Trade between China and Georgia has increased rapidly in the past several years, and Chinese companies are playing a key role in boosting the bilateral cooperation. Natalie Carney has the story.
China’s Hualing group in a recognizable name in Georgia. The company is currently involved in building the largest business trade centre in the caucuses here on the outskirts of Tbilisi.
“This is the largest trade center that we have invested in Georgia. It will activate the whole Black Sea area after the construction is done. The trade center covers an area of 420 hectares and it is only part of our investment plan,” said Wang Shengxin, general manager, Hualing Group Georgia.
Since 2009 Hauling have invested upwards of USD 500 million into infrastructure, forestry and finance across the country.
“Georgia for us is a unique country with very good resources and nice people. The investment environment is very beneficial for the investments and also the scenery is beautiful so these are the reasons we decided to stay and develop here,” he said.
Hualing was one of the first companies to take advantage of a Georgian push for foreign trade markets and investment following a souring of relations with Russia back in 2006.
China's Hualing group may be the biggest investor in Georgia's burgeoning economy, but it is certainly not the only one! According to data from the Georgian Statistics bureau, FDI from China to Georgia reached 218 million dollars in 2014 - with more than 20 Chinese companies operating in the country.
Bilateral trade has also surged between the two countries with Georgian exports to China increasing by over 400% in the last three years!
This is where the exports started to increase dramatically.
Maya Grigolia works for a research group conducting a feasibility study on a Free Trade Agreement currently being discussed between China and Georgia, which is expected to be signed this year.
“For example the study shows that GDP will increase 0.05% only because of this Free Trade Agreement and will increase Georgia’s exports up to 30% within 10-15 years,” said Maya Grigolia, Research Director PMCG.
China admits that Georgia has a key role to play in its new Silk Road initiative as a hub between Asia and Europe. For one, Georgia’s comprehensive free trade agreement with the European Union can help expand China’s export markets.
“This Free Trade Agreement has to be very careful, to bring the investor to Georgia. To produce here, to use Chinese intermediate products, to finalize on Georgia’s territory and then export to the European Union,” she said.
Meanwhile the nearly completed Kars-Tbilisi-Baku railway, will help facilitate the movement of goods from Central Asia and China to Europe.
As will a new Black Sea port on Georgia’s western coast, currently being built by a joint Georgian/US consortium.
Georgia’s economic stability is dependent on export and investment diversification. China and the One Road and One Belt Initiative are giving the country hope of a prosperous future.
