President of the Republic of Abkhazia




Dear citizens of the town of Pitsunda!

On June 9 this year giving a speech for the public of Gagra district I promised that will meet you in order to communicate in a regime of direct and open dialogue. I want to reassure you that I am not afraid of any talks despite of the fact that a lot has not yet been done.

Pitsunda is a visit card of Abkhazia. It is a world-known resort. It has enormous potential, but unfortunately, it is not fully utilized.

I have instructed to create a working group to study the situation at the place – it was your initiative. The work group has to start its activities in the direction of changing the situation in Pitsunda, however, this does not mean that it will be able to do everything. But we have to take necessary measures in order to change the situation.

The situation, with no exaggeration, is oppressive. A lot has already been said by the Head of the Administration of the city and other speech-makers. Yes, I know about a lot of problems and we are trying to address them. However, there are a lot of talks and discussions, but, unfortunately, not a lot of real action.

I am being open here: not all of our expectations were met in the field of financial assistance. Some people think I will hide something. I am not going to do that.

There are some problems related to the investment of resources that come from Russian Federation. Today we have the necessity to clearly elaborate the issues of design estimates, which were not done in a proper way for a long time.

I have already mentioned some of the mistakes that took place earlier. For instance, at some places where the work could have been done for 10-15 millions, 100 million rubles were spent. And now let's look at the situation with sluice in Gagra after we paid significant amounts of money – not ours, Russian money. Our aim is not to cheat on people that we call friends.

Besides, we have to seek own opportunities that we have, rather than be ironic about it. We have to do everything possible, so that we do not act as suppliants, begging for money. We have to prove to ourselves and to everyone that we can develop independently. We have to do it now, correctly and effectively using the opportunities that Russia grants us. And those opportunities are rather serious.

Some oppositional moods exist in our society, and they actually should exist. But we have to be just. When I am saying that 1,3 billion rubles will be sent to Gagra district, I am asked, where this money comes from. Those are Russian money, not my personal. And our state, unfortunately, does not have that kind of money yet. I want you to know, significant part of that money will be sent to Pitsunda to solve issues related to Inkit lake, roads, water supply, hospital, kindergartens, etc. I want there to be understanding that we can not immediately solve all of the problems. But we are doing everything possible, so that this money would openly and transparently be passed to our people. There can be no other approach.

733 million rubles are set to reconstruct electric substations and distribution grids for both Gagra and Pitsunda. That money should be rationally utilized and it should be envisaged so that those traction stations that are vital for our energy system be repaired.

In general, 446 million rubles are sent to develop Gagra distric as a tourism and recreational cluster; 350 – for water supply of Gagra district, 1 billion 135 million for all other districts.

To but and place lifts – 10,1 millions, to reconstruct kindergarten – 122 million rubles (72 millions in 2015, 50 millions in 2016), and also, which is really important, to conduct land-reclamation of Pitsunda cape (136 millions), for lake Inkit (2016 – 40 millions, 2017- 90, 6), 4 million rubles for hydraulic engineering research, related to the implementation of those activities on improvement of hydraulic, soil and agro climate conditions. Thus, in two years we will solve the problem of Inkit lake.

Those figures sound good. And we will undoubtedly have that money. But we have to do everything possible to correctly use that money. I want everyone that is related to forming the document packages on design estimates to understand that all those frauds that took place before will not be tolerated. We know the principles that formed in the past: there were projects estimates with higher numbers than needed, they found contractors that did not have all necessary opportunities to conduct activities, and then those labor contracts were passed to sublease, thereafter, the objects were built by people who do not know anything about construction business.

Same happened at Pitsunda mechanized bakery. I reviewed those materials. Who was the contractor? To whom were the contracts passed? How was that money supposed to be used?

But this happened not only in Pitsunda. This is related to almost every of our mechanized bakeries. A lot of money was used in order to launch those bakeries. The equipment was bought, but today those bakeries do not function.

Why spend state money and money of Russian partners? Was it done to manipulate with consciousness?
Today, for the most part, the baking of bread is done by commerce organization. So maybe it would have been right to give them that work and spend the money on other fields of activity of the state?

I heard about the problems of Pitsunda and want to note, the socio-economic state in the city is unsatisfactory. Only some of the enterprises in Pitsunda correspond to standards. And with that Pitsunda has the potential of one of the most successful, prosperous towns of Abkhazia. And that potential lies in the touristic sphere of activity and in order for it to develop, we have to preserve Pitsunda. This is a unique place not only for Abkhazia, but for the whole world. Such a talentless approach will not be forgiven by the future generations.

I already told you that significant amounts are set within the Investment program for the development of Pitsunda. If those resources are properly utilized a lot of problems would be addressed. But the financing at such level would not solve all the issues. We have to earn our own profits.

And we have opportunities for that. The previous leader that talked before me told us on how the figures changed. And those figures change significantly. I will name you one example. For the period of May-June 2014, the number of tourists of the «Pitsunda resort» was 1953, and for the same period of 2015 – 5424. The growth stands at 278 %. The figures for person-daysare – May-June 2014 – 18607, May-June 2015 – 45271. The growth is 243 %. A very characteristic indicator is the number of registered tourists that came here independently (not using tickets for tour groups) and paying for their stay using cash. This way, in 2014 it was only 62 people, and in 2015 – 3417. Such a difference may be explained by the fact that it is only this year when we started full-scale registering of tourists and send the money to the budget, not to the pockets of some people. Significant difference takes place concerning the tax gatherings of the “Pitsunda Resort”. For the first half of the year of 2014 (until June 30) it was 4,3 million in taxes, and only 3,2 million were paid. As of June 18, 2015, 7,6 million of taxes have been paid. That would be 2,5 times bigger than it was in 2014.This is what I am referring to as internal reserves.

