Approach in the context of the Ukraine crisis

CESCE, Country Risk

A little over a month ago, direct flights between Moscow and Tbilisi, suspended since 2019, were resumed.

Also, a few days before, Putin signed a decree to relax entry requirements to Russia for Georgians who wanted to stay in the country for more than three months. Both measures are framed in an evident context of rapprochement between the Caucasian country and Moscow.

Since the war began in Ukraine, Georgia has tried to maintain an equidistant position between Russia and the West: initially condemned the invasion but, instead, decided not to support the sanctions imposed by the UE. Consequently, economic and trade ties between Tbilisi and Moscow have strengthened in the last year. In 2022, Georgian exports to Russia increased by 6,8% to $652 million, while Russian imports from Georgia grew by 79% to $1.800 billion.

This divergence in figures is explained by Georgia's role as a way to evade sanctions through the direct re-export of goods, since goods “in transit” are not subject to sanctions. Russia has also resorted to indirect exports by creating intermediary companies in neighboring countries. Specifically, around 15.000 Russian companies were established in Georgia in 2022, a figure 16 times higher than that observed in 2021. To prevent Russia from employing Georgia (and other countries, such as Türkiye, UAE or Azerbaijan) to avoid the sanctions, the EU adopted on June 23 the eleventh package of sanctions that contemplates extraterritorial measures by which it could restrict exports to those countries that are helping Russia.

Source: CESCE

Any questions about this news?

Talk to Coexia, the AI ​​of the foreign trade

Enter Make another general inquiry

International business service providers

Promotion Organizations

Barcelona Free Trade Zone

Public entity for economic revitalization, operates as an engine of industrial development in the Barcelona area.read more...

Promotion Organizations

VUI - One-Stop Shop

The One-Stop Shop for Internationalization (VUI) is a space for information and advice.read more...

Promotion Organizations

Asturex

Asturex, Foreign Promotion Company of the Principality of Asturias, SA is a capital company.read more...

Promotion Organizations

PROEXCA

PROEXCA is a public company attached to the Ministry of Economy, Knowledge and Employment.read more...

Promotion Organizations

Chamber of Madrid

The International Business Department of the Madrid Chamber of Commerce supports companies.read more...

Promotion Organizations

Chamber of Spain

The Spanish Chamber of Commerce is a public law corporation and advisory body.read more...