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Economy Minister Testifies Before War Commission
Civil Georgia, Tbilisi / 24 Nov.'08 / 18:55

Economy Minister, Eka Sharashidze, was questioned by the parliamentary commission studying the August war at a hearing on November 24.

The major issue on which Sharashidze was pressed by some commission members, in particular by the commission chairman, MP Paata Davitaia, was the information provided by intelligence chief, Gela Bezhuashvili.  

Bezhuashvili told the commission on October 25 that his agency informed the Economy Ministry and the Energy Ministry about a suspicious investor planning investments in the Georgia’s energy sector. The reference was made that Russia was behind that possible investment deal.

The issue was raised by the commission during the testimony of Alexandre Lomaia, the Secretary of the National Security Council, on October 28. He told the commission that the intelligence service informed the authorities after the August war about possible Russian investments in the energy sector. Lomaia, however, did not go further into details on the matter and said the authorities were studying that information.

The issue was once again raised by the commission on November 12 when it questioned former Prime Minister, Lado Gurgenidze, who told the commission that such a note was sent by the intelligence service in October. “I think the Economy Ministry will give you more detailed information about it,” Gurgenidze said.

During the hearings on November 24, Eka Sharashidze, the Economy Minister, told the commission on the matter: “There was no privatization in the energy sector in the course of 2008 [the only privatization in the sector took place this year last week when Energo-Pro purchased Kakheti Energy Distribution (KED) for USD 6.1 million]. The intelligence chief meant a possible deal with one of the companies in the energy sector. I do not think that it is now worth of speaking about that company, or we may [speak about the company] beyond the closed doors.

The commission chairman, MP Paata Davitaia, however, responded that information about the company could not be confidential and it should be discussed publicly. “Privatization itself is a public process,” MP Davitaia said.

In a response the Economy Minister again repeated that no privatization in the energy sector was carried out this year. “Hence there was no suspicious company participating in any privatization in this sector,” she said. The Minister also said that those Russian-owned companies which operate currently in Georgia, including in the energy sector created no problems to the country.
Sharashidze also said that the letter in question contained information not about possible privatization, but about “a deal in the energy sector” – no other details of this “deal” were discussed at the commission hearings.

The Economy Minister told the commission members that she had learnt about this note from the intelligence service from then PM, Lado Gurgenidze. She also said that personally she had not read that letter and Gurgenidze only informed her verbally about the content of the letter. “This letter itself has not been received by the Economy Ministry,” she said.

When asked by the commission chairman about the intelligence chief saying that his agency had sent the letter to the Economy Ministry, Sharashidze reiterated that the Ministry had not received the letter and she had been verbally informed bout this letter by then PM.

PM Davitaia then asked the Minister: “So you do not know anything about this company?”

“I do not know exactly what the content of this letter was,” Sharashidze responded.

“So if you do not know the content of the letter, you presumably do not have information about that company,” the commission chairman then told the Minister.

“Yes, I just know that the letter concerned the energy sector and a deal in this sector with one of our neighbors,” Sharashidze responded, although earlier during the hearings she told the commission that she did not deem it appropriate to speak about that company at the public hearing and was ready to do that at the closed-door session. She was not further questioned on the matter by the commission members.

MP Davitaia, however, said that the commission has failed so far to receive sufficient information about the matter and the commission might summon again those officials related with this issue, which have already been questioned by the commission.

Below are other key points of Sharashidze’s 25-minute long testimony:

  • Although we saw the growing escalation ahead of the August war, the scale of what has happened was unimaginable;
  • The Georgian economy turned out to be more sustainable and strong than we could imagine;
  • One of the duties of the Economy Ministry during the emergency situation is to oversee normal functioning of transport infrastructure;
  • The Ministry was also monitoring prices on the products to prevent price hikes;
  • The Ministry was also engaged in providing temporary housing for the displaced persons.

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