President of Georgia Mikheil Saakashvili, made presentation of the new project of economic development of Georgia

Dear compatriots!

I decided to address you today about our plans and future views.

I was meeting with world leaders during last few weeks, but the most important meeting is the meeting with you-with thousands of my fellow citizens.

We have advisors who are the leader economists of the world, but meeting with hundreds of representatives of the Georgian business, with people who really create economy of Georgia and accordingly, our every day life, is the main thing.

That is why I want to use this chance and share my opinions with you.

I want to talk about our future and future of our country.

It is indisputable that many things have changed in Georgia during 32 months, after the Rose Revolution.

We live in absolutely different country now.

We live in a country, which is inspiring with more and more faith and optimism every day.

Georgia is inspiring with faith that it is possible to make changes, that it is nothing impossible, that Georgian people, with their achievements and successes, can surprise not only the neighbor countries, but also the whole world.

I do not want to boast with our achievements, but still I intent to discuss several results with you. Danger, to return everything in old form, is still big, because all achievements are quite new and accordingly, if we forget what was done, we can easily appear in old period, 32 months ago, when everything was just starting.

That is why I want to remind my promise. 32 months ago, when I became the president of Georgia, I made promise to defeat corruption and stabilize economic situation in the country.

I made promise to improve destroyed and ruined infrastructure (roads, hospitals, schools and etc.), to increase budget and accordingly, to pay pensions and salaries, i.e. those huge liabilities that gathered during many years.

I also promised to find the way from long lasting power crisis and defeat hidden economics, to defend market from smuggling and to defeat economic crime, to decrease taxes and to create equal conditions for all entrepreneurs.

I promised to establish border between state and criminal world, to fight with organized crime and release business from criminal influence.

These were my main promises.

My companions and I believed that we were able to do all in spite of unbelief and skeptic attitude from others and we did all.

First results of reorganization are delivered from our ancient history, from national energy that gathered during last years and that had the right direction and from special obstinacy of our people.

We must mention that all above-mentioned questions are mainly achieved for today and if not totally, main aspects are really solved.

Imagine perspective of the permanent supply of whole Georgia with electricity, we'd all laugh at this perspective 32 months ago and even could not imagine reality of this question.

All parties were promising to manage 14, 16, 18 hour schedule of the electricity supply in pre-election period.

Our people could not bear any more, people really were at the edge during last 15 years -let us remember how we were burning tire-covers on the road, how we were taking kerosene to children to make them warm.

We were tired also from another, that nobody could do anything new because of the energetic blockade in Tbilisi and in regions.

This year, in spite of the total power blockade that was arranged by our most wicked opponent, we had first winter with permanent electricity on basis of payment (if we do not consider those 3 days).

I want to remind this one more time.

32 months ago, it was really difficult to imagine patrol in place of big-bellied road policemen.

Different propagandists can abuse our police by television, but this abuse and jumble can not overcome gratitude of our people that is shown every day.

All persons feel better because nobody stops them, nobody blackmails and we have police, which will come during a need and defend.

Very many countries do not have this luxury and this was totally unbelievable for Georgia.

32 months ago it was very hard to imagine that Miranda Kervalishvili, inhabitant of the village Tchrebalo, very beautiful and mountainous village of the region Ambrolauri, could get the highest scores at exams and enter university without any "advantage", bribe and protection.

I think we did not forget that system of universities and institutes was totally destroyed during my time and time of my parents and entrance examinations represented one united chain of corruption and big puddle.

We already have second national examinations this years and nobody heard how they were going.

We established tradition that is the total contradiction of what was established during last 30-40 years.

Televisions have not broadcast like last year and there was no pretension that somebody takes bribe or somebody is left without "patronage".

Main thing is that mainly those people are not satisfied with the reform of education, who were making money at the entrance examinations during many years.

Of course, I do not mean all, but my words are about quite important and active part from this sphere.

Let us take another example.

Foreigners were not visiting Tbilisi, as it was announced as the trouble zone in international press.

I remember that foreign air companies totally stopped to fly in Georgia in 2003.

I could not imagine that constructions the best international hotels of Haiti, Hilton, Radisson and more brands up to 20 could start in 2006.

Now, Tbilisi will really become the most interesting centre of tourism in the post-soviet union.

This means that people will have income form here and Georgia will have more reach economics.

All this will really take place and nothing is a tail or just the promise for future. Constructions of Haiti and Radisson have already started in Tbilisi and now, when I am talking with you, tens of little and medium hotels are constructing in Batumi.

