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Saturday, 22 October 2016


Kobalia dooms Tbilisi to ill health

2010-08-25 11:23

6735.jpegGeorgia is planning to hold a solid and stable privatization program as was stated by Vera Kobalia, minister of economy and sustainable development in July. "All on sale by auction" is the motto adopted by the head of the economic authority. Presently, facilities in the very center of Tbilisi have come in Vera's view. They will soon be put up for auction and sold to refill the state treasury that is thinning away. The price is not specified but as presumed it's not one lari.


Georgia's economy minister openly admits: despite ongoing privatization that started in Georgia a few years ago there still are a sufficient number of facilities - an eyesore to the government. Years of start-up that brought nearly USD 72 million to the state's moneybox are gone, and now Ms. Kobalia wants to make the privatization process even more intense and, consequently, more profitable.

Let's take a look at the so-called privatization map of Georgia. Over the recent time several curious facilities were transferred to individual use: Gruznefttrans, Ocean Shipping, Betonconstruktsia plant, Machakhela hydro-electric plant, Batumi's central market, Chakva tea factory in Batumi, Napiri publishing house in Tbilisi, center for development of human resources - also in Tbilisi. Besides, there are Georgian Telecom, Tbilisi cinema hall in Batumi, Electrovozostroitel now owned by Dema Computers Limited (Russia), research and development institute of Automatics and Computer Engineering, Iveria hotel in Kobuleti, Tbilaviastroy, Inturist in Batumi and a large number of non-residential spaces ibidem.

Formerly, the facilities that really needed private hands, investments and consequently modernization and development were offered for auction. Now, however, Kobalia aims at the assets that, as she thinks, are of great value and interest to the investors. What if a future bidder is interested in Svertitskhoveli or Samtavro, will he be able to agree with the economy minister on a decent price for one of these assets?

Manana Nachkebia, the Right Opposition faction leader, thinks that total privatization is an interim measure that does the economy no good failing to solve state budget problems:

- Over the recent years the budget has been refilled mostly by privatization. That is why the government decided to liberate buildings in the center of Tbilisi as soon as possible to sell them. The focus must be the administration's right decisions and development of various economy sectors, not the economy's dependence on privatization. Most importantly, the war with Russia only forced investors to stop investing into Georgia. That is why we are rushing with privatization now.

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