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Books on Georgia
REPUBLICAN REFERENCE
Area (sq.km)
69,700
Population
4,934,413
Principal
ethnic groups
Georgians 68.8%
Armenians 9%
Russians 7.4%
Capital
Tbilisi
Currency
Lari
President
Mikhail Saakashvili
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Update No: 286 - (28/10/04)
Georgia has fundamentally changed in all spheres -
president
Georgian President Mikhail Saakashvili believes that fundamental changes have
taken in all spheres of life in the country over the past few months.
"Today we are on a different planet compared to what Georgia used to be
merely a year ago," he told a Cabinet meeting on October 8th. He was
referring to the consequences of the Rose Revolution that brought down Eduard
Shevardnadze a year ago.
He said that the approach to recruitment policy and state service has changed.
"We took over a government that had been unable to pay pensions or wages
for months, had failed to control the regions, seaports or customs, a country in
which law was absolutely absent," Saakashvili said.
"The situation in Georgia has drastically changed," he said.
He said that at present the government is paying primary attention to
strengthening the army. "On the anniversary of the November 23 revolution,
our army servicemen will be in barracks repaired according to European
standards," Saakashvili said.
The South Ossetia conundrum
The most urgent problem facing the army is how to deal with the problem of South
Ossetia. South Ossetia is legally a province of Georgia, but a conflict in the
1990s led to its de-facto independence. Tensions between Tbilisi and Tskhinvali,
involving numerous armed clashes, have escalated in recent months as Saakashvili
has stepped up efforts to restore control over South Ossetia. The tragedy at
Beslan in North Ossetia, in which hostage-takers of children were inter alia
trying to stir up ethnic strife in the Northern Caucasus has not helped to
defuse the situation.
Nearly 500 Georgian interior troops are expected to take part in exercises in
the Gori and Kaspi districts near the administrative border of the breakaway
republic of South Ossetia. The exercises will involve artillery and aviation,
and a competition of snipers will be held, a Georgian Defence Ministry source
told Interfax on October 13th.
He said the interior force's reserve peacekeeping battalion, which will
participate in the exercises, will soon replace Georgian units performing
peacekeeping duties as part of the joint forces in South Ossetia.
Georgian PM, S. Ossetian leader may meet in Sochi - S. Ossetian official
Officials of Georgia and the self-proclaimed republic of South Ossetia are
discussing the possibility for Georgian Prime Minister Zurab Zhvania and South
Ossetian President Eduard Kokoity to meet in Russia's Black Sea resort of Sochi.
"Routine consultations are in progress to organize this meeting in Sochi
and compile its agenda," Boris Chochiyev, South Ossetian minister without
portfolio and a co-chairman of the Joint Control Commission on the
Georgian-South Ossetian conflict, told Interfax-Military News Agency over the
telephone from Tskhinvali on October 12th. He declined to disclose any possible
date for the negotiations.
The Joint Control Commission made a decision at its last session in Moscow on
September 30-October 2 to set up an expert group involving representatives of
all the parties engaged in the process to clarify such terms as the
Georgian-South Ossetian "conflict zone," "the joint peacekeeping
forces' zone of responsibility," and "a security corridor," he
said. "The point is that the Georgian party has recently been trying to
suggest its new interpretations of all these terms, thus deviating from the 1992
Dagomys agreements on South Ossetia," Chochiyev said. "The objective
of the Georgian party is to expand the territory of the conflict zone to the
Roki tunnel, but it will not succeed," he said.
The South Ossetian minister suggested that Tbilisi had applied double standards
to assessing early October's situations in which peacekeepers were injured.
"When two Georgian peacekeepers sustained injuries in the village of
Tamarasheni under unclear circumstances, the Georgian authorities immediately,
without any inquiry, accused Ossetia of the incident. But Tbilisi kept silence
when fire was opened on a Russian peacekeeper from a car with a Georgian license
plate before the eyes of numerous witnesses in the village of Artsevi,"
Chochiyev said.
US gives Georgian army equipment
Georgia is now in an informal military alliance with the US, with which
Saakashvili has close ties, having received his higher education there. Some 200
US special forces are training the Georgian army in anti-insurgency techniques,
while Georgia is augmenting its troop presence in Iraq.
The U.S. government in a recent move has given the Georgian army vital
equipment, sources in the Georgian Defence Ministry told Interfax on Sunday
October 10th. "A U.S. cargo place carrying this gift, which is worth a
total of $1.1 billion, arrived at the military aerodrome near Tbilisi on
Sunday," the source said. The figure of $1.1bn is clearly an error. $1.1
million is more likely, a useful addition in what is a small-scale war of
attrition and manoeuvre.
"The gift includes 50,000 square meters of cloth for camouflage uniform,
300 sets of military uniform for service in deserts, and field equipment for the
command of the 11th brigade of the Georgian Defence Ministry," the source
said.
Among the people attending the gift-giving ceremony was Saakashvili, U.S.
