Thursday, August 30, 2012

Swiss company will monitor cargo at Georgian-Russian checkpoints

by Anna Robakidze

29.08.2012. Russia finally ended its long-term negotiations with Georgia and a number of other countries by officially joining the WTO and becoming the 156th member of the organization on August 22nd. Russia had already integrated into the global economy so the entry is primarily in the interest of its domestic economy.

Georgian-Russian negotiations were conducted with the help of Switzerland, which played the role of neutral mediator in the discussions. The countries have signed a number of bilateral documents and now all parties are looking forward to the possible benefits that stem from the new trading agreement with Russia– especially considering these relations will be regulated by WTO law.

Russia placed an embargo on a number of Georgian products back in 2006. The closing of the market by the Russians was more a political step rather than a natural action against the quality of products produced in Georgia as claimed by Moscow at the time. However, the situation is due to be changed now.

Under the signed bilateral documents in Geneva, Russia becomes a member of the WTO and the shared border is now open for the trade of goods like cigarettes and alcohol beverages.

Several important issues have been regulated within the framework of the Georgia-Russia negotiations. Parties agreed to open three trade corridors and on monitoring mechanisms, which itself consists of two components– Electronic Data Exchange System (EDES) and an International Monitoring System (IMS). Upon the entry into force of the agreement, Russia, Georgia and neutral party Switzerland, will establish a Joint Committee, which will be in charge of supervising the implementation of the deal, as well as be authorized to address all possible disputes between the parties. Checkpoints will be monitored by a neutral company, accountable to the Swiss side and will be contracted separately by Georgia and Russia.

There will be three checkpoints opened: Larsi, Roki and Psou.

Sergi Kapanadze, the Deputy Minister of Foreign Affairs of Georgia, revealed in an interview with Pirweli that SGS (Societe Generale de Surveillance) will be the company providing monitoring on the border with Russia.

SGS is a Geneva-based company, which provides inspection, verification, testing and certification services. This will ensure that the products, systems or services meet the requirements and standards set by the two governments, standardization bodies or by SGS customers.

The company will deploy their observers from September 1st, at the Larsi check-point, which was opened again about two-years ago. It is expected that regulating trade relations with Russia and presenting neutral observes on the exit-point between the courtiers will increase the number of visitors and also cargo turnover.

Opening such a large market could be extremely attractive for Georgian wine makers; however, they also mentioned that the income from exporting their products to different countries in the world is way larger than it was before the Russian embargo.

The positive fact is that WTO law regulations ensure fair trade relations in the future. However, as expert Paata Sheshelidze commented, there is always the chance that Georgian products will be prohibited in Russia again, based on being of insufficient quality, like in 2006.


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