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Study Slams EU's Approach to Georgia Free Trade Talks
Civil Georgia, Tbilisi / 2 Mar.'11 / 20:30

EU should reshape its current “bad” approach towards free trade agreement with Georgia and open negotiations “without further delay” since Georgia has “more than satisfied” the relevant preconditions, a study released on March 1 by the Brussels-based think-tank Centre for European Policy Studies (CEPS) says.

The 105-page study, conducted by researchers from CEPS; Paris-based Groupe d’Economie Mondiale and Tbilisi-based libertarian think-tank New Economic School-Georgia, says that the European Commission is insisting on “a hugely demanding set of preconditions” before agreeing to open negotiations with Georgia on deep and comprehensive free trade agreement (DCFTA).

Georgian Deputy Foreign Minister, Tornike Gordadze, complained recently that discussions on launch of DCFTA talks were “the most difficult” part of Association Agreement negotiations between Georgia and the EU. He told the Brussels-based EUobserver.com last month that during talks with European Commission officials in charge of trade, he got the "impression that they have changed the preconditions.”

“Now the ones that were set for concluding the negotiations are the same for starting the negotiations,” Gordadze, who is Georgia’s chief negotiator with EU, said.

According to the study released by CEPS, in March 2009 the European Commission sent to Georgia list of preconditions with some of them to be fulfilled before the start of DCFTA talks and others – after the formal launch of negotiations.

The study criticizes the European Commission for use of, as it put it, “fuzzy” language without defining what “sufficient”, “adequate”, “effective” or “proper implementation” exactly means.

 “The preconditions are written in an ‘open-ended’ language which gives to the Commission the absolute power to decide whether the preconditions are met or not,” the study says.

According to the study, in December 2010, the European Commission sent to Georgia a new, separate document, which shifted some of the preconditions, which initially were intended for implementation after the launch of the negotiations, into the list of those preconditions, which have to be met before formal launch of talks.

The study argues that the European Commission’s approach is “bad” from number of perspectives, including for development policy for Georgia, from commercial policy point of view, as well as from the foreign policy perspective.

In terms of development policy, the study says, “the burdensome regulatory changes imposed on Georgia are equivalent to taxing Georgian production – endangering her growth, the sustainability of her reforms and of her successful fight against corruption which is so crucial for her long term development.”

The study says that preconditions in sanitary and phytosanitary measures would trigger an average price increase of 90% for the key food products, which “would greatly endanger the political stability and fuel an anti-European sentiment in Georgia.”

The study criticizes the European Commission’s approach in terms of commerce arguing that it would fail to promote trade between Georgia and EU.

“In order to survive the vast majority of Georgian producers, which would not be able to sell their products anymore on Georgian markets under EU norms, would try to sell them to foreign markets using non-EU norms, boosting artificially Georgia’s exports to non-EU countries,” according to the study.

It also says that the approach is “bad” from the foreign policy perspective, because the European Commission’s preconditions “show the EU as being hegemonic towards its very much smaller neighbour, not an enlightened and trustable anchor.”

In the section where the study discusses potential motives behind the European Commission’s approach, it says that one of the reasons behind putting such preconditions before Georgia might be “a tactical maneuver” of the Commission in order to control the timing of DCFTA negotiations.

“One possible reason for such a motive is Russia’s accession to the World Trade Organization (WTO),” the study reads. “The Commission may want to start the negotiations on the DCFTA only after Russia’s WTO accession in order to put pressure on Georgia’s position in the WTO,” the study says, but it also adds that it was a “speculation” and does not discusses it further.    

Georgian Deputy Foreign Minister, Tornike Gordadze, also raised this point in February interview with EUobserver.com and said: “Some people also say the change [in European Commission’s position by putting new preconditions for launching talks] could be some sort of indirect pressure from the EU to drop our objections in Russia's WTO bid.”

“I hope this is not the case,” Gordadze added.

The study released by CEPS was authored by Prof. Patrick Messerlin and Alexandre Le Vernoy from Groupe d’Economie Mondiale at Sciences Po; Michael Emerson from CEPS and Gia Jandieri, the vice-president of New Economic School-Georgia.

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