. Russia regards Georgia's approximation to EU and NATO as provocations that threaten regional stability.

In 2014 Georgia signed an Association Agreement and a free trade agreement (DCFTA - Deep and Comprehensive Free with the EU which aims to support good governance, economic recovery and economic growth. Through the Association Agreement, the political and economic cooperation between Georgia and EU has deepened and contributed to increased economic activity in the country. Visa free travel to the EU was granted to Georgian citizens in 2017 which was an important step in Georgia's EU-approximation process.

Political development

In 2004 Micheil Saakashvili was elected president after the peaceful Rose Revolution in 2003, when the former President Eduard Shevardnadze was forced to resign after allegations of electoral fraud and corruption. Saakashvili carried out radical reform policies, but with time his support among the Georgian population decreased after accusations of authoritarianism and corruption.

In 2012 Georgia held its first democratic election and saw a peaceful transition of power after the opposition party Georgian Dream won over Saakashvili's United National Movement (UNM). Georgian Dream won the parliamentary elections again in 2016 and received constitutional majority. The 2017 local elections have further strengthened the party's power.

The executive power is divided between the President and the Government. In 2017 Georgia concluded the transition from a semi-presidential to a parliamentary system, where the president will be elected through indirect elections and some of the presidential powers will be transferred to the Prime Minister.

Law and order

The respect for human rights is in many areas good in Georgia. Despite a sometimes polarized political debate, the electoral process and election results are respected. The Georgian democracy is still young and a lacking understanding of the role of democratic institutions can at times be noticed in the public debate and in political statements.

There can be political influence of the courts and the police Despite a series of reforms, the judicial system is still criticized for not being independent.

Limited access to and information from the breakaway regions of Abkhazia and South Ossetia make it difficult to accurately assess the situation, but weak rule of law and discrimination against ethnic Georgians are occurring issues. Through powerful anti-corruption reforms, Georgia managed to reduce corruption significantly in the first decade of the 21st century. According to Transparency International, Georgia went from ranking as number 124 out of 133 countries in 2003 to number 44 in 2016. Corruption has been successfully combatted at lower levels, but the problems remain in the higher levels of society, and anti-corruption efforts continue.

Progress has been made in terms of strengthening the rights of women and to combat violence against women, both by structural reforms and attitude changes. However, it is still estimated that there is a large number of unreported cases of female victims of domestic violence.

There is no similar positive trend for the situation for ethnic, religious and sexual minorities, where the government fails to protect minorities and to ensure their rights. LGBTI people, Jehovah's Witnesses and people with disabilities are among the vulnerable groups. Criticism has been directed at the police's ability to fight and prevent attacks and the state's ability to prosecute discriminatory crimes, despite the fact that there is an anti-discrimination law.

Economy and business

Georgia is rich in natural resources and has good conditions for fruit and wine cultivation as well as tourism. Agriculture employs over half of all inhabitants, but accounts for only one fifth of the country's exports.

Over the last decade, Georgia's economic growth has been relatively good, but poverty and unemployment are two of the country's biggest challenges. The recent economic development has contributed to the emergence of a slightly bigger urban middle class but many Georgians still live in poverty. According to statistics from the World Bank the share of people living in poverty has since 2006 decreased from 35 to about 21 percent. Although poverty has gradually decreased almost 10 percent of the population still live in extreme poverty.

The unemployment rate is high, especially in the major cities. Due to the low living conditions many people are absorbed by the informal sector or seek better opportunities abroad.

Since the mid-2000s, the economy has been increasingly liberalized, which has attracted more foreign investment. Georgia is now considered to have a very good business climate and ranks high on the World Bank's "Doing Business Index".

Page owner: Department for Europe and Latin America

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