The August Conflict | Economic Impact on Georgia?
Tbilisi radar, destroyed by a Russian missile
In Georgia, attention now turns towards sorting out the impact of the short August conflict. How plausible is the reporting we are seeing? Do the journalists get it right?
Here's one account by the New York Times, outlining some of the damage and the upcoming challenges.
Click here for the complete article (access is free, but it will require you to register; we can make the article available to you directly as well).
Posted on an e-mail newsgroup focusing on Georgia, this NYT article quickly drew a response. Here is what (Dr.) George Welton, a consultant we have worked with extensively and who has done various research projects in Georgia, had to say:
"This is sufficiently fishy to warrant comment. First, ‘Caucasian Tiger’ gimme a break. As far as I could tell before the war the economy was vastly overheating with an inflated property market and a banking sector expanding way too fast (is there any other city in the world with this many ATMs?) But more importantly, Georgia was still not really producing anything that the world wanted to buy. Two of its largest exports – manganese and copper – have increased their revenues dramatically largely because of the price of resources going up on world markets and agriculture has still not recovered from the Russian market closing (wine is now exporting at about 40% its pre-ban levels – not allowing for inflation). But now everything wrong with the Georgian economy is going to be blamed on the war.
That said, I think that the war damage melodrama is vastly unhelpful.
1/ I don’t really buy this claim of $50 million repair costs for Caucasus Online. Can anyone verify this happened? I know people who were emailing, texting and skyping throughout the war – and there are lots of reasons why a business might want to exaggerate its losses. I have a feeling a lot of Georgian businesses might find they had things hit by the Russians in coming weeks.
2/ The tourist season has been damaged but ‘Russian tourists?!’. The Armenian tourists (who have to be the vast majority of the Georgian tourist market) will be back next year.
3/ There is no evidence that the fire outside of Borjomi National Park was started with incendiary bombs. The 950 hectares (just under 10 square kilometres) was almost entirely outside the park (the revised Gvt figures put 150 hectares in the park) and even if it had all been in the park, this is only slightly more than 1%. Borjomi did not ‘burn’.
4/ The idea that the Russians targeted infrastructure or that they might in the future is completely unsupported by the evidence. One train bridge (right next to another train bridge which almost immediately replaced it) was destroyed. None of the key infrastructure (Inguri dam, the BTC pipeline, the ports etc) were damaged significantly.
5/ The banking system survived without banks closing their doors for a significant time and in spite of the fact that there was a war. This is remarkable and while I am sure it will continue to need support, I think this should be seen as a sign of the strength of the Georgian economy, not its weakness.
6/ One billion infrastructure losses?!? – I guess he must be talking about the military (which still seems a little implausible)
The reason why this matters is that where the article is right is that the key damage to this country is investor confidence. Foreign aid might get the Georgian budget through the next two years or so – but after that if investors don’t start to come back then the country is really in trouble. And talking about the horrendous damage and huge risks that Russia poses to the country are not going to help that confidence return.
So far George Welton's comments. Any views?
Interview by Dustin Gilbreath
By: Dustin Gilbreath
CRRC’s third annual Methodological Conference: Transformations in the South Caucasus and its Neighbourhood
შიდა მიგრაცია საქართველოში: რა ვიცით მის შესახებ CRRC-ის კავკასიის ბარომეტრის მონაცემების საფუძვლეზე?არსებული შეფასებების თანახმად, მსოფლიო მასშტაბით შიდა მიგრანტთა რაოდენობა ბევრად აღემატება საერთაშორისო მიგრანტთა რაოდენობას. სამწუხაროდ, საქართველოში ძალიან ცოტა მონაცემი არსებობს შიდა მიგრანტების რაოდენობისა და მათი გეოგრაფიული განაწილების შესახებ. საქართველოს სტატისტიკის ეროვნული სამსახურის შინამეურნეობების ინტეგრირებული გამოკვლევები რეგულარულად აგროვებს ინფორმაციას ქვეყანაში შიდა მიგრაციის შესახებ. სახელმწიფო სერვისების განვითარების სააგენტო კოორდინაციას უწევს მოსახლეობის რეგისტრაციას საცხოვრებელი ადგილის მიხედვით.
By Till Bruckner
By Nino Zubashvili
By Dustin Gilbreath
From environmental catastrophe to violence, our world currently faces serious challenges with long-term consequences. In this context, what do people in the Caucasus consider to be the most acute problems?
In terms of the business findings, CRRC's Media Survey (undertaken in September/October 2009) generated extensive data that is available to help media make good business decisions. One recent presentation, summarized here, focused on showing the diversity of data that is available.
