Georgia seeks FTA with GCC

FROM THE REDACTION

The Georgian Prime Minister, Lado Gurgenidze on the 11-th of April sought a Free Trade Agreement with the six-nation Gulf Cooperation Council and said it could be finalised within a couple of years if both sides were keen enough.

Speaking at the Crans Montana Forum event focusing on business ties between the GCC and Eastern Europe, he called upon GCC investors to take advantage of his country’s liberal economic environment.
Foreign investment in the first quarter of the year touched the $ 500 million mark, mostly in the banking, construction and transport sectors with the banking segment accounting for $ 200 million of the inflows. This was indication enough of Georgia’s come back in attracting investments following the politically tumultuous second half of 2007. He said Georgia was expecting foreign investment inflows to be anywhere between $ 10 billion to $ 20 billion over the next five years creating some 200,000 new jobs, which would go a long way in eradicating poverty in the former Russian State, he said in a presentation, ‘Georgia: New Eldorado for Foreign Investments on the Crossroads of Europe and Central Asia’ showcasing Georgia to GCC investors at the forum.
In 2006 Georgia’s real GDP growth rate reached 8.8 per cent, making it one of the fastest growing economies in Eastern Europe. The World Bank dubbed Georgia ‘the number one economic reformer in the world’ as in one year it improved its ranking from 112 to 18 in terms of ease of doing business.
Georgia’s economy grew by 12.4 per cent last year compared to 9.6 per cent in 2006 and the strong growth rate was due to an entrepreneurial surge in the country fueled by determined efforts to cut red tape for new businesses, besides rapid credit expansion, growth in domestic consumption led by a growing middle class, infrastructure rehabilitation, export growth and diversification not to forget off-the-charts high Foreign Direct Investments into the country. A fresh five-year mandate for continuation of the ongoing reforms process was issued recently with the first edition of the process (2004 to 2008) comprising of radical de-regularisation and liberalisation policies, successful supply-side fiscal experiment with low, flat and decreasing taxes and modernising the state and civil services coming to an end.
Gurgenidze said the Georgian government was waging a war against inflation making price stability the sole priority of its central bank. He said the threat of inflation was taken ‘very seriously’ and the central bank authorities stand to face a vote of no confidence if Government’s inflation target was missed by more than 2% for four consecutive quarters.