The government often tells us about the new stages of the China-Georgia Relations, the signed agreements or memoranda. They visit China, attend exhibitions, and announce new projects. If all their signatures were actual activity, Georgian-Chinese production would be flourishing now. However, these “business” visits often leave us with nothing but photos of the handshakes.
We shall tell you about two Chinese projects that we were gloriously notified about, though both of which failed. Neither the Tkibuli jacket factory nor the locomotive plant was opened. In this article, you will learn why we needed this investment.
Modern Locomotive Plant
“Although the political systems are very different, China and Georgia have common interests, and this applies to the economy,” Prime Minister Irakli Garibashvili said in 2015 during his visit to China.
A memorandum on the construction of a locomotive plant was signed during this visit. The document was signed by Badri Tsilosani, owner of JSC “Vagonmshenebeli” and Min Xing, President of Dalian Locomotive and Carriage Building on behalf of China.
According to the memorandum, they would have opened a Georgian-Chinese enterprise in Georgia, which would have produced modern locomotives (electric locomotives and diesel locomotives) and their parts. We were also supposed to consume the products and export them. Cooperation with the markets of Iran, Turkey, and European countries was planned. The Chinese side also offered lifetime maintenance services for the manufactured products.
Locomotive and Carriage Building of Dalian Factory is the only large state-owned enterprise in China. It was founded 122 years ago. It manufactures and exports locomotives, engines, and urban railway vehicles. The company has built a total of 13 thousand locomotives. Dalian has maintenance services in 25 countries in Asia, Africa, and Oceania. Subsidiaries also operate in South Africa and New Zealand.
A locomotive is a hauling transport, it is attached to a train or carriage and it is used to haul them on the rails.
“It was a negotiation, an intention, where there were no obligations. Do you know how many issues are discussed? But then things do not turn out. We still hold such meetings, sometimes in Europe, sometimes there, sometimes here, we negotiate with many people, “said Guram Ratiani, director of JSC “Vagonmshenebeli”.
In order to find out why this Chinese investment is so important, we talked to people who are familiar with the problems of Georgia’s railway infrastructure. As they told us, first of all, we need to renew the locomotive fleet. We do not have sufficient numbers, and those that we do have, are not working due to their antiquity.
“If we specify the railway infrastructure, the rails, diesel locomotives, wagons, locomotives, in all these layers, the worst situation is in the locomotive fleet. In fact, consider that we do not have it. All are amortized. If anything goes wrong, they go for business trips to Russia, bring parts, or bring specialists here. This park is already outdated and needs to be replaced. “Drivers often call me – we do not drive, we carry the locomotives,” said Davit Gochava, founder of the Professional Railway Club.
The locomotive driver of the Tbilisi Locomotive Sorter Depot tells us that the electric locomotives are okay, but the diesel locomotives are in a much worse condition.
“We do not have enough to operate the railway normally, it is outdated, it often breaks down. There are old, written-off electric locomotives, they remove some necessary parts from it and put them on operational ones. Several locomotives were overhauled 5 years ago and since then, we still have to work with those old locomotives that are made in the 70s. The locomotives’ fleet is in a terrible condition, they are being forcefully exploited,” – said the driver Zviad Mumladze.
Maxime Diasamidze has been working in a diesel locomotive plant for 54 years. He was a driver and a constructor, and after retiring he was promoted to brigadier. The railwayman tells us that only two locomotives are in order at the Tbilisi depot.
“The technical condition is devastated, the transport is deteriorating and the drivers are suffering. 10 out of 16 are operational, though we can hardly call it the operation. It can be out of order 3 times a day. Sometimes the freight station will break down, then the key station will also break down. “Two diesel locomotives were repaired seven years ago in Dnepropetrovsk, and those are the two that operate.”
By the end of 2019, Georgian Railway had 24 electric trains and 153 operating locomotives. 96 of them are electric locomotives and 65 are diesel locomotives.
