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Rural poverty in Georgia

The break-up of the Soviet Union led to Georgia’s independence, but it also brought hardship for many Georgians, and especially for rural people. With the collapse of markets and the creation of about one million small farmers through privatization, each with less than 1 ha of land, the nature of agriculture changed dramatically. Newly privatized farmers reverted to subsistence production, cultivating mainly wheat, maize and potatoes. But farmers did not have the resources to purchase inputs, and crop yields decreased. Livestock production also declined sharply. In 2004 total agricultural production had fallen by more than half compared to the pre-independence period.

More than 80 per cent of the country’s rural people depend entirely on their own farms for subsistence, and a typical household consumes more than 70 per cent of what it produces. More than half of the labour force works in agriculture, but the sector produces less than one fifth of gross domestic product (GDP). Productivity is low, underemployment and unemployment rates in the sector are high, and income is inadequate. Most rural households are trapped at the minimum subsistence level, eking out a meagre livelihood but unable to generate a surplus to invest in rebuilding their assets. They are vulnerable materially and psychologically. About 45 per cent of all the households in Georgia live under the national poverty line.

Who are Georgia’s poor people and where are they?

Poverty is widespread throughout the country. Standards of living took a sharp downturn after the collapse of the command economy, when jobs formerly guaranteed by the state in various sectors simply ceased to exist. In urban areas people face poverty as a result of high unemployment and low wages. The incidence of absolute poverty is generally lower in rural areas, where people can produce their own food. Poverty is most severe among pensioners with children, affecting 70 per cent of households in that group in both rural and urban areas. But it also affects the younger generations. More than half of single, working-age adults are poor.

Overall, and especially in rural areas, households headed by women with children are particularly vulnerable to poverty. Social and economic crises have eroded previous gender gains. Although women have equality under the law, in practice Georgian families are strongly patriarchal and women are traditionally considered homemakers. They generally have fewer employment opportunities and comparatively lower wage levels.

Poverty weighs heavily on rural women. They bear a large share of farm work, cultivating crops and tending livestock. Traditionally they contribute to household income by processing agricultural and dairy products. Breakdowns in social services and the unreliable nature of public utilities make women’s burden even heavier. As male family members migrate in search of work, the number of households headed by women is increasing. In certain districts, such as Mtskheta-Mtianeti in the central part of the country and Kakheti in the south-east, women are four times as likely to be poor than elsewhere.

The incidence of rural poverty is highest among people living in remote, mountainous and highland areas where there is poor potential for agriculture and where they have little or no access to social and financial services.

Why are they poor?

Georgians felt the effects of their failing economy soon after the break-up of the Soviet Union. As processing industries closed down and export markets for Georgia’s products collapsed, poverty increased. Poor farmers cultivating small plots lack essential inputs and technology, they face difficulties in consolidating their landholdings, they have inadequate access to markets and to rural credit, and their opportunities for off-farm employment are limited.

The Russian Federation’s embargo on Georgian products, imposed early in 2006, has had a severe impact on agricultural exports, affecting the livelihoods of rural people.

Source: IFAD