The FINANCIAL -- In
total 1,645 businesspeople have left the country recently as a result
of challenges they have faced because of the Georgian Government, said
Mahmoud Davari, member of the board of the International Chamber of
150 Iranian businessmen’s bank accounts have been frozen amidst claims of suspected money laundering. Georgian banks as well as the Ministries of Economy and Foreign Affairs have declined to comment on this issue citing the sensitivity of the subject. The case of these Iranians is still very delicate, The FINANCIAL was told by the Ministry of Economy.
The number of companies registered in Georgia by Iranian businessmen in the years 2012-2013 was 2,215, according to the National Statistics Office of Georgia (GeoStat).
Georgia exported products with total value of USD 14,330 thousand to Iran in January-June of 2013 while it exported products with total value of USD 19,053 thousand in 2012, according to GeoStat. As for import, Georgia imported products from Iran with total value of USD 47,396 thousand in 2013 and USD 99,403 thousand in 2012.
It is mainly ferroalloy, wood, cars, sheep and goat meat, and blood that is exported to Iran from Georgia while it is oil, glass, ceramic tiles and cement that is imported from Iran in Georgia, according to the statistics.
“In 2013 we faced different problems under order of the Georgian Government. We were hence forced to close bank accounts here,” Davari, an Iranian businessman with Georgian citizenship, told The FINANCIAL.
President Obama and Iranian President Hassan Rouhani thawed a three-decade freeze in relations between their two countries on Friday, speaking by phone in the first conversation between an American and Iranian president since 1979.
The President revealed Friday afternoon that the two leaders had spoken. He said he believes the two countries can reach a “comprehensive solution” on Iran’s nuclear programme, and said he and Rouhani had both directed their diplomats to pursue an agreement.
“How can Iranian or other businessmen start a good business in Georgia without a bank account? Also, Iranians have faced problems in regard to getting visas, which is another obstacle for them in coming and investing in Georgia,” Davari said.
Georgia abolished its visa regime unilaterally for the citizens of Iran from 1 July, 2013, due to migration problems and economic sanctions. Besides, some leading banks in Georgia have put Iranian citizens living in Georgia under certain restrictions in terms of banking services, so say Iranian businessmen.
After the UN’s economic sanction against Iran, it became increasingly hard for Iranians to do business abroad. However, compared to other countries Iran was encouraged to make big investments in Georgia.
Lately, Obama administration officials have been concerned that Iran may be using Georgia to evade mounting U.S. and European sanctions aimed at curbing Tehran’s nuclear programme.
Following a Wall Street Journal article detailing evidence that Iranians close to the regime had set up companies in Georgia, the Georgian Government said it would investigate the information.
“TBC Bank has closed the accounts of Iranian businessman to the value of USD 18 million. But I know that they are inviting Turkish businessmen, and netting them. This is happening by government order. At this moment no banks are cooperating with Iranians. 150 accounts have been closed by banks in Georgia. Out of the 150 accounts 95 were inactive. They opened the accounts and registered their businesses because they wanted to stay and live here. That is not right, I admit. We are looking for true companies and investors to come here,” said Davari.
The worsening of Georgia’s visa regime has hampered the inflow of Iranian tourists in the country, Davari claims.
89,697 Iranian leisure and business travellers visited Georgia in 2012 and 88,792 of them left the country, according to GeoStat.
“The number of people in Georgia that have lost their jobs just because of being Iranian is 1,645,” Davari claimed. “They left the country because of the difficulties that the Georgian Government created for them regarding visa and bank account issues. We have backed out of our programmes. Lots of projects are frozen and waiting for the future. The Tbilisi Sea Project is one of those projects which is stopped at present. Its investor is waiting for a better system. I hope that in the next three months this project will pick up again. Anyway, we are waiting for the green light and are looking for the right way to change the situation. I understand that we should be patient as the Government is in the process of changing to a better system,” he added.
“Georgia is a friend of America and it cannot say no to the laws that come from America. But nowadays the relationship between American, Iranian and European governments are better. So Georgia is free in its decisions and views towards Iranians,” Davari said.
“Iranian businessmen are a part of the country. We are living here and this country is very friendly to us. But regarding business I think it was mistake that the Government closed down Iranian accounts, as it is those businessmen’s accounts that could do much better things to the country like they did in Dubai. Iranians built Dubai and transfer USD 20 billion to Dubai every year, so why not to Georgia? As I am a board member of ICC Georgia this is a part of my job - to ask this question of the Government. They have never been negative to me, they were always positive towards those people who want to start business here. The new government never says “No”, but I guess they just need some time to settle all the programmes in Georgia. Within three months the situation will be better and much clearer in Georgia. We are waiting for a new president, a new blood system in the country,” Davari said.
The construction as well as energy and agriculture sectors all seem attractive to Iranian businessmen so far. “This kind of investment is a basic investment for the country, which Georgia really needs. We are generally interested in Tbilisi and after it Batumi, not yet other cities in Georgia. By the way, Georgia needs a much bigger Airport as the current one is not really working perfectly, I don’t think it meets the necessary standards,” Davari said.
“We want to start exporting products from Georgia, to make this country export-oriented. Food, water, and many other things can be imported from here as Georgia is very rich in terms of the nature. Georgian plants are golden. I make programmes for those products to start being exported and then invite investors to invest in these programmes, but recently I have been facing several problems, which come from the uncertainty of the Government’s programme and decisions. Investors should know where to come and what conditions the country is creating for them. The Government welcomes them but does not provide them with the proper programme. This then confuses investors,” Davari said.
The reason why Iranian businesspeople are coming to Georgia is the peace, happiness and freedom evident here, Davari said. “According to my Georgian citizenship I can tell you that Georgia is a peaceful country. It is a place for investors. They can live, they can work and be happy. The beautiful Georgian people are always welcoming to them. Iranians feel free in Georgia - they can drink, talk, go for a walk at 3 o’clock at night and not fear that somebody will hassle them. The police system is very good. Georgia is the mother of mines, metal, agriculture and many other things that attract investors. If you are clever, you can make billions from this country, and that is what we will do,” Mahmoud Davari said.