Georgia is a transit country and is involved in international rail transportation. Therefore, the maintenance of the railway infrastructure should be especially taken into account. As the railway personnel tells us, international cargo at our stations is often delayed due to technical malfunctions of locomotives. The opening of a Georgian-Chinese enterprise would have remedied this situation. Modern asynchronous locomotives would have been produced here. As professionals explain to us, this type of engine is much more powerful and runs faster.
“It is a more progressive engine that reuses already consumed energy. The speed of our trains is very low. The export train, which went from Kars to China, stopped at Akhalkalaki station for 11 hours. There is one crane that works slowly. They barely moved, processed these containers, formed a new train, and hauled with a locomotive. The locomotive is bad, its speed is low, it all affects each other and increases the processing time at the station. One of the narrowest places on the “Silk Road” is the transport system of Georgia and this should be taken into account. The cargo is coming, the cargo is coming – they say, the point is how fast the train is moving and how long it will be processed at the station,” – said Davit Gochava.
“Akhalkalaki Road was the most loaded one. It is a very difficult profile and it is very hard for locomotives to move. Neither current nor voltage is maintained. If this keeps up, we won’t have any more electric locomotives in a while, and we haven’t had anyone in charge for a long time. “So to say, we force it to work'” said Zviad Mumladze, a driver who drives electric locomotives in eastern Georgia.
The opening of a locomotive enterprise would facilitate the employment of professionals and thus further benefit the Georgian economy. As the railwaymen tell us, many experienced personnel are left unemployed. They also are interested in why we need railway faculties and schools.
“We are the first in the region with this information, knowledge, and opportunities, i.e. electric locomotive construction. Our country has traditionally operated this field. Today, we have unemployed professional people, engineers. Unfortunately, the field has no development. “We have not only professional colleges, but also
a specific field at the University, MA students and professors, but these people are left behind the railway,” said Ilia Lezhava, deputy chairman of the New Georgian Railway Trade Union.
“The hydraulic transmission line is sent to Ukraine for repair. It can be done here too, then why on earth we need so many institutions, why do we want so many students and educated people? They are sending 350 kilos of hydraulic transmission to Ukraine, repair there and bring back. When you can explore which details stop working, then go there, bring the part, and repair it here. Someone has to introduce, for example, how to repair a generator, a hydraulic transmission. “Why do we want these institutions then? close it!” – says Maxime Diasamidze, brigadier of the electric locomotive plant.
The trade union tells us that they were not surprised by the failure of this project, because it is not the first time that the Georgian Railway has not fulfilled its promises.
“I thought it was a stupid thing and I was right. A number of similar projects have been announced. The countdown was also turned on in Kutaisi so that the train would enter the airport. The countdown ran out and the train never entered the airport. The launching of the “Stadler” factory was announced and the deadlines for that also expired. “Unfortunately, the current management is accustomed to spreading false information and creating false expectations,” – says Ilia Lezhava.
Tkibuli Jacket Factory
The Chinese missions impossible also include the Tkibuli jacket factory. The agreement was signed on November 5, 2018, during Mamuka Bakhtadze’s visit to Shanghai. After two years of negotiations, the document was signed by representatives of the Partnership Fund and the Jiangxi Huazhao Management Company.
China planned to invest $ 5 million in Tkibuli. Construction should have started in 2019, and the first products would be released in 2020. Based on the agreement, jackets of famous brands would be made here, which we would export to the EU.
The Chinese side would technically equip the enterprise, also select job seekers, take them to China for six months, and train them for free. The “Partnership Fund” had to provide infrastructure and communication to the enterprise.
When announcing the project, 300 new jobs were underlined by the Partnership Fund, which was vital for Tkibuli. It was also said that we chose Tkibuli because there was a sewing tradition here.
Yes, they wanted to, but apparently, it was not sufficient. The construction of a jacket factory in Tkibuli has not even started. Within a month of the agreement, Chinese investors arrived on-site, met with City Hall and City Council officials, and selected two locations for the enterprise. It was supposed that the factory would be opened at the entrance to the city, either in a former hospital building or in a tea factory building. They have not communicated with City Hall since then.
“It was an introductory meeting. Mostly, they visited for location scouting. The municipality guided and toured them to several places. Thus ended our communication. There was no more discussion, nor was there any talk about deadlines,” – says Eliso Chanturia, head of the public relations department at Tkibuli City Hall.
