Georgia may lose the WTO game if it sticks to political demands
05 May, 2011
Georgia may lose the WTO game if it sticks to political demands

The second round of negotiations over the Russia’s entry in the World Trade Organization is over and Georgia still sticks to its political demand in exchange of voting for Russia. Georgian analysts fear that if Georgia does not shift the focus from political to economic demands it may lose the WTO game.

Details of the second round of Georgian-Russian negotiations over the Russia’s WTO membership [held on April 28-29, 2011 in Bern, Switzerland] are kept confidential. Meantime Georgian government assures

that things are going in the right direction.  As Nino Kalandadze, Deputy Foreign Minister of Georgia stated on May 2, 2011, the indicator of positive movement is that the sides appointed the third round of negotiations  in May [in Switzerland again for it is the mediator country between negotiating sides starting 2008 when Russia routed Georgia in August].
“Negotiations are going successfully and there is no need to stop it. On the reverse it is encouraged from both [negotiating] sides. I would not elaborate details at the moment for sides agreed not to disclose details at the moment. However the positive move is that we started discussing very serious concrete proposals on comprehensive issues that is a step beyond formal phase,” Kalandadze said reiterating once again that Georgia’s demands are unchanged: Georgia would support Russia’s bid to join the WTO if Moscow agrees to make borders with Russia in Georgian breakaway republics of Abkhazia and South Ossetia transparent.  Currently Russian officials monitor the posts and Georgian side cannot control the turnover of goods that poses security and contraband risks.
To solve the problem Georgia proposed three versions. Initially it demanded restoration of Georgian customs supervision on cross points. Then it proposed to control borders mutually together with Russian side. Now Tbilisi offers “a compromise solution” involving deployment of EU monitors on the questioned borders. Moscow finds all of them unrealistic and blames Georgia in “politicizing” WTO talks. Moreover Moscow hints it can join the global trade club without Georgian consent but it would not like to do it.
Georgian economic analysts cannot recollect such a precedent but they believe the EU and the US [been vitally interested to have Russia within the WTO] would make this kind of precedent for Russia exclusively and Georgia would rather focus on economic demands and negotiate lifting Russian trade embargo imposed on Georgia in 2006. They believe Russia will go on this concession while it never allows restoration of Georgian state control over borders in Abkhazia and South Osetia once the Kremlin recognized them as independent republics in 2008.
The EU and the US made it categorically clear to Georgia that they would like to have Russia one of the major economies world over, within the WTO and the WTO talks is no mechanism to solve political issues. 
Few days earlier the second round of WTO talks Michael McFaul, the U.S. President’s special assistant and National Security Council’s senior director for Russian and Eurasian Affairs, reiterated once again that Russia’s entry to the WTO is a top priority to the US, and hinted the embargo problem might be easily resolved.
“I am not worried about that,” he said. “But there is this fundamental issue about border.”
Georgian government meantime downplays importance of Russian market and underlines the most important term in the WTO talks with Russia is control over the borders in the occupied territories.
“This is our fundamental requirement emanating from the WTO Charter,” Kalandzde said on April 26 adding it is a “purely economic” requirement of Tbilisi. When asked of recently revealed contraband case of Georgian mineral water to Russia, she said:
“We have neither motivation nor desire to restore this [Russian] market in any way. Is it connected with the WTO entry issues? I decidedly say these issues have no interconnection with each other.”
Temur Iakobashvili, Ambassador of Georgia to the United States, also backed this approach.
McFaul accentuated that US would not be mediating between Georgia and Russia and squeeze on Georgia over the WTO talks’ terms with Russia to escape politicization of the issue.
Georgian economic analysts find governmental approach extremely unserious and fear such confrontation may lead only to a deadlock.  They fear Georgia may lose a chance to get back to Russian market that actually can be used as a platform for political reconciliation process with Russia.
“The key thing is a result. We want to strengthen political relationships and can confrontation lead us to this result? No business person and reasonable country will say that any market even a tiny one is not important. And how can we say that the Russian market with more than 100 million consumers is not a priority. It will be a priority for the coming 100 years and no other market can replace it, it is impossible from technical point of view. To hit new market needs huge money and how can we refuse Russian market that is already familiar to us?” Demur Giorkhelidze, an economic analyst, told Georgian Journal.
Levan Kalandadze, an economic analyst, believes McFaul’s statement in folk terms translates as following: Georgia sticks to wrong position; its partner got annoyed and turns a back to it.
“Russia will enroll the WTO in this way or other, and Georgia will end the game with no result,” he said.


