On 1-2 February, Yaroslava Babych, head of Macroeconomic Policy Research Center participated in an international forum – “The Prospects of Georgia’s Democratic and Economic Development” organized by the Institute for Development of Freedom of Information (IDFI), in partnership with the University of Bremen and with the financial support of the Federal Foreign Office of Germany.

Prime Minister of Georgia, Giorgi Kvirikashvili opened the Forum. The Ambassador of the European Union to Georgia – Janos Herman, German Ambassador – Bettina Cadenbach, and Director of IDFI – Giorgi Kldiashvili, also delivered a speech during the opening ceremony of the forum. Each day of the forum was divided into two panels that include the following topics: (1) Georgia’s European and Euro-Atlantic Aspirations, (2) Main areas of EU-Georgia Partnership, (3) Georgia’s Economic Development, and (4) Georgia’s Democratic Development.

Prof. Babych spoke of the challenge of inclusive growth in Georgia. Her main thesis was that while Georgia enjoyed quite impressive economic growth in the last decade (6.2% on average from 2003-2014), a sizable part of the population remained stuck in low productivity, low-paying jobs, and unemployment close to 14% on average. According to the data, currently, about 60% of the employed Georgian population are "self-employed", earning only about 17% of the GDP – a huge gap implying low levels of labor productivity.

One of the main factors standing in the way of "inclusive" growth is the low quality of primary and secondary education in Georgia. Mathematics, science, and reading comprehension scores are quite low by international standards, suggesting that a big chunk of the population has not acquired even the basic skills level needed on the modern labor market.

Unless the problems in the educational system are solved, Georgia cannot hope to attract the kind of investments that would ensure sustainable growth in the long term.

The forum took place at Tbilisi Courtyard Marriott Hotel and was the concluding event of the project – “Strategic Plan Georgia 2020 – Strengthening Public Involvement (ZigB)”.