Nobody could imagine construction of the most modern park in the Eastern Europe (without any exaggeration) on the place, where the private army of the Georgian feudal met us totally armed some time ago and as my defense counted, had 87 targeted bombs towards us and on the place, where builders again found buried bombs several weeks ago.

It is true that entertainment in the park will be without any charge for our people, but at the same time, this is good way to attract hundreds and thousands of foreigners and invest money in our economics.

This is the symbol of real success.

I visited this park and was astonished, because this park is on the place where "baboons" were checking our passports several years ago, did not allow some people to enter at all and could make all kind of humiliation, insults and checking out of laws and rules.

Now we are able to enter this place freely and one more- Russia, Czechoslovakia, Hungary or other our neighbor countries or countries of the Easter Europe do not have such park.

All this was very hard to imagine.

Before touching the main question, I want to draw your attention to this case: do not think that I boast, or reproach, I just want to emphasize that all this is still very "new" and there is a danger to return everything to the start point.

They can talk that there is corruption in the country, but everybody must look in own heart-you know that you had no touch with corruption and this is the main thing.

That is why I address you not to believe to this mere-trust your own eyes and perceive the reality!

Unfortunately, there are many persons who want to destroy all this.

World bank (there is no more big international organization), recently published conclusion about countries of Europe and Asia and separate insertion in this conclusion, "powerful management brings results", is dedicated to Georgia.

If you allow, I will read the citation:" Corruption was decreased in Georgia with the biggest scales from 2002 to 2005 in countries of Europe and Asia".

This means that Georgia occupies first place in the fight with corruption in the countries of Europe and Asia.

"Rate of reforms after the Rose Revolution in 2003 is really impressionable. Little, but very brave group of reformers in the authority, decreased state pressure on the economics and created fiscally stable system of the social defense. Group managed to reform corruptive institutions in a very short period, simplified regulatory environment for business sector, implemented serious tax reform, improved management of state finances and strengthened the state control. "

This is the conclusion of the World Bank on processes that are going in Georgia.

I think that these people have enough competent representatives on a place to know exact situation.

Let us take last example not to go to far; Article of the most influential and serious and I think most skeptical and as a rule very critical magazine "Economist" was sent today and we can read in this article that Georgia has the most successful authority in the post Soviet Union.

These are our results.

Nobody could imagine construction of so many roads, hotels, repair of schools and I want to say that this year we will make all two and three times more.

Four big hospitals are practically finished, more than hundred dispensaries and hospitals will be constructed, road of 3 million square meters is already constructed.

We managed to do more in one year than it was done during 15 years in the whole Georgia.

Nevertheless, I am not saying all this just to talk about past.

You know very well that all this is just the beginning-basis, on which the edifice must be built.

Georgia still remains to be the country where are enormous problems.

Georgia still remains to be the country that stands quite far from the time, when each Georgian will personally feel all positive changes in family and in own surrounding.

Of course, we know very well that whole branches of economics were ruined.

I know very well that all regions are not equally developing.

Here, in Batumi, from where I am addressing you, there is still huge difficulty, but at the same time, there are regions in Georgia where is not going even the tenth of what is creating here.

Of course we have much work to do.

There are many strong persons, strong and full of energy, but they do not meet the new day with joy, because they have no job.

In addition, there are people, who maybe do not have problems of easting, but they feel that their potential is not totally realized.

This is also very big problem, because person can have a job and everyday income, but if he or she is not working with own profession, intellectual and labor resources will not be totally used.

There are persons who were working during whole life because of us and nowadays, they appeared in a condition, where they have to sell things from house and even sometimes the house when they are ill and need money for medicines.

We know this very well.

I also know very well that prices are increasing in Georgia, but I want you to know the reason of this, why is this taking place.

Price of oil increased practically three times after we came in the authority.

Together, with the oil price, prices of things of the first usage are automatically increasing-all rise in price, when benzene is rising.

Besides, there are many investments in economics and this means big money, which is very good and this is the right way, but this fact also means that this money is not equally distributed-many people find profit from this and some part finds jut loss, because prices are going up and they can not afford many things.

We, authority of Georgia, know this very well. We also know that we must not just look at this, but we must act.

We must do all to change this negative side, to change such tendencies and choose another direction.

That is why this is the time now to go to the next stage of the economic development.

Unemployment is the main problem in Georgia.

Because of this fact, our main task is to reduce level of unemployment minimum twice during following years, before the end of my first presidential term with stimulation of economics.

Work places must be created in all regions of Georgia and not only in the capital and seaside regions, but in all, in the most difficult regions for reaching too.

What is necessary for stimulation of economics?

First of all, we must improve business environment, then increase qualification of employed and unemployed people, train them and determine professional orientation.

Now, about development of the private sector.