Ambassador to Georgia Richard Miles, and Georgian General Staff
Brigadier-General Vakhtang Kapanadze. "The purpose of this gift is to help
Georgia ensure its national security," the source said.
The 300 sets of military uniform were to be transferred to the Georgian
commandos. "This battalion will soon leave for Iraq, where 159 people are
currently serving. It is planned that the Georgian contingent will be increased
to 300 servicemen before the end of November," the source said.
At the end of the ceremony, Saakashvili told reporters that "the US
assistance will be used for strengthening the Georgian army." "This
assistance means that the logistical support of the armed forces has increased
almost fourfold, which means that the combat potential of the army has
increased," he said.
In addition to equipment, the US has also provided military tents, special
computers, bullet-proof vests, and night-vision devices, Saakashvili said.
""It's everything that is needed for effective military action,"
he said.
BP to provide $60 million for security of Baku-Tbilisi-Ceyhan pipeline
It is not just security of its territory, but of the new vital pipeline
crossing, which insurgents could target. British Petroleum will provide $60
million to Georgia over the next five years for additional measures aimed at
ensuring secure construction of the Baku-Tbilisi-Ceyhan export pipeline,
Georgian Prime Minister Zurab Zhvania said on October 10th.
Zhvania and British Petroleum Azerbaijan President David Woodworth have recently
visited the Borjomi region, where the pipeline is being built. "The
Georgian government is happy that British Petroleum has fulfilled all its
demands regarding the security of the pipeline," Zhvania said.
Zhvania also said British Petroleum will provide another $10 million for social
and educational programmes in Georgia.
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ENERGY
Gazprom may spend 300m Euro for Georgian pipes control
The Georgian government is discussing the participation of Russia's Gazprom in
the management of the country's gas pipelines and in the privatisation of
Tbilgas, a government source said recently, Interfax News Agency reported.
He said the purpose of a working visit by Gazprom executives was to examine
Georgia's gas infrastructure.
Gazprom is ready to pay about 300 million Euro to gain control of the Georgian
pipelines, a source at the Georgian Economic Development ministry said following
closed door talks with Gazprom.
The details of the confidential talks were not disclosed. Gazprom executives
also met at length with Georgian Prime Minister, Zurab Zhvania, Economic
Development Minister, Kakha Bendukidze, and Energy Minister, Niki Gilauri.
"We are interested in Georgia as a transit country," head of
international projects at Gazprom, Alexander Gorokholinsky said. "As for
the privatisation of Tbilgaz, this is part of the overall system," he said.
Gorokholinsky said the Georgian government has new players with new ideas.
"So we are discussing various issues with them - time will tell whether
this will be a joint venture or if another form of cooperation will be
used," he said. "The main objective of the visit to Georgia was to
coordinate positions on cooperation in the gas industry, namely by setting up a
joint venture or by participating in the privatisation of gas assets in
Georgia," a Gazprom source said.
"During the visit a plan was drawn up under which Georgia will provide a
list of assets to be privatised and will provide full information on them. The
sides will decide on privatisation with Gazprom participation by year's
end," he said.
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FINANCIAL NEWS
EBRD issues new strategy for Georgia
European Bank of Reconstruction and Development (EBRD) recently issued a new
strategy for Georgia. Georgia among the poorest countries of the EBRD's 27
countries of operations, has achieved notable progress since the elections of a
new president and government earlier this year, according to a statement issued
by the bank, New Europe has reported.
The new authorities have addressed key problem areas, namely those affecting
Georgia's investment climate, such as organised crime and corruption, governance
and structural issues in vital sectors such as energy and the weak external
position with high foreign debt. The government's commitment, willingness and
ability to reform are crucial to meet the significant challenges the country
faces.
EBRD will intensify its policy dialogue with the authorities in an effort to
improve the investment climate for local and foreign investors. In
infrastructure the focus will be on power and energy, regional transport, water
utilities and telecommunications. New investments would be considered mainly on
a non-sovereign basis that is meaning without a guarantee from the national
government and only if accompanied by appropriate regulatory and institutional
reforms.
The bank will expand its funding of local enterprises, including micro-, small-
and medium-sized enterprises and larger private enterprises, directly and
through local banks. In the financial sector, the EBRD will support existing and
new partner banks using the full range of debt instruments and will seek
suitable equity investments.
Georgia forms part of the EBRD's "Early Transition Countries" (ETC)
initiative launched this year to stimulate market activity in the bank's poorest
countries of operations. The initiative aims to stimulate market activity by
using a streamlined approach to financing more and smaller projects, mobilising
more investment, and encouraging economic reform. The initiative is part of an
international effort to address poverty in these members of the Commonwealth of
Independent States (the former Soviet Union).
The bank will accept higher risk in the projects it finances in the ETCs, while
still respecting the principles of sound banking. As of mid-2004, the EBRD has
signed 35 investment projects in Georgia in the energy, transport, agribusiness,
general industry and banking sectors worth more than 350m Euro.
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