Saakashvili: Georgia overcoming Russian trade barriers

Mar 16 2007, 14:18

TBILISI, Georgia (AP) - President Mikhail Saakashvili said Thursday that Georgia is shrugging off a virtual Russian trade embargo, telling parliament and the people in an annual address that overall trade increased sharply last year despite the restrictions.

In other remarks reflecting persistent tension in ties with Moscow, Saakashvili - who has sought to decrease Russian influence and forged closer ties with the West - reiterated his criticism of peacekeeping mechanisms that include Russian contingents in two separatist regions he is seeking to bring back to the fold.

The annual address to parliament came after a year in which already strained relations with Russia spiraled downward, with Moscow banning imports of Georgian wine and mineral water in the spring and then severing transport links in response to the brief detention of Russians on espionage charges.

The outspoken Saakashvili said it was perhaps unprecedented that "a young country on the path of development has been subject to such economic pressure and so many blows in one year. But Georgia, and the Georgian people most of all, showed the whole world their strength and their ability to fight."

Even though "our traditional market was completely closed," Saakashvili said, the economy grew by nearly 10 percent in 2006 and the volume of trade with foreign countries grew by 40 percent to $5 billion.

"This means that Georgia has done what is practically impossible. We managed to quickly reorient the economy from Russia to other markets," Saakashvili said. He said trade with neighboring Turkey grew by 40 percent, with the European Union by 45 percent, and with Ukraine and Kazakhstan by nearly 100 percent.

Saakashvili stressed the country's desire to join NATO and said he hopes the United States and Europe will get more involved in efforts to resolve the conflicts with South Ossetia and Abkhazia, two separatist regions that have run their own affairs with support from Russia since wars in the early 1990s.

"Today's peacekeeping process has been fully discredited and is ineffective," said Saakashvili, who has accused Russian peacekeepers in South Ossetia and Abkhazia of siding with the separatists - part of what his government says are Russian efforts to destabilize Georgia and maintain influence.

He reiterated that the Georgian government is prepared to offer South Ossetia and Abkhazia regions broad autonomy. The leaders of the breakaway regions, who want independence or union with Russia, have rejected such offers.  

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