Flea market instead of Singapore for Georgians24.02.2011 | 13:29
Eurasia Review, a highly respected periodical, answers the question Europe has been asking for a long time: will Georgia be transformed into Singapore as Mikheil Saakashvili dreams? The verdict is categorical: no, it will not. For obvious and even natural reasons that the European analysts have enumerated in detail. Still, it's unlikely Tbilisi dreamers will take them into account. GeorgiaTimes correspondent asked Andrey Epifantsev, a Russian expert on Caucasus, if the republic's economy can make a breakthrough.
Eurasia Review specialists worked in Georgia for a few weeks only. Still, this short period of time was enough to make an obvious conclusion: Georgia will not be a new Singapore. Lately there have been a lot of expert reports trying to present Georgia's economic situation in a more or less unbiased form. And results of this research bode no good to the country's economy. However, Eurasia Review research is a particular case: it is not only a study of reforms the country has undergone and their influence on economy. The authors confirm a severe verdict that Sakartvelo will never become a new Singapore.
Indeed, theoreticians of Georgian miracle forget where they live in a fervent self-publicity campaign featuring their progress. The country's neighbors are Azerbaijan and Turkey, not China and India. The European analysts point to these quite obvious facts stating: "It is true that Georgia has the potential to become a transit country for energy resources and other goods. But unlike Singapore, it can be done only on a very small scale. Azerbaijan is not the Persian Gulf and Turkey is not China."
Singapore, a prosperous city-state has an exceptionally beneficial geographical location amidst countries with immense human resources: China, with 1,500,000,000 population in the north east, India - on the other side, plus Malaysia and Indonesia, leave alone Thailand. On the whole, nearly 2,000,000,000 people live in Indo-China.
Back to Georgia now. Turkey with 70,000,000 population, the only really big market in the region, is given the role of China. Aggregate population of Georia's closest neighbors - Armenia and Azerbaijan - is less than 10,000,000. Certainly, there is vast Russia, but it is not taken into consideration for the lack of economic ties with Georgia. So if Georgians are lucky to find goods they might export, a buyer will be hard to find. Unlike Singapore that is rich in end markets.
Still, Georgia has a chance of success. It is said in Eurasia Review report that the country might become a kind of mini Singapore. No doubt Tbilisi can play an important role in regional transit of goods and energy resources and turn into a trading center for the entire South Caucasus. Still, comparison with Singapore or Hong Kong looks more like a metaphor and a convention and has nothing to do with economy.
The conclusion is that Georgia had better not waste time on vain dreams. The only option is to become a major "flea market" in the region while its close neighbors Armenia and Azerbaijan are in a conflict. On the other hand, Georgia itself is not free of conflicting either. This fact makes Georgia's dreams to become a new Singapore even less feasible, Eurasia Review analysts point out.
The analysts emphasize that political stability and security have made Singapore the place of choice for investors and tourists. "No matter how safe the streets of Tbilisi are, as long as significant parts of the country fall outside of the control of its government, Georgia will have a hard time to convince the outside world that it is a stable and safe place to make long-term investment", - the report reads.
Here the European experts are totally right. Ideologists of "Caucasian Singapore" will have to make a choice: either to sort out numerous problems with neighbors or just remove the word "Singapore" from their economic vocabulary. The second option is more likely. Singapore is absolutely safe not because every tenth person sits in jail like in Georgia, but because it is located in a quiet part of the planet.
Meanwhile, Georgian authorities keep dreaming of a vigorous inflow of investments with reminders that the fifth part of the country is "occupied" hanging all over the country. A very curious approach like in a children's song about a miracle man bringing a surprise gift of 500 ice-creams in a helicopter. Foreign investors don't live by fairy-tales. To them Georgia is an unquiet, almost failed state.
Eurasia Review analysts don't give recommendations to Georgian authorities. GeorgiaTimes correspondent asked Andrey Epifanstev, a Russian expert on Caucasus, if there can be any recommendation at all. According to him, the country's economy in its present state can't make a breakthrough.