I already talked what was done in a positive way, but this process must be irreversible.

It is fact that Georgia needs to attract many investments and foreign capital, but it is necessary to establish state and industrial environment, which will be much more transparent, clear and long-termed for this capital.

It is necessary to have modern and effective tax department and to decriminalize financial relationships.

In first year, when we started very serious fight against corruption, relation with owners was mainly based on the tax police.

Nevertheless, when tax policeman goes to study business object, criminalization of the representative of this object automatically takes place, because it enters relations of the criminal law, break of the tax code automatically means break of the criminal code.

We must implement reform of the tax department, where taxes and customs will be unified, financial police will be just one of the formations and relations with it the last stage in very rare cases.

All the rest must be solved in scales of ordinary, civil relations between state and business.

This reform requires months and we must not have illusion that first we will unify departments and then divide again, this will not take place any more.

This will not be the reform of my former, during whom several departments were mechanically unified in one.

Implementation of above mentioned is the process that needs many months and scientific approach.

This reform must be implemented in conditions of total computerization; Informative base must be unified.

It is also important that none of the professionals will be dismissed from work; on the contrary, we must use their knowledge and experience in more effective way.

Nevertheless, businessman must know that he/she will have relations with civilized state.

He/she must be sure that state is not the instrument for punishment, or is not just the instrument for punishment at least, because state must also have mechanism of punishment in its structure.

Nevertheless, this is the last that state must use.

Before this, relations between state and business object must be implemented only on the tax level, as it happens in normal countries with market economy.

At the same time, we need more improved court system and I know this very well.

We need establishment of the arbitration system, but not like the one we have established a year ago.

That was the authority's huge mistake, as the same people were businessmen and arbiters at the same time, which gave no chance to the state to win.

We are ready to invite foreign arbiters and pay them high wages and we will let them together with local real arbiters - not like those false arbiters we had previously - to resolve disputed cases.

I think the most late, we must arrange this question by the beginning of the next year and create exactly this type of the arbitration system in Georgia.

We must function system of micro credits at the same time.

What is micro credit?

For instance, worker of the rural economy, who has the chance to start business with the help of state.

By the way, we invest much money I the rural economy-we already purchased several hundred tractors and plan to purchase some more several thousands, make irrigation channels and so on.

Every person must have possibility to take bank credit and we must do our best to make this system function.

From the second side, we must help state too, but mainly people must be trained for business activities.

I charge authority to start training of our citizens and help people, who will show good theoretical knowledge at the first stage, to start own business.

We must spend state resources on this too. We will need several months to train all, but this program must be started from January 1 of 2007 and function in full force.

Nowadays our main problem is to train personnel.

From one side, we have high level of unemployment, but from the second side, there is big deficit of qualified work forces in a number of spheres.

Lets us discuss construction sphere for instance.

There are many constructions in Georgia now and we are not ready for this now.

Constructions are going in such speed, because there is no corruption and pressure any more, taxes are decreased, Georgia has become more stabilized country, more and more foreign capital is coming here; but we have problems because industry of construction materials in not properly developed and we do not have enough qualified workers.

I can say the same about pharmaceutical business, computer and program companies, service sphere- many new cafes, restaurants, hotels, they open every day, but practically none of them have trained personnel.

We can not think about serious development with this situation.

Some time ago, hotel "Inturist" was to be prepared for opening and 80 percent of workers were foreigners during last two months.

Now we are talking about one of the hotels, but next year approximately 40-60 hotels will be constructed in Batumi and Kobuleti.

From where will masters, house painters, grinders and welders come? We must train them.

Foreign people must not take these jobs and they will not take, we will not allow and must not allow so many foreigners on work places, because we have many our unemployed people.

Nevertheless, it is necessary to work in very high tempo to have qualified personnel for work places.

This is very serious question.

Our Education system was totally destroyed.

I think you remember what kind of institutes and universities were opened in 1990; universities and academies were established almost in every village.

All prop-technical institutions were transferred in academies- I remember this very well and maybe some of you have even graduated from the academy of this type.

There were appearing many specialists from international justice, international relations and medicine spheres.

Thousand and thousand of students took diplomas of doctors and these were the doctors who never saw patients in life.

I remember, I saw advertisement of one of the colleges, this college had the faculty of stomatology and international justice and while functioning, it was producing dentists and jurists at the same time.

We implemented serious reform from this point of view and many of such colleges are not accredited, but meanwhile, prop-technical system that was destroyed before too and during soviet period, it was punishment to send a child there, totally deteriorated.

That is why we must create system of new professional training.

Ministry of Education is working on this and first 7 colleges will already be opened in September.

