Georgia is located between Europe and Asia and has become a crucial junction for trade flows across the two regions. Since the country’s political independence from the Soviet Union, the government has made a considerable effort to increase funding to social sectors and improve the transparency of public expenditure. While the country has made significant strides in recent years regarding human development, Georgia’s poverty rate continues to impede further development.
In 2015, about 20.1 percent of the population of Georgia was recorded as living below the poverty line by the Asian Development Bank. While the country has also experienced significant economic growth over the beginning of the 21st century, it has failed to translate it into equal wealth. Income disparities exist in pockets across the nation. As the country continues to urbanize, large differences between rural and urban areas continue to exist.
Those living in rural Georgia earn much of their income through the agriculture sector. Only 27 percent of rural dwellers earn their income through salaried work and 28 percent of rural incomes come from social payments. As the country’s agriculture production has become stagnant in recent years, much of the poverty today can be attributed to the agricultural sector which tends to account for around 45 percent of rural household income.
Georgia’s poverty rate also tends to be impacted by household sizes. Households with children have higher chances of falling into poverty than those without children. In rural areas of Georgia, around half of the children live in poverty, which is significantly greater than in urban areas.
In Georgia, one in every five children lives in poverty and one out of six live at the minimum subsistence level, according to UNICEF. These children that live in poverty also experience less educational opportunities than their peers living in wealthier families. The UNICEF representative of Georgia, Laila Omar Gad, professes that “We need to invest more in reaching the most vulnerable children, or pay the price in slower growth, greater inequality, and less stability”.
While large pockets of poverty remain, Georgia’s poverty rate has decreased by 14.4 percent in only four years, between 2010 and 2014. This result is partially due to the increase in the employment rate of those living in poverty from 50.7 percent to 56.6 percent over the same period.
Improving living conditions through economic activity has proven to reduce poverty in the country and should continue to be a tool to improve the living conditions for the people of Georgia. The World Bank Group has noted that the fiscal policies, inclusive economic opportunity creation and the deeper analysis of the rural economy all have driven the poverty reduction in Georgia.
To continue on the path toward development, Georgia must continue to engage in poverty alleviating policies while also working to ensure equal opportunities for all.
– Tess Hinteregger