View of the Georgian capital Tbilisi

Georgia Connecting point between Europe and Asia

Although Georgia was for a long time part of Russia, and subsequently the Soviet Union, the country managed to preserve its cultural identity, including its own language and its own alphabet. For a long time, the republic also did well economically – until the breakup of the Soviet Union, which led to economic collapse in Georgia.

Starting in the mid-1990s, the economy experienced a strong recovery. Since then, however, the country has repeatedly been shaken by new crises.

Territorial conflict

One unresolved issue is the territorial conflict surrounding Abkhazia and South Ossetia. These two regions are striving to achieve independence from Georgia, and are being supported by Russia in this endeavour. In August 2008, the conflict escalated temporarily into war between Russia and Georgia. Since then, diplomatic relations between the two countries have been suspended.

While Georgia has largely recovered from the aftermath of the war and the impacts of the global economic and financial crisis, large sections of the Georgian population continue to suffer from poverty, underemployment and unemployment.

Cooperation with Germany

Since the collapse of the Soviet Union, Germany has been actively engaged in helping to stabilise the South Caucasus region (Georgia, Armenia and Azerbaijan).

Georgia is one of the countries supported by Germany through thematic and regional programmes. Through its South Caucasus Initiative, the German government is making an active contribution to the process of political, economic and social transformation in Georgia and its neighbouring countries. The development cooperation programme focuses on sustainable economic development; environmental policy, the protection and sustainable use of natural resources; and democracy, civil society and public administration.

People in the Freedom Square of the Georgian Capital Tbilisi during the Rose Revolution in October 2003

Enhancing democracy and the rule of law Internal link

Since regaining independence in 1991, Georgia has been faced with both internal and regional challenges. The democratisation process was hampered by nepotism, corruption and electoral fraud.

Settlement for internally displaced persons in Saguramo, Georgia

High unemployment rate Internal link

Due to the Abkhazia and South Ossetia conflicts, there are more than 250,000 internally displaced persons in Georgia. Their displacement is exacerbating poverty in the country, which is already severe.

Georgia: A farmer repairing a combine harvester

Strengthening the agricultural sector Internal link

The government's efforts to liberalise the economy and build a more enabling environment for private enterprise have won international recognition.

A court building in Tbilisi

Partnership with Western countries Internal link

Georgia is seeking partnership with Western countries. The country is very interested in joining NATO and, in the longer term, accede to the EU.

European Monitoring Mission in Georgia (EUMM)

Suspended diplomatic relations Internal link

Russia's support for the breakaway Georgian territories of Abkhazia and South Ossetia is putting enormous strain on the relations between Tbilisi and Moscow.

German development cooperation with Georgia

In the field of bilateral development cooperation, Germany is Georgia's second largest bilateral donor, after the US. At the Georgian-German government consultations in August 2017, development projects worth a total of up to 272.9 million euros were agreed. Most of this funding (up to 218 million euros) is being provided in the form of loans.

Cooperation with Georgia is part of the BMZ's regional approach to the South Caucasus, which in turn has been closely aligned with the European Neighbourhood Policy. Since 2018, cooperation has focused on the following priority areas:

  • Sustainable economic development
  • Environmental policy, protection and sustainable use of natural resources
  • Democracy, civil society and public administration
An employee of a wine testing lab in Tbilisi is testing the quality of Georgian wines.

Financial products for small and medium-sized enterprises Internal link

Following the disintegration of the Soviet Union, industry in Georgia was in a state of collapse. Economic recovery was chiefly led by micro, small and medium-sized enterprises (MSMEs). Today, they account for 90 per cent of all businesses in Georgia.

National park in Georgia

Promoting renewable energy, setting up national parks Internal link

With German support, the capacity of the Georgian energy sector has been increased significantly in recent years. Cooperation now focuses on boosting energy efficiency and promoting renewable energies.

Citizens' office in Telavi, Georgia

Making headway on democratisation Internal link

In Georgia, the development of democratic and market-based institutions has advanced significantly in recent years. Germany's development cooperation is helping to accelerate this process.