The country of Georgia is a newly emerged democracy located in a geopolitically important Caucasus region. Since Georgia regained independence in 1991, it has been struggling with political and economic challenges. Poverty and unemployment have been some of the major challenges that the Governments of Georgia have been facing since independence. Recent developments have made it clear to the Government and people of Georgia, that education is the key to the country’s economic growth and development.

The Government of Georgia’s new social-economic development strategy “Georgia 2020” as well as a four-pillar strategic development plan and reform agenda declare education as the country’s major priority. It is believed that high-quality education will yield in raising professionals who will help the country develop through the attraction of investments, creation of new businesses, and support of the industry.

The workforce in Georgia does not meet the industry and labor market demands and is not prepared for the job market. This constraint has been studied by various scholars and organizations in Georgia and various solutions have been proposed, one of which is the internationalization of higher education and the creation of partnerships with leading European and U.S. universities to bring their high-quality programs or branch campuses to Georgia.

The article reviews the effects of higher education internationalization on economic growth on the example of two university models and partnerships that recently emerged in Georgia. Namely, a partnership between the U.S. San Diego State University and Georgian partner universities and the new Kutaisi International University. These two examples have been studied and reviewed as fine examples of how university partnerships lead to internationalization of higher education that can contribute to economic growth, and poverty reduction through human capital development and could be great alternatives of Western university branch campuses in emerging economies and low to medium low-income level countries like Georgia.

Keywords: Internationalization of higher education, university partnerships, San Diego State University-Georgia, Kutaisi State University, international branch campus, human capital development for economic growth.

JEL Codes: I20, I21, I28, I29