Georgian PM: Gov’t aims to turn growth into tangible gains for citizens

Georgian Prime Minister Irakli Kobakhidze on Wednesday emphasised that his Government’s priority was ensuring that the country’s economic growth translated into tangible benefits for citizens, including efforts to reduce high prices for food, medicines, and fuel.

Speaking at a meeting of the governmental coordination commission on food prices, attended by representatives of major retail chains, Kobakhidze highlighted the need to balance business freedom with social responsibility.

“Business freedom is our main starting point, and, of course, it has its advantages when businesses independently define their activities. This helps the economy and employment and is important in every respect”, he said.

“However, in this case, the social burden on citizens has become so heavy that we decided, based on consultations, to try to introduce certain changes to the overall situation. In reality, there are cases where the difference in prices is double or even triple. Together with you, we want to discuss what can be done in this direction and how certain practices can be changed in order to reduce prices”, Kobakhidze continued.

The Prime Minister further noted that the average markup in retail markets amounted to 86 percent, which he described as unusually high.

“Overall, according to our calculations, the average total markup amounts to 86 percent. We believe that an 86 percent markup is quite high. Over the past five years, the number of markets in the country has doubled”, he continued.

Kobakhidze also highlighted that Georgia had 113 markets per 100,000 people - significantly more than Germany or Austria - which affected price levels.

“In Georgia, there are 113 markets per 100,000 people, whereas in Germany the same figure is 45, and in Austria 62. In some countries, the figures are even lower. Naturally, this ultimately affects prices and places an additional burden on the population”, he concluded.

The Government plans to hold additional meetings with distributors and local producers, and the commission’s work will extend beyond food to address medicine and fuel prices.

The meeting was attended by up to 15 representatives of large retail grocery chain markets.