In recent years, the Republic of Georgia has experienced rapid growth which, prior to the onset of the COVID-19 global pandemic, had been expected to continue. During this period, however, the Government has pursued a package of neoliberal policies that, unless they are accompanied by an equally strong push for comprehensive social security, are unlikely to usher in the inclusive growth it seeks. The Government has, though, recognised the importance of investing in social protection for an inclusive growth agenda in its strategic economic development plan, and that the general increase in average incomes has also been partly driven by social transfers.
Thanks to the combination of growth and investment in social protection, Georgia has made impressive progress in tackling poverty. The overall decline in poverty over the past decade can largely be attributed to a general increase in real incomes across rural and urban areas. However, the gains have not been equally shared – overall, inequality remains high by regional standards. As an upper-middle-income country with ambitions to align more closely with Europe and eventually join the European Union, the time is ripe for Georgia to deepen its commitment to inclusive social protection. A progressive and ambitious nation should aim not only to tackle poverty but also to offer the majority of its citizens the opportunity to realise their aspirations to lead more productive and secure lives.
Development Pathways has supported the ILO, and its partner UN Women, to complete a general assessment of the social protection system in Georgia. The assessment (carried out during the onset of the COVID-19 pandemic in 2020) was undertaken from a lifecycle perspective and in reference to international experiences, as well as to social security standards and conventions. This report finds that Georgia’s system already performs relatively well, largely driven by the impacts of the old-age pension on poverty and inequality. However, key gaps in social protection provision remain, particularly for children and people of working age. It reiterates the importance of national social protection floors to protect people from risks across the lifecycle and covariate shocks, and explores scenarios for expanding Georgia’s existing system and their potential costs.