Georgia, also known as the Republic of Georgia until 1995, is a country in the Caucasus region of Eurasia. Located at the crossroads of Western Asia and Eastern Europe, it is bounded to the west by the Black Sea, to the north by Russia, to the south by Turkey and Armenia, and to the southeast by Azerbaijan. The capital and largest city is Tbilisi. Georgia covers a territory of 69,700 square kilometers (26,911 sq mi), and its 2017 population is about 3.718 million.
Georgia has a number of cave paintings and other kinds of evidence that proves the existence of the first humans outside Africa. They date back to approximately 6000 years BC. People back then used to raise animals and grow crops, which is one of the first examples of agriculture.
The Earliest Tribes
One of the earliest tribes to ever appear in history was in 12th century BC. A tribal union called Diauehi. They knew how to make tools using metallurgy techniques. They survived numerous invasions, but over the course of 1500 years, they lost their unity and were broken into different branches. Some of these branches are still part if Georgia, such as Svans, in the north, and East-Kartvelians.
That’s actually how Kartvelian languages were formed: Georgian, Megrelian, Laz, and Svan.
During the reign of Colchis on the coast of the Black Sea in the 13th century, a second tribe appeared in Western Georgia. They are known to be the first state formation in Georgia and are called Colchians; that refers to tribes inhabiting the eastern coast of the Black Sea.
From 6th to 3rd century BC, persian invaded Colchis several times, until around 300 BC, Parnavaz I founded the Kingdom of Kartli. It is also know as Iberia in Greek-Roman literature.
At the end of the 4th century BC Alexander the Great invaded Iberia and established a big Greco-Macedonian empire to the south of the Caucasus. The main language of Iberia then was changed to Greek.
During the 2nd century AD, Iberia strengthened her position in the area, especially during the reign of King Pharsman II who achieved full independence from Rome and reconquered some of the lost territories from declining Armenia. At the beginning of the 3rd century, Sassanid Persians took Albania and most of Armenia from Romans. Western Georgian state survived the invasions for more than 250 years until 562 when it fell into the Byzantine Empire.
During the 4th and most of the 5th centuries, Iberia (or the Kingdom of Kartli) was under Persian control. At the end of the 5th century, Vakhtang I Gorgasali formed an army to take Iberia back from Persians. He then named himself the King. Afterwards, the armies of Vakhtang fought against both Persia and the Byzantine Empire.
At the end of the 10th century, David of Tao invaded the Earldom of Iberia (Kartli) and gave it to his foster-son Bagrat III and installed Gurgan as his regent, who later became “King of Kings of the Iberians” on the death of Bagrat the Simple (994).
David the Builder
The struggle between Georgia and the Persian Empire went on, until in the 11th century, King David IV and his army, even though outnumbered, stood against the Seljuq Sultan Mahmud, who had declared Jihad on Georgia, and managed to defeat the Seljuq invadors at the battle of Didgori. During his reign, King David IV also conqured many other cities which are now parts of Azerbaijan and Armenia. For these heroic actions, King David IV, or David The Bulider, or in Georgian Davit Aghmashenebeli, is a true legend among Georgians.
The Golden Age
After King David IV, it was time for a Queen to rule. Queen Tamar, titled as “Mepe” (king). Interestingly, the word Mepe, meaning “Ruler” is the same for male and female in the Georgian language. The reign of Queen Tamar represented the peak of Georgia’s might in the whole history of the nation; that’s why they call it “the Golden Age”. They fought against Turks and Persians, and as a result, conquered some parts of Armenia and Iran under Queen Tamar’s command during the 12th and 13th century.
The conflicts between Georgia, Ottomans of Turkey, and the Persian Empire, have made a great contribution to what Georgia is today; especially in case of culture, language, and traditions. Turkish elements are traceable in Georgian cuisine; Farsi and Georgian languages share many similar words from Arabic or Sanskrit, and there are beliefs that are exactly the same in all the three countries.
However, there was one part of history that somehow had an even greater impact on the formation of Georgia:
Russia and USSR
In the early 20th century, Georgia, once again, found itself in war against Armenia and remnants of the Ottoman Empire, while the rapid spread of ideas of revolutionary socialism in rural regions accounted for some Soviet-backed peasants’ revolts in Racha, Samegrelo and Dusheti. In 1921, the crisis came to a head; the 11th Red Army invaded Georgia from south and headed to Tbilisi. Finally, on 25 February the Red Army took over Tbilisi and established the Georgian SSR. That was when Georgia officially became part of the Soviet Union.
Established by Vladimir Lenin, the Soviet Union, officially known as the Union of Soviet Socialist Republics (USSR), was a federal sovereign state in northern Eurasia that existed from 1922 to 1991.
The communist, socialist, anti-imperialist, and anti-capitalist ideologies of the USSR affected Georgia and its economy in many different ways.
