Publication:  N7 / Review Period:  October 1-31, 2021/ Author: Nika Kratsashvili

Overview of Russia’s Economic Relations with Abkhazia and Tskhinvali Region is being prepared within the framework of the project - Roadmap to Kremlin's Policy in Abkhazia and the Tskhinvali Region. The purpose of the publication is to provide an overview of economic relations between Russia and Abkhazia and the Tskhinvali region. The review is a monthly publication and will be useful for everyone – decision-makers, public employees, media representatives and other people who are interested in the Kremlin policy in the occupied regions of Georgia.

Economic Relations Between Russia and Abkhazia

Participation in International Events

• On October 1-2, the Chamber of Commerce and Industry of Abkhazia participated in the Expotravel-2021 international tourism exhibition in Yekaterinburg. As part of the exhibition, the Ural Tourism Association and the Abkhaz Tourism Union signed a cooperation agreement.
• The Abkhaz Chamber of Commerce and Industry, at the invitation of the Chamber of Commerce and Industry of Karachay-Cherkessia, participated in the I International Youth Business Forum which was held in the city of Teberda, on October 8-10. A pavilion of Abkhaz products was presented at the forum. The forum involved a total of over 150 young entrepreneurs. The cooperation agreement between the Chambers of Commerce and Industry was signed in August 2021.

Abkhaz Pavilion at the Expotravel-2021. Source:  Apsadgil

Bzhania’s Visits to Moscow

• In October, Aslan Bzhania, the de facto President of Abkhazia, paid two “official” visits to Moscow. During his October 8-16 visit, Bzhania met with the Russian Deputy Prime Minister, Marat Khusnullin, representatives of Gazprom and its subsidiary Gazprom Promgas, the Director of the Federal Agency for Air Transport, Alexander Neradko, the Defense Minister, Sergey Shoigu, and the Finance Minister, Anton Siluanov. Bzhania and the de facto Minister of Economy, Kristina Ozgan, discussed the socio-economic development of Abkhazia in 2023-2025, gasification of Abkhazia, restoration of the Sokhumi airport, etc. After the visit, Bzhania took personal control of the implementation of the investment program and visited the facilities included in the program. Bzhania announced the establishment of a dedicated headquarters to oversee the implementation of the investment program.
• On October 26, as part of his next visit to Moscow, Bzhania together with Valery Papba, the Deputy Head of the de facto Presidential Administration, and Kristina Ozgan met with Dmitry Kozak, the Deputy Head of the Russian Presidential Administration who oversees the directions of Abkhazia and the Tskhinvali region. The main topic of discussion was the issues related to the socio-economic development of Abkhazia for 2022-2025. Later, Bzhania discussed the gasification scheme in Abkhazia during a meeting with the Russian Deputy Prime Minister, Alexander Novak; while a meeting with the Minister of Transport of Russia, Vitaly Saliyev, discussed the development of transport infrastructure and the restoration of air traffic in Abkhazia. Bzhania also met with the Russian Sports Minister, Oleg Matitsin, and discussed sports cooperation between Russia and Abkhazia.

Cooperation with Regions of Russia

• The de facto Ministry of Health of Abkhazia purchased two ambulances with the money received as a gift from the former President of the Republic of Adygea, Hazret Sovmen.
• Entrepreneurs from Stavropol Krai, together with representatives of the Pyatigorsk Chamber of Commerce and Industry and the Stavropol Krai Industry Support Fund, visited Abkhazia.

“Customs” Issues

A meeting between the Russian and Abkhaz “customs” services was held in Sochi. Natalia Polosukhina, the Head of the Krasnodar Customs Service, Konstantin Kozlov, the “Representative” of the Russian Federal Customs Service in Abkhazia, and representatives of the Abkhaz “Customs Committee” participated in the meeting. It was noted that in summer, the load at the Adler customs checkpoint five times exceeded the design capacity. The main topic of discussion was the export of agricultural products to Russia.

• In the framework of the International Customs Forum 2021, the Russian Federal Customs Service and the Abkhaz Customs Committee signed three documents in Moscow.

International Customs Forum – 2021. Source:  Apsadgil

Banking Service Development

The national payment system APRA, together with NSPK JSC (operator of the Mir payment system), have successfully tested a service that allows money transfers from Mir cards to APRA World cards. The service will allow holders of Russian bank cards to make transfers to a card of any bank that is a member of the APRA payment system. In the first nine months of 2021, the volume of transactions in the APRA system reached RUB 18.9 billion.

Tourism

• The high-speed passenger catamaran Griffon of the Vodokhod Express Russian company will connect Sochi and Sokhumi for the first time after a 29-year hiatus. On October 10, the catamaran docked at the Sokhumi port on a test route which took 3 hours and 15 minutes. The traffic will operate from May 1 to October 1, 2022.
• As part of his visit to Moscow, the de facto Minister of Tourism, Teimuraz Khishba, held a meeting with the Abkhaz-Russian working group to discuss the insurance issue for Russian tourists spending holiday on the territory of Abkhazia.

Economic Relations between Russia and the Tskhinvali Region

Visit of Government Officials

On October 1-2, a delegation of the Russian Ministry of Economic Development headed by the Deputy Minister, Dmitry Volvach, visited the Tskhinvali region. The delegation included Vitaly Gudin, the Director of the Ministry’s Department for Special Programs and Projects, overseeing the directions of Abkhazia and the Tskhinvali region, and his Deputy, Anton Melnik. The purpose of their visit was to inspect the facilities under the Russian investment program. The delegation visited the newly opened Tskhinvali N3 public school, a building under construction on Heroes Street, the basalt factory, the State Drama Theater, the State University of South Ossetia, and a new maternity hospital in Tskhinvali. The meeting with the de facto President, Anatoly Bibilov, discussed the economic issues of the Tskhinvali region, the investment program, and the future plans. The budget of the 2020-2022 investment program totals RUB  4.5 billion.

Delegation of the Russian Ministry of Economic Development in the Tskhinvali Region. Source: Cominf

Russian Energy Week

The de facto Prime Minister of the Tskhinvali region, Gennady Bekoev, took part in the Russian Energy Week international forum which was held in Moscow on October 13-15. The forum discussed the issues of traditional and renewable energy sources, as well as international energy cooperation. The forum has been held since 2017.

Conference in Tskhinvali

The international conference - South Ossetia at the Crossroads of Civilizations. Problems of Security and Sustainable Development, with the participation of the Russian National Committee for Black Sea Economic Cooperation was held in Tskhinvali. The conference focused on the development of economic infrastructure and the agro-industrial complex in the Tskhinvali region, the training of young people at the College of Digital Technologies and other issues.

Test Bus Route to Vladikavkaz

A test bus route was launched from Kvaysa to Vladikavkaz. For the first time, only five passengers used the public transport. The test route did not even cover its own expenses. Residents of Kvaysa did not have any information about the start of a new bus route, and they requested the bus to start the route directly from Kvaysa, not from Tskhinvali.