Georgia and China to Begin Negotiating Free Trade Agreement
17 September, 2015
Georgia and China to Begin Negotiating Free Trade Agreement
A Silk Road ‘Shortcut’ for China to Europe

Georgia and China will begin talks on free trade. The decision was made during negotiations between Georgian Prime Minister Irakli Gharibashvili and his Chinese counterpart, Li Keqiang. As the administration of the Georgian government stated, Georgia will be the first country in the region to sign this agreement with China. “Gharibashvili and Li also talked about deepening contacts between Georgia and China and emphasized the active cooperation between the two countries, which
is considered to be one of the main achievements of the new Georgian government,” says the statement.

“As China’s Silk Road Economic Belt extends across the Eurasian landmass, we in Georgia are well placed to connect two of the world’s largest trading regions.”


The friendly relations between Georgia and China are even more noticeable, if we look at the Chinese visitors in Georgia and Georgians in China, Mr. Gharibshvili added. The two sides also emphasized the significance of economic cooperation and talked about the restoration of the historic Silk Road trade route. The significance of the ‘Tbilisi Silk Road Forum’ founded by Irakli Gharibashvili was also emphasized. On October 15-16, the Chinese delegation will visit Georgia. The Prime Ministers discussed the activity of the Asian Infrastructure Investment Bank and expressed hope that with the proper financing many big-scale projects can be implemented. Li Keqiang added that Chinese companies are more and more interested in Georgia. China is one of the closest economic partners of Georgia. In 2014 the trading volume between the two countries increased by 28 percent.

Georgian Journal offers you the opinion piece by Georgia’s PM Irakli Gharibashvili that was published in the China Daily under the title: A Silk Road “Shortcut” for China to Europe:

“Georgia is Europe’s natural gateway to Asia, as it is Europe’s eastern most entry point both by land and sea. With its deep ties to the European Union, including the new Association and free trade agreements, Georgia is the traditional trade hub of the Caucasus and Black Sea region. As China’s Silk Road Economic Belt extends across the Eurasian landmass, we in Georgia are well placed to connect two of the world’s largest trading regions.

I am in China this week to further strengthen the connection between China and Europe that passes naturally through Tbilisi.

“Connectivity across the Eurasian landmass needs a doorway through which China and Europe can connect. Working together, China and Georgia can ensure that the new Silk Road becomes a true force for positive economic growth, trade and cooperation.”

The Georgian government is proud of its increasingly close ties with China. In recent years, trade with and foreign direct investment from China has grown substantially. In 2014, China was our third-largest source of foreign direct investment.

I have come to Beijing to strengthen the already friendly relations between Georgia and China and to discuss new avenues for deeper cooperation. Top Chinese officials have recently visited Georgia. And on Oct 15 and 16, Georgia will host senior government officials, economists, international financial institutions and nearly 300 Chinese business leaders at the inaugural Silk Road Forum in Tbilisi, an event designed to strengthen cooperation and investment along the new Silk Road and demonstrate the unique opportunities offered by Georgia to businesses around the world.

Georgia’s strategic location linking East with West was underscored this year when it hosted both the annual meeting of the European Bank for Reconstruction and Development and the inaugural meeting of the China-led Asian Infrastructure Investment Bank. Last month, we hosted senior officials from 57 countries in Tbilisi for the initial round of the AIIB negotiations and to select its first president, Jin Liqun.

Georgia was the 45th country to join the AIIB. We believe the bank will add massive value to developing economies and play an important role in cooperation with other international financial institutions such as the World Bank, the Asian Development Bank and the EBRD.

Georgia strongly welcomes China’s Silk Road Economic Belt project, which offers a strategically important opportunity to deepen economic and cultural ties between Asia and Europe. As part of our cooperation with China under this initiative, we have established a joint working group to explore possibilities for a free trade agreement between our two economies.

As part of Georgia’s regional leadership role, we have deepened cooperation with China, Turkey, Kazakhstan, Azerbaijan, Turkmenistan, Uzbekistan and Afghanistan to integrate transportation corridors and open new routes. Of importance, the Silk Wind Multi-modal Block Train project has the potential to bring goods from China to Western Europe in record time, utilizing a safe and efficient transportation corridor.

Internally, reforms in tariff policy, as well as technical regulations, have made Georgia’s foreign trade policy one of the most liberal in the world. As a regional business hub, Georgia enjoys excellent infrastructure and free trade with all of its neighbors, the Commonwealth of Independent States, Turkey and the EU. We are also experiencing unprecedented growth in FDI inflows. In 2014, FDI increased 86.6 percent to $1.75 billion, the highest since 2007. These rankings are supported by extremely positive international rankings. Georgia is ranked 15th in the World Bank’s Ease of Doing Business country list and it is the 22nd freest economy in the world according to the latest Heritage Foundation survey.

I strongly believe that the sustainable development of Eurasia will largely depend upon strengthening channels of communication and trade across this vast area. Connectivity across the Eurasian landmass needs a doorway through which China and Europe can connect. Working together, China and Georgia can ensure that the new Silk Road becomes a true force for positive economic growth, trade and cooperation.

My country looks forward to a long and positive friendship with China and to helping Chinese businesses achieve their goals in Georgia, Europe and along the entire new Silk Road.

The Georgian prime minister’s assessment is as optimistic as the project is bold. Yet it is this kind of boldness and regional leadership that Georgia needs to continue to grow and develop economically. The PM and his government will have to continue reforms and walk a political and foreign policy tightrope in order to remain attractive to the Chinese as a hub of this new Silk Road.

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EUR
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GBP
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