Aligning Institutions and Industrial Strategy: A Transformation Framework for Georgia’s European Future
Abstract
Georgia’s industrial challenge is not the absence of strategies, but the absence of a credible framework that can turn institutional reform into firm upgrading, export capacity, and lasting competitiveness. This paper develops GIPTM-7, a seven-pillar model for industrial transformation in a small open economy pursuing Euro-Atlantic integration. The model is derived through a systematic literature review, thematic synthesis, Georgia-specific contextual adaptation, and qualitative scenario analysis. Its seven pillars are Glassy Institutions and the rule of law; entrepreneurial and private-sector capacity; strategic state policy and industrial finance; knowledge and human capital; infrastructure and connectivity; sustainability and industrial resilience; and global integration and EU alignment. The scenarios show that industrial transformation is not linear. Institutional credibility affects the success of patient capital, while entrepreneurial and private-sector capacity determines whether international integration leads to greater economic complexity or only higher trade volume. The paper concludes with policy and implementation priorities for strengthening productive capacity and EU-aligned industrial governance.
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