AMBROLAURI, Georgia — For weeks, while fistfights broke out in his country’s parliament and Washington worked on a new package of sanctions, Sasha has just been trying to sell his wares.
Business has taken a turn for the worse, the 59-year-old told POLITICO from his fruit stand on the highway that runs through Racha, one of Georgia’s poorest regions.
“There’s not so many people buying at the moment,” he said, arranging cucumbers in a cardboard box. “The farmers I buy from only survive because of support from the EU — if the money stops coming in, it will be a catastrophe.”
Since the South Caucasus nation signed an association agreement with the bloc in 2014, Brussels has been Georgia’s single biggest donor, providing more than a billion euros in grants. That’s been supplemented by investment from EU member countries and hundreds of millions of dollars from Washington’s USAID development agency — money that supports the work of democracy-building NGOs and media outlets, alongside industries like agriculture and winemaking in impoverished rural communities.
Now, though, the ruling Georgian Dream party has put itself on a collision course with the West — threatening the economic lifeline that helps Georgians make ends meet in regions like Racha.
On Tuesday the party forced through a controversial new law that would brand NGOs funded by such donor schemes as “foreign agents,” in a move Europe’s top legal body warned was reminiscent of rules used by Russia to crush civil society and stifle domestic dissent.
In anticipation of the decision, the U.S. announced on May 24 it would review its lucrative program of bilateral ties with Georgia, as well as impose sanctions on Georgian Dream politicians for “undermining democracy.” The EU, for its part, has warned that the law’s approval will put in limbo the country’s hopes of joining the bloc, just six months after it was granted candidate status — and thereby endangering continued Western financial support.
“Without European funding, we wouldn’t have any of this,” Lasha Gagoshidze, the owner of a honey manufacturing business in the mountain town of Ambrolauri, the capital of Racha region, told POLITICO. He pointed to his metal vats and processing equipment, emblazoned with the EU flag and received as part of agriculture and rural development support programs.
Gagoshidze’s firm has won hundreds of thousands of euros from the bloc to expand, buying from a wide network of honey farmers and setting up a laboratory to ensure products meet the standards for export to the single market.
“We’re learning our practices and standards from the EU,” he said. “If that link breaks, we’ll stop learning — it’s not like we have anything to learn from Russia.”
Pivot to Moscow
Hundreds of thousands of Georgians have taken to the streets of the capital, Tbilisi, and other major cities in previous weeks to demonstrate against the “foreign agent” bill.
But the changes to civil society are just part of what many protesters, opposition politicians and Western officials fear is a pivot away from Georgia’s European path and toward Moscow. Since the Kremlin invaded Ukraine in February 2022, Tbilisi has refused to impose sanctions on neighboring Russia and has even bolstered trade ties.
With nationwide elections scheduled for October, Georgian Dream’s rhetoric has started to resemble that coming from the Kremlin, with its leadership airing conspiracy theories about a “Global War Party” that wants to drag Georgia, along with Ukraine, into conflict with Russia. The ruling faction has introduced an “LGBT propaganda” bill casting itself as the sole defender of Georgian values against a degenerate West, and has accused the U.S. of supporting NGOs that want to stage a revolution.
From her newstand on a street corner in Ambrolauri, Lia, 64, explains that of all the books, shoes and trinkets on offer, her best seller is the far-right Asaval Dasavali newspaper, a tabloid critics accuse of propagating anti-Western conspiracy theories.
“I support the government and their law,” she said. “For me, things like homosexuality are unacceptable. We need to get rid of all this evil influence from abroad, whether it’s from Russia or Europe — we are Georgians, nothing else.”
The cover of this week’s edition of the paper features a photoshopped picture of a smiling Georgian President Salome Zourabichvili — who is not a member of Georgian Dream and has accused the party of upending the country’s hopes of joining the EU — next to Adolf Hitler.
