ISET

This paper analyses income distribution and poverty reduction in Georgia in the period 2010 to 2017/2018. As we have no data for 2019, our findings do not relate to the most recent distributional policies of the Georgian government.

Our results suggest that while Georgia has substantially reduced poverty and income inequality, continuous monitoring of the situation would be helpful.
Main findings are:

• Georgia has made significant progress in poverty reduction, almost halving the poverty rate to 16% during 2010 to 2015 (using the World Bank measure for lower middle-income countries). However, poverty did not decline further from 2016 to 2018 and remains high when compared to peer group countries.

In the past several months the world has been rocked by profound economic and social turbulence. The COVID-19 epidemic has forced many countries around the world into widespread emergency lockdowns. Economic activity plunged dramatically in February-March 2020, with rapid indicators showing strong contractions in retail, restaurant business, and passenger transport. The scale of the imminent economic fallout is not yet known, but early expert opinions suggest that the economic shock may be even more dramatic than during the 2008 global financial crisis. Under these circumstances, it seems impossible to think of any kind of economic policies except those related to the epidemic and the means of combatting its fallout. Yet, some policies, particularly those that have long-term economic consequences for the country, deserve our attention even in these turbulent times. Among them are the larization policy
measures initiated by the National Bank of Georgia in June 2016.

As the novel coronavirus COVID-19 outbreak continues to spread around the world and has been declared a global pandemic by the World Health Organization, the next global economic recession is no longer an “if” or even a “when” event. Unfortunately, it is already upon us. In just the past few days:

• Stock market indices have continued to exhibit high volatility, rallying one day and plunging at a record pace the next;

• Companies around the world are shoring up cash, as they start to fear for their liquidity;

• Countries have adopted drastic measures to limit outside travel and social interactions;

• Health systems in the most afflicted countries are strained to near breaking point;

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