2016-06-18
Secretary Rumsfeld thank you very much,
We are honored to be hosting you in Georgia, I am grateful to the Rumsfeld Foundation and Central Asia-Caucasus Institute at Johns Hopkins University for organizing the CAMCA Regional Forums. I am glad that this year Tbilisi was selected as a site for holding this regional event.
I would like to especially thank Secretary Rumsfeld for his support of Georgia and the region throughout his career in in the United States Government and now.
As I look around the room, I'm inspired to see so many Rumsfeld Fellows who are contributing to the development of their respective countries. I also experienced first-hand the profound impact of a study fellowship in the United States. In the 1990s, when enrolling in the top American universities seemed nearly impossible for someone from this region, I was given the opportunity to pursue graduate studies at the University of Illinois as a Muskie Graduate Fellow, a program funded by the US State Department.
That experience was nothing short of life-changing, and it motivates my efforts to forge closer ties between Georgia and the United States.
I am excited that you are here to discuss important geopolitical and economic developments in the region. From my perspective, the timing for this Forum could not be better, as last month we celebrated Georgia's 25th anniversary of regaining independence.
Our small nation has overcome poverty, has gone through the civil war, invasion by Russia and partial occupation by a neighbor many times our size. We have built a modern, dynamic democratic state. While there is still more work to be done, we are fully committed to making Georgia a model of institutionalized democracy.
We did not do this alone. Friends and allies helped us get to where we are, first and foremost the United States. We feel this debt keenly, and we are committed to repaying our part of this bargain to preserve the values we share.
Our nation's success is rooted in three pillars - economic development, security, and democracy. While I will focus my remarks today on economic development, it is important that I update you on all three as they are inter-related.
In recent years, we have made great strides in making Georgia an attractive place for international investment. In the first quarter of this year, foreign direct investment in Georgia reached USD 376.3 million USD - more than double FDI in the same period last year.
Our generally cooperative relationships with all our neighbors and near-neighbors make us an excellent jumping-off spot for doing business in the Caucasus, Middle East, Turkey, or even Russia.
When investors look at Georgia, they see a country that is stable, welcoming, and on the rise.
According to the World Bank, we are one of the easiest countries in which to do business. We have the 9th lowest tax burden in the world. And all the major credit rating agencies consider us stable.
We believe promoting internal economic development goes hand in hand with attracting investment. My government has adopted a Four Point Reform Agenda designed to ensure sustainable development and inclusive growth.
Reforms will cover the tax system and capital markets, as well as the education, health, and pension systems. All of this underscores the Government's commitment to creating a modern, educated, and healthy Georgian workforce that is ready to compete in the global economy.
After more than a decade of successful reforms and considerable public investment, Georgia is becoming a vital connector for transport and transit on the New Silk Road.
We are working hard to install the necessary "hardware" - transport and logistics infrastructure. In parallel, we are making a lot of progress on acquiring the "software" of international trade.
Hardware
With respect to transport and logistics infrastructure, the further development of our Black Sea ports is a critical step. The new Anaklia Deep Water Sea Port, which is being developed by a consortium that includes the US-based Conti Group in New Jersey and Georgian companyTBC Group, will handle 100 million tons of cargo annually and accommodate large Panamax type vessels.
We are also modernizing our railway network. Two large tunnels are being constructed to connect Georgia's east and west, which will increase rail speed by 50% and triple our network's capacity.
Together with our Azeri partners, we are building the Baku-Tbilisi-Kars Railroad, which will connect Georgia and Azerbaijan to Turkey, and through it to the EU. This will allow 45% faster delivery from Asia to Europe.
The East-West Highway, Georgia's main transport artery, is also being upgraded with the help of the World Bank, Asian Development Bank and other donors.
Logistics is an area that will require ongoing investment. It is encouraging that international companies sense the opportunity and are willing to invest. For instance, Gebruder Weiss, an Austrian transportation giant, partnered with Tegeta Motors to build Georgia's first A Class logistics center near Tbilisi International Airport.
We're working to build on all this "hardware" by putting in place the right "software." We already enjoy free trade with markets totaling 900 million people, spanning from the EU, Turkey, and the CIS countries to the US, Canada, Japan, and the EFTA countries (Iceland, Liechtenstein, Norway, and Switzerland).
The Deep and Comprehensive Free Trade Area (DCFTA) with the EU that took effect in 2014 gives Georgia the opportunity to further integrate into EU markets and diversify its economy.
The DCFTA also carries important benefits for our partners, potentially enabling Chinese and other companies to supply the EU market in a more cost-effective manner.
When it comes to trade promotion, China is one of our top priorities. We conducted a joint feasibility study of a Chinese-Georgian FTA and have already begun negotiations. Our analysis indicates the FTA will boost Georgian exports to China by almost 10% per year, including a nearly 29% increase in the export of wine products. What's more, by building on our existing free trade frameworks, an FTA with China will give Georgia access to one-third of the world population.
On top of these free trade agreements, we are implementing a holistic approach to border management modernization. The excellent balance between trade facilitation and customs control that we've achieved is dramatically increasing capacity, and Georgia is now widely considered a model for reforming customs administration.
We are also working to harmonize tariffs and customs procedures. Already today, goods transit through Georgia from Asia to Europe and back again with remarkable ease and low cost.
Let me turn to the security situation because economic development depends upon stability and peace.
Our relationship with our NATO allies is excellent. Georgia's European and Euro-Atlantic choice, which is the will of Georgian people, is irreversible. Our cooperation with NATO represents progress toward a more secure future for all.
Unfortunately, Georgia's aspiration to join the democratic family of European nations is falsely perceived as a threat by our Northern neighbor.
Georgia's membership in NATO will widen the zone of security and stability in Europe. And we know that a stable region is a precondition for economic prosperity.
Security and prosperity are nothing without freedom.
In the past, the lack of an independent judiciary in Georgia was a challenge to the country's democracy.
We have taken consistent and decisive steps to protect the judicial branch from political, financial, or any other influences.
And we have ensured that judges and prosecutors have life tenure and peer-to-peer regulatory oversight.
We also firmly believe in freedom of expression and free media. In 2015, Reporters Without Borders rated Georgia as a leader in Eastern Europe, and Georgia has advanced in the most recent rankings.
Our commitment to freedom of expression is crucial this year as we look ahead to October's parliamentary elections.
Since 2012, we have delivered free elections at both the local and presidential levels. We eagerly anticipate election monitoring this year as we work to ensure that the 2016 elections are the most transparent and fair in Georgia's history.
This democratic progress is squarely in line with the values of the Georgian people.
As Georgians, we are proud that our country's economic and democratic progress are vital sources of regional stability.
We appreciate the important role of the CAMCA Forum in helping advance regional economic growth and development.
To all participants, and especially the Fellows, let this gathering strengthen your resolve to work together to ensure that peace, stability, and democracy prevail.
Once again, I would like to thank the organizers for your commitment to Georgia and the region. I wish you all the best for a productive time in Georgia!