Friday, August 7, 2015

Georgian diplomat: Reinstating trade restriction by Russia would be ‘wrong’

07.08.2015. It would be a “wrong decision” if Russia re-imposes ban on import of Georgian products, lifted two years ago, Georgian PM’s special representative for relations with Russia, Zurab Abashidze, said on August 5.

Commenting on possible Russian sanctions, Georgian PM Irakli Garibashvili said on August 6 that there seems to be a “misunderstanding” and added that Tbilisi “cares a lot about” having an access to the Russian market.

Russian PM Dmitri Medvedev told government members on August 4 to consider “measures to restrict import of products” from those countries, which have joined EU’s sanctions against Russia over Ukraine.

Last year, along with Albania, Montenegro, Iceland, Liechtenstein, Norway and Ukraine, Georgia aligned itself with one of EU’s sanctions involving ban on imports originating from Crimea and Sevastopol unless accompanied by a certificate of origin from the Ukrainian authorities.

Those countries, except of Georgia, have also aligned themselves with other sets of EU sanctions, targeting major Russian state banks, energy and arms sectors, as well as blacklisting dozens of Russian officials and Russia-backed separatist commanders in Ukraine.

After the EU extended prohibition of imports from Crimea until June 23, 2016, Georgia continued its alignment with this sanction, according to a declaration made by the EU foreign policy chief on July 28.

Speaking at a government session on August 4, Russian PM Dmitri Medvedev asked the Ministry of Agriculture to “clarify” the issue and, if confirmed that “number of countries”, which he did not identify, joined EU’s sanctions, the government should prepare relevant decision on applying Russia’s counter-sanctions on those countries.

Also on August 4 Russia’s state consumer protection agency, Rospotrebnadzor, said it blocked ten shipments of brandy and wine produced by two Georgian companies because of their failure to “meet safety and quality requirements.” [read more here].

Timing of the announcement, which was made on the same day when the Russian PM spoke about possible counter-sanctions against “number of countries”, triggered concerns in Tbilisi about potential return of Russian embargo, which was imposed in 2006 citing “sanitary concerns” and lifted in 2013 several months after the Georgian Dream coalition came into power.

Although Tbilisi has been aligned with EU’s ban on imports from Crimea for almost a year already, the issue came into attention only late last month.

Last week Georgian PM’s special representative for relations with Russia, Zurab Abashidze, tried to downplay the issue saying that there was “nothing new” in this decision as Georgia had been part of EU’s ban on imports from Crimea for a year already and now it was just extended.

But following August 4 remarks of the Russian PM and the announcement by the RosPotrebNadzor, Abashidze said on August 5: “As it seems, the Russian side is linking possible trade restrictions with Georgia to last year’s decision by Georgia [to align with EU’s ban on imports from Crimea].”

“We believe that would be a wrong decision by Russia, because one of the main tangible results, which were made possible through bilateral Georgian-Russian dialogue, launched in 2012, is restoration of trade-economic relations,” said Abashidze, who is involved talks with Russian Deputy Foreign Minister Grigory Karasin, which are held in Prague once in several months since late 2012.

Abashidze repeated again: “Georgia joined last year one out of up to 15 various sanctions imposed by the EU… This sanction was automatically extended for a year and in 2015 Georgia made no new decision in respect of joining sanctions.”

Commenting on this issue on August 6, PM Irakli Garibashvili told journalists: “Georgia joined last year only one out of 15 sanctions… and that is related to exports from Crimea.”

He said that joining ban on imports originating from Crimea was natural for Georgia, which itself has two occupied territories – Abkhazia and South Ossetia.

“We want the same from other states – to have sanctions on products, produced in Abkhazia and Samachablo [referring to South Ossetia]. Pursuant to our policy of non-recognition [of Abkhazia and South Ossetia], this [joining EU’s ban on imports from Crimea] was unavoidable necessity,” Garibashvili said.

“We have no intention to join sanctions imposed against Russia. There are many reasons for that. We care a lot about the achievement and result, which we already have between Georgia and Russia – I mean restoration of trade relations. As you are aware a successful dialogue is underway for three years already and we have a significant progress in respect of trade and economic relations,” PM Garibashvili said.

“Embargo was imposed on our products years ago [in 2006] because of reckless policies of [then president Mikheil] Saakashvili. We managed to reopen this [Russian] market [for Georgian products] through our constructive and pragmatic policies and we appreciate it,” he said.

“So I think now there is some misunderstanding – there is nothing new, we joined it [ban on imports from Crimea] last year,” Garibashvili said. “This stir seems to be caused very artificially and I have no doubt that destructive forces within [Georgia] do not want to normalize relations [with Russia] and restoration of trade relations. We are interested in restoring normal, good neighborly relations with Russia. Of course Abkhazia and Samachablo remain main problem in our relations – our occupied territories.”

“I was and I am still against of Georgia joining sanctions against Russia; we had this position last year and have the same position now and we do not intend to change it,” PM Garibashvili said.

After Russia lifted trade embargo, Georgia’s exports to Russia increased four-fold in 2013, compared to 2012, to USD 190.2 million. Exports to Russia saw over 44% y/y increase in 2014, reaching USD 274.9 million, accounting for 9.6% of Georgia’s total exports last year.

But Russia’s sanctions-fueled economic woes had consequences on neighbors too, including Georgia, whose exports to Russia suffered almost two-fold decline to USD 70.6 million in the first half of 2015, compared to the same period of last year.


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