Abkhazia and Russia Sign Investment Agreement Amid Opposition Concerns
Kristina Ozgan (left), Abkhazia’s Economy Minister, and Maxim Reshetnikov, Russia’s Economic Minister.
SUKHUM / AQW'A — Abkhazia and Russia have signed an agreement allowing Russian legal entities to undertake investment projects within the republic, as reported by Abkhazia’s Ministry of Economy. Signed by Abkhazia’s Vice-Premier and Minister of Economy Kristina Ozgan and Russia’s Minister of Economic Development Maxim Reshetnikov, the agreement defines mutual responsibilities and establishes substantial support measures for foreign investors operating in Abkhazia.
Ozgan emphasised the agreement's critical role in stabilising Abkhazia’s economy, noting a marked increase in investment activity in recent years. She shared that investment in core assets has more than doubled in the past four years, surpassing 11 billion rubles ($110M). Alongside this growth, she pointed out, average salaries, GDP, and budget revenue have also more than doubled. “We’re able to demonstrate a new approach by decreasing state investments and increasing private ones, which brings qualitative changes that this agreement will enhance,” she said, underscoring the potential impact of these large-scale projects on employment and the broader economy.
The Russian Ministry of Economic Development expressed confidence that this agreement will attract new Russian investments in key sectors like agriculture, manufacturing, tourism, and infrastructure. Reshetnikov highlighted its importance in supporting the development of essential infrastructure, such as gas, water, heating, transport, social services, and digital systems.
Since 1 September, Moscow had suspended its funding of the Abkhazian budget, with this agreement being one of its stipulated conditions for resuming financial support. However, despite the potential financial benefits, the deal has met strong opposition, with critics arguing that it favours foreign oligarchs and threatens Abkhazia’s economic sovereignty.
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Former Human Rights Ombudsman Asida Shakryl questioned the prioritisation of foreign investors over local businesses. “Why does the Abkhazian state prioritise foreign investors over local businesses?” she asked, criticising the lack of similar opportunities for Abkhaz business owners to access land. She urged Parliament to address these issues closely and assess the potential economic impact.
Other opposition figures have echoed these concerns. Leuan Mikaa, chairman of the Committee for the Protection of Abkhazia’s Sovereignty, argued that the agreement creates an imbalance by favouring privileged foreign companies over national businesses. Mikaa cautioned against land collateral obligations and the risks of local companies being marginalised. Lawyer Said Gezerdaa pointed out that the agreement bypasses protections meant to safeguard Abkhazian land, potentially giving foreign companies easier access than local business owners.
Economist Akhra Aristaa argued that the agreement threatens national businesses and the country’s budget. He explained that large amounts of foreign capital would operate outside Abkhazian jurisdiction, making it harder for local entrepreneurs to secure funding. Aristaa also voiced concerns about how the outflow of revenue could impact the budget and social services.
With the agreement signed, calls for transparency and a more balanced approach to economic independence continue to grow. Many in the opposition urge the government to consider the broader implications for Abkhazia’s local businesses and long-term economic stability.