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Georgian Tomatoes and the Association Agreement: What to Expect? - published: 26.06.2014

Malkhaz has been selling tomatoes for the past 10 years in the Didube bazaar in Tbilisi - ripened, fleshy crimson-coloured beefsteak tomatoes. Many customers are regulars. "I don't want to lose my business. I'm afraid that I can only sell standard-sized tomatoes because of the big agreement between Georgia and Europe,the market vendor said when asked about the Georgia-EU Association Agreement. 


Neither the upcoming Georgia-EU Association Agreement nor the Deep and Comprehensive Free Trade Agreement (DCFTA) regulate the size or shape of any vegetable. Still, the misconception and worry about the future of the Georgian tomato is widespread in tomato-loving Georgia. 


Fallacies about the Association Agreement are common. These include Georgia being obliged to legalize same-sex marriage, that Russian-Georgian relations are doomed to deteriorate and that the Association Agreement will harm the Georgian economy. The EU even addressed these popular fears in a Myth-Buster earlier this year.

But what is really at stake for Georgia and what is there to win for this nation of 5 million?


Recap of the Association  Agreement and the DCFTA

The Association Agreement and the DCFTA are accords aiming to boost political and economic ties between the EU and Georgia. The EU Council has cleared the way for signing the Association Agreement on June 16. Provisions on, in particular, free trade were declared provisionally applicable until all 28 EU member states ratify the far reaching agreements. 


The European Parliament still needs to give its green light - a mere formality. Ratification by the Georgian Parliament is expected in July. 

The main goal is modernizing Georgia's state institutions and its economy. Acting Commission President José-Manuel Barroso argued on June 13 in a joint press conference with Georgian Prime Minister Irakli Gharibashvili that "the agreement is an investment in the future - an investment that the EU believes will yield high returns".

EU officials, including Barroso and Enlargement Commissioner Stefan Fьle, have continuously stressed that the accords at stake are the outcome of Georgia's pro-European choice. "The European Union is imposing nothing on Georgia. Georgia has made a choice and we are here to support that choice", Barroso said in a press conference on June 12 after his meeting with Georgian President Giorgi Margvelashvili.

 

Anti-Discrimination Law and Same-Sex Marriage

EU anti-discrimination law covers gender, age and other common grounds for disadvantaged persons. Cases can range from a young woman losing out on a promotion to her less-qualified male colleague to a 50-year old factory worker getting laid off because of age. A Georgian anti-discrimination law was passed in May, amidst strong and on-going protests. Opposition to the new law was fuelled by fears of same-sex marriage legalization.


The requirement of adopting anti-discrimination legislation stems from before the Association Agreement. Georgia committed itself to creating such legislation in order to be granted a short-term visa-free travel regime with the EU. 


A short comparison with practices in EU member states shows that the new anti-discrimination law neither prohibits nor legalizes gay marriage. The vast majority of EU member states provides for, at the minimum, civil unions for same-sex couples. Roughly a third of EU countries, including Spain, the UK and France, recognize gay marriage. The constitutions of Poland, Hungary and a few other EU countries define marriage as a union between a man and woman.


Geopolitical Game-Making

A summer scenario of Russian retaliatory measures in Georgia's breakaway regions of South Ossetia and Abkhazia is possible but not probable. Russia seems to be all engaged in Ukraine and little time is left to stress over tiny Georgia. The South Caucasus country's progress on the Association Agreement has not been followed by outbursts of Kremlin threats or been widely covered by Russian media outlets. 


Georgia is not another Ukraine. Far less is at stake: there is no Black Sea Fleet and economic ties are less significant. Russia's Ukraine intervention has geared up the diplomatic and economic pressure on the Eurasian giant state. The EU argues that in the long run a prosperous Georgia will be in Russia's interest. 


Economic Benefits

The DCFTA is the core of establishing economic links between the EU and Georgia. The agreement is supposed to give Georgia access to the EU's 500 million-strong consumer market. The EU predicts an increase of trade by 12% for Georgia's exports to the EU and 7.5% on imports from the EU. If reforms are completed, the Georgian GDP is predicted to get a 4.3% annual boost. Georgian importers will save 84.2 million Euro on customs duties annually. At the same time, the economic benefit to the EU will be minimal since Georgia is not an important trading partner. 


Applying EU product norms and standards will be tough for many Georgian companies in the beginning but can yield new opportunities in EU-Georgia trade and Georgia's trade with the world. Exports to Russia would only be adversely affected in the case that Russia imposes an import ban on Georgian products. 


Eventually, quite contrary to his fear, Malkhaz will not have to start selling standard-sized tomatoes and Georgian tomatoes might even find their way onto European dining tables.


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