Monthly Review

Review of Russia's Economic Relations with Abkhazia and the Tskhinvali Region

2023 / 06 / 01

Publication:  N26 / Review period:  May 1-31, 2023 / 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

Formation of a Single Social and Economic Space

On May 17, the 3rd joint meeting of a working group was held in Moscow. The working group discussed the issues related to the implementation of a program for the formation of a single social and economic space between the Russian Federation and the de facto republic of Abkhazia.

The Abkhaz “delegation” comprised of ministers of the de facto agencies. The Russian delegation was headed by Dmitry Volvach, the Deputy Minister of Economic Development of Russia, who oversees the occupied regions of Georgia in the ministry.

Meeting in Moscow

During the meeting, the parties noted that out of 45 events planned within the program, 18 have already been completed, 17 are at the stage of implementation, and ten undergow agreement procedures. The meeting also paid attention to the harmonization of customs “legislation,” as well as to the formation of a common space in the field of healthcare, social security and education. The second half of 2023 was set as the deadline for the implementation of the remaining events.

Visit of a Delegation of the Republic of Bashkirostan

On May 22, a delegation of the Republic of Bashkortostan, headed by the Minister of Trade, Alexei Guseev, visited the de facto Republic of Abkhazia. Guseev met with the de facto Deputy Prime Minister and the Minister of Economy, Kristina Ozgan. The parties discussed the issue of increasing turnover and transit potential. Attention was also focused on the creation of a trade corridor for the export of wine, citrus, nuts and other products from the de facto republic.

Along with Guseev, heads of large enterprises of Bakhshirostan interested in direct trade relations also visited the occupied Abkhazia. During the visit the delegation met with Ozgan and visited the enterprise of the Abkhaz Wines and Beverages company.

“Caucasus Investment Exhibition”

On May 2-4, the Caucasus Investment Exhibition was held in the city of Mineralnye Vody, Russia. It should be noted that this type of exhibition was held for the first time and it was visited by the de facto President of Abkhazia, Aslan Bzhania. Russian high officials also attended the exhibition.

During the visit, Bzhania met with the Deputy Prime Minister of the Russian Federation, Alexander Novak, who supervises the occupied regions of Georgia. Abkhazia's energy problems and the reconstruction of Sokhumi Airport were discussed at the meeting.

Meeting Between Aslan Bzhania and Alexander Novak

A meeting between Bzhania and the Russian Prime Minister, Mikhail Mishustin, discussed planned projects in the field of gasification and tourism. According to media reports, while observing the Abkhaz stand, the Prime Minister of Russia expressed his interest in the reconstruction project of Sokhumi Airport. Mishustin also shared his memories of his vacation in Abkhazia a long time ago and emphasized the tourism potential of Abkhazia.

Economic Relations Between Russia and the Tskhinvali Region

Memorandum with the Russian Export Center JSC

On May 30, the President of the de facto republic, Alan Gagloyev, met with Veronika Nikishina, the General Director of the Russian Export Center JSC. During the meeting, the parties signed a memorandum which envisages cooperation in trade and economic fields. The Russian Export Center JSC supports the export of products from Russia to the de facto region. During 2022, the center contributed to the export in the amount of USD 20.6 million which is a 40% increase compared to 2021.

Meeting Between Alan Gagloyev and Veronika Nikishina

Caucasus Investment Exhibition

The de facto President, Alan Gagloyev, also attended the Caucasus Investment Exhibition held in Mineralnye Vody.

It should be noted that the Tskhinvali region was represented quite largely at the exhibition and the Prime Minister of Russia, Mikhail Mishustin, visited the region’s stand as well. At the exhibition, the occupied region presented dairy products, wine (products of Ironsan Winery and David Lokhov's private winery), beer (Highland Keli Brewery LLC), mineral waters (Bagyati Bottling Plant), sauces (ASSA TUAG and Entrepreneur Dzhigoit M. P.), honey (Entrepreneur Akopova N. G.), tea (Entrepreneur Abaeva A. S.).

In addition to food products, the Ir Basalt company, which will soon begin production, was also presented. According to the de facto Deputy Prime Minister, the exhibition also featured mining products and minerals needed for construction materials: diabase, andesite, siltstone, chalcopyrite, serpentinite, various types of tuff, etc. Along with this, brochures talked about the tourism prospects of the Tskhinvali region and the investment potential in this area.

According to Gagloyev, at the exhibition, the Tskhinvali region presented a mineral project which is in the process of development. The project turned out to be interesting for investors. A meeting between the de facto President and Mikhail Mishustin mainly discussed the export of lead.

Aslan Bzhania and Alan Gagloev at the Caucasus Investment Exhibition