Will the Western Sanctions Damage the Economic Prosperity of Georgia?

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On July 17th, Irakli Martinenko, one of the hosts of “Alt-Info’s” program “Alt-Analytica,” discussed the possibility of the West imposing sanctions on Georgia. According to Martinenko, Western sanctions will not have a significant impact on the Georgian economy since Georgia is not exporting any of its products to the Western markets and does not benefit from other economic goods of the West. The host claimed that the imposition of the sanctions would only harm pro-Western media outlets, political parties and non-governmental organizations. Still, it would not affect the overall economic situation of the country.

The claim of Irakli Martinenko, as if Georgian products are not being exported to the Western markets, is disinformation. The proclamation that the termination of the financial support from the Western partners will not have a negative impact on the Georgian economy and the overall prosperity of the population is also false.  In reality, the financial support provided by the EU and the United States is aimed to promote the critical spheres of sustainable development (economics, entrepreneurship) and is being allocated through the state budget and various other programs and projects.

  • The claim that Georgian products are not exported to the Western markets is disinformation

According to the National Statistics Office of Georgia, the overall share of US and EU exports over the last ten years varied between 23% and 33%. For comparison, the share of the exports to the Russian Federation during the same period was between 1.7% and 14.5%.
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As for the first two quarters of 2021, the share of exports to the EU and EU amounts to a total of 20.54%. It is worth mentioning that since September 1st, 2014, most of the tariffs and barriers have been removed for most of the exported products.

  • Financial support of the West is being Allocated in Various Ways

The claim that the financial support received from the West is only used to benefit small sections of the Georgian society, i.e. media, political parties and non-governmental organizations, is also false. In reality, the financial aid of Western partners is used to develop various spheres in the country:

The European Union supports rural development and agriculture in Georgia through ENPARD, the European Neighborhood Programme for Agriculture and Rural Development. Implemented in 2013, the main goal of the ENPARD programme is to reduce rural poverty. Programme assistance is provided to the government and also to NGOs working directly with communities on the ground. The total budget for ENPARD in Georgia, covering the period of 2013-2022, is € 179.5 million. Through the ENPARD programme, the European Union aims to build capacity and support government institutions in the reform of the agriculture and rural development sector, improve employment and living conditions of rural populations and promote diversified social and economic opportunities in rural areas, particularly for women and youth. In addition, within the framework of the Association Agreement (AA), various other agricultural projects are being carried out in Georgia. For more on the topic, see our article:

The DCFTA Facility Programme is created for Georgia, Moldova and Ukraine and is aimed to support small and medium-sized enterprises and has a total budget of 200 million Euros. Via this program, EBRD granted the Bank of Georgia the first tranche of USD 50 million USD. This programme will facilitate access to finance for Georgia’s private sector to help companies fulfil the DCFTA requirements and reequip factories with appropriate standards. More than 12 different EU-funded programs are now being carried out in Georgia to support economic growth and business development.

Not to mention, the EU has provided macro-financial assistance to Georgia several times in the past to deal with budgetary and financial needs. The Georgian treasury has received financial support from the EU in the form of grants and soft loans first in 2018 in the amount of 45 million Euros, up to 35 million Euros of which was allocated as a soft loan and up to 10 million Euros as a grant. Georgia has also received a significant amount of financial support from the EU in 2020 to deal with the social and economic implications of the coronavirus pandemic. In spring 2020, EU countries allocated a total of 250 million Euros to Georgia. For more on the topic, see:

The financial support revived for the US is even more significant, most of which are aimed at strengthening entrepreneurship, agriculture, infrastructure, public health sector, defence, education, human rights protection, conflict resolution and more. During 1992-2020, Georgia has received 4,348,400,000 dollars in the form of financial assistance. For 27 years, only through the United States Agency for International Development (USAID), the EU has assisted Georgia with more than 1.8 billion dollars. Every year, the US government allocates around 40 million dollars to support at least 50 large-scale programs aimed at aiding the democratic development of Georgia, its strive for the free market economy and building the pro-Western society.

Myth Detector has been writing about the type and amount of US assistance even before. For more details, see our articles:

The topicality of Imposing Western Sanctions on Georgia

The statements regarding the possibility of the West imposing sanctions on Georgia appeared after the violent events of July 5th and the non-compliance to the international requirements set for the judicial body. These actions were followed by harsh responses from Brussels and Washington. Even though the word ‘sanctions’ was never mentioned during the EU statement of July 13th, several hints were made regarding the termination of the financial support.

On July 16th, the US State Department and the Secretary of State, Antony Blinken, condemned the violation of the April 19 agreement (i.e. Charles Michel Agreement) by the Georgian government. After the harsh statements of Washington, US ambassador Kelly Degnan stressed that in case of not fulfilling the demands of the April 19 agreement, “sanctions can be one of many tools available.”


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Violation: Disinformation
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