Stressing the Importance of Local Economic Development in Georgia

Meet alumna Salome Mekvabishvili, Head of the Strategic Development Department at the Ministry of Economy and Sustainable Development of Georgia. Salome followed our Local Economic Development course in 2020 with a purpose in mind: to contribute to boosting local economies across Georgia. She seeks to do this through the empowerment of local governments and communities by underlining the importance of Local Economic Development (LED) and what it takes for it to work. 

An over-representative part of Georgia’s workforce is engaged in low-productivity agriculture. Informal employment is prevalent in agriculture, dominated by subsistence and semi-subsistence farming. Local communities, while generally self-supporting, lack the ability to create high-value, productive jobs that lead to economic self-dependence. The benefits of economic growth have not yet been broadly shared and economic growth has resulted in insufficient employment gains. Many Georgians seek opportunities – and money – elsewhere, and without discovering or rediscovering the local potential, this will eventually cause a breaking point in which local communities will no longer have the population or resources to sustain their growth.

In short, economic vulnerability for communities across Georgia debilitates the country as a whole. Recently, however, the Georgian government has been taking steps to empower its local economies.

Both a challenge and an opportunity 

Georgia has only recently adopted its decentralisation strategy at the national level, and the process of localising the strategy’s objectives is taking time. The goals set forward are ambitious and focus mainly on three important directions: increasing the role of local governments in managing a substantial share of public affairs, ensuring adequate resources for local governments and introducing effective and innovative management and quality service delivery systems at a local level. There are several obstacles in the process, due in large part to a tangible knowledge and skills gap at the local level:  “We can observe top-down planning and implementation dominating, which is mainly due to a lack of capacity on local levels to analyse the local economy, promote networking and understand local business and market dynamics”.

For this national plan to work, any local stakeholder tasked with a local economic development process ought to be supported in the theory and practice of LED. As local economic development in Georgia is still in its nascent stage, there is ample opportunity for supporting and highlighting innovative and even experimental initiatives, and moreover, as Salome says, “there is a space to base LED practice more on learning and improvement rather than just on planning and execution”.

The challenge of the knowledge gap remains, and so does the need to empower local authorities and communities with the right tools and understanding to realise their economic development.

From The Hague Academy to back home 

From her perspective as a central government official, Salome’s time with The Hague Academy focused on her exploring how she could best support local initiatives, how to share tools, what best practices she could use, and how she could conceptualise what LED means in the Georgian context. The conclusion that she shared with us is clear: the government should develop LED policies that ensure participation and ownership of local communities in the process. The low level of involvement at the local level of the general public, including businesses, results in a mismatch between decisions and local interests and needs. Effective mechanisms need to be developed for public and private partnerships to fully utilise the potential of the local business sector.

“Stakeholders of LED processes need the support to seize the advantages of joint efforts, and to identify, promote, and follow up on opportunities for local economic growth”.

Local problems often require local solutions, and local stakeholders are the ones best suited to adapt and capitalise in their own contexts. Salome emphasises cooperation with local stakeholders:

“From my point of view, promoting LED should be a two-way street, where local communities hold governments responsible, and conversely governments establish processes, systems and space for joint decision-making. I want local governments and communities to share the ownership and tackle problems together to ensure an increase in their quality of life”.

In her Back Home Action Plan, Salome then wishes to increase the capacity of local governments through cooperation and encouragement of local decision-making, and to raise awareness of this systematic approach to local economic development.

Short and long-term progress

Since participating in the course, Salome is satisfied that she has been able to stress the importance of LED at the central government level. She has managed to establish strong links with international organisations whose priorities are in line with her motivation to support local development plans. She is now a member of working groups within and beyond the Ministry, to research and develop a Local Economic Development Concept Paper and intends for it to serve as a base for relevant policies in the future.

“In the future, I am hopeful that the driving force of development in Georgia will be its localities”. Salome believes that 10 years is enough time for local communities to meaningfully participate in the local economic development process, and is confident that they will be the driving force in not only their but Georgia’s development.

Join the Local Economic Development course!

Are you interested in exploring strategies and tools to improve conditions for local economic growth and job creation? Make sure to join our Inclusive Local Economic Development online course!