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Georgia’s View of the Organization of The Black Sea Economic Cooperation (BSEC)

 

H.E. Mr. Grigol MGALOBLISHVILI *

BSEC was one of the few initiatives in a post Soviet period that aimed at seizing the moment and uniting the states of the entire Black Sea region under a common regional umbrella, with the purpose of promoting mutually beneficial results. In the early 90’s this was a revolutionary initiative as it aimed to nest together two different groups of countries: on the one hand, Turkey and Greece, who had already enjoyed market economy and had more or less developed trade and investment infrastructure; on the other hand, the rest of the Black Sea countries, who were previously part of the Warsaw pact organization, with their economies built on a principle of central planning and their efforts focused on diverting trade away from non-communist countries, including their own immediate neighbors in the region.

With the collapse of the communist bloc, independent countries that emerged from the undone system found themselves exposed to the market competition that thrived in the real world. In addition, previously existing internal economic ties quickly dissolved, leaving individual countries partnerless, with national economic structures largely inadequate to the emerging market economy context.

The political collapse combined with economic hardships quickly modified the regional landscape of divided but nonetheless existing peace and tranquility into uncertainty and instability with accompanying effects of bloodsheds caused by civil and ethnic strife.

In this context, Turkey’s proposal to create a regional entity that would aim at facilitating trade between its members as well as contributing to the overall developmental process through regional cooperation was a laudable endeavor.

Proposed idea was instantly shared and thus, in 1992 the Black Sea Economic Cooperation (BSEC) was conceived with the consent of 11 black sea countries.

Since its conception, BSEC as an organization endured many changes. Throughout the years BSEC acquired a wide institutional base and has formed a culture of dialogue and communication on mutually advantageous projects. Relevant structures and institutions with special objectives, vital for the proper functioning of the Organization have been put in place. Gradualy, number of states and regional institutions have asked for the observer Status in BSEC while BSEC has successfully developed relations with many International and Regional Organizations.

Georgia’s involvement in BSEC has always been infused with the spirit of cooperation taking root from both our domestic and foreign interests. It is the main goal of our government to build a strong democratic state, at peace with its neigborus that is willing and able to assume all of its responsibilities on the regional and global agenda. At the same time, Georgia attaches great importance to tranquil regional setting and the environment of trust and cooperation for its secure internal development. Therefore, promoting and engaging in regional cooperation is one of the main directions of Georgia’s national security as well as a strategic foreign policy objective.

Georgia attaches particular importance to the development of cooperation within the frames of the wider Black Sea Region. From the days of our independence we have tried to promote good neighborly and mutually beneficial relations among neighbors. We strive to create an advantageous environment in the Region and welcome ongoing integration of the Black Sea countries and notably Turkey, into the Euro-Atlantic and European structures. We wholeheartedly welcome inclusion of Romania and Bulgaria into the EU and believe that this will have a positive effect on the stability and prosperity of the entire region.

Georgia is one of the co-founding members of the BSEC. Since the conception of the organization it has been our guiding principle to facilitate the work of the organization. Amongst other things, we are particularly proud that the Agreement of the Black Sea Trade and Development Bank (BSTDB), main financial pillar of the Organization, was signed in Tbilisi in the year of 1994. This bank is functioning very successfully and has already implemented many important projects in the Member States. In addition, the institutional mechanism of cooperation between BSEC and EU was established in Tbilisi in 1999, adopting the BSEC-EU Platform of Cooperation.

Within the BSEC format, Georgia attaches particular importance to developing cooperation in such important spheres as transport, energy, trade, agriculture and tourism as well other areas such as small-scale enterprises, science and technology, fighting organized crime, strengthening of the mechanisms of good governance, institutional renewal and others.

It needs to be emphasized that Georgia promotes regional cooperation not only through its participation in regional formats but is contributing to improving regional economic climate by adopting liberal economic policies on the national level.

Through our reforms we have contributed to intensification of regional economic ties. Thanks to significantly reducing non- tariff barriers for imports, as well as tariff rates we are enjoying better trade relations with several BSEC countries. We have also improved conditions for cargo shipment through the territory of the country as currently there are no transit fees for the vehicles and the visa procedures are significantly simplified. Free Trade Agreements as well as the Agreements regarding the visa-free regime were signed with some member-states such as Azerbaijan, Armenia, Moldova, and Ukraine while we currently have a three-month visa free entry with Turkey and are due to upgrade the current preferential trade regime with a free trade agreement.

In addition, such regional projects as The Baku Tbilisi Ceyahn (BTC), Baku Tbilisi Supsa (BTS) and Baku Tbilisi Erzerum (BTE) as well as the commencement of Baku-Tbilisi-Kars railway project and a singing of the Tbilisi Declaration on Common Vision for Regional Cooperation, is a clear demonstration of productive regional cooperation on energy and transport issues. These projects are contributing to the welfare of participating states. We would like to see this very spirit of friendship and cooperation extended to all stakeholders.