The locals were happy with the Georgian-Chinese investment in Tkibuli. As they say, nothing works here except the mines, one sewing boutique, and grocery stores. Therefore, they hoped that a new employment space would appear. In the end, it did not happen. Young activist Tsotne Abesadze tells us that false expectations and disappointments are a daily routine for Tkibuli residents.
“When you are told that the contracts have already been concluded and it has been decided to create a new, high-paid job soon, it is pleasant news for the town like Tkibuli. Now the project has failed and it again leaves the town in this status quo that there is no alternative job. This is not the first fact nor the last. The population of Tkibuli is accustomed to making promises and not fulfilling them. This is everyday life and, consequently, you do not have a sense of protest,” – says Tsotne Abesadze, the founder of the youth movement “Strong Mukhura ”.
According to the latest census, there are a total of 20,839 people living in Tkibuli Municipality. According to the data of 2019, only 2,041 people were considered to have jobs and 1,633 people were employed.
“We wish it to be done, we, the locals will support it with full strength. If there are better conditions in Tkibuli, no one will go abroad, right? There is a mine, sewing workshop, and nothing more, what else does Tkibuli have? Young people and middle-aged people are leaving Tkibuli,” – says Maia Ashotia told us. He is the main brigadier in Tkibuli sewing plant.
Malkhaz Bochorishvili, a manager of MPP Georgia Tkibuli Garment Factory, thinks that another enterprise would create competitive conditions in Tkibuli and might increase the salaries of its employees:
“Let’s say if here a person has 400 GEL and the Chinese person would have 500 GEL and our tailor would go with them, it is logical. Then we would raise a salary too. That is good, the competition is good in general.”
20 agreements and 10 memoranda have been signed between the Georgian and Chinese parties in the last ten years. Prime Ministers held official meetings in China. It seems that their business trips have not always yielded results, although the illusion of an economic partnership with China has been created. Mate Gardava, the founder of the Center for Economic Transformation, says that in reality, the free market is neither in Georgia nor in China, so, it is suitable for both sides to show to the people as if they have active economic relations:
“China is a communist country, the state is the leading acting figure. Therefore, memorandums are often signed with such countries, as well as Russia and China. An enterprise is being built, a factory is being built within the framework of a memorandum, masked as someone’s economic support. This creates a kind of illusion that a communist country ruled from the center is ostensibly fighting to create market mechanisms. The Georgian government also supports the management of the economy from the center, and it does so. Georgia is not a country of free-market relations either. That is why it is suitable for them to show people as if everything goes for the development of a market economy.”
The Partnership Fund also tells us that the memorandum does not mean the actual start of the project. Nino Kvariani, head of the public relations department of the Fund, says they wanted to build a jacket factory, but the Chinese side refrained from investing. It is true that the memorandum was signed in 2018 when Kovid-19 did not even exist, but the suspension of the project was still blamed on the pandemic.
“Then pandemic situations followed and the Chinese side refrained from investing. Signing a memorandum with a Chinese company does not fully mean concluding a contract and starting a project. A memorandum means consenting to the expression of common interests. We were very eager to do it. It was also a direct initiative of Davit Saganelidze. As you know, Tkibuli needs enterprises, but it could not be done by our decision alone, we needed a partner. When the memorandum was signed, there was readiness, but then a lot is being studied and if an investor thinks that a similar project can be implemented elsewhere and it is more profitable, he has the right to change the decision. We will never force anyone to invest money in Tkibuli.”
It turns out that the government knew that the construction of a factory in Tkibuli was not guaranteed, but they still gladdened people with the news, as if new jobs would be created. Another international project was announced and thus, the illusion of economic development was created.
“The Prime Minister publicly declares that an agreement has been reached, we have signed, agreements have been exchanged and all this is priceless “This approach is bad that you can talk about the agreement, what is beneficial for the town and the country, you can score political points, then time will pass, it will fail and no one will take responsibility,” says Tsotne Abesadze, founder of the youth movement “Mukhura”.