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Energy industry of Abkhazia needs investors

Energy industry of Abkhazia needs investors

Problems of the Abkhazian economy, last but not least depends on the state of the energy industry. Abkhazia is discussing the statement of the President of the Republic Aslan Bzhaniya on the need to attract investment in the energy sector. The Head of State stated, “If we do not attract investments in the energy sector, we will not ensure sustainable work, and we will have even more problems. Therefore, this is how life forces us to act.. In connection with the statement, a discussion began on the advisability of attracting foreign capital and further privatization.

Investments in the restoration of Soviet hydroelectric power plants are practically blocked. According to the law of the Republic of Abkhazia "On Energy" "... electric power facilities, directly intended for the production of electrical energy, power over 5 MW, existing (including destroyed and unused) as of the date of adoption of this Law, are state property and are not subject to privatization”.

In Abkhazia, they fear for their sovereignty and consider energy independence in this vein. but, all clear, talk about the state monopoly on strategic energy facilities is shaking the air. Abkhazia, like never before, dependent on two neighboring states: Georgia and Russia. Own production of electricity does not allow to cover its growing consumption, and the murdered Soviet national economy does not even allow the normal use of the available capacities. Accordingly, the flow of electricity comes either from Georgia, either from Russia, and Russian and Georgian power engineers are involved in the elimination of daily accidents at networks and stations (the latter without public disclosure by the authorities of Abkhazia). Moreover, Abkhazia is in no hurry to pay for imported electricity: because from Georgia this is a diplomatic curtsy, and Russia, as a friendly partner, writes down in debt.

The republic should not count on such a state of affairs for a long time.. Russia will someday get tired of all this rigmarole with the children's problems of the southern republic and it will stop patronizing, and Georgia does not care about the problems of its neighbors. In this way, Abkhazia faces a simple dilemma: or in the evenings sit by candlelight and kerosene lamps, or change your policy. There is only one option left – Russian investments. Since investors just won't come, due to the risk of bankruptcy. Therefore, investments will not be, when a screwed-up entrepreneur is kicked out the door, but hard, almost surrender agreements, for many years guaranteeing the rights of Russian business in relation to energy facilities.

Is there an alternative here? Most likely the time for alternatives is lost. After 2008 year it was possible to use Russian aid wisely, gradually changing the ill-fated transformers, installing counters, opening inexpensive hydroelectric power plants in the villages and properly regulating mining. But everything was done exactly the opposite, and as a result, the republic found itself in an almost catastrophic situation..

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