Nino Khutsidze, Civil Georgia

Civil Georgia, Georgia
May 30 2006

Officials in Tbilisi are cautious about unveiling details of ongoing
negotiations, involving the Georgian, Russian, Abkhaz and Armenian
sides, regarding setting up of a consortium which will deal with
multi-million project on rehabilitation of the Abkhaz section of
Russo-Georgian railway.

Chief of the state-run Georgian Railway company Irakli Ezugbaia
informed lawmakers about the talks at a session of the Commission for
Territorial Integrity. But no details of these hearings are known as
the session was held beyond the closed doors.

Abkhaz sources reported in early May that the Georgian, Abkhaz,
Russian, and Armenian sides signed a protocol on establishing a
consortium - the Black Sea Railways - which will rehabilitate the
Abkhaz railway during the talks in Moscow on May 4. According to these
reports the consortium will be an open joint stock company where the
Abkhaz side will be represented as "a full-pledged party."

But the Georgian officials have denied these reports.

"There are no four parties. There are only two parties - Georgian
and Russian. All the rest [the Abkhaz and Armenian sides] are only
invited to participate in the working meetings," Irakli Ezugbaia told
Civil Georgia on May 30 after the parliamentary commission hearing.

"No decision has been made so far regarding the parties [in the
consortium], because we are still working on mechanisms of setting
up of this consortium. Final political decision will be presented
only after this [work] is over," Ezugbaia said.

He noted that the protocol signed in Moscow on May 4 is a document
which reflects position of the sides regarding the issue.

Ezugbaia also said that no agreement has been reached so far on
how shares among the participating sides will be distributed in
the consortium.

"There are different positions among negotiating sides about this
issue," Ezugbaia added.

He also said that the consortium will most likely be registered in
"one of the European states."

Ezugbaia stressed that the Georgia will push participation of those
Georgian experts in rehabilitation of the railway, who are internally
displaced persons from Abkhazia.

Parliamentarians participating in the commission hearings noted after
the session that "no sufficient answers" were provided by the chief
of the Georgian Railway.

Ezugbaia said he is in charge of "the technical aspects" of the
rehabilitation of the Abkhaz railway, which will cost roughly
USD 200-300 million; hence he is not in a position to comment on
"political aspects of the issues."

MP Shota Malashkhia, who chairs the Commission for Territorial
Integrity, said after the hearings that the issue related with the
railway consortium is too complicated and "is like a big spider web
of legal questions."

"We can not see mechanisms of creation of this consortium; we can not
see how the control over this consortium or investments will be carried
out... All the lawmakers [attending the session] have an impression
that the issue is not fully realized," MP Malashkhia told reporters.

If implemented, the project will revive the Trans-Caucasus Railway,
which stretched more than 2,300 kilometers during Soviet times,
connecting Armenia and Georgian Black Sea ports with central Russia;
the railway, which has been on hold since the conflict in the breakaway
region in the early 90s, operated passenger services and handled more
than 15 million tons of transit cargo per year.

According to the public opinion survey commissioned by the
International republican Institute this April 75% of 1500 surveyed
citizens thought Georgia said that restoration of the Abkhaz railway
will "better suit Georgian national interests."