The latest direct election of a president in Georgia eclipsed all other news, in both domestic and foreign policy. Even the economy went into suspended animation waiting for the results, as business decided to play safe.
DOMESTIC POLICY: Elections, elections, elections
The president is being directly elected for a six-year term for the last time in Georgia. The president is not the head of the executive branch and effectively performs a merely ceremonial function in the country. Still, this post is an important part of the political process that allows Georgians to have their voices heard. That’s why Georgia’s parties are fighting so fiercely and making use of every resource available to them.
Officially, Zurabishvili is an independent, but she has been enjoying the full support of the ruling Georgian Dream party, which means that she has enormous resources at her disposal. The party’s leader is Bidzina Ivanishvili, a billionaire who made his money in Russia and former premier. Vashadze belongs to the United National Movement party. He has ex-President Mikhail Saakashvili batting in his corner from Holland and a political bloc of 10 parries that has grown even broader since the first round of voting.
More details about the presidential election in Georgia and their impact on the situation in the country and the region can be found in the monthly analytical report.
ECONOMY: Inflationary blip
Over the past month, Georgia’s lari declined by 11 tetri, Georgian cents, in relation to the US dollar. According to Georgia’s National Bank, the official exchange rate was LAR 2.7251/USD and LAR 3.1170/EUR. Experts tie the lari’s nearly 4% decline over October to election rhetoric, saying that business is being very cautious and converting lari to dollars. As a result, prices for consumer goods have risen about 6.3%, which has affected inflation. In October, inflation was 0.3% compared to the previous month, and annual inflation was already at 2.3%.
Price changes in some specific product groups had a stronger influence on annual inflation, however: transport, up 6.5%; private transport, up 10.3%; and healthcare, up 6.1%. Prices also rose for a slew of other goods and services, including tobacco products, alcohol medical services and equipment, medication, and so on.
FOREIGN POLICY: Accusations from Sochi
Russia continues to accuse Georgia of manufacturing biological weapons, spreading viruses, using dangerous insects for sabotage, and poisoning people. The Russian government’s claims about the high-tech Richard Lugar Research Center, built by Americans in Tbilisi, have been around for years now. In October, Russian Federation President Vladimir Putin himself made such claims at the annual Valdai Club meeting in Sochi.
“I saw that statement by the former National Security Minister of Georgia,” said Putin. “There’s no question that it caused considerable concern… If it’s true, then this represents a huge threat.”
Putin went further and, in answer to a question that was voiced during a Validai Club session, suggested that the lab was manufacturing drugs that could selectively affect a person’s genes depending on what ethnic group they belonged to.
This situation coincided strangely with the poisoning of the Skripals, behind which British investigative agencies have found links to Russia. The Kremlin has been playing a game that could lead to dangerous consequences. Tbilisi has more than once dismissed Moscow’s accusations and requested that the scientific lab’s activities be monitored. But the Kremlin has ignored these suggestions, as its real purpose is to use the subject of this lab for its own purposes from time to time.