Belt and Road Initiative offers great opportunities, says Georgia's vice-PM

Georgia sees China as a strategic partner and hopes to become a good base for Chinese companies to develop their businesses and even expand to European regions, said Dimitry Kumsishvili, the country's first deputy prime minister, on Friday.

The country is working with Chinese companies to find new opportunities not only in Georgia but also in the wider region, as Georgia is the only nation in the region that has signed a free trade agreement with the European Union, Turkey and China, Kumsishvili told China Daily website in an interview.

FTA BOOSTS RELATIONS

In 2017, bilateral trade increased by 13 percent to almost $914 million, Kumsishvili said.

From the beginning of this year, especially during the first three months, a lot of companies have already participated in the free trade agreement, he said.

The Georgia-China Free Trade Agreement has already brought bilateral relations to a new level, he added.

For Georgia, a strategic partnership with China is very important, and the agreement is the evidence of how much China appreciates a small country like Georgia, Kumsishvili said.

The agreement went into effect Jan 1. According to the agreement, China will impose no tariff on 93.9 percent of products from Georgia, while Georgia will impose no tariff on 96.5 percent of products from China.

It is the first FTA that China signed after proposing the Belt and Road Initiative.

China has become Georgia's third-largest trading partner, fourth-largest export market and third-largest source of imports, according to Georgia's National Bureau of Statistics.

GEORGIA IN THE BELT AND ROAD INITIATIVE

Georgia is in a strategic position along the key route between Asia and Europe under the Belt and Road Initiative.

Explaining why the initiative is so important, Kumsishvili said it provides great opportunities in trade, investment and people-to-people exchanges.

"The Five Principles of Peaceful Coexistence Coordination are the core values of our country and absolutely what we value, because this is very close to our hearts," he said. "Mutual and beneficial cooperation is a win-win game."

The Belt and Road Initiative, proposed by President Xi Jinping in 2013, aims to create greater trade, infrastructure and people-to-people links between Asia, Europe, Africa and beyond by reviving and expanding the ancient Silk Road routes.

FRUITFUL BILATERAL COOPERATION 

Kumsishvili said meetings with Minister of Commerce Zhong Shan and Minister of Transport Li Xiaopeng during his visit in Beijing were "fruitful".

"Along with the free trade agreement, we have already signed several very important agreements and memorandums on joining free industrial, technological and trade zones with the Ministry of Commerce," he said.

In November, there will be an expo in Shanghai and Georgia will be present to promote Georgian products in the Chinese market, Kumsishvili said.

"Georgia is the homeland of wine, and the number of bottles of wine we sold to the Chinese market last year increased significantly to 7.2 million bottles, and we hope that after the free trade agreement is brought into force the number will double or triple in the near future," he added.

Kumsishvili said he agreed with the Chinese minister of transport to work a little more to promote the Trans-Caspian International Transport Route (Middle Corridor), which runs through Kazakhstan, the Caspian Sea, Azerbaijan, Georgia and Turkey.

"It connects China to Europe, and it takes seven to 12 days to bring cargo from Asia to Europe," he said. "We also agreed that on the road transportation we can strengthen cooperation and deepen our relationship."

A flagship project of the corridor, the Baku-Tbilisi-Kars Railway connecting Azerbaijan, Georgia and Turkey, was inaugurated on Oct 30, 2017 in Azerbaijan.

The 826-kilometer line will have the capacity to annually transport 1 million passengers and 5 million tons of freight at the initial stage.

A growing number of Chinese companies are becoming interested in exploring opportunities in Georgia.

Georgia received $600 million from Chinese companies up to 2017, and up to now Georgia has 160 active Chinese companies working in the Georgian market, Kumsishvili said.

Hualing Group invested in banking, the hospitality industry, real estate and an industrial park, Kumsishvili said.

CEFC China Energy, a Shanghai-based company that entered Georgia 18 months ago, acquired a free industrial zone from the Georgian government and now owns 85 percent, he said.

"We have four free industrial zones, and two of them belong to Chinese companies," Kumsishvili added. "I hope they will increase their investments in that direction. Chinese companies are welcome to our country."

On taxation, Kumsishvili said Georgia already has a very good business environment and it ranks eighth worldwide as the lowest taxation country.

"Last year, we even changed the mobility of the corporate profit tax, where companies paid the tax only on the distributed profits of the enterprise," he said. "Otherwise they do not have to pay that tax, which helps a lot."

Georgia only has six taxes, and the interaction between government and companies is 100 percent digital on the e-platform, he added.

The business environment in Georgia is very good in ease of doing business and Georgia ranks 16th on economic freedom by the Heritage Foundation, Kumsishvili said.

"So Georgia is very attractive, open and hospitable," he added.

A TOURISM-FRIENDLY DESTINATION

Not only famous for its wines, Georgia also has rich tourism resources.

The number of tourists increased by 54 percent last year, and there is huge potential to attract more Chinese tourists to Georgia, Kumsishvili said.

Last year, Georgia, a small country with a population of just 3.7 million, hosted 7.5 million international visitors, he said.

Georgia has all the facilities to serve Chinese tourists and offers some very interesting tourist attractions in the country, he added.

Georgia has signed an agreement with Alibaba, and it will provide all necessary support services such as e-visas, he said.

"We already have direct flight between Urumqi and Tbilisi," he added.

"Hualing Group launched a new airline My WAY in our country... and I do hope they will start flying to China," he said. 

Kumsishvili said he hopes Georgia will attract around 1 million Chinese tourists in the near future.

China hosted a cultural day of Georgia, and the country's minister of culture is working with China to host a cultural day in Georgia, Kumsishvili said.

The Confucius Institute at the Free University of Tbilisi and the Confucius Classroom at Tbilisi Open University were officially established in 2010 and 2017 respectively, according to Confucius Institute Headquarters.

Last year marked the 25th anniversary of diplomatic relations between China and Georgia.