Fainting in Coyles An occasional letter from the
Heart of Euroville
Wednesday, August 04, 2004
A new hero
Ladies and Gentlemen, I give you Kakha Bendukidze . This enterprising chap is the new Economy Minister in Georgia.
According to the Economist he has a well shall we say radical approach to his job.
His privatisation drive is prodigeous, as he says "Georgia should be ready to sell “everything that can be sold, except its conscience”. And that is just the start".
But what a start, so what is next in his list of ambitions - nothing serious I guess? Wrong
Next year—if not sooner—he will cut the rate of income tax from 20% to 12%, payroll taxes from 33% to 20%, value-added tax from 20% to 18%, and abolish 12 kinds of tax altogether. He wants to let leading foreign banks and insurers open branches freely. He wants to abolish laws on legal tender, so that investors can use whatever currency they want. He hates foreign aid—it “destroys your ability to do things for yourself,” he says—though he concedes that political realities will oblige him to accept it for at least the next three years or so.
So that'll be it? No as a piece de resistance, he wants to crown his political career by continuing along the road ,"I have shut down the department of industrial policy. I am shutting down the national investment agency. I don't want the national innovation agency.” Oh yes, and he plans to shut down the country's anti-monopoly agency too. “If somebody thinks his rights are being infringed he can go to the courts, not to the ministry.” He plans, as his crowning achievement, to abolish his own ministry in 2007. “In a normal country, you don't need a ministry of the economy”.
Can somebody invite this man to the next meeting of Ecofin. The idea of competing currencies, closing down of ministries abolishing taxes - need I go on?
Europe is worried by the sucess of economies like Estonia with their tax-cutting regiemes. They ain't seen nothing yet.
Hat tip Mr Carr