Obviously, throughout these fifteen years, the context in which BSEC was created has changed significantly. If organization started off with members who had political, economic and ideological divisions still fresh on their minds, currently, almost all the countries are progressing to a higher degree of democratic and economic development based on liberal principles.

Nonetheless, challenges still persist that hamper the full-fledged realization of the common regional agenda. Among these are perceived and real obstacles. The perceived obstacles, which feed off the zero sum-game considerations reinforced by the difference of values, are restraining an open hearted cooperation on many regional issues. On the other hand, existing ethnic conflicts in the region preclude BSEC member countries from engaging in otherwise mutually beneficial region-wide projects.

In this light, it is even more unfortunate that in contrary to the BSEC main principles and objectives we have a situation when one state undertakes fully inadequate and inappropriate actions towards another state, in the form of unilaterally closing the borders, introducing export ban and full trade embargo, severing transport and postal links and fixing a “political price” on energy resources aimed at disrupting our economic development.

Contrary to what many might argue, we consider that this is not only a bilateral issue. Such developments directly and very negatively impact the very fabric of multilateral cooperation within BSEC, at the same time questioning member states’ commitment to the principles that lie at the heart of this organization.

We believe that BSEC as an organization for economic cooperation must step up a rhetoric when its member states fail to comply with main principles and objectives of the Organization. Member states have to be encouraged to act in a spirit of friendship and good neighborliness. Mutual respect and confidence as well as the dialogue and cooperation must be promoted. The overall effect of the organization will only be noteworthy if all participants contribute to the common agenda.

At the same time, today, BSEC is endowed with several important opportunities. The EU has become increasingly interested in BSEC’s potentional and has made steps to engage with the organization. As the Black Sea is becoming European Union’s internal sea, there are vivid prospects for more active EU engagement in this region. Developing structural and tight relations is vital as EU possesses both the resources and the expertise necessary to move ahead with regional projects.

The successful development of the Region very much depends on political will, coherence of national interests of the countries and good timing for positive approaches. Proper participation of BSEC in the global economic relations and strengthening of its international identity, requires creation of favorable conditions for security and stability inside the Organization.

In this regard, Georgia welcomes the commenced process of BSEC Reform and Restructurization which aims at transforming BSEC into a more effective organization, with more capable and effective institutions and the capacity to ensure continuity and consistency in the implementation of the projects undertaken under the organization.

Georgia believes that without a proper regional context no country can survive in today’s interdependent world. The “Economic Dimension” acquires great importance in today’s international relations. BSEC should elaborate and realize its policy in order to protect economic and political interests of the Member States. In this regard, the activities of the BSEC should be directed at the development of trade relations, expansion of the export from the BSEC countries to foreign markets, facilitation of the movement of labor and services to other states and attraction of more foreign investments to BSEC region.

Effective utilization of energy and transport potential has considerable importance for the development of the BSEC Member-States. In order to extend cooperation in the spheres of energy and transport it is important to balance the interests of energy producer, transit and consumer countries. In this regard Georgia considers that cooperation in the field of energy within the frames of BSEC has to be based on clear market conditions. BSEC Member States should refrain to use energy resources as a political tool. Particular importance should be given to the cooperation in the fields of development of interconnected electricity networks and electricity transition.

The BSEC Region at the same time is attractive in terms of cooperation in fields of telecommunications, tourism, agriculture, small and medium business, sciences and technologies. BSEC play an even more considerable role in fighting organized crime, international terrorism, proliferation of weapons of mass destruction, illegal trade of arms and drugs, human trafficking and illegal migration.

The future agenda and strategic goals of the BSEC have to be based on the principles of cooperation and respect for each country’s interests. Economic success and progress, fruitful cooperation between the participating countries will promote the creation of the stable and peaceful environment in the whole Region. As the experience shows, the regional cooperation within the frames of one union is an affective way for the development of each participating state. Following the examples of other regions, the countries of the Black Sea Region have to cooperate closer and have to strengthen economic relations.

Initiation and realization of new projects should be the main concern of the BSEC Agenda. The realization of the two important new initiatives will give a new lease of life to BSEC’s credibility. The currently adopted Memorandums of Understanding on the – “Coordinated Development of the Black Sea Ring Highway” and “the Development of Motorways of the Sea at the BSEC Region” are of outmost importance. These projects will surely serve as backbones for truly intensifying trade among the participating states.

Today BSEC faces many opportunities. It is time to seize the momentum and take further steps to turn BSEC into a credible organization for the sake of its member countries and the region as a whole.

*Ambassador Extraordinary and Plenipotentiary of Georgia to the Republic of Turkey