New ADB Country Strategy to Expand Trade, Drive Economic Growth in Georgia
TBILISI, GEORGIA (23 August 2019) — The Asian Development Bank (ADB) has today endorsed a new Country Partnership Strategy (CPS) for Georgia.
The 5-year partnership strategy, from 2019–2023, supports the Government of Georgia’s overall development strategy to increase productivity and reduce poverty through closer economic integration with its neighbors and the rest of the world.
The new CPS will focus on expanding trade, creating jobs, and combating poverty through the development of economic and transport corridors in Georgia and for Central and West Asia. It will also strengthen the country’s private sector and support the government’s emphasis on market-driven growth by further developing an enabling business environment and skills among the labor force.
Located at the crossroads between Asia and Europe, Georgia is well-positioned to take advantage of its strategic location. The country has over 30 free trade agreements with its major trading partners, attracting high levels of foreign direct investment. In 2018, Georgia’s economy grew by 4.7%. Yet a high unemployment rate, especially among young people, and a persistent current account deficit caused by low productivity has prevented the country from achieving its full potential. Helping the government address these issues is a key focus of the new CPS.
“We are delighted to continue our strong partnership with the Government of Georgia to help develop the country and improve the lives of its people,” said ADB Country Director for Georgia Ms. Yesim Elhan-Kayalar. “The priority of our new country partnership strategy is to further develop the country’s openness to the global economy as a means to drive growth and reduce poverty. We will do that through our support for regional cooperation and integration, trade facilitation, the development of transport and economic corridors, improved infrastructure, more livable cities, a better trained workforce, and institutional reforms and business development to support the private sector.”
ADB’s sovereign lending to Georgia to support the new CPS is projected to reach over $2 billion over five years, supplemented by the mobilization of additional cofinancing from development partners. This includes support for three flagship projects of the government: the development of the East–West and the North–South transport and economic corridors, and the Anaklia Deep Sea Port and Special Economic Zone. These projects are critical for Georgia’s goal of becoming a regional hub through increased connectivity and trade, opening the landlocked markets of Armenia and Azerbaijan, and extending the Central Asia Regional Economic Cooperation corridors to the Black Sea and Europe.
In parallel with the development of transport corridors, the new CPS will support the government’s vision of connecting them to local centers of economic activity, major tourist destinations, and the rural population engaged in agricultural production. Priority will be placed on creating livable cities that offer prime business, logistics, and investment destinations that will drive economic growth and job creation.
“The ultimate objective of the new CPS is to help develop the Caucasus as a gateway to the world and complement other regional cooperation initiatives in neighboring countries. The CPS is fully aligned with the Government of Georgia’s development strategy—Freedom, Rapid Development, Prosperity: Government Platform 2016–2020—and ADB’s Strategy 2030, both of which call for closer regional cooperation and integration,” said ADB Director General for Central and West Asia Mr. Werner Liepach.
ADB has supported Georgia since 2007 and is one of the country’s largest multilateral development partners. Sovereign and nonsovereign loans to Georgia to date total about $2.8 billion.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to $21.6 billion. Established in 1966, it is owned by 68 members—49 from the region.