Georgia's economy grows as protests persist

Tbilisians have spent the past two years marching through the capital to challenge the government's direction. Every Saturday, crowds gather in Avlabari Square and move toward parliament, chanting against the administration of Prime Minister Irakli Kobakhidze. The demonstrations mark the anniversary of the contested parliamentary elections held on October 26, 2024, which ignited the current political crisis.

The ruling Georgian Dream party, which has held power since 2012, faces accusations of growing authoritarianism. Critics point to the decision to suspend European Union accession talks as a move that pushes the country closer to Moscow. The government announced in November 2024 that it would not prioritize opening EU negotiations before the end of 2028, a stance that peaked public anger two days after the elections.

Economic data reveals a sharp divergence from the political mood. The Georgian National Tourism Administration reported that the country recorded over 5.5 million international tourist visits in 2025. This figure represents an 8.4% increase from the previous year and stands nearly ten times higher than the approximately 560,000 visitors who came two decades ago. The influx includes travelers from Europe, the Middle East, and large numbers from Russia.

The arrival of Russian nationals has significantly altered the local economy. Following the full-scale invasion of Ukraine in 2022, tens of thousands of Russian citizens relocated to Georgia. They brought capital for new businesses and exerted pressure on the property market by purchasing homes across the country. This dynamic fuels local discontent among a population that still views Russia as an occupying power, a sentiment rooted in the wars of the 1990s and the August 2008 conflict.

Prime Minister Bidzina Ivanishvili, who founded Georgian Dream in 2012, oversees this complex balance. He made his fortune in Russia during the 1990s and previously served as prime minister from 2012 to 2013. His government presides over an economy that grew by 7.5% in 2025, marking five consecutive years of expansion. However, the growth coexists with persistent issues such as unemployment, low wages, and widespread poverty in rural areas.

The geopolitical position of Georgia remains precarious. The nation is situated between Russia and Turkey, with Russian military control over Abkhazia and South Ossetia, regions that account for approximately 20% of its territory. Diplomatic relations are severed, yet economic ties remain strong through trade, tourism, remittances, and energy imports. The European Union has recently criticized the government's record on rule of law, adding external pressure to the internal standoff.