Rayhan Demytry
South Caucasus correspondent
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American sanctions against the richest man in Georgia, Bidzina Ivanishvili, aim to freeze his assets
Last spring, when tens of thousands of Georgians protest against what they considered a clear sign of Russian influence on the country’s policy, the Georgia Parliament rushed through amendments to the country’s tax code.
Transparency International (TI) Georgia, the anti -corruption watchdog, wrote at the time that change – which allows the transfer of assets of the Offshore accounts to Georgia – can have been introduced to serve The interests of the richest and former country in the country Prime Minister, Bidzina Ivanishvili.
He is the founder and honorary president of the country’s power party, Georgian Dream.
“Now it is clear that these changes have been brought to him,” said Beso Namchavadze, main analyst in Ti Georgia economics.
With an estimated wealth of $ 4.9 billion (3.9 billion pounds sterling), Mr. Ivanishvili earned his money in Russia in the 1990s, in computer science, metals and banking. It is believed that most of its wealth would be hidden in offshore societies.
Georgia was immersed in the political crisis and the daily demonstrations of the street last May, when deputies of the country adopted the “bill on transparency on foreign influence”, often nicknamed the “law of foreign agents ».
Under this legislation, the media and non -governmental organizations which receive more than 20% of their funding from foreigners must register as “organizations acting in the interest of a foreign power”, submit to Strict audits or face punitive fines. It was largely considered a decision to prevent us and other Western influences on the country.
Demonstrations then continued when the Georgian government led by dreams won contested legislative elections in October. The demonstrations were stimulated again in early December when she said that she would arouse EU membership talks.
Hundreds of peaceful demonstrations have been arrested and severely beaten by the police.
In response to this repression, the US government announced sanctions against Mr. Ivanishvili at the end of last year.
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Daily demonstrations continue to the Georgian government’s decision to stop talks to join the EU
There is also the possibility of sanctions from the United Kingdom. Last month, James MacClearly, a liberal democratic deputy, presented a request at the start of the day in the British Parliament calling on the government to impose sanctions on Mr. Ivanishvili.
The motion was expressed “a deep concern in the face of the suspension of the EU membership process in Georgia and the growing use of excessive force against peaceful demonstrators”.
Ti Georgia believes that if the United Kingdom required sanctions on Mr. Ivanishvili, all of his commercial empire would be affected, because he has companies that have companies registered in two British territories abroad – the British Virgin Islands and the islands Caymans.
“All his large companies, which he has in Georgia, in the hotel sector, in the energy sector, all the mother companies of these Georgian companies, the last beneficiaries are recorded in these so-called offshore territories “Said Beso Namchavadze.
He adds that Ti Georgia believes that Mr. Ivanishvili and other family members continue to transfer ownership of companies they previously controlled through offshore entities to newly established companies in Georgia.
In January of this year, paintings and other works worth nearly $ 500 million were imported into Georgia, according to data published by the Ministry of Finance.
Many believe that works of art came from the precious collection of Mr. Ivanishvili.
“For all those who know him, it is quite clear that it is something that he appreciates the most of all the active ingredients, and all the wealth, that he has,” explains Tina Khidasheli, ex-minister of defense de Géorgie and head of the non-civic idea of the government organization.
“He will bring back paintings and he does not want to pay tax on her.”
The head of the Georgia Parliamentary Committee on Finance and the Budget, Paata Kvijinadze, recently defended the tax transfer of assets from the Offshore accounts to Georgia.
“If someone has benefited from this law, I am happy,” he said in an article on social networks. “This is exactly what the law should be: to bring companies from the offshore zones and attract more investments in the country”.
In response to the proposed British sanctions, the Georgia party has published a declaration defending Mr. Ivanishvili, saying that a threat of sanctions was “without foundation” against the founder of the party who brought “a democratic breakthrough to the country”.
In addition, Mr. Ivanishvili’s lawyer announced last month that his client was continuing the Swiss bank Julius Baer for, among other reasons, misinterpreting “the so-called” American sanctions, which the lawyer described as “blackmail policy”.
The American sanctions against Mr. Ivanishvili predict that his assets are frozen and impose restrictions on citizens and American companies to do business personally with him, but they do not affect his businesses or his family members.
For more than a decade, Mr. Ivanishvili has been involved in legal battles with another Swiss bank, Credit Suisse, for fraud and mismanagement of his money.
Some people believe that the billionaire’s distrust of the West and the increased use of conspiracy theories at home, like accusing adversaries of being part of the “World War Party”, or “deep state”, come from its grievances longtime financiers.
Since he became convinced that the Credit Suisse has been part of a large conspiracy against him, explains Tina Khdasheli. “Bidzina Ivanishvili held Georgia’s hostage to his personal financial problems.”
Experts say that even if Mr. Ivanishvili’s official position is the honorary president of the ruling party, it is clear that there remains the number one person in Georgian politics. Sanctions against him are therefore considered sanctions against the whole government.
Nika Gilauri was Prime Minister of Georgia from 2009 to 2012. He now heads a private company called Reformatics, which advises governments around the world on economic reform.
Mr. Gilauri says that the continuous political instability of Georgia and international isolation have a negative impact on the economy. “We see a very negative effect on the FDI, direct foreign investment, if you take nine months of 2024 compared to nine months of 2023, we have a 40%drop. So, in the future, this will continue to worse.”
But the Georgian government portrays a different image.
Last month, Prime Minister of Georgia, Iraqi Kobakhidze, signed an investment agreement inward of $ 6 billion with the EAM EMAar real estate group.
Levan Davitashvili, the Minister of the Economy has described it as the “largest foreign investment agreement” for decades, which should contribute 1.5% growth to the economy.
Prime Minister Iraqli Kobakhidze even suggested that 10% growth was now “absolutely realistic” for the Georgian economy.
But research recently published by Policy and Management Consulting Group (PMCG), a Georgian research firm, said that the prospect of the next six months was “extremely negative”.
He underlined the impact of continuous political disorders and said that the suspension of EU membership talks “was considered negatively by all the economists questioned”.
Mr. Gilauri de Reformatics says that their own analysis shows that the economic growth of Georgia this year will be zero.
“In the future, we will have a budgetary problem, a exchange problem. We will have an inflation problem. We will have a job problem, a problem of job creation, and we will have a problem of economic decline.
“Having new elections is the only way to follow for the country as well as for Bidzina Ivanishvili personally.”
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