At first glance, the Georgian economy is a good news story. The economy’s growth rate improved from 2.5% in 2016 to 4.5% in 2019. Georgia’s ranking in the World Bank’s Ease of Doing Business Index also improved from 24 to 6, out of 190 countries. A closer look at the Ease of Doing Business ranking reveals that there’s a big area for improvement in Georgia’s ranking in ‘resolving insolvency,’ one of 10 criteria the bank measures to guide the economy. Georgia’s lowest score in the World Bank’s ranking is in this area of ‘resolving insolvency’ where it ranks just 64. This is where the Georgian Business Rehabilitation and Insolvency Practitioners Association comes in. Founded in 2018, the association is focused on creating a licensed and well-regulated profession for improving the insolvency system.
The vision for the Georgian Business Rehabilitation and Insolvency Practitioners Association is to improve the Georgian economy by boosting business rehabilitation. The organization is working closely with the government to ensure that the regulations and legal frameworks develop in a way that can effectively be used by courts moving forward to improve the overall ranking and continue to spur economic growth. While the first objective of the organization is to have the profession licensed and well regulated, their next step is to strengthen the profession through the research and standard setting that will contribute needed improvements in the insolvency arena.
Ensuring consistent standards for business operations in addition to helping organizations rescue and resolve insolvency before turning to bankruptcy can capture more recovery rate on the dollar and the length of time it takes to recapture those funds. While Georgia performs well on these measures for its region, and has improved slightly in the past year, the organization recognizes that it’s performing below the OECD standard in both measures and the impact that moving up the rankings on those measures can have to grow the Georgian economy significantly. Fueling economic growth is one of the core tenants not just of the Georgian Business Rehabilitation and Insolvency Practitioners Association, but also of the Global Power of Associations.