ISET Economist Blog

Erekle II – The Tragedy of an Enlightened King
Saturday, 21 September, 2013

Few events in Georgian history had consequences that were as far-reaching as the infamous Treaty of Georgievsk of 1783. At the end of the 18th century, Erekle II. (1720-1798) handed over his kingdom of Kakheti and Kartli to the Russians, aligning the fates of Georgia and Russia for the next two centuries. In the middle of what today is called the Age of Imperialism, when European countries, including Russia, were dividing the globe among themselves, Georgia was offered to Catherine the Great on a plate. Of course, she did not reject.

Being a colony of European power was an ambivalent experience for every country. Yet the people that fell victim to British and French imperialism often made leaps in development. Still today, most of the railways in Africa and many in India were built by the Europeans, and even some of the ships that are operating on African rivers today are relics of colonial times. On the other hand, many scholars attribute the weak institutions and the deficient economic development experienced by most former colonies to their past subjection to foreign rule.

Being a colony of Russia, however, was a particularly traumatic affair. First of all, Russia itself was an agricultural society. It could not export the technological and political innovations of modern times to its colonies, because Russia had not acquired them itself. While colonization, in general, had ambivalent effects on the development of society, Russian colonization was only detrimental. Secondly, while Western European powers abandoned their colonies in the first half of the twentieth century, until 1990 the Soviet Union, more or less identical with Russia, kept a tight grip on the people is suppressed. Economically, the forced membership in the Soviet Union was obviously disastrous. It is very likely that the Georgians would not have to deal with the economic problems they are facing today if they had not been the Socialist Soviet Republic for almost 70 years. Finally, while the Western Europeans today are remorseful about their history and show guilty conscience towards their former colonies, the Russian leaders only feel remorse that their empire broke down. Russia revealed its attitude towards its former colonies quite openly when it invaded Georgia in 2008.


Erekle arguably underestimated what it meant to invite the Russian Bear to his kingdom, and probably he did not expect his decision to have consequences that reached into the 21st century. Nonetheless, he well understood that Russia was a dangerous ally, and he tried hard to instead get the French on board. To that end, in 1763 he fully rehabilitated the Georgian Catholics, who had previously been subject to legal discrimination. Yet this was to no avail. In the second half of the 18th century, the French Kings were absorbed by the turgescent problems in their own country (that would soon sweep them away), and they could not divert any resources to defend remote Georgia against the Persians.

The legitimacy of the Bagrationi rule was challenged because the king hardly managed to protect its citizens against the Persians, pushing against the southern borders, and the Dagestanis, frequently raiding the North of his kingdom. In this situation, Erekle initiated farsighted reforms, trying to strengthen Georgia’s economy and in this way ensuring its independence.

However, the modernization of Georgia under Erekle’s rule started under the most unfortunate circumstances. He inherited from his forerunners a feudal society with a closed economy, almost entirely based on agriculture. The kingdom was devastated by numerous wars and the mentioned forays of Lezgin clansmen from Dagestan into Georgia (the dreadful Lekianoba). Georgia was not only lacking production of non-agricultural goods but due to the many wars, its labor force was heavily strained. Certainly, Erekle was fighting uphill.

In the 18th century, the situation of the aristocracy was precarious in many European countries. Unlike in Georgia, elsewhere in Europe, the threats against the feudal system were internal rather than external, but the problems of the nobility were similar. Most rulers reacted with oppression and tenaciously clinging to their privileges, and just a few were “enlightened monarchs” like Prussia’s Frederick the Great. Erekle, however, clearly belongs to the category of those who adopted an approach of reformation and renewal. These efforts are almost forgotten by today’s Georgians, as his fatal decision to ally with the Russians overshadows his entire rule.


As the only entity commanding substantial amounts of capital, the government directly set up a number of economic operations throughout the country. The Topxana, a weapons factory, was erected, and the Zarapxana was established, engaging in the production of gold and jewelry. Erekle also founded a printing house. The most innovative feature of all these activities was that instead of relying on compulsory labor of the kingdom’s citizens, Erekle employed a paid labor force. This greatly improved the motivation of the workers, raised the living standard of the people, gave incentives to invest in human capital (as many of the mentioned activities involved skilled labor), and led to a dispersion of capital in society.

When the Georgian population, decimated by wars and crises, did not have the potential to carry out the ambitious economic plans, Erekle relied on foreign expertise and manpower. On the king’s initiative, 800 Greek miner families were persuaded to move to Georgia and revive the mining industry of the country, traditionally rich in gold and silver. Furthermore, the king obliged his nobility to divert peasants of their fiefdoms from agricultural work and allocate them to the mines. In this way, he created a “working class” in the 18th century, a fairly large group of people not employed in agriculture. A letter of the king has survived to our days in which he speaks about the importance of a skilled labor force for the economy as a whole, a goal for which he considered the mining industries instrumental. Moreover, in the letter, he states clearly that the only way in which his kingdom could survive was economic strength. Unfortunately, Erekle’s enemies understood this as well – when in 1795 Mohammad Khan Qajar invaded Eastern Georgia, he destroyed all mines and killed all workers, among them 700 Greek miners.

Like David the Builder 600 years earlier, Erekle tried to attract foreign merchants with favorable conditions. As mentioned before, he tried to allure the French by upgrading the status of Catholics, and he engaged in correspondence with French traders to convince them to include Tbilisi in their main trade routes connecting East to West. Unfortunately, the hope for comprehensive economic cooperation with the French was disappointed.

Erekle signed the “Manifesto dedicated to Armenians” (მანიფესტი სომხებისადმი), promising them that they would enjoy the same “respect and love” of the king as the native Georgians. He convinced a wealthy Armenian merchant, comparable to a billionaire of today, to relocate from India to Georgia by offering him the noble status of Tavadi.

When the East-West trading route of French merchants did not materialize, Erekle switched to the goal of turning Tbilisi into a regional center of the Caucasus that would connect Russia and Persia. To that end, in 1750 he opened the so-called “Ossetian Passage” (ოსეთის გზა). For making this dangerous road attractive for traders, the government guaranteed its safety. He also capped the tolls the nobility was allowed to take from travelers on this road, making it cheaper compared to other North-East routes.

King Erekle abolished the state monopoly on alcoholic beverages and leased out the right to trade with salt and tobacco to private entrepreneurs. As part of the economic activities of the government, all raw tobacco grown by the citizens was collected in Tbilisi, processed in a state factory, and sold afterward to those merchants who had acquired trading rights.

In the end, all this did not help. The country was too weak to remain independent, and Erekle was forced to sup with the devil. Faced with the choice to make a pact either with greedy Russians in the North, who were Orthodox Christians or with less imperialist but more aggressive Persians in the South, who were Muslims, he opted for the Russians. How would you have decided?

The views and analysis in this article belong solely to the author(s) and do not necessarily reflect the views of the international School of Economics at TSU (ISET) or ISET Policty Institute.