Food Safety in Georgia: views from retailers, producers and consumers in Tbilisi and Samtskhe-Javakheti
Book Review | The Post-Soviet Wars: Rebellion, Ethnic Conflict and Nationhood in the Caucasus | Christoph Zürcher
Brookings Index of Regime Weakness | State Rebuilding or State Collapse in the Caucasus | The Annals of Data
Here are some basic tips and tricks we found useful.
Book Review: Georgia Diary: A Chronicle of War and Political Chaos in the Post-Soviet Caucasus | Thomas Goltz
Visa liberalization: How much do people in Georgia know about the conditions of visa-free travel to the EU?
CRRC’s previous blog posts have shown that the population of Georgia had rather moderate expectations of the recent visa liberalization with the Schengen zone countries, especially when it comes to the question of how much ordinary people will benefit from it. Europe Foundation’s latest survey on Knowledge of and Attitudes towards the European Union in Georgia, conducted in May 2017, provides a more nuanced understanding on how people in Georgia feel about this process and to what extent they are familiar with the conditions of visa liberalization.
Taking partly free voters seriously: autocratic response to voter preferences in Armenia and GeorgiaDo voters in less than democratic contexts matter or are elections simply facades used to create a veneer of democratic accountability for domestic and international actors? Within the Autocratic Response to Voter Preferences in Armenia and Georgia project, funded by Academic Swiss Caucasus Net, CRRC-Georgia and CRRC-Armenia aimed to help answer this question, at least for Georgia and Armenia. On October 27, Caucasus Survey published the results of the project in a special issue, available here.
What are young people’s values and how are these different from older generations’ values in Georgia?As Georgian society is going through social and cultural changes, it is important to understand people’s beliefs and values. Comparing the values of young people to those of the older generations is also important. This blog post summarizes the findings of a study that examined the values of young people aged 18 to 25, and analysed how these values are different from the values of older people in Georgia, based on both quantitative (World Values Survey, 2014) and qualitative data (40 in-depth interviews conducted in 2016). The study looked at values, perceptions, attitudes and tolerance towards different minority groups in Georgia. It concludes that in many cases, the younger generation shares more modern views and values, while the older generations are more inclined to support traditional values and hold conservative points of view.
In the December 2017 CRRC/NDI survey, pollution was the second most commonly named “infrastructural” issue, with 23% of the population choosing it in the respective show card. Only roads were named more often, by 33%. Approximately equal shares of men and women named pollution: 25% of women and 20% of men; similarly, there was no difference in the frequency of naming this issue by age.
The Caucasus Barometer survey regularly asks people, “Which of the following statements do you agree with: “‘People are like children; the government should take care of them like a parent’ or ‘Government is like an employee; the people should be the bosses who control the government.’” Approximately half of the population of Georgia (52%) agreed in 2017 with the former statement and 40% with the latter. Responses to this question have fluctuated to some extent over time, but overall, attitudes are nearly equally split.
2018 წლის საპრეზიდენტო არჩევნები, განსაკუთრებით კი — მეორე ტურში დატრიალებული მოვლენები შესაძლოა, ქვეყნის დემოკრატიული განვითარების გზაზე უკან გადადგმულ ნაბიჯად ჩაითვალოს. პირველ და მეორე ტურებს შორის მთავრობამ განაცხადა, რომ არჩევნების შემდეგ დაახლოებით 600 ათასამდე მოქალაქეს ვალებს ჩამოაწერდა, რაც, ზოგიერთი დამკვირვებლის აზრით, ამომრჩეველთა მოსყიდვად უნდა ჩათვლილიყო...
But what do people want?
Georgians are enthusiastic in supporting the country’s accession to the European Union. Since 2012, when the National Democratic Institute (NDI) and CRRC-Georgia started tracking attitudes, three quarters of Georgians approved of the government’s goal of joining the EU, on average. What motivates Georgians to support the Union, or alternatively, to abandon support? A survey experiment included in the latest CRRC/NDI poll suggests potential economic burdens have a modest yet significant effect on support for membership. Results do not support the common belief that a potential military threat from Russia dampens Georgians’ support for the EU.
CRRC-Georgia investigates who is more susceptible to Russian-pushed conspiracies surrounding Georgia’s US-funded Lugar Centre.
In Georgia, a conspiracy about the US-funded Richard Lugar Centre for Public Health Research in Tbilisi has recently gained traction. As CRRC-Georgia’s USAID-funded research shows, Georgia’s far-right groups eagerly picked up on this conspiracy and blamed the centre for the seasonal flu outbreak in early 2019.