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Is Free Trade with China Threat to Georgian Production?

Is Free Trade with China Threat to Georgian Production?

Georgia begins negotiations on free trade relations with China in November. As a result, the two countries will be able to trade without barriers, however, specific details at this stage are  unknown.

For example, it has not yet  been determined whether goods produced in Georgia will  enter the Chinese market without any charge, and vice versa. Also, it is unknown whether quotas will be set for specific products. All this will be found out in the process of negotiations.

Georgian government is fascinated by the prospect of free trade relations with one of the world’s biggest economy as well as  business circles and some experts, however, the second part of the  experts are   talking about possible dangers.

The government encourages local businesses by implementing the government programs such as  “Produce in Georgia”, the cheap credit program, on the other hand, the Georgian production may face problems. Chinese products are known around the world for their cheapness, just for this reason  China has been able to conquer many big markets in  the world. Therefore, the question arises – whether the Georgian products will  be able to compete with Chinese.

Economic expert Demur Giorkhelidze sees more threats in the free trade relations with China than opportunities. He believes that removal of trade barriers, on the one hand, will  flood  the Georgian market with  Chinese goods, on the other hand, the Georgian manufacturers will  offer nothing to  the Chinese market that China doesn’t produce at a lower price.

According to him, the Chinese government and the Chinese intellectual elite focus on business development while nothing like that happens in Georgia.

Given the current  challenges,  the expert Emzar Jgerenaia believes that the possibility that Georgian products will  enter the market without any barriers should be put on the free trade agreement with China.