As the dust settles on Georgia’s latest parliamentary elections, the country stands at a critical juncture between its longstanding aspirations for European integration and the realities of its political landscape. On October 26, 2024, Georgians voted to extend the ruling party's decade-long leadership for an additional four years. Widely viewed as pro-Russian, the Georgian Dream party declared victory with 54% of the vote, securing 89 seats in parliament.
This election, the first since Russia’s invasion of Ukraine and Georgia’s attainment of EU candidate status, holds particular significance in shaping the country’s uncertain position between Europe and Russia.
Once firmly pro-Western, Georgia’s ruling Georgian Dream party has changed its position, adopting policies that are more in line with Moscow's influence. This turnabout seriously questions Georgia's future and the ongoing battle between its ambitions for Western integration and Russia's conservative influence.
Election Integrity and Governance Concerns
Georgia’s political system is parliamentary, with real power concentrated in the hands of the prime minister and parliament, while the presidency is largely ceremonial. Therefore, for Georgia's future, this makes the parliamentary elections extremely crucial.
The ruling party, Georgian Dream, founded by billionaire Bidzina Ivanishvili (also called as the “Russian Puppet”), has dominated Georgia politics since 2012 but has faced allegations of authoritarianism and corruption. Despite Georgian Dream's apparent support during her election, President Salome Zurabishvili has grown more critical of the administration, exposing political difficulties. The widespread dissatisfaction with Georgian Dream's leadership, which has been a source of conflict for many years, is highlighted by this shift in the president's position.
These tensions reached a peak on election day, with a series of reported incidents casting doubt on the government's handling of the process and raising questions about the fairness of the elections. The president of Georgia, Salome Zurabishvili, and opposition parties refused to recognize the results of the elections due to fraud and “Russian interference.”
Citing concerns about election integrity, a crucial element in Georgia’s democracy test, Zurabishvili has called on the West to pressure Georgian Dream into reconsidering the results, accusing the government of “working hand-in-hand with Russia” and using Russian propaganda to sway the election outcome.
On the other hand, Dmitry Peskov, Kremlin spokesman, denied that Russia had tampered with the vote and accused those who were rejecting the results of trying to sabotage Georgia.
According to the report by the Organization for Security and Cooperation in Europe’s Office for Democratic Institutions and Human Rights (ODIHR), the election was rigged by vote buying, double voting, coercion, and intimidation. This conclusion is drawn from an analysis of voting rule modifications and 439 complaints submitted to District Election Commissions on election day by party representatives and observer organizations. A Georgian Parliament member, Tina Bokuchava, evaluated this situation as a theft of Georgia’s European future.
"This is an attempt not to steal the results of one party’s support but Georgia’s European future.- Tina Bokuchava"
EU foreign policy chief Josep Borrell and the European Commission published a joint statement and voiced concerns, stating that independent observers did not consider Georgia's parliamentary elections "free and fair," and warned that the Georgian government’s trajectory is distancing the nation from EU values.
Georgia’s EU Aspirations
The EU granted Georgia candidate status in December 2023, but the country's path to membership faced setbacks. Following the approval of a controversial "Foreign Agents" measure by the Georgian Parliament in July, the EU suspended the membership process. According to this regulation, media organizations and non-governmental organizations that get more than 20% of their income from foreign sources must register as "foreign agents," provide sensitive information, and risk audits or pay significant fines. The Georgian government claims that this legislation will improve transparency and protect the nation from outside influence, but others see it as a means of suppressing criticism and restricting media freedom, much like similar laws in Russia.
Adding to the tensions, The Georgian Parliament recently passed an anti-LGBTQ law that invalidates same-sex marriages performed overseas and prohibits gender changes and adoption by LGBTQ people. Although President Salome Zourabichvili refused to sign it, the law's passage highlights the growing tensions and disagreements surrounding Georgia's commitment to European values. The combined impact of these policies, as well as recent election observations, reflect Georgia's precarious position, sending mixed signals to both the EU and Russia and leaving the country in a geopolitical limbo.
Russia or the West?
Long a threat to the Southern Caucasus, Moscow's influence has diminished in recent years as a result of events such as the end of the Karabakh conflict, Baku-Brussels energy cooperation, and Georgia's European integration efforts. However, the recent Georgia election gave Russia another chance to reassert itself as if Tbilisi’s policies don’t reflect Moscow’s conservative agenda already.
The 2008 war over Abkhazia and South Ossetia marked a turning point in Russo-Georgian relations. Sparked by Russia’s backing of separatist movements in these two regions, the war led to a five-day conflict, ending with Moscow's recognition of the territories' independence and the stationing of Russian troops there. This conflict resulted in the loss of 20% of Georgia's territory and further deepened the mistrust toward Moscow.
Despite this, economic pressures and geographic realities have compelled Georgia to take cautious steps for normalization of relations. Restoring direct flights and allowing visa-free entry for Russians are realistic steps aimed at stabilizing trade, tourism, and regional relations.
