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Building Bridges or Shifting Course? Assessing the China-Georgia Strategic Partnership 

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Building Bridges or Shifting Course? Assessing the China-Georgia Strategic Partnership 

Despite longstanding diplomatic flirtation, the announcement of a strategic partnership between the two countries still came as a significant surprise.

Building Bridges or Shifting Course? Assessing the China-Georgia Strategic Partnership 

Georgian Prime Minister Irakli Garibashvili (left) shakes hands with Chinese Premier Li Qiang during a visit to Beijing, China, July. 31, 2023.

Credit: Government of Georgia

From July 27-31, a delegation from Georgia, led by Irakli Garibashvili, paid an official visit to China. The visit began with a notably warm welcome at the airport, followed by meetings between Garibashvili and Chinese President Xi Jinping, as well as Premier Li Qiang. Subsequently, China and Georgia jointly announced the elevation of their bilateral ties to a strategic partnership, pledging to bolster policy coordination and alignment in development plans under the framework of the Belt and Road Initiative (BRI) and promote two-way trade and investment.

In a joint statement issued by China and Georgia, the two states expressed their intentions to intensify cooperation in various sectors, including transport, telecommunications, infrastructure modernization, digital technologies, manufacturing, railway networks’ upgrading and expansion, and environmental protection.

While hosting his Georgian counterpart, Li expressed China’s willingness to work closely with Georgia to carry forward their long-standing friendship and enhance strategic communication. Both countries see the establishment of the bilateral strategic partnership as an opportunity to deepen pragmatic cooperation, benefiting their respective nations and peoples.

Additionally, besides the strategic partnership, the countries also signed a bilateral cooperation plan between the governments of China and Georgia within the BRI framework.

Over the years, I have closely observed the developments in China-Georgia relations. In a 2016 article for The Diplomat, I boldly asserted that Georgia had the potential to play a significant role in China’s Belt and Road Initiative. Three years later, in another article, I maintained that Georgia could still serve as a hub for China, but only if the BRI survived.

Georgia’s unique position as a connector state between the Eurasian interior and Europe has attracted Chinese interest for some time now. Moreover, the ruling Georgian Dream party has shown a favorable attitude toward Chinese leadership. Garibashvili himself expressed warm sentiments in a speech at Peking University in 2015, emphasizing that “there is no country in the region that is more open to Chinese business and investment, Chinese people and culture or Chinese innovation and ideas than Georgia.”

Despite this diplomatic flirtation and openness, the recent announcement of a strategic partnership between the two countries still came as a significant surprise. It marks a notable milestone in the bilateral relationship and signals a deepening commitment to enhance cooperation and coordination in various sectors, especially within the framework of the BRI.

China-Georgia Relations: The Background

China and Georgia established diplomatic relations in 1992, with China being among the first countries to recognize Georgia’s independence. However, at that time, Beijing had limited interests in the region. Trade between the two countries amounted to a mere $3.7 million at the end of the 20th century.

Throughout the 2010s, cooperation between Georgia and China mostly revolved around economic matters. Despite the originally modest trade figures, significant growth occurred in this domain. Initially, Chinese involvement in Georgia was mainly limited to individual projects and credit lines. However, over time, China’s presence expanded substantially, establishing itself as a major player in Georgia’s economic landscape.

Notable Chinese investments in Georgia include the construction of the Khadori Hydro Power Plant by Sichuan Electric Power Corp China (SEPC). The China Xinjiang Hualing Group became the largest Chinese investor in Georgian mining and timber production. Furthermore, an ambitious 51.6-kilometer section of a Chinese-built highway, featuring 96 bridges and 53 tunnels, is cutting through Georgia’s rugged and mountainous terrain, with costs rising to nearly $1 billion.

In 2017, Georgia took significant steps to enhance its economic cooperation with China by signing a Free Trade Agreement, making it the only country in the region with such an agreement with China. This move opened Georgia’s market for 96.5 percent of Chinese goods, while China reciprocated by providing duty-free access for Georgian export products, including wine, mineral water, tea, fruits, and more, accounting for 94 percent of goods.

As noted by Michael Cecire, growing Chinese economic influence around the world often goes hand in hand with deepening political engagement. While it may seem puzzling that a country with a population of 4 million and a GDP of just $24.6 billion could become a major interest for the world’s second-largest economy, there are other factors driving the Sino-Georgian strategic partnership.

