Russia-Abkhazia agreement
On September 25, the Abkhaz parliament will review the ratification of the Russia-Abkhazia agreement on mutual recognition of court decisions.
Abkhaz economist Akhra Aristava believes that the agreement is unbalanced and does not reflect the interests of the Abkhaz side.
“The ratification of the agreement on “Mutual Recognition of Court Decisions” without addressing the inclusion of Abkhazia in the Russian ruble emission zone directly harms the interests of Abkhazian banks and local entrepreneurs. They will not have the same access to the Russian ruble as their Russian counterparts, creating conditions for unfair competition.
Historically, over 90% of Russian banks deny loans to Abkhazian businesses, clearly favoring Russian entrepreneurs who find it easier to secure credit.
To protect local businesses and the banking sector, Abkhazia should insist on ensuring a steady supply of Russian rubles, as outlined in the 2009 agreement, which granted a 10-year loan at 2% interest to develop small and medium enterprises in the region.
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Defending and safeguarding our republic’s interests is no easy task, but it must be done. Notably, the loan granted in 2009 was repaid by Abkhazia in 2019, proving that the country is a reliable and trustworthy borrower.
Currently, Abkhazia faces a credit resource deficit exceeding 20 billion rubles. To balance mutual interests, it’s crucial to secure a new ten-year, low-interest loan for our banking system. This would ensure equal access to financial resources for both Russian and Abkhazian entrepreneurs. Only after resolving this issue should the agreement on “Mutual Recognition of Court Decisions” be ratified.
The claim that this agreement will help combat the shadow economy doesn’t hold up. Abkhazian entrepreneurs who obtain loans from Russian banks operate legally and transparently; otherwise, they wouldn’t receive loans at all.
No such agreement can tackle the shadow economy, which has grown to over 60% of Abkhazia’s economy in recent years due to a lack of reforms.
To my knowledge, the parliament is currently reviewing legislation aimed at bringing the economy out of the shadows. For example, the recently passed law on “Currency Control and Currency Regulation” is one such initiative. Next in line is the bill on “Turnover Tax,” along with several other proposals.
At this moment, it is crucial to focus on laws that will foster economic growth and increase budget revenues. Therefore, the agreement on “Mutual Recognition of Court Decisions” should be postponed until the issue of ensuring the Abkhaz economy with Russian rubles is resolved”.
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