We need much more such colleges-maybe thirty, or even fifty, but time is the necessary thing for this.

For instance in Kobuleti, service school will be opened to train personnel for tourists business. We are opening special college in Rustavi, which will train personnel for nitrogen and metallurgical factories; we are opening school in Tbilisi, which will train personnel for construction, but all this is not enough.

Besides, we want to give chance to business to take people, practically by indefinite amount for 3 months and teach them appropriate trade.

We are ready to allocate the sum for the three-month internship program in private businesses for at least 50 000 citizens.

What does this mean?

I think you often heard opinion that is impossible to find a job and I know that may people do not even seek jobs any more, they seat at home without hope.

I want to say, state will not be able to take the role of job-giver any more.

Let us discuss, from where comes the salary of the president, salaries of policemen, militaries and ministers-these are the taxes of our business.

We do not have oil and are not rich with any other natural resources.

We live only with the means of taxes, which come from business, it means that more little is the state apparatus, business has less tax to pay and private sector is more able to give jobs to our citizens.

It is fact that job giver and job seeker must meet each other-this is mutual initiative and state can not send untrained person in a business.

This is one of the psychological barriers too.

Business must show initiative, but we are ready to finance labor length of three months for any person of any age, who will be taken by the representative of business.

Nevertheless, I repeat that business must show initiative and wish- business takes probationer for three months and state pays 450 GEL during this period.

This is necessary to take people out from houses.

Business will find profit from this, because representatives of business will have chance to meet many successful persons, who are eager to work and can show their potential in this work.

Maybe this was not profitable for business before, but now business is insured-it does not have any obligation to give work places to persons, but I am sure that many probationers will find jobs, if not at the place of probation, then at some different place.

We must awake wish in people to work and to trust in own forces and we must give chance to them to make better understanding of the modern economics.

In this case, state is ready to be the financial guarantee.

At the same time, we will start training.

I know that many have two and three diplomas, but can not find jobs, because they are not in accordance with modern economics.

Ministry of Education has elaborated separate program for this problem.

Prime minister of Georgia must create the whole system, but ministries of Labor, Health and Social Defense and Education mutually work on this.

We have separate program for people, who have education, but can not find job according to their qualification.

We must all cope with this burden.

I want to tell our businessmen that you will not lose anything as a result of this program... But through participation in this program you will make an enormous patriotic step, have many workers who work for free and have no obligation to give work places to them necessarily in our business.

You will get qcquanted with many gifted people and wil have own wish to take them on work and broaden your business.

If business shows initiative, we are ready to finance 50 thousand persons this year and 100 thousand persons and more next year, in case of a demand.

We will create all conditions to cause interest of business in this-arrange informational campaigns and talks separately to each businessman; we will share our opinion to them individually.

When 150 thousand citizens complete preparations and labor probations, we will be ready to discuss next question-to reduce taxes for the Georgian business.

I want to remind all Georgian businessmen that customs duty will practically be annulled from September 1 of 2006 on 90 percent of the production.

This means that your expenses will be reduced.

I also want to remind that we are one of the countries, which has the lowest taxes in Easter Europe. We also have the lowest taxes on a number of products in the whole world.

I want all us to use these possibilities together.

This is the new initiative for creation of new work places and I wanted to present this project to you.

I want to tell that this is very important initiative, because gives new possibility and chance to all-to unemployed and to the representatives of the Georgian business.

I want to ask you all to take active participation in this.

From the first of September we are taking announcements from persons who want to start as probationers and from representatives of business. First flow of such probationers must start from September 18.

We will do all to make number of such people maximally big.

Several million GEL in intended for the implementation of this program and as I mentioned above, each person will have 450 GEL during these three months, in face of allowance.

This is very serious financing form the state.

And finally, I want to return to the Choloki Bridge.

Georgia is in the epoch of big changes and symbolic parallels.

Nevertheless, I want to tell that one of the shining symbols is the Choloki Bridge, from where I steel feel emotions.

Georgia was the symbol of humiliation, division, all kind of disaster, darkness and shameful country that had no perspective.

Today it is the symbol of new Georgia-united strong, bright and beautiful.

This is the symbol of Georgia, which still has many problems. It is impossible to solve them in one day and they need gradual approach, but main thing-hopelessness and unbelief in own forces will not disturb us any more.

I am very glad when I see bright faces of our children in streets.

We will have Georgia that will be proud example not only for our future generations, but also for neighbor countries, region and any other nation of the world.

Many nations already follow our country.

We have very beautiful Georgia, but of course, each of us wants to make it more beautiful.

Than you very much

Communications Office
of the President of Georgia

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