A billionaire’s country

753

“A period of renaissance and business prosperity has come to Georgia!” – such an enthusiastic forecast was made already in five days after the parliamentary elections by the Chairperson of the Supervisory Board of Bank ‘Republic’, General Director of the company ‘Redix’, Lasha Papashvili.

It should be noted that Papashvili’s statement was made before the beginning of the meeting of Georgian businessmen with the leader of the winning political coalition “Georgian Dream”, billionaire Bidzina Ivanishvili.

According to Papashvili, a talk concerning the establishment of benefits in terms of tax regulations, in particular concerning the issuing of the low-interest loans for agriculture, has already been initiated.

During this meeting Ivanishvili promised the businessmen to release them from the ‘state terror and put an end to monopolies’.

“Business will be free and there will be no monopolies any more… The coalition will be in the country’s service and the authorities will not interfere in the business activities. I promise that the members of the government will not intervene in anybody’s activities and will not be able to blackmail the proprietors and go shares with business”, — claimed Ivanishvili.

However, the chairman of one of the largest banks of Georgia ‘TBC-Bank’, Mamuka Khazaradze has estimated quite cautiously the perspectives of the Georgian business: “Perhaps a period will come when Georgian business will subjugate the peaks. Business creates the budget, working places, provides people with pensions, salaries and establishes infrastructures. There is no way to fight the sphere that fills in the budget. I’m satisfied with the meeting. Such meetings should continue in the future as well. And if those messages that I’ve heard, will be fulfilled the Georgian business will be developing by all means”.

Furthermore, during the meeting Ivanishvili was sending other messages as well. For example, he promised that those businessmen having left the country owing to ‘the political pressure’ would return as soon as they prove their innocence. He called the large companies to cut ‘inadequate prices’ down for particular products. Ivanishvili promised to help businessmen ‘with the settlement of the existing problems as much as possible’. He is planning to reconsider the Labor Code of Georgia and establish a strong anti-monopolistic agency, support the laissez-faire in the private business and immunity of private property and etc.

Ivanishvili made a special emphasis that he would try to bring the Georgian production back to the Russian market in the nearest future.

“I strongly hope that we will be able to promptly renew trade and culture relations. I don’t have any document concerning this but I think that Russia isn’t happy with such relations and if we start to make efforts for restoration without any preliminary conditions for trading and cultural relations then I hope we will obtain results”, he claimed.

A candidate for the Minister of Economics and Sustainable Development of Georgia, Giorgi Kvirikashvili stated that the restoration of the Georgian production to the Russian market would be a priority for the Ministry of Georgia.

The priority for the candidate for the Minister of Finances, Nodar Khaduri, in case of his appointment to this position, would be fulfillment of the obligations that the coalition ‘Georgian Dream’ undertook during the pre-election period.

According to Khaduri, the following spheres of healthcare, agriculture and education would become first-priority.

At the same time, according to the candidate for the position of the Chairman of the Fiscal Committee of the Parliament, David Onoprishvili, in his interview to the agency ‘Netgazeti’, the new government isn’t considering the changes in connection with the taxes neither in the frames of tax boost nor in the frames of reduction of taxes.

The billionaire Ivanishvili himself stated during the interview with the Russian version of the journal Forbes that he isn’t going to return to business.

“I have virtually withdrawn from the business”, — he said.

Ivanishvili has pointed out that he doubts he would carry out investments in the Georgian economy, though he is ready to become a partner for investors.

“I doubt whether I would invest. However, if the business (major, medium and small) would like to enter the country and the local business meets and shares the risks, the external investor who is not familiar with the country would feel more confident and active. I wanted to fulfill this model back in the 90s through Cartu Bank that was intended as investment bank. We were ready to allot 25% of the project cost from our funds for each project of a foreign investor. I was talking of the tourist project, where I was ready to pay 75 % as long as others would come and start business. I would definitely return to this project. I offer land and partnership again as long as the things would go better”, — claimed Ivanishvili.

However, Ivanishvili still promised the Georgian businessmen to provide financial aid ‘with his own capital’.

“We would do our best not to allow the authorities and officials interfere into the private business. I guarantee that private ownership would be protected in Georgia. This should become the basis for establishment of a real investment environment and business development in the country”, he stated.

“If I am sure that there is a perspective I would help with my own capital”, — promised Ivanishvili to the businessmen.

It should be acknowledged that the expectations of the Georgian society are much connected with the personality of the billionaire himself. For the long period Ivanishvili was virtually not familiar to the Georgian society, and the majority didn’t even know how he looked like.

However, the charitable and patronage activities, conducted over a long period in Georgia, has created quite an attractive (not to say more) image of the richest Georgian in the world.

Moreover, the victory of the coalition ‘Georgian Dream’ during the parliamentary elections was assured by two factors – the faith of the electorate in the fact that Ivanishvili is and will be able to change the life of the country towards better and the glaring mistakes of the former government.

“If we proceed from the promises that Mr. Ivanishvili made during the pre-election campaign, from the economic program of his coalition, all of these give grounds for the thought that the state wouldn’t interfere in the business and neo-bolshevism would be brought to an end that had been flourishing under Saakashvili’s regime. Certainly, it is an optimistic view to the moving events that I fully share”, — said ex-Minister of Economy of Georgia, Vladimir Papava in his interview with newcaucasus.com.

According to Papava, besides the neo-liberal façade reforms, the old Georgian government had undertaken quite aggressive steps towards the control of business having modernized the total corruption in the country into some shape of ‘elite corruption’.

“The façade part of the Georgian economy has become neo-liberal but the content – neo-bolshevist, so a detonating mixture of neo-liberalism and neo-bolshevism has emerged. Theoretically it’s impossible but the regime of Saakashvili in Georgia managed to accomplish this”, — reckons an expert.

The time will show how soon the billionaire Ivanishvili will succeed in making Georgian economy successful. Meanwhile, the country has stiffened in expectation. In expectation of the dream to come true…

P.S. In the beginning of the year, the web-site of the American fund Heritage Foundation together with the edition The Wall Street Journal published a list of degrees of economic freedoms in the world countries according to 10 criteria: freedom of business conduct, trade, investments, labor-market, level of corruption, convenience of taxation and etc.

The countries are distributed according to such groups as ‘free’ (more than 80 items), ‘mainly free’ (70-80), ‘relatively free’ (60-70), ‘moderately constrained’ (50-60), ‘completely constrained’ (‘closed’, ‘repressive’: 50-40 items).

Hong-Gong occupies the first place with 89.9 points in this rating, while the second place is occupied by Singapore with 87.5 points, and the third place – Australia with 83.1.

Among the countries of the South Caucasus the highest position of the rating belongs to Georgia with 69.4 points (34th place), then Armenia follows with 68.8 points (39th place), Azerbaijan is on the 91st place with 58.9 points.

Georgia and Armenia are referred to the group of countries with ‘relatively free’ economy, Azerbaijan – to the group of ‘moderately constrained’ economies of the world.

Turkey occupies the 73rd place in the rating with 62.5 points. Russia displays the lowest indices – 144th place with 50.5 points.

 

Tamar Nergadze, for newcaucasus.com

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