Russian market opens for Georgian fruits and vegetables
29 May, 2014
Russian market opens for Georgian fruits and vegetables
In spite of diverse political vectors of Georgia and Russia, the latter continues to lift its ban on Georgian agriculture products step-by-step. After an eight year gap, the export of Georgian tomato, cucumber, cabbage, eggplant, cherry and sweet cherry, also peach, plums, apricot, persimmon, kiwi and berries is restored to Russia as of 26 May. Fresh potatoes are also welcomed, but only if they are washed and packed properly, the Russian federal veterinary and phitosanitary surveillance Rosselkhoznadzor reported on 22
May.
Russia banned Georgian wine and mineral waters as well as agriculture products in 2006 under alleged sanitary reasons. The ban was only officially declared lifted in the summer of 2011 prior Russia’s entrance at the World Trade Organization. By this the Kremlin tried to woo Georgia because the latter was intent to veto Russia’s WTO enrollment. Actually, Georgian wines re-appeared on shelves of trade outlets in Russia only during June-July of 2013 after protracted bureaucratic and technical procedures related to the import to Russia. Later in the year Georgian farmers were allowed to export grapes and citrus to Russia. And now the list of admitted fruits got enhanced.
However, next to this fruit-admitting policy Moscow readily presses on the “stick” keys. The Kremlin warns Tbilisi to think twice before signing the upcoming Association Agreement with the EU scheduled to be inked on 27 June. On May, Alexander Lukashevich, a Spokesman of the Russian Foreign Ministry, said the Georgian authorities have to understand the results of the questioned endorsement affair. He pointed out that Russia is already a number three top trade partner for Georgia and Georgia should not lose this opportunity.
The Georgian government appreciated the return of Georgian agriculture product back to the Russian market although they acknowledge the risks related with this enticing but tricky market. According to Giorgi Kvirikashvili, Minister of Economy and Sustainable Development of Georgia, the return of Georgian agriculture products to the Russian market is very important and will significantly ease the life of ordinary citizens. He is hopeful that the coherent policy and constructive attitude may solve problems beside the trade with Russia.
“We think that by a coherent policy, a Euro-integration oriented policy and normal constructive attitude, and by the development of trade and tourism with Russia, perhaps in a long-term perspective, we will regulate other problems too,” he stated on 26 May. The Georgian authorities believe Georgia has learnt a lesson from the trade embargo in 2006 when Russia was the major export market that halved Georgian export that year and heavily affected the wine and mineral water sectors which depended on Russia by almost 90% and 50% respectively. However, Georgian wine and mineral companies managed to hit new markets and diversify the export countries. Paata Zakareishvili, State Minister for Reconciliation and Civic Equality of Georgia, admitted that the return of Georgian products to the Russian market should not be a subject of political bargain. But if things go in this direction Georgia is able to diversify its trade.
Georgian analysts believe the Russian market is really important to Georgian agricultural products, but it is unreasonable to depend on any market by more than one-third of the total trade while Georgian wines already depend on it with around 70%. Russia’s share in the total Georgian export quickly reached 7% as the ban was lifted by the end of 2013, PMCG reports. Soso Archvadze, an economic analyst believes nobody should say no to such a lucrative market as the Russian market, but the 70% reliance of the wine industry is already pretty risky.
“Georgia must keep its focus on the internal market to supplant the import [that fluctuates around 80%] plus undertake efforts to diversify its export markets as much as possible,” Archvadze said.



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