Azernews.Az

By Leman Mammadova

Positive changes in the economy of Azerbaijan and Russia will help to neutralize the negative effect of the depreciation of the Turkish lira for Georgia, Trend reports citing the report of the International Monetary Fund (IMF) on Georgia.

The report noted that a prolonged depreciation of the lira could lead to the departure of Turkish companies operating in Georgia, especially in the textile sector. Nevertheless, analysts of the fund believe that in the near future, Turkish manufacturers will maintain a high interest in Georgian resources. The prolonged depreciation of the lira and high inflation in Turkey will limit remittances from this country.

In the near and medium term, the lira depreciation would curb the financial capacity and risk appetite of Turkish investors in Georgia, affecting new FDI inflows.

Since the beginning of the year, the Turkish lira has fallen by almost 30 percent against the dollar. As of Dec. 20, $1 equals 5.3025 Turkish liras.

Relations between Turkey and Georgia are strategic both at bilateral and regional level.

Georgia plays the role of transportation of Caspian Sea energy resources to Turkey and the Western markets as well as a door for transport links between Turkey and Azerbaijan, Russia and Central Asia.

Turkey and Georgia together with Azerbaijan continue the trilateral cooperation at highest level in various fields, particularly energy and transport. The Baku-Tbilisi-Ceyhan oil pipeline, the Baku-Tbilisi-Erzurum gas pipeline and the Baku-Tbilisi-Kars railway are concrete examples of this cooperation as well as Southern Gas Corridor, Lapis Lazuli projects.

At present, the two countries intend to expand the agricultural cooperation as well.

Turkey is the largest trading partner of Georgia. At the same time, the country also has a large share in direct investments, tourist flow and remittances to Georgia.

In January-November 2018, the trade turnover of Turkey and Georgia amounted to $ 1.55 billion (13.7 percent of the total trade of Georgia). The main export items in Turkish export are plastic products, machinery and equipment, electrical tools, iron and steel goods, while scrap metal and petroleum products are being imported from Georgia.

Turkey is in seventh place for remittances to Georgia - $7.56 million. In the third quarter of 2018, Turkey also ranked fourth ($ 32.1 million) in terms of direct investment in Georgia.

There are 27 Turkish companies with a capital of more than $ 1 million in Georgia. So far, about $3.5 billion worth of 197 projects have been undertaken by Turkish contracting firms. Areas of activity of Turkish companies are concentrated in areas such as power plant, touristic facility, housing and road construction. Turkey since 2004 until today has made a total amount of bilateral development assistance of $101 million to Georgia.

According to the protocol signed between the two republics at the end of 2011, the citizens of both countries may travel to each other only with a personal identification card.

In January - October 2018, a total of 1,792,478 tourists from Georgia visited Turkey, which makes 5.04 percent in the total number of foreigners who visited Turkey in January - October 2018.

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