Georgia enoys new free trade deal with four European countries

Two years after signing its Association Agreement (AA) with its Deep and Comprehensive Free Trade Area (DCFTA) deal with the European Union (EU), Georgia is now benefiting from a new free trade agreement with the European Free Trade Association (EFTA).

Switzerland, Norway, Iceland and Liechtenstein – combining 14 million consumers with high purchasing power – opened their markets to Georgia when the free trade deal came into play yesterday.

Thanks to the agreement signed on June 27 in Switzerland’s capital Bern, Georgian goods will now be exported without tariff and non-tariff barriers to EFTA member nations, which encompasses Switzerland, Norway, Iceland and Liechtenstein.

This was Georgia’s first international agreement with Iceland and Liechtenstein.

Georgia's PM Giorgi Kvirikashvili said the country was becoming a regional hub for doing business. Photo by the PM's press office. 

The agreement included the following:

• Trade with goods and services;
• Sanitary and phytosanitary measures;
• Technical barriers to trade;
• Rules of origin, trade promotion and cooperation in customs matters;
• Investments;
• Intellectual property rights;
• Public procurement;
• Competition;
• Trade protection measures and sustainable development.

The agreement was signed by Georgia's Minister of Economy Dimitry Kumsishvili, Federal President of the Swiss Confederation, the head of the Federal Department of Economic Affairs, Education and Research Johann Schneider-Ammann and Ministers of the EFTA member-states. Photo by the PM's press office.

Georgia’s Prime Minister Giorgi Kvirikashvili attended the agreement signing ceremony. He believed Georgia's signing of a free trade deal with the EFTA was a historic event.

This happened exactly two years after signing a DCFTA deal with the EU. I would like to note that we still believe in the EU and are enthusiastic about its future,” Kvirikashvili said.

Georgia and EFTA countries share a common understanding of the value and importance of free trade. It is the very principle upon which the EFTA was created. With the conviction that free trade is a means of achieving growth and prosperity, EFTA has been a standard bearer for international exchange since the 1960s,” he added.

Excellent relations between Switzerland and Georgia: Delighted to welcome PM @KvirikashviliGi. #PresidentCHpic.twitter.com/WusGlL8XqQ

— J N Schneider-Ammann (@_BR_JSA) June 27, 2016

Georgia's PM noted this year the country celebrated 25 years of independence and highlighted Georgia’s recent achievements in the trade sector.

Georgia has a DCFTA deal with the EU, free trade with Turkey and the Commonwealth of Independent States (CIS), a preferential export regime (GSP) with the United States (US), Canada, Japan, and we expect to sign a free trade deal with China by the end of this year. This means that Georgia will soon have a web of free trade deals covering more than two billion consumers,” said Kvirikashvili.

He added Georgia had taken action  to become a free, thriving and dynamic economy that attracted investors and businesses. Kvirikashvili underscored Georgia was a country with stable democratic institutions, low corruption a simplified tax system and business-friendly legislative environment.

I am very proud to say we have been ranked ninth in the world for ease of doing business by the World Bank and according to the World Economic Forum investors coming to Georgia can enjoy the 24th lowest tax burden in the world."

The compound annual Gross Domestic Product (GDP) growth in the past five years is 4.9 percent and all major credit rating agencies consider us stable. Georgia, in sum, is a safe and stimulating place for foreign companies to invest. Georgia is already becoming a regional hub for doing business."

Kvirikashvili believed Georgia being at the crossroads between Asia and Europe and the revival of the modern Silk Road was solidifying his country's future as a trade, logistics and transportation hub.

Meanwhile the Federal President of the Swiss Confederation, the head of the Federal Department of Economic Affairs, Education and Research Johann Schneider-Ammann believed the speed and the quality of the free trade negotiations was a clear indication of positive relations between Georgia and the EFTA.

Furthering free-trade in the Caucasus: with Georgian PM @KvirikashviliGi at EFTA signing ceremony #PresidentCHpic.twitter.com/XrIMFxII6p

— J N Schneider-Ammann (@_BR_JSA) June 27, 2016

Georgia and EFTA countries have already established close economic relations and there is great potential for further expanding these links. We believe that the free trade deal will become a strong stimulus for development of trade and investments between the economies,” he said and thanked thenegotiating teams for their commitment to achieve the best results.

The decision to establish a free trade deal with Georgia was made by the EFTA Council of Foreign Ministers on November 17, 2014.

The first round of negotiations took place in Georgia in September 2015, while the second round was held in December 2015.

Georgia successfully completed its third and final round of negotiations with the EFTA in February 2016.

Currently Georgia enjoys free trade with markets that cater to more than 800 million people, including the EU, CIS and Turkey.

The Georgian Government has also started free trade talks with China.