Aware of its past controversies with Russia and the ongoing impacts of the conflict in Ukraine, Georgia has been aiming to maintain positive relations with Moscow. The Georgian Dream Party's campaign throughout the election period was centered on the idea of “keeping the nation out of the war”. Controversial ads that were released a month prior to the election received severe criticism. Advertisements using images of war-torn Ukrainian cities and peaceful Georgian landscapes were shown on billboards throughout Tbilisi and aired on television. The underlying message emphasized the importance of maintaining relations with Russia.
Besides the fear of war, a strong cultural bond is at the core of Georgia's pro-Russian stance. With strong Orthodox Christian traditions, Georgians see their religion as a connection to Russia. The Georgian Orthodox Church, closely related to its Russian counterpart, is the most trusted organization in the public eye, except for the military. Georgia's political scene is still influenced by these long-standing cultural ties, which makes it more difficult for the country to completely separate from Moscow.
Georgia's history and ambitions, however, also distance it from Russia. The trauma of the 2008 war fostered deep resentment toward Moscow and solidified its reputation as an aggressor. Russia's ongoing military presence in South Ossetia and Abkhazia, as well as its more broad regional operations, such as the invasion of Ukraine, have only served to deepen this mistrust. Inspired by democratic ideals and economic prospects, younger generations and civil society organizations strongly support EU membership and deeper NATO connections viewing these alliances as pathways to greater sovereignty and security. These aspirations underscore Georgia's determination to build a future aligned with Western democratic values.
Georgia's geographic position and its dependence on trade and energy routes involving Russia make it difficult to completely cut ties. This reality, combined with cultural connections and the lasting effects of conflicts over Abkhazia and South Ossetia, forces the Georgian government to maintain a delicate balance. While pursuing its goals of joining the EU and NATO, Georgia continues to negotiate with Russia to preserve regional and economic stability. These conflicting forces highlight the ongoing challenges Georgia faces in distancing itself from Russian influence and integrating with the West.
Foreign Investment and Economic Stability
Georgia's foreign policy depends on its ability to maintain a geopolitical balance, but the nation's economic problems are an even more urgent issue. Political decisions and economic trends, particularly in foreign investment, play a pivotal role in shaping Georgia’s future stability and growth.
Even before to the most recent elections, Georgia's economic difficulties were apparent. According to Geostat, foreign direct investment (FDI) fell 24% from $2.09 billion in 2022 to $1.6 billion in 2023. Additionally, reinvested funds accounted for the majority of 2023's FDI, with only 20% representing new investment, compared to 35% in 2022.
Furthermore, Georgia's foreign reserves experienced the biggest monthly fall in the National Bank of Georgia's history in October 2024, falling by $627 million to $4.08 billion. Reserves have fallen $1 billion in the last year to levels not seen since July 2022. This sharp decline was driven by depreciation pressure on the Georgian lari, which forced the National Bank of Georgia to intervene by selling foreign currency reserves to stabilize the exchange rate. Such interventions are often necessary to prevent excessive volatility in currency markets, particularly in economies like Georgia's, where external shocks, political uncertainties, and declining foreign investment worsen currency pressures. According to former Georgian Prime Minister Nika Gilauri, Georgian Dream’s policies may cause FDI to decline sharply to $500 million annually, a level not seen since the pandemic.
Following the Georgian Dream party’s election victory, economic forecasts have become even more uncertain. After the elections, shares of the two biggest Georgian banks listed on the London Stock Exchange sank sharply: TBC Bank Group fell 13%, and Bank of Georgia Group declined 6.8%. Even if stocks experienced a minor recovery, investors' fears about the political environment are reflected in this volatility.
Georgia's top investment bank, Galt & Taggart, on the other hand, is optimistic, predicting that the political turmoil will only last a short while and won't have an impact on the state's medium- and long-term growth prospects in 2024 and 2025. Nonetheless, several other signs suggest that Georgia's economic future will be difficult.
What’s Next?
With Georgian Dream’s re-election sparking doubts about the country’s commitment to democracy and European integration, the upcoming months are crucial. Leaders must choose between continuing to lean toward Moscow's influence, which might further isolate them politically and economically, or pursuing the EU-mandated reforms to safeguard their European aspirations.
A more promising future with employment chances, educational opportunities, and a thriving economy is what the younger generation sees in European integration. However, Georgian Dream's long-standing dominance and worries about election fairness have driven up political tensions, increasing investor fear and the possibility of economic stagnation. That’s why President Zurabishvili and the opposition are calling for fresh and fair elections to improve Georgia's reputation and win back the trust of international investors.
As Georgia progresses, it is unknown if the government will continue its inclination toward Russia or turn back toward Europe, reshaping the nation’s place in the region and its future on the world stage, but for now, the prospect of EU membership appears more distant than ever.
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