Saakashvili: Increase of Gas Price will Hit Georgia’s Economy

President Saakashvili said on December 1 that Russia’s decision to increase the price of gas for Georgia from the current USD 63 to USD 110 per 1000 cubic meters starting from 2006 is “a political decision” which will hit the country’s economy.
 
“This is purely a political decision… The increase in the price of gas will hit the Georgian economy, but it will not suppress the democratic mood… Russian companies are the major gas consumers in Georgia and they will suffer most of all,” Saakashvili told reporters Thursday in Kiev, where he is participating in the inaugural forum of the Commonwealth of Democratic Choice.

This statement of Saakashvili comes into direct conflict with an earlier announcement by Georgian Prime Minister Zurab Nogaideli, who said on November 25 while visiting Moscow that an increase in the price of gas will not severely impact the country’s economy. He said that the financial losses caused by this increase in gas prices will be only 0.6%-0.7% of Georgia’s GDP.

“But these losses will be compensated by economic growth, which will be a double-digit figure next year,” Nogaideli said.

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