The French-born president has urged the government to follow through on key reforms mandated by Brussels as part of the EU membership process, including improving human rights protections and tackling political polarization.
But despite its Russian-style tactics, Georgian Dream insists the country is on course to join the EU by 2030. Prime Minister Irakli Kobakhidze has vowed that the deeply conservative, Orthodox Christian nation will become an EU member “with dignity.”
That’s a message many Georgians believe: According to recent polls, the government is expected to win October’s national elections against a disunited opposition.
Taking a break from cleaning Ambrolauri’s white marble church, Londa Kaldani, the wife of the local priest, says she believes her country will join the EU on its own terms.
“We are Georgians, so therefore we are Europeans,” said the 34-year-old. “But we should be able to join the EU as we are.”
Such views, however, clash with the message coming from Brussels. The EU has said the road to membership will be closed without clear progress on key issues; and that now, as other candidate states move toward accession talks, Georgia is falling behind.
Speaking to POLITICO, Maka Bochorishvili, the country’s former envoy to the EU — now a Georgian Dream MP — struggled to square that circle.
“Believe me, it’s extremely painful for me, as the person who was responsible for relations with the EU, to hear these messages,” she said. While European integration is “challenge number one,” she added, it must be balanced with “achieving basic security and basic stability” by passing new restrictions on Western-funded NGOs.
Economic fallout
The sense that Georgian Dream wants all the benefits of closer ties with the West while honoring none of the obligations that come with them, has caused consternation in Brussels. Pressure is growing for the EU to suspend Georgia’s candidate status, which would likely come with major funding cuts.
For Georgian NGOs and grant-giving organizations who rely on Western funding, the prospect of being labelled as shadowy agents of foreign influence is already complicating their work.
Eto Arsanidze is an environmental campaigner and feminist activist who founded the Racha Community Organization, which is likely to be labelled a foreign agent under the new rules.
Among the projects she helps run is an EU-funded scheme to empower local women to make money from traditional crafts; the initiative puts thousands of euros in the pockets of households on the edge of poverty. Efforts by her network to expose corruption and mismanagement by local Georgian Dream politicians, however, have put a target on her back.
“I’ve had menacing letters, I’ve had abuse online — people from the local government have told my father that he needs to make sure I’m careful. They make it sound like they’re concerned, but it’s a threat,” she said.
“More than 80 percent of Georgians think there’s no alternative to joining the EU. If the EU is considering stopping support for us, I just hope they will listen to the people, not the government, because leaving us alone is going to make things impossible.”
While schemes like Arsanidze’s have used EU funds to get off the ground in the hope of helping grantees turn a profit, she points out that entire sectors of the economy will be dependent on continued access to funds — as well as on increasing access to European markets — for years to come.
Other projects in Racha are already taking a hit. One scheme that would provide free dental care to children in the nearby town of Oni was pulled by the NGO behind it due to “serious challenges” related to the new restrictions.
The conflict over the foreign agent law has seen the country’s currency, the lari, lose around 5 percent of its value in the past few weeks, and Georgia’s central bank has had to spend $60 million defending it as investors fear promises of closer integration with the EU will fall through.
Many young Georgians appear to be deciding that if the West won’t come to them, they will go to it. Hundreds of thousands have left in just a few years, enabled to do so under the visa-free travel regime offered by the EU.
Some member states are reportedly now pushing to cancel this scheme, however, if Georgia doesn’t change its political trajectory. For those who have built a life in Georgia, the prospect of EU and U.S. funding drying up leaves them in despair.
Among them is Marianna, 33, who works in a newly-refurbished café opened by a friend in Ambrolauri, in a development that received more than €5 million in funding from the EU.
“I’ve lived in 16 different countries, I’ve worked in Belgium — in Brussels — but I always wanted to be back here,” she said. “Now, life is getting harder. It feels like there is no future in Georgia.”
Gabriel Gavin reported from Ambrolauri, Georgia. Tornike Mandaria contributed to this report.
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