New Economic Course Gets Mixed Reviews

From the point of reforms, by combating corruption and modernization, Georgia has become the leading country in the region, Georgian President, Mikheil Saaklashvili stated at charity supper held by Georgian businessmen, on December 27th. He stated that the main achievements during the year were in economic field and addressed the threats which create basic obstacles for business development in Georgia.

“We achieved two main goals from the point of microeconomics in 2010, these achievements are: a high economic increase and the slight reduction of the unemployment level in the country compared to former years. We have created a healthy state sector and we are taking control of the formal items and insuring that less important items are not let in the state structures. At the same time, the number of employed people is increasing in the private sector," Saakashvili stated.

One of the main preconditions for business development in the country is a stable environment- the President said. Herewith he has underlined the negative role of inflation on business success in the country and mentioned Georgia’s national bank’s intentions concerning the issue. “Detention of inflation in the country is the main element of political stability- any kind of destabilization in it will hamper business development. Inflation damages everything in the country and I hope that each businessman takes the measures which the National Bank will carry out next year, with understanding.”

One of the main issues the President talked about was the new economic course for the country. As he has mentioned, “This is a right course and this course which has been adopted will provide partnership relations between the authorities and the business sector.” Taking all the above mentioned into consideration, Saakashvili stated that the country “Is in an ideal position for investments.”

“2010's final fairy tale,” this is the epithet of oppositional National Forum’s representative, Nodar Javakhishvili. It is also what he called the authorities’ new economic course, and statements made by the authorities concerning the economic and business development in the country. “You can not find anything new or similar to an economic course in the so called new economic course named by the authorities. Why should we trust the authorities that long before declared that a “liberal tax environment” would come true in 2011? Especially when the tax increases will significantly rise next year. There have been several attempts from the authorities to PR agriculture, however we have not seen Georgian frogs or crocodiles grown in the Samegrelo region, also the creation of a corn granary in Kvareli turned out to be an empty promise.”

As economic analyst Davit Narmania stated for The Messenger, “I can not see even basic changes in the economic course presented by the authorities. The authorities’ economic team had and retains a liberal attitude towards the issue. However, the government's interference indicator in the economy is still high. As for the simplification of the tax administrative issue, it is one of the elements of a common economic course and it can not be named as a new economic direction. . As for business, some positive steps have been made in this field; specifically, the simplification of business registration, tax pavement, and custom procedures. I welcome these, but there are many problems in the direction of business security.”