The Government of Georgia has made significant policy efforts over the past years to build an environment conducive to private sector development and entrepreneurship, and to support small and medium-sized enterprises in particular. The OECD has supported this reform impetus, working closely with the Ministry of Economy and Sustainable Development (MoESD) to help identify gaps and develop relevant measures to create a conducive policy environment for Georgian SMEs. Georgia participated and featured as top improver in the three rounds of Small Business Act assessment for the Eastern Partner countries, which resulted in the corresponding OECD publications SME Policy Index: Eastern Partner countries 2012, 2016 and 2020. In parallel, at country-level, the OECD supported the design of Georgia’s SME development strategy 2016-2020, and assessed the progress made in the implementation in 2018. As a follow-up to this work and upon request of the MoESD, the OECD provided assistance in preparing the new SME Development Strategy 2021-2025 (“the Strategy” hereafter) and the related Action Plan for the first implementation period, building on the findings of the latest SME Policy Index (OECD et al., 2020[1]).
This project was carried out as part of EU4Business: From Policies to Action, a multi-country project carried out by the OECD with the financial support of the European Union, and in close cooperation with the European Union and GIZ. The MoESD established a dedicated public-private working group to elaborate the Strategy, which gathered on several occasions throughout 2020-2021, including two working group meetings organised in September 2020 and March 2021 to discuss challenges and reform priorities for SMEs in Georgia. The OECD also provided support in costing the measures of the first Action Plan through three dedicated technical workshops, during which members of the working group discussed the costing methodology and worked on concrete examples taken from the draft Strategy’s Action Plan. The final version of the Strategy was approved mid July 2021 by the Government of Georgia.
While this work was conducted under phase 1 of the EU4Business: From Policies to Action project, phase 2 of the EU4Business project launched in May 2021 aims at helping Eastern Partner countries “build back better” with a strong emphasis on supporting the digitalisation of SMEs. In that context and as an immediate follow-up to the work on the Strategy, the OECD is helping the Government of Georgia to design policies to accelerate the digital transformation of SMEs. In that regard, two working group meetings took place in June and October 2021, gathering senior policymakers from Georgia, private sector representatives and international practitioners and experts from OECD countries, as well as EU and OECD representatives.
This peer review note is the result of these two work-streams:
the first part summarises the assessment and recommendations provided for the SME Strategy, highlighting the measures that have been implemented and the additional steps that could be considered for future action plans over the implementation period;
the second part is dedicated to SME digitalisation in Georgia, taking stock of the current state of play in terms of both framework conditions and dedicated support programmes for SME digitalisation, and providing policy options to accelerate the digital transformation of SMEs.
This note served as a basis for discussion for at a peer review of Georgia at the OECD Eurasia Competitiveness Roundtable (November 2021).