The President of Georgia Mikheil Saakashvili summed up last year's economic situation at the charity dinner held with Georgian businessmen and listened to the new initiatives from them today. Mikheil Saakashvili pointed out during his speech that political stability is a necessary condition for the activeness of business circles.
"I believe that we have two major achievements from the economical point of view - first is that the economic growth is high and second - this is the first year, when during seven years there is a small, but still some decrease of employment rate. Psychologically it is a very important factor. Why was an unemployment rate increasing during last several years? Despite the fact that the crises seriously damaged private sector we were cutting the state apparatus according to plan. We were cutting many formal positions. A person with 20-30 GEL salaries was considered as an employed person. We had significantly reduced the number of employers at state apparatus and this was an annual tendency. This year the number of employed people went a little bit high. It means that we have developed a healthy state sector and we are controlling it not to grow again, but at the same time the growth of employment has started in private sector. This is a very important turnaround. So to say we have two major issues - high growth and decrease of unemployment. As one of the product of it all we will decrease deficiency from 4000 to 3000. This is very important and it happens because we have foreign aid - if not the foreign aid, the deficiency wouldn't reach even this number. The major negative tendency is of course inflation that affects our citizens daily. The inflation is caused by growth of fuel price. There is a competition all around the world - hunger doesn't exist anywhere anymore - everyone wants to have luxury items, etc. We are part of this competition and we mustn't be backwards, when others grow and improve, if you aren't growing and improving - you will find yourself in second or third league and will lag behind the world development forever. The influence of inflation affects the products of primary consumption and it is extremely felt during New Year days. Sure this all is a huge challenge. By the way, the World Bank took some measures in certain directions this year and will take next year as well. Of course it is not good for business, when we speak about growth of credit rate, but on the other hand this is an anti-inflation measure. We must understand that the stoppage of inflation is the major political basis - any type of destabilization delays the development of business. Inflation affects everything, when for example in 2008 the growth of fuel price was up to 150 USD - it caused the collapse of world economy. So, hopefully everybody will understand those measures, which the National Bank will take.
Now about where do we stand. The World Bank nominated Georgia as number one reformer country. We are on 12th place, but we should be among first ten countries. I want to tell you how this 12th place was defined for us: simply, US Trade Union raised an issue that if the Labor Code is not well developed in country this should turn you down in regards of business. This is a totally unacceptable criteria, because anti-economic criteria was brought in during the debates on liberal economic course of country. Sure it was pure political thing, but the influence of Trade Union exists in the world and it happened so that we found ourselves on 12th place instead of 9th. Though we remain on first place in Eastern and Central Europe and sure next year we will be among first ten countries when we improve other criterias", the President of Georgia stated.
Mikheil Saakashvili referred to the survey held by "Transparency International" that was carried out in order to define corruption rate. This survey showed us that the corruption rate is minimized in our country. It is very important to carry out reforms, modernization and maintain political stability in country permanently. He spoke about the development of tourism potential and those projects that will provide the success of this sphere mostly. Mikheil Saakashvili stressed his attention on the attraction of investors as well.
"We are ideally ready for the foreign investments in Georgia. This is great important factor to turn Georgia into Singapore of this region and we are seeking in this direction. If you read Moldavian and Ukrainian press carefully, if you listen what the people on the streets talk about in Baku, Erevan and by the way in Russia - it will turn out that Georgia is pretty attractive country in all aspects. We managed the major thing - we can see that Georgia became an absolute leader in regards of reforms, fight with corruption and modernization and we are not only saying what "Transparency International" or "Economist" wrote about us. It is important to become a major liberal center and the fastest modernized country. Sure it all needs political stability.
During seven years we are in the regime of this reforms and experiments. Seven years might seem too long for someone, but it is not too much for testing psychology - it is very little time. It needs much longer period of political stability and permanent reforms, because political stability and stagnation must not be one and the same. It is the major thing - stable and high tempo of reforms. The way it was adopted in Black Sea region was the top of irrationality. Many Georgians, who remember Abkhazia say even today that Abkhazia is better then Adjara, there is nothing to say about Anaklia. But the sea climate is the best in Anaklia, if something can develop somewhere is exactly this zone. We are developing the half of this zone very well.
The same can be said about Svaneti. During Soviet times people weren't moved from Svaneti like Chechnyans, but nothing had to develop there and this region was totally conserved. I am sure that only 5 or 6 of you have visited Svaneti. You don't have to be ashamed because I started visiting this place recently too. Svaneti, in these regards is a gold mine, because Svaneti has the highest mountains. In this respect, especially for skiing purposes nothing can come close to Svaneti. For example Gudauri is located on 2000 meters above sea level, Mestia is located on 1300. Though the height changes a little bit faster, you go up so fast that it is impossible to imagine. You are on the best place, the climate is best and you feel yourself well", Mikheil Saakashvili noted.
The President spoke about new economic course as well - he noted that this course was specially developed in order to establish good partnership relations between the State and business sector. He also noted that an entrepreneur should be given an ability to operate their business without any bureaucratic barriers and tax or customs press.
"This is exactly what the new economic course is about - everything must be done in order not to make business stop and close down, even when violations are found. An Ombudsman institute must be brought in, among them Institute of Pardoning - though everything must be done justly and transparently and the impression mustn't be created that we should pardon them still. The centers must be created like - EZR. When I was checking customs offices before several times I have visited customs terminal and I remember how dirty those places were, how many shady persons were browsing around. Everybody was looking in your hands... A totally different thing was brought in now - you go there like you go to supermarket and pay money, take a receipt and take your goods with you. So, the business in no longer associated with mud. This is huge psychological transformation. I saw the analogical terminal in Poti - same type of terminal is being constructed in Adlia as well. This must be implemented on every sphere - like all building of Public Register are made out of glass, are pretty and you easily get the document identifying your ownership on land. The same happens in police center - the same must be done in every entity. Communication with such entities must be pleasant. It should be this way - they must serve you, who you pay money to and not on the contrary. So, we will do it together with you. This is the interactive process that I spoke about", the President of Georgia noted.
After the speech the President of Georgia and the members of economic group got familiarized with problematic issues bothering the businessmen. They have listened to the new initiatives from the entrepreneurs, which will improve the business climate.
About 100 businessmen attended the charity dinner today. By their decision the amount gathered at the charity dinner will be spent on purchasing personal computers for orphans.