What were the main challenges facing the UK in 2022?
The biggest challenge for the UK has been shared by many of the world’s economies. That is, the high rate of inflation caused by the boom in demand for global commodities as we have moved out of the Covid pandemic, and exacerbated by Russia’s invasion of Ukraine. The increase in costs is affecting businesses and families alike. 2022 has also seen changes in the UK’s political leadership following the resignation as Prime Minister of Boris Johnson and subsequently of Liz Truss. Our new Prime Minister, Rishi Sunak was appointed in late October and set out in his first public statement that his priority would be to tackle our country’s economic challenges.
How the war in Ukraine impacted the population of the UK?
Firstly, I would say that it was inconceivable to the British population – and to other peoples around the world – that Russia would start another war on the European continent.
But when the invasion occurred, support for the people of Ukraine was immediate and strong.
Just as in Georgia, individuals and charities have collected money and daily necessities such as clothing and medicines, to deliver to Ukraine or other countries to which Ukrainians had been forced to flee.
Many British people have provided accommodation for displaced Ukrainian families who have taken refuge in the UK. Over 250,000 visas have been issued for Ukrainians under this sponsorship scheme, or to join family members already resident in the UK.
The U.K. government is a strong supporter of Ukraine. Does the whole population share this position?
The UK Government has given its full backing to the leadership and people of Ukraine. We have provided military, economic, and humanitarian assistance and, with G7 and other international partners, worked to ensure Russia pays the price for its actions, both politically through the UN and other international fora and economically through sanctions. Public opinion polling has shown that the majority of the British population understands and supports the Government’s commitments to Ukraine, even if it means some cost to our economy.
The UK and Ukraine agree to a new Digital Trade Agreement (DTA) to provide much-needed support for the Ukrainian economy. Can you please explain the benefits of this agreement?
This Agreement is designed to maximise the opportunities that digital tools open up across every sector of an economy – not only finance and professional business services but also retail, health, education, agriculture, manufacturing, and others.
It allows for duty-free trade in digital content and for the processes of trade (contracts. invoices, certificates, administrative documents, etc.) to be electronic, reducing the time and costs of trading in goods. The Agreement will therefore help Ukraine businesses and people better access the goods and services they need to maintain economic activity through the current crisis, and lay the foundations for a digital trade-based recovery for Ukraine post-war.
In the case of UK-Georgia digital trade, duty-free digital products are included in the bilateral Free Trade Agreement that has been in force since January 2021, and government-to-government cooperation under the agreement has already led to the simplification of some processes through digitalisation. Additionally, to further support digital trade and innovative, technological approaches to trade, our Embassy hosted the first UK-Georgia FinTech Forum in September, bringing together businesses and researchers for potential collaboration.
What is the current state of Georgia – U.K. trade and why the growth is not significant over the time?
While global and regional shocks to the world trade picture have influenced our bilateral trade to some extent, I am pleased to say that trade flows are in fact on an upward trend. Data published by the UK’s Department for International Trade (DIT) shows that total trade in goods and services (exports plus imports) between the UK and Georgia was £267 million in the four quarters to the end of Q2 2022, an increase of 50.8% (£90m) on the same period to Q2 2021. Of this total, the UK’s exports to Georgia accounted for £156 million (up 15.6% or £21m), and Georgia’s exports to the UK for £111 (up 164.3% or £69m).
If we look at the types of goods exported in each direction, from the UK to Georgia the top places went to cars, specialised machinery, beverages, and medical and pharmaceutical products. And from Georgia to the UK, refined oil, metal ores, fertilizers, iron and steel, and organic chemicals. I am very happy to say too that the UK is importing an increasing amount of Georgian wine because of growing interest from UK consumers in this very special product for Georgia. I am confident that trade between our countries will continue to strengthen, not only trade in goods but also in services, where Georgia has much to offer.
What are the main obstacles for U.K? Investors in terms of investing in Georgia?
First let me note that in partnership with EBRD, the UK has been proud to support since 2016 the Investors’ Council of Georgia, which is the principal forum for open dialogue between the Government of Georgia and business associations representing international and Georgian investors, to identify obstacles faced by investors and the steps needed to eliminate them and further strengthen the investment climate. The Council, Government line ministries, and other bodies have achieved much progress so far.
From my conversations with existing and prospective UK investors, I would summarise their main considerations when making investment decisions as firstly, long-term certainty about the policy and/or regulatory environment for their sector. Changes in direction or the introduction of new rules without a transition period or so-called grandfathering can be disruptive and costly.
Secondly, an independent legal system that includes capability in corporate law. Currently, commercial legal disputes have to be heard in courts outside of Georgia, adding time and money to the process. And thirdly, access to an appropriately skilled workforce. Georgia has very high levels of education and training but in some sectors, investors find it difficult to recruit expertise within Georgia.
All of these considerations are not unique to Georgia, of course, and I am sure that through continued dialogue with investors and support from the international community, Georgia will further increase its investment attractiveness. Certainly, the growth in Foreign Direct Investment (FDI) recorded in 2022 is extremely positive.
What Georgia should do to attract British Investors?
Georgia has much to offer to UK investors. The country’s attractive geographic location on the crossroads of Europe and Asia, simplified procedures for setting up a business, low corruption, and minimal taxes and Governmental fees are amongst this. Georgia is open to investments in many thriving sectors such as energy, real estate, manufacturing, regional logistics, agriculture, and hospitality. Some UK investors understand this well already. We can see from DIT data that in 2020 the stock of FDI from the UK in Georgia reached £1.4 billion.
In terms of attracting additional British investors, investment promotion activities and direct engagement with UK businesses could be very helpful. I know that the Embassy of Georgia in London works hard to promote Georgia to the UK business community and our Embassy in Tbilisi complements this by providing advice and support to those prospective investors on the practical steps to entering the Georgian market.
How many Georgian students received financial support for studying in the UK?
I am very proud that the UK Government’s Chevening scholarship scheme has been operating in Georgia for almost 30 years now. Under this scheme around 300 young Georgian professionals and future leaders have studied for their Masters’ degrees in British universities. This year we have supported 15 scholars in their UK study. Applications for Chevening scholarships for the school year 2023/24 will open in August 2023 so I encourage everyone interested to look out for the publicity on the Embassy’s social media channels @UKinGeorgia.
Tell us about exchange programs the U.K is offering in Georgia
The Chevening scholarship scheme is the only educational programme the UK Government is funding at the moment. However, I am pleased that many children and young people from Georgia choose to go to the UK to study on a private basis, including at summer schools to improve their English language skills.
Do you know the number of English speakers in Georgia? Is it growing in comparison to the previous years?
I am not able to offer any statistics on this but I continue to be amazed by how widely and expertly the English language is spoken in Georgia and used commonly in business, diplomacy, and other fields. I would here like to note that the British Council – the UK’s international organisation for cultural relations and educational opportunities – is proud to be one of the best providers of English language teaching and examinations in Georgia.
Can you name the person of the year?
From an international perspective, I have to agree with Time magazine’s nomination of President Zelenskyy of Ukraine. From a British perspective, I should however add that in 2022 an important figure for the UK and the 56 countries of The Commonwealth was our late Queen Elizabeth II, who celebrated the 70th anniversary of her reign in June. Our Embassy was delighted to be able to celebrate this milestone with our friends in Georgia, and I would like to reiterate our gratitude for the messages of condolence we received when Her late Majesty passed away in September.
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