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Who will Suffer from Restrictions on Trade between Georgia and Russia?

What are the consequences of trade restrictions between the two countries, which Russia intends toimpose abolishing the free trade agreement? What processes should be expected, and how innovation will affect the activities of Georgian exporters?

According to the expert Emzar Jgerenaia, in this situation Russian exports will suffer more, as Russiaexports to Georgia 4 times more than imports.

“If the free trade regime is cancelled, then  Georgia will have to introduce customs duties on goods from Russia, respectively, the Russian products will facenot less  problems in Georgia than Georgian goods  in Russia. Customs duties in Russia are very different, exporters mainly pay 12%, which is less than in Georgia. At the same time, despite the abolition of free trade agreement, Russia still remains one of the priority markets for Georgia. If amaximum duty of 12% is not imposed on Georgian products, this will  not affect the Georgian export,”- he notes.

An expert Roman Gotsiridze has a different opinion, who believes that Russia’s withdrawal from the free trade agreement will significantly reduce profits of Georgian exporters.

“The introduction of customs duties will be an additional barrier for Georgian goods, they will rise in price, respectively, their competitiveness will decline. It is necessary to calculate what are the maximum tariffs on various products under  the WTO framework, a member of which is Russia. The main thing that export will not be  banned and mechanisms of the Phytosanitary Service and Rospotrebnadzor will not be involved, etc. “- the expert notes.

According to the Presidential Adviser on Economic Affairs of Georgia George Abashishvili, the decision of the Russian government does not provide for a ban on the export of any goods

– it means that Georgian products will be customable.

“Georgia will not face any serious problems in this case, or even if a full ban is introduced as the European Union is the main trade partner of Georgia at this point. After signing an association agreement with the EU, our exports to Europe will grow significantly and our businessmen  should be activated in this direction, “- the adviser adds.