We have to correctly use the situation. I am not saying about other figures on tax collection. We are often reproached with the fact that we increased the tax rate, burdening our people and enterprises. I would like to highlight that we have not increased any tax rates, but the figures of tax gatherings increased radically. By the end of this season, all of the debts that Pitsunda has should be paid using the money collected as taxes.

Sometimes the issues of selling this resort is brought up. Let us think, would it be wise to get rid of those riches that we possess? Searching for investor that are ready to work with us is different. But just to get rid of that would be a serious mistake.

I think that this year, as it was noted, the touristic season would be successful and profitable for the budget and for our citizens. In order for it to be this way, we have to do everything possible so that the activities of all structures were aimed at results. We have to promote this process, support people working in the sphere of tourism.

I have recently met with the top officials of MIA and we spoke on the fact that we have to radically switch approaches to addressing a lot of issues – the criminal situation in Abkhazia, the issues of drug addiction, the environment on roads. We have to toughen our attitude to that or our country that we call country of soul will stop being called that.

Now concerning the issues of financing Pitsunda by means of the budget of Gagra district and lack of town's own resources. I heard about that not only today, we already discussed that at the Parliament. The Parliament, at my request, plans to change this situation. Pitsunda should not be reduced to the status of a village in terms of budget structure. This corresponds neither with the status of a town, not with the volume of tasks that the administration of Pitsunda has to address. That is why these issues should be solved in the nearest future. I am confident that the situation on that issue will be changed.
I already said that we are aimed at developing the taxable base. In order to do that we have to form the class of entrepreneurs, tax payers, create full-scale economy. We have to reach an acceptable level of own incomes. And for that we launched the support of small and medium-sized business, by means of granting credits at low percentage rate.

I want to be honest: that money was available in the past too, but for some reason they were not effectively working for you and I.

Today with the lack of opportunities that our country had a couple of years ago with the intense Russian financing, we managed to increase the incomes of the National bank to 45 million rubles in just two months. And that money will be used as the resource for crediting small business.

Now concerning other part of crediting, which will be implemented by means of Russian assistance in the amount of 1 billion 200 million rubles. The credit rate is 10 per cent. I would ask not to tangle and say that we are “distributing” Russian credit money. This is incorrect. We are just offering those projects that correspond to well-known demands. The commission of the Ministry of economy chooses the projects. In the end, the final word would belong to the leadership of bank structures in Moscow.

Now concerning Pitsunda temple. This issue is exaggerated. This temple is well-known to connoisseurs of art well aside Abkhazia. Legally, the concert hall of Pitsunda temple belongs to the Ministry of culture and preservation of historical and cultural inheritance. It stands at the balance of the ministry. When making any decision concerning this temple the opinion of the population of Pitsunda has to be considered. There can be no other approach. From the other side, we cannot ignore the fact that this is one of the most ancient temples with a rich history. Those issues that the church brings up should not cause problems to the organ. This organ has been installed especially for Pitsunda temple, for its acoustical opportunities and transferring it somewhere would be pernicious. In any case, these are not issues of the nearest future.

Now, let’s talk on the subject of organization of use of land. This is quite a serious problem.
We have to address it without procrastination. We are saying a lot that we are taking care of people, that we want to solve a problem with the housing for youngsters, but unfortunately, not a lot has been done in this relation. We did not provide our people, our veterans with accommodation. We have the land that we are not utilizing to the full. That is why the issues related to the pieces of land that are settled for 20 years have to be legally addressed. A lot of questions would be dissolved than. I am saying you as a Head of state, that I will not tolerate any self-willed seizure and will demand that from other officials.

This is not only the problem of Pitsunda. A man starts to build garage that in the end turns into hotel complex. This cannot be the case.

I want the population of Pitsunda to know – our goal is to do everything possible so that everyone, including the President, would feel the changes. I don't want to be the black sheep. We have to do everything possible so that our country succeeds. And then, I am sure, all of the problems will be resolved. There will be less talks of political character.

Concerning the issues of employment policy – of course, there are issues that cannot be so easily resolved. And they also exist here, in Pitsunda. This working group has not been created just to show off in front of me. The issues have to be resolved so that they would benefit the people.

They say that concerning the issue of the return of the credits there are some problems, but he figures are not named. The figures are named, but no one is listening. More than 230 million of credit money that has not been returned for a long time are refunded to the budget of Abkhazia.
Just lately, I came across a document, which I has not seen before. It happens that for the last years the Ministry of finance besides the bank sphere was also crediting separate structures and people. The biggest sum was 27 million rubles given back in 2010. And no one refunded a single ruble of that sum. But they will, I promise.

How many people do I receive and what problems do those people voice? I receive a lot of people. But I do not have TV reports on those meetings. People are coming with the same problems as before. But I will not give people 1 or 2 thousand rubles. But I cannot ignore when people come asking for help with some illnesses. And considering our resources we are trying to help as we can. And we give some big amounts too.

Concerning the lake that formed in the mouth of Bzib river. Today, when we were passing this place, I gave instructions to the Prime-minister to deal with this problem.

Concerning Asechkovillage. I did not forget you. The money that we have is not big. I instructed the head of the administration and we will start with water supply. I promise, you will have water. This is not pre-electoral campaign, I am saying this as a head of state and I will do everything possible so that those works will be fully implemented. Same with Ldzaa village. All those issues would sum up, if we do not address them.

I am very confident, that we will be successful. I am honest and open to you. In that constitutional term that I have, I will do that volume of work, that  I am talking about. And shall anyone not scare me with different measures and actions. I am not faint-hearted and will stand side by side with my nation till the end. I am not going to escape anywhere.

Thank you.

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