The Middle Corridor in the Spotlight

While Georgia brings some assets to the table, such as its economic potential and natural resources, I believe that the primary aspect that has captured China’s attention – and led to the establishment of the Sino-Georgian strategic partnership – is Georgia’s strategic location, particularly its significance for the Middle Corridor of the Belt and Road Initiative. The Middle Corridor is a critical component of the BRI, aiming to establish efficient trade routes and transportation links between China, Central Asia, the Caucasus, and Europe. As a connector state situated in the South Caucasus region, Georgia serves as a crucial gateway and transit point for goods moving between these regions.

During the meeting between Garibashvili and Li Qiang, they assessed Georgia’s transit potential and emphasized the significance of developing the Middle Corridor. They acknowledged that this corridor’s importance had grown even more crucial in light of the current global challenges.

The Russian invasion of Ukraine has resulted in a redirection of trade routes to the Middle Corridor, which encompasses Georgia, Azerbaijan, the Caspian Sea, and Kazakhstan. However, Georgia has yet to fully capitalize on this opportunity.

Following Garibashvili’s China visit, discussions surrounding the Middle Corridor have intensified. “The importance of the Middle Corridor has been talked about for a long time, but today this topic is extremely important for everyone – both for East and West – and the connection of these two markets cannot happen without the Middle Corridor,” Parliament Vice Speaker George Volski said.

“Georgia’s geopolitical position corresponds to the standard necessary for the development of the historical Silk Road, and a lot of things will happen through Georgia,” he added.

The Anaklia Port Saga

A critical focal point within the Middle Corridor is Georgia’s Anaklia Port, strategically located on the eastern edge of the Black Sea, serving as the shortest route from China to Europe.

Back in 2016, when the Georgian government announced the conclusion of the tender for the construction of the Anaklia deep-water port, the outcome surprised many experts. The contract was not awarded to the most viable bid involving two Chinese companies, Power China–Hubei Hongyuan Power Engineering Company, Ltd, and China Harbour Engineering Company, Ltd, despite the Chinese government’s backing. Instead, the winner was the Anaklia Development Consortium, a joint venture between Georgian Group TBC Holding and U.S.-based Conti International.

China was initially seen as the preferred partner, as the construction of the port in Anaklia was explicitly aligned with Beijing’s new Silk Road trans-Eurasian transit development policy. However, rumors circulated that the U.S. government played a role in the final decision.

These speculations gained further weight when then-Secretary of State Mike Pompeo visited Georgia in 2019 and offered strong support for the Anaklia Project, while also bashing China. “I communicated our hope that Georgia completes the [Anaklia] port project,” Pompeo said. “The project and others will enhance Georgia’s relationship with free economies and prevent Georgia from falling prey to Russian or Chinese economic influence. Those pretend friends do not have Georgia’s best interests at heart.”

However, just a few months following Pompeo’s visit, the United States’ Conti International withdrew from the Anaklia Development Consortium, and subsequent political controversies and arbitration actions between the government and consortium members led to the abandonment of the project. As a result, no construction progress has been made over the past seven years, leaving the future of the Anaklia port uncertain.

Despite the previous obstacles, some developments have taken place just now. On February 20 of this year, the Ministry of Economy and Sustainable Development of Georgia made an announcement indicating a new approach to revive the project. They initiated a call for expressions of interest to attract a private partner for a 49 percent stake in the Anaklia Deep Sea Port project, while the state will retain ownership of 51 percent of the shares.

“It should be our task to start the construction of the Anaklia port this year. The construction of roads and highways is underway; we are working on the expansion of the airport and other concepts. So, we have positive developments in all directions,” Garibashvili said.

With the U.S. investor no longer involved, does that mean that China will be awarded the contract this time? And would that mean something more than just an economic partnership?

The Future of China-Georgia Relations

As an absolute majority of Georgians remain supportive of the country’s Euro-Atlantic aspirations, it is crucial that Georgia’s partnership with China does not engender a shift away from its foreign policy goals. Rather, it should rather serve as a potential solution to certain domestic challenges. However, some concerns arise due to the current foreign policy approach of Georgia’s ruling party, which appears to involve criticism of the West while engaging in closer relations with Russia and now China. Additionally, China’s position regarding the conflict in Ukraine is not entirely aligned with the international community’s stance.

Given these circumstances, the China-Georgia partnership may prompt questions about its broader implications for the country in the South Caucasus. As Georgia seeks economic benefits from cooperation with China, it must carefully navigate potential political ramifications and ensure that its domestic and foreign policies remain aligned with its long-term goals and values.

The Georgian government must strike a delicate balance between leveraging economic opportunities with China while upholding its Euro-Atlantic aspirations and adhering to internationally recognized principles. By doing so, Georgia can harness the potential benefits of the partnership while maintaining its commitment to its broader geopolitical positioning and aspirations. But will Georgia’s government be able – and, more importantly, willing – to do that?