Economy takes over in the US-Georgia relationship
06 March, 2014
Economy takes over in the US-Georgia relationship
The recent visit of Georgian PM Irakli Gharibashvili to the US is a breakthrough that marks the launch of a new economy-oriented policy of the US to Georgia – this is the estimation trumpeted by an overwhelming majority of Georgian economic analysts. They predict a higher than expected inflow of investments in Georgia as a result of the positive signals sent by the White House. Also, the Georgian business climate is believed to improve at faster speed once prompted by
the US and the EU alike, as both are interested in the stability and economic welfare of the country more than ever.
The Ukrainian upheaval and its lamentable consequences had a cold shower effect on the West. It understood more than ever how unpredictable Russia can be on meddling in the post-Soviet neighbors’ affairs, and how heavy the result of such interference may be if the neighbor countries strive to the West and EU integration. The direct consequence of this awakening had a positive impact on Georgian PM’s visit to the US. Instead of a relatively small-scale meeting between the ex-president of Georgia and the US political elite, Gharibashvili was accepted by unprecedented large-scale meetings with representatives of all governmental branches including the White House, State Departments and the Capitol, and President Barak Obama himself. The Georgian governmental delegation met with over 30 of the most influential US politicians and secured sustainable and enhanced US support in economic, trade and security issues of Georgia. The leading Western publications made a positive acclaim of Georgian PM in lieu of the previously unfavorable dominated coverage largely questioning the new governmental policy of Georgia. But of paramount importance was the focus shift from the previously dominated defense issues on the economic reforms and trade partnership, Giorgi Abashishvili, an associated professor of economy at the Ilia State University, admits. “This kind of high level interest of the US to Georgian authority is a signal to all investors worldwide think of long-term investments in Georgia whose investment image was somewhat shattered after the 2008 August war,” Abashishvili said in an interview with Georgian Journal. “As a matter of fact, in the 22-year long history of Georgian-US relationships after Georgia’s independence, this is the first time such a big focus fell on a larger trade and economic partnership.”
Abashishvili underlines that this economic relationship will be based on the US-Georgia Chart on Strategic Partnership concluded in 2009 that envisages cooperation in economy, trade and energy sectors and eventually aims at economic growth of Georgia, encourages economic reforms and a liberal approach in business. According to the Chart, the US will support the South Corridor energy corridor promotion in Georgia, also its integration into the global market competition where Georgia still holds a weak position. The US declarations to enhance mutual investments with Georgia may be a vigorous stimulus to restore Georgia’s August-war-affected investments image. The upcoming prospects of free trade with the US, as built in the Chart, and the EU [where the said agreement will be signed in August this year] is an extra way to lure potential investors who think of the sales market first of all.
Ditrikh Muller, co-founder of Georgian Investment Group+, believes the recent visit to the US and highly positive acclaim of the international press on Georgian PM marks a breakthrough in the lukewarm approach of the West to Georgia after a new power came in office. He conjectures that after the Ukrainian tragedy the West understood how easily Russian-oriented forces may manipulate a poor population and use discontent toward the authorities into destabilization, handy for Russia alone. Therefore, the West will be accentuating economic reforms in Georgia to bottom out the poverty and be less vulnerable to manipulations.
“Once nobody wants Russia to be dominating the region again, Georgia, that keeps itself resilient to Russian pressure as of yet, will be a pet project to the west showing the benefits of western integration. I presume that after these events the US and the EU will build on such benefits to Georgia that they did not plan before. The stagnated economic reforms of Georgia will get a new impetus, Georgian authorities will be under supervision to improve its investment climate and lay the foundations to a really democratic economy in Georgia,” Muller said.

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USD
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EUR
1
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3.0854
GBP
1
GBP
3.4584
RUB
100
RUB
3.9340