Other Stories
The World Digital Mining Summit to be held in Georgia
The summit is scheduled to take place between 21st-23rd September in the Hualing Hotel, Tbilisi, Georgia.
Galt and Taggart - Tourism Boom Continues in Georgia
Tourism has become one of the key drivers for the Georgian economy. Galt and Taggart has recently published research about the Georgian tourism sector in the first half of 2018.
"The worst dream for Putin is that Russians want to live in Georgia"
This year, visitors to the Adjara region would notice that there is a boom in construction in and around Batumi.
Underground gas storage facility to be built in Georgia
KfW, a German government-owned development bank signed a EUR 150 million promotional loan with the state-owned Georgian Oil and Gas Corporation (GOGC) for the construction of the first underground gas storage facility in Georgia.
New gambling rules for Georgia
Georgian lawmakers are preparing a new draft law relating to online-casinos and gambling that will seek to curb gambling addiction in Georgia.
How expensive is it to visit Georgia?
The Georgian Lari (GEL) is the official currency of Georgia and is the only legal means of payment in the entire territory of Georgia.
Trade with the EU and the Commonwealth of Independent States (CIS) has grown significantly
Trade with the EU and the CIS has grown by 26% and 33.5 % respectively, says GeoStat, the Georgian National Statistics Office.
The unemployment rate decreases in Georgia
The unemployment rate decreased in Georgia by 1,9% and amounted to 12.1% in the 2nd quarter of 2018 compared with the previous quarter,
Memorandum of Understanding to be signed between Georgia and Malaysia
According to the Georgian Ambassador to Malaysia Nikoloz Apkhazava, Georgia plans to sign a Memorandum of Understanding (MoU) with Malaysia.
“Blauenstein Georgia” due to expand in Georgia
“Blauenstein Georgia” is planning to open more shops in Georgia. It is an agriculture company that sells meat products, meat and convenience food.
The amount of Direct Foreign Investment rises in Georgia
According to the information of the National Statistics Office of Georgia, the amount of direct foreign investment in Georgia has risen
It’s going to get  harder for foreigners to get residence permit in Georgia
It’s going to get harder for foreigners to get permit of residence in Georgia.
Mziuri Park in Tbilisi to be renovated soon
It was the dream of prominent Georgian writer Nodar Dumbadze that when the original Mziuri park was constructed and opened in 1892 that it should be a park for children,
Winemakers to produce Kvanchkara in its place of origin - Racha
Khvanchakara is a semi-sweet Georgian red wine which originates from Racha, in the western part of Georgia. Kvanchkara is made of two types of grape Mujuretuli and Aleksandrouli.
The level of Georgian wine and Chacha exported has increased
The National Wine Agency of Georgia has recently published statistical information about the level of Georgian wine and Chacha exported between January and July, 2018.
New fire engines to be Manufactured in Georgia
The Acting Head of the Emergency Management Agency Shalva Khutsishvili said that the old Zili fire engines (which were made in the USSR) will be phased out and replaced with new ones, manufactured in Georgia.
Georgia witnesses a record number of tourists
The Georgian National Tourism Administration publishes statistical information about international visits to Georgia.
Canadian businessman plans to build a hotel in Bakhmaro
Canadian businessman Vadim Malishev plans to build a hotel in Bakhmaro resort, Guria, in the western part of Georgia.
Coffee Factory will open in Tbilisi in October
The first coffee factory (which will be located on the Kakheti highway) in Tbilisi will open in October.
Places in Georgia where real estate is the most expensive
The real estate market in Georgia is growing annually. In Tbilisi as well as other regions of Georgia new developments are increasingly taking place.
How much does a vacation cost in Tbilisi?
It is the middle of summer and those who have not yet taken a vacation are looking for an appropriate place for sure!
The price for extreme sports in Georgia
Georgia offers a variety of options to extreme sport lovers.
The number of Georgians who own property abroad increases
The number of foreign properties owned by Georgians is increasing.
How much does Taxi cost in Tbilisi?
Stories how Taxi drivers try to deceive passengers and charge them with more money than they should pay are known for everybody all over the world.
What are the highest paid areas in Georgia
According to the data collected by the National Statistics Office of Georgia in the first quarter of 2018 the highest paid jobs in Georgia are found in the financial and insurance fields.
Exchange Rates
GEL Exchange Rate
Other Stories
Recently Toyota rolled out Global Campaign under this slogan that reflects the Olympic and Paralympic Spirit of Encouragement,
A couple from Switzerland combines Swiss tradition and technology with Georgian products. Their cheese is made in the Georgian mountains and sold in local stores and hotels.
It has been more than five years since the residents of Lilo village, near Tbilisi, cannot open their windows.
63 000 GEL was received by the Georgian Agro Export Group which is just a small part of the European Neighbourhood Programme for Agricultural and Rural development.
Georgian entrepreneur Guka Tavberidze, who runs his own business in the UK and does it quite well, has been invited by BBC
The grand opening of 7-star The Biltmore Hotel Tbilisi took place in Georgia’s capital on July 31.
DUSHETI, Georgia – The Georgian government and the World Bank will allocate USD 5.6 million (12 million GEL) to fund
A new Georgian clothing brand named Person has emerged in Georgian market.
Georgia is in the midst of an economic maelstrom, Euronews reports.
Situation at Georgia’s mineral water market is interesting: over the last year, the volume of export has grown by 56 percent. According to “GeoStat”, over $114 million worth of mineral water was sold
GEL Exchange