The Government of Georgia Policies Impacting Inequality

Friday, 3 July 2015: 10:15 AM-11:45 AM
CLM.B.06 (Clement House)
Maia Margvelashvili, Tbilisi State University, Tbilisi, Georgia
There are pretty much different definitions, who are the rich in contemporary societies and where does their wealth come from. According to the World Top Incomes Database, a household income of about $113,000 lands you at the top 10th, while $394,000 makes you a bona fidemember of the 1 percent; Prof. Bill Rubinstein, an expert on the history of the wealthy, thinks annual earnings of £250,000 is the cut-off point today; etc. But we suppose, it’s more important to find ways for reducing existing inequality, in particular, poverty alleviation within contemporary societies. 20% of global population lives on less than $1 a day and nearly 50% on less than $2 a day.

Research goal was to find what activities are conducting by Georgian Government for above purposes. More than 500 thousand Georgian citizens (11% of total population) were receiving “subsistence allowance” from the Government in 2013. Total unemployment in the country reached 15% (IMF). Situation is more complicated by the inflation and national currency (Lari) exchange rate recent sharp reduction. For reviving economy, along with other relevant activities on October 2014 Georgian Government emphasized the importance of restoration of the Great Silk Road, noting that Georgia is ready to contribute to this cause and took the initiative of the Forum of the Silk Road in 2015 aiming “the transition from discussion to action”.

The Silk Road Tourism Action Plan recommended by the UN World Tourism Organization that emphasizes the extensive opportunity for developing sustainable tourism along the Silk Road. It seeks to revive the historic routes as a tourism concept fitted to the globalized age we live in. Based on proposed Roadmap we developed a comprehensive Silk Roads Heritage Corridor in Georgia, capital assets of which has enormous value to the tourism industry - culture, art, music, landscape, wildlife and climate (including World Heritage Sites);. Practice show that tourism is better placed than many other sectors in relating to the needs of the poor. There are a number of reasons for this: Tourism is labor intensive, which is particularly important in tackling poverty; It creates opportunities for many small entrepreneurs and is an industry in which start-up costs and barriers to entry are generally low; Tourism provides not only material benefits for the poor but also cultural pride, greater awareness of the natural environment and its economic value; The infrastructure required by tourism, brings also benefit to poor communities; etc.

As Tourism is a principal export for 83% of developing countries, is growing rapidly and is the most significant source of foreign exchange after petroleum, we are convinced that: tourism can be harnessed to bring local economic development in forms that will assist in the reduction of poverty; poverty reduction criteria should play a more prominent role in decision-making about tourism development; and tourism must be considered alongside other industries as a primary development option, in government policy and related action of development banks.