MoE Reports to Parliament on DCFTA Implementation Plan 2018-2020

On Wednesday of last week, Deputy Minister of Economy and Sustainable Development Genadi Arveladze reported on the progress made in the 2018 National Action Plan and presented the 2019 Action Plan for the Deep and Comprehensive Free Trade Area Agreement (DCFTA) between Georgia and EU Member States to the Parliamentary Committee on European Integration. Currently, the DCFTA Implementation National Action for 2018-2020 is currently being carried out by the Ministry of Economy and Sustainable Development and other responsible entities, including the Ministry of Environmental Protection and Agriculture and the Ministry of Regional Development and Infrastructure.

The DCFTA, or Deep and Comprehensive Free Trade Area, entered into force in July 2016 as part of the Association Agreement Georgia signed with the European Union in June 2014. The preferential trade regime increases market access between the EU and Georgia based on a system of better-matched regulations. Georgian businesses have so far struggled to benefit from the regime, however, as the main potential export, agricultural products, have failed to overcome the hurdles of European technical, quality, and food safety regulations. This is clearly reflected in the 2018 trade balance figures: exports from Georgia to the EU increased by 11.5% to $730.3 million, while imports from the EU into Georgia increased 19.5% and amounted to $2.6 billion. Overall, trade turnover increased by 17.7% ($3.4 billion). Arveladze attributes the growth to the DCFTA.

The fact that not only has the overall volume of exports increased, but the number of companies who export goods abroad increased by 37% to 789 companies, is a strong indicator that the growth has not been concentrated at the top, in large, already successful businesses. Arveladze explained that during the period of 2014-2018, recognition of Georgian products in the EU significantly increased, particularly for agriculture products: kiwi, dried lemons, persimmon, black currant, apples, quince, and fruit jams. Arveladze also mentioned pet furniture and glass bottles as products from Georgia recognized in the EU for their quality and value. Georgia is actively cooperating with relevant EU institutions to help open the EU market for the import of Georgian animal-origin products, he noted.

Arveladze thanked the German International Cooperation Society (GIZ) for the support in developing Georgia’s export strategy, which is now focusing on the value chains of textiles, furniture and communication technologies for potential export to EU markets.

Arveladze also briefed the parliamentarians and attending civil society representatives on issues of phytosanitary measures, customs, state procurement, environmental protection and other ongoing and planned reforms designed to bring Georgia’s internal standards more in line with Europe’s as part of the DCFTA. Establishing a regulatory system for industrial products is a key priority for the ministry, including changes in product safety and the adoption of technical regulations in industrial conditions. Another major area of work has been geographical indications (GIs). At their annual meeting in March last year, the EU-Georgia Sub-Committee on Geographical Indications approved GI protections for several products, including: Tkibuli tea, Machakhela honey, Kutaisi greens, and Akhalkalaki potatoes.

By Samantha Guthrie

Image source: Ministry of Economy and Sustainable Development

15 April 2019 17:42