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Wednesday, 26 October 2016


Georgians dream of Singapore

06.07.2010  |  14:30

6291.jpegGeorgian economy must follow Europe's example, as Vera Kobalia, Georgia's new minister of economy and sustainable development thinks. Kobalia mentioned... Singapore - as a European example Georgia must look up to. In her opinion the post-Soviet republic must focus on tourism and small enterprises. GeorgiaTimes correspondent discussed whether the head of Ministry of Economic Development will manage to set up a "Georgian Singapore" with Sergey Demidenko, expert at the Institute of Strategic Analysis and Evaluation and Giorgy Khukhashvili, an economic expert in Georgia.


"If we want Georgia to develop - I appeal to my colleagues - let's work every day to make our small businesses more solid and foster tourism in the country", - Vera Kobalia is quoted by Business Georgia.

The new economy minister believes that Georgia must not waste time and become a European Singapore. To achieve this, the country must eradicate unemployment, boost agriculture and tourism as well as attract investors.

A million-dollar question: how does Mrs. Kobalia imagine a hybrid of an Asian technological paradise in an agricultural and tourist shell of Georgia? To answer the question let's turn to the history of the Asian state.

As we know, by the time when Singapore gained independence it was a small poor country that lived on imported drinking water and construction sand. However, Lee Kuan Yew managed to solve a heap of domestic problems helping Singapore make a leap from a third-world country to a progressive state with a high standard of living. Lee Kuan Yew based his strategy on foreign investors invited to the country as well as the fight against corruption. As a result in 30 years' time Singapore became one of the most corruption-free countries.

Remarkably, this anti-bribery campaign was declared in Georgia too and corruption rate did drop in the country. However, the state budget greatly depends on the Western aid, and it is quite hard to attract investors in a situation like this let alone pushing up agriculture.

GeorgiaTimes correspondent asked the experts if it was really so.

Sergey Demidenko: I would say that such statements should not be taken seriously in the literal sense. Anyway a top-ranking politician holding a responsible position must make catchy statements outlining his/her intentions for further activities. That is why we rather often hear such statements from new persons in this or that administration. "Following Singapore's example" sounds catchy and interesting. However, Georgia has no possibilities to do that so far since the foundation of Asian Tigers' economies was technological breakthrough. And I don't know whether Georgia will be able to make this breakthrough on its own. I know nothing of scientific, technological and educational basis for things like that. That is why this is just a bright statement by a new politician who wants to make herself heard - nothing more.

Georgy Khukhashvili: new minister Kobalia repeats the words of other leaders that are busy making up plans, so her statements should not be taken seriously. As for Singapore, this contradicts statements on the Western vector and Georgia's integration into European structures. How do authorities see it: joining the EU and announcing Singapore as an example? These are mere slogans with nothing behind them. This is pure propaganda. In my view, now Georgia is on the way of nomenclature capitalism - a purely post-Soviet option.

Will Georgia be able to boost agriculture, attract investors and develop tourism?

Sergey Demidenko: Honestly speaking, these things sound somewhat dubious to me firstly because I don't know what can be attractive to investors in Georgia. Moreover, in terms of agriculture Tbilisi continues to depend on CIS market, the main market for the republic. Georgia's potential is too poor to compete on Western European, American or Asian markets. Its potential is limited by scarcity of fertile lands and agricultural resources. The only investors that might get interested in the republic will come from ex USSR. As for tourism, it implies a well-developed infrastructure that must be created. Only then will people come. But, I repeat, those who like having a good vacation, willingly spend their money in Europe, Asia and other popular places. Georgia used to be a health center for the Soviet Union, greatly due to Abkhazia and its unique natural characteristics. That is why setting up a tourism infrastructure Georgia must focus on CIS market. And as we know lately Tbilisi has been consciously distancing itself from this market which is now the main obstacle for a national economy to start growing.    

Georgy Khukhashvili: In theory Georgia is capable of raising its economy. But with the current system now dominating in the country this is definitely impossible mainly because of systemic errors that the authorities continue to make.

Ruslan Chigoev

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