Stalin’s totalitarian leadership resulted in forced collectivization of agriculture and enacting draconian labor legislation. They used the resources for rapid industrialization, which significantly expanded Soviet capacity in heavy industry and capital goods during the 1930s. This industrialization was primarily motivated by preparing the country for war. As a result, the USSR was transformed from a largely agrarian economy into a great industrial power, leading the way for its emergence as a superpower after World War II.
For this common goal, men from all across the Soviet nations were employed in factories to facilitate the industrialization with maximum workforce. Consequently, women took responsibility of families and had to take care of most of the jobs in cities. Here are examples of jobs women were involved:
- running shops
- running bakeries
- cleaning the streets
- educating children
- providing medical aid.
As it is still visible today, just as expected from a former Soviet Union member, most Georgian women are doing the same jobs. Most doctors, bank clerks, and teachers are women.
After a democratic election, On October 28, 1990, the nation was renamed to the Republic of Georgia. It declared independence on April 9, 1991, under Zviad Gamsakhurdia, as one of the republics to secede just four months before the failed coup against Gorbachev in August. Although a declining number of hardliners supported this, the Soviet government didn’t, and Georgia remained in the Soviet Union until its collapse in December 1991.
The Booming Economy
Since the early 21st century, positive developments have been visible in the economy of Georgia. The World Bank dubbed Georgia “the number one economic reformer in the world” because in one year, it improved from rank 112th to 18th in terms of ease of doing business. Georgia improved its position to 6th in the World Bank’s Doing Business report 2019. On the minus side, the country has a high unemployment rate of 12.6% and has fairly low median income compared to European countries.
The 2006 ban on imports of Georgian Wine to Russia, one of Georgia’s biggest trading partners, occurred. The IMF Mission described this break of financial links as an “external shock”. Also, Russia increased the gas price for Georgia. Around the same time, the National Bank of Georgia stated that ongoing inflation in the country was mainly because of external reasons, including Russia’s economic embargo.
The Georgian authorities expected that the current account deficit due to the embargo in 2007 would be financed by “higher foreign exchange proceeds generated by the large inflow of foreign direct investment” and an increase in tourist revenues.
Georgia is becoming more integrated into the global trading network. Its 2015 imports and exports account for 50% and 21% of Georgia’s GDP respectively.
Georgia is developing into an international transport corridor. The corridors are through:
- Batumi and Poti ports
- Baku-Tbilisi-Kars Railway Line
- an oil pipeline from Baku through Tbilisi to Ceyhan, the Baku-Tbilisi-Ceyhan pipeline (BTC)
- the South Caucasus Pipeline
After Saakashvili, the government has been more successful in collecting taxes. Among other things, the government introduced a flat income tax in 2004.
As of 2001, 54 percent of the population lived below the national poverty line, but by 2006 poverty decreased to 34 percent, by 2015 it is 10.1 percent. In 2015, the average monthly income of a household was about $426. 2015 calculations placed Georgia’s nominal GDP at US$13.98 billion. Today, services make up for most of Georgia’s economy, as the country is moving away from the agricultural sector day by day.
In regard to telecommunication infrastructure, Georgia is the last among its bordering neighbors in the World Economic Forum’s Network Readiness Index (NRI). NRI is an indicator for determining the development level of a country’s information and communication technologies. Georgia ranked number 58 overall in the 2016 NRI ranking, up from 60 in 2015.
Tourism is an increasingly significant part of the Georgian economy. In 2016, 2,714,773 tourists brought approximately US$2.16 billion to the country. According to the government, there are 103 resorts in different climate zones in Georgia. Tourist attractions include more than 2,000 mineral springs, over 12,000 historical and cultural monuments. UNESCO recognizes four of these as World Heritage sites. They are: Bagrati Cathedral in Kutaisi and Gelati Monastery, historical monuments of Mtskheta, and Upper Svaneti. In 2018, more than 1.4 million tourists from Russia visited Georgia.
Investment in Georgia Today
Since Georgia opened its door to investors, the government has been very liberal regarding issuing temporary and permanent residentships to people coming to Georgia to start or grow their businesses. This has contributed to the rapid economic growth in the past decade.
Georgia knows that the country does not have enough capital to invest in everything, and their biggest economic alliance, Russia, is not on good terms with them right now. So they had to trust investors from other countries to bring money to Georgia. In the past few years, a lot entrepreneurs from all over the world have come to Georgia to promote their businesses. Start-ups are growing incredibly fast, and there are so many events happening in order to help people with creativity to develop their ideas into something huge.
You don’t have to be an economist to realize that investing in Georgia is a wise decision. It takes a glimpse to what is going on in the country now to understand that tourism is growing every year. Investors from other countries have already built a lot hotels, spas, restaurants, and started numerous other businesses aimed at tourists. And this won’t stop for at least another decade.
Georgia today is developing and needs money flowing into the country, to be able to run the economy. Georgia welcomes creative ideas, big capitals for investment, start-ups, skills and abilities.