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Karabakh conflict and Georgia - assessment and forecast

Karabakh conflict and Georgia - assessment and forecast
Karabakh conflict and Georgia - assessment and forecast

Demur Giorkhelidze, an economics expert, summed up the impact of conflict between two neighbors, Azerbaijan and Armenia, on Georgia's economy and the region at a briefing today.

The expert thinks that the conflict will escalate soon and will not turn into a global or regional war.

According to him, this is just between Armenia and Azerbaijan, and there is no prospect of resolving this conflict by force.

"What is happening in the Caucasus today is the influence of geopolitics," Giokhelidze said. He believes that the Karabakh conflict will not be a deterrent for large investors.

The expert is convinced that the conflict will also have an indirect impact on GEL, but not significant.

"GEL exchange rate fluctuates many times a year. It is the result of the current pandemic and changes in world politics and a result of subjective policy: mistakes in macroeconomic policy. Therefore, nothing new will happen here. Due to the current situation, the funds need a relatively quiet location. The Armenia-Azerbaijan war is not a hindrance to large investors. It can affect small and individual investors," Giorkhelidze explained.

The expert believes that the war will not have a significant impact on the Georgian economy.

"The main sources that connect us with Azerbaijan, especially the energy carriers, will not be in any danger. Both Armenia and Azerbaijan know very well that global interest should not be touched because it will end badly. Nothing threatens the gas and oil pipelines. They both know this well," Demur Giorkhleidze said.

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