Georgian economy: crisis and prospects

The Georgian economy is in a difficult situation currently. The world crisis has seriously affected it. However the Russian aggression has made the crisis even more dramatic. Under the current circumstances it is very important to find an appropriate strategy for overcoming the difficulties.

Many politicians have criticized the Government over its statistics. They consider the figures it presents are unreliable and are just there to comfort the authorities. Former MP and leader of the Industry Will Save Georgia Party Zurab Tkemaladze thinks that the statistical department is not fulfilling its duties properly and only disseminating figures which the authorities have demanded are published. Former Minister of Economy and MP Lado Papava thinks that the inflation statistics are not accurate. Officially inflation is around 6-7%. Nobody will trust these figures except the Government, says Papava, pointing out that in November inflation was officially 6.3% but in reality at least three times higher.

The country’s leadership tries to present the dire economic situation as the product of the Russian aggression and world crisis. Independent analyst Niko Orvelashvili, now in opposition, thinks that the current situation is the result of unwise economic policy implemented by the ruling administration. He says that maybe the global financial crisis to be blamed for 20-30% of it but Saakashvili’s economic policy failures are 70-80% responsible. Saakashvili considers that the Government’s attitude to business and the racketeering which became state policy are the cause of economic hardships.

Economic analyst Gia Khukhashvili thinks that there is no progress-compatible situation in the country and many changes need to be implemented in the tax code to make it more attractive for businesses to trade in Georgia. Former President of the NBG Nodar Javakhishvili thinks that if the country’s leadership conducts an adequate policy over the next three years we could become a more attractive country and in 5-6 years very successful. According to Javakhishvili the country needs patriots and good professionals. It is hard not to agree with such a statement and the sentiments behind it.