The Integration of Artificial Intelligence in Georgia: Socio-Economic Impact, Institutional Challenges, and Policy Recommendations

Abstract

Digital technologies and Artificial Intelligence (AI) are transformative forces profoundly shaping Georgia's economic, social, and governance landscapes. While Georgia endeavors to bolster national competitiveness through technological progress, systemic challenges persist concerning digital infrastructure, regulatory frameworks, and a cohesive national strategy. These impediments hinder comprehensive digital transformation and constrain economic growth.

This study investigates AI and digital technology integration within Georgia's private and public sectors, analyzing key institutional barriers and proposing recommendations for sustainable development. Employing a qualitative methodology, the research utilizes semi-structured interviews with government and business experts, complemented by open-source analysis.

Findings reveal that AI integration in Georgia is in its nascent, fragmented, yet promising stages. Primary barriers include:

• Absenceofaunifiedstrategicandlegalframework, deterringinvestmentandrapidinnovationdissemination.


• Significantregionaldisparitiesindigitalaccess, exacerbatingeconomicdifferentiationandlimitinginclusivegrowth.


• Ongoing challenges in data governance and cybersecurity, elevating operational risks and impacting business reliability.

The paper concludes that establishing a long-term, inclusive national digital strategy is imperative. Such a strategy should prioritize critical investments in digital infrastructure, foster research and development, develop robust regulatory and ethical frameworks, and deepen public-private partnerships. Crucially, it must specifically address regional digital divides to ensure equitable access and maximize nationwide economic benefits. This approach will facilitate AI's full potential for GDP growth, enhanced public sector efficiency, and elevated international competitiveness, preparing Georgia for future challenges.