Publication:  N34 / Review period:  March 1 - 31, 2024 / Author:  Arsen Araqelov 

Review of Russia’s Economic Relations with Abkhazia and the 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

Delegation of the Russian Ministry of Economic Development in Sokhumi

On March 25, a delegation of the Russian Ministry of Economic Development visited the de facto Republic of Abkhazia. The delegation included the Deputy Director of the Department for Special Programs and Projects of the Ministry of Economic Development, Anton Melnik, and the Deputy Minister of Economic Development of Russia, Dmitry Volvach.

The delegation got acquainted with the ongoing and completed work within the framework of the 2023-2025 investment program which was developed by the Russian government to promote the socio-economic development of the de facto republic. In a conversation with journalists, Volvach noted the de facto republic will receive RUB 5.6 billion in financial assistance from Russia in 2024.

The parties confirmed the 2024-2025 plan for the ratification of “legislation” whose one of the goals is to provide appropriate conditions and security guarantees for Russian private investors in Abkhazia.

Reconstruction of Sokhumi Airport

Preparatory work for the reconstruction of V. Ardzinba Sokhumi International Airport continues. Employees of the de facto Ministry of Emergency Situations are clearing the area around the airport from trees and bushes. A search for unexploded ordnances is also underway. The de facto Vice President, Badra Gunba, also visited the works.

Reconstruction work is being carried out by a company of Rashid Nurgaliev, the son of the Deputy Secretary of the Russian Security Council. Reportedly, technical flights from the airport will start no later than July 2024, and the airport will be fully operational on December 31, 2024. 

Melnik, who was on a visit to Sokhumi, confirmed the start date of the airport. During the visit, he paid special attention to the ongoing work on the territory of Sokhumi Airport. Melnik said that RUB 12 billion was invested in the airport reconstruction project, and the first test flight from Russia to Sokhumi Airport will take place this year.

On March 26, the de facto Minister of Energy and Transport, Jansug Nanba, met with residents of the village of Babushara and discussed with them the airport reconstruction. Telegram channels of Abkhazia reported that the de facto government plans to evict the local population to expand the airport territory. Nanba denied the reports and stated that the meeting with the population served to inform them about the ongoing work.

It is worth noting that Nanba also mentioned that the customer company plans to expand the airport which is due to the fact that part of the complex was transferred to the use of the de facto Defense Forces and corresponding structures of the Russian Armed Forces.

Meeting with the Russian Tourism Joint Stock Company

On March 13, in Moscow, the de facto Deputy Prime Minister and the Minister of Economy, Kristina Ozgan, and the de facto Minister of Tourism, Teimuraz Khishba, met with the General Director of the Russian JSC “CAUCASUS.RF,” Andrei Yushmanov. The meeting was also attended by Pyotr Pantyukhov, the Deputy Head of the Department for Special Programs and Projects of the Russian Ministry of Economic Development.

“CAUCASUS.RF” is actively working on the development of the tourism and recreational sector in the North Caucasus Federal District of Russia. The meeting discussed the prospects for cooperation in the field of tourism development. 

Abkhazia at the Tourism Exhibition in Moscow

On March 19-21, Moscow hosted the International Travel and Hospitality Show, MITT-2024, in which Abkhazia also participated. At the exhibition, the stand of the de facto republic of Abkhazia was presented in the style of the Shakurani cave located in Gulripshi. The members of the delegation were the de facto Minister of Tourism, Teimuraz Khishba, and representatives of Abkhaz tourism companies. Abkhazia's “Ambassador” to Russia, Alkhas Kvitsinia, also visited the exhibition.

The tourist exhibition which has been held in Russia for 30 years represents delegations from 58 regions of Russia and 29 different countries. The exhibition allows participant countries to demonstrate their tourism potential to Russian citizens.

Stand of Abkhazia at the Tourism Exhibition

Tourist Train – “Sochi”

The tourist train Sochi on the Tuapse-Sochi-Gagra route will resume operation on May 1. In 2023, the train served 40 thousand passengers.

Economic Relations between Russia and the Tskhinvali Region

Alan Gagloyev’s Visit to the Kvemo Zaramagi CCP

On March 1, the de facto President of the Tskhinvali region, Alan Gagloyev, held a working meeting at the Kvemo Zaramagi crossing checkpoint (CCP). The CCP is the only land route between Russia and the Tskhinvali region. Gagloyev met with the Director of the Department of State Policy in the field of arrangement of checkpoints across the state border of the Russian Federation of the Russian Ministry of Transport, Mikhail Kokaev.

Gagloyev got acquainted with the progress of construction work at the CCP, the purpose of which is to modernize and increase its capacity. According to Kokaev, additional traffic lanes will be put into operation shortly, which will solve the traffic jam problem at the checkpoint. After the reconstruction, the CCP will serve an additional 400 cars per day. In good weather, an average of 70 trucks and 1000-1100 cars pass through the checkpoint daily.

Unified Customs Tariff

On March 29, the so-called parliament ratified a “law” according to which the rates of the EAEU Unified Customs Tariff will apply to goods entering the region.

Despite many years of active work to harmonize the customs services of Russia and the region, there were fears in the region that the use of the EAEU Unified Customs Tariff would be unprofitable for the “budget” and local residents. Before the ratification of the Law, the de facto Minister of Finance, Dzambolat Tadtaev, focused on the issue.

According to Tadtaev, given that 95% of goods imported into the region come from Russia, the adopted unified tariff will affect products coming from all member states of the EAEU, except Russia. According to the so-called Minister, only 5% of imported goods come from “third countries.” Consequently, these goods will be taxed under the EAEU Unified Customs Tariff, and the “law” will not apply to goods imported from Russia.