Caucasus Business Week #124

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BUSINESS WEEK November 30, 2015 #124

November 30, 2015, Issue 124

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GEORGIAN DEVELOPMENT BANK TO LAUNCH OPERATION IN SPRING 2016 Bank Sector’s Competitor or Cheap Source for Financing Domestic Production GOVERNMENT TO BOOST GEORGIAN TEA PRODUCTION The Georgian Authorities has found impetus for promoting the Georgian tea production sector and drawn up the Georgian Tea state program that calls for rehabilitating the tea plantations. The state program consists of two components based on the co-financing principle for rehabilitating both privately owned and leased tea plantations and creating modern primary tea processing

enterprises. Only legal entities are welcome to the project, while cooperatives must possess the status of an agriculture cooperative. The cost of rehabilitation works on a hectare must not exceed 2 500 GEL (including VAT). If this cost exceeds 2 500 GEL per hectare, the co-financing amount will be determined on the ground of 2 500 GEL. Pg. 6

TOYOTA UNVEILS REGIONAL TRAINING CENTER OF GREAT IMPORTANCE IN TBILISI Pg. 12

BUSINESS CAFÉ – SECOND MEETING OF THE JOINT PROJECT BY INSOURCE AND PASHA BANK Pg. 3

Ephrem Urumashvili: BitCoin is Least Risky Crypto Currency Pg. 4

Giorgi Bachiashvili: We Plan to Launch Five New Projects Worth One Billion USD Pg. 8

GEORGIA’S CHALLENGES IN FREE TRADE REGIME WITH EU The report published a year later after the DCFTA enactment proves, that, despite serious obstacles, Georgian agriculture products are paving the way to the European markets anyway. The January to July performance demonstrates that Georgia exported 100.5 million USD agro food products to Europe, up 83.9% compared to the same period of 2014 and up 148.9% compared to the same period of 2013. Georgia’s main exports items on the EU market are represented by filbert, mineral and spring waters, wines, alcoholic drinks, vegetables and fruits. Today it is indisputable fact that the EU market,

along with strict quality compliance requirements, provides many preferences and advantages, first, stability and favorable prices. Everybody agrees the EU market is an accomplished market with refined and balanced rules of game and Georgian farmers have to get to know these regulations just today. To penetrate the EU market, the enterprisers and peasants have to resolve many tasks simultaneously in terms of quality and production of ecologically clean products, laboratory exploration, protection of international standards and finding customers in the EU market. Pg. 9


NEWSROOM

2 MAIN EVENTS

EU offers €100m to help Georgia implement Association Agreement

ITALY: 27TH EU STATE TO RATIFY GEORGIA-EU ASSOCIATION AGREEMENT ONE COUNTRY LEFT TO RATIFY DEAL

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taly has become the 27th of 28 European Union (EU) member states to ratify the Georgia-EU Association Agreement (AA). Today the Senate of the Republic of Italy, one branch of Parliament, ratified the AA deal. The Italian Parliament consists of two houses; the Chamber of Deputies and the Senate of the Republic. Prior to today’s decision, the Chamber of Deputies ratified the Georgian-EU deal on July 29, 2015. With this vote Italy became the 27th EU country to ratify the Georgia-EU agreement. The Georgia-EU Association deal has already been ratified by European Parliament and 27 of 28 EU member states. Belgium is the only remaining EU country to ratify the deal. Belgium’s support for the Georgia-EU deal was crucial, as EU Association deals must be ratified by all 28 EU member states before they can be fully implemented. Georgia’s AA deal was signed by a country representative and the EU on June 27, 2014 in Brussels.

The European Commission is supporting reform implementation and economic development in Georgia through a new assistance package totalling €100 million. In particular, the Commission said the money would support the EU-Georgia Association Agreement (AA), signed in June 2014, and bilateral agreements on mobility. The new package will also help Georgia meet its reform objectives in the public administration, agriculture and rural development sectors. EU Commissioner for European Neighbourhood Policy and Enlargement Negotiations, Johannes Hahn said the aid would help to promote an active civil society, assist key Georgian institutions to implement the AA and advance Georgia’s visa liberalisation process with the EU. ” With the Association Agreement, the EU-Georgia relations have moved to another level. The assistance package will support central elements in this ever closer relationship,” said Hahn, who is on an official visit to Georgia.

Minimum pension is increased up to 180 GEL Pension will become 180 GEL from July, 2016 – Premier Irakli Garibashvili has declared about this decision on Friday at the government session. “Future 2016 budget will also be socially focused. These funds should be for increase pensions, teachers’ salaries, to support development of mountainous regions and for other events. Initially, I want to mention pension issue. We have decided that pensions will become 180 GEL from July, 2016. Pensions are grown by 64% comparing to 2012. So, we issue 600 million more GEL for pensioners”, - the Premier has noted. Irakli Garibashvili has noted, that works are carried on the pensions reform in order to arrange this sphere finally and introduce pension saving system. It should be noted, that over 706 695 entities were taking elderly pension in Georgia by late October and 113 072 183 million GEL has been necessary for their pensions.

Promotion program of small land farmers continues The government changed the mind to suspend promotion program of small land farmers. The Premier has declared about this at the Friday session. Garibashvili talked about the enactment of different social assistances for mountainous regions from 2016. He noted, that 20 million GEL is envisaged for the fund of mountainous regions. In addition, over 1 billion GEL is allocated for financing of Ministry of Regional Development and Infrastructure by the next year. “However, over half billion should be spent on road infrastructure improvement. 280 million GEL is merely envisaged for the fund, which should be spent for the implementation of regional projects. Program “Produce in Georgia” will be continued. As of today, 139 new plants are funded, while more than 600 enterprises have spent money on re-equipment. However, we have financed 123 new industrial farms , which is a total investment of 350 million GEL. We should have 3-year program for spring works and we have decided to continue it further. Agriculture insurance program should be continued as well and program “Plant the Future”. There is another news, we have written off 26 million worth of leisure debts to 8000 farmers”, - the Premier has noted.

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EU TOP OFFICIAL JOHANNES HAHN ARRIVES IN GEORGIA

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ne of the European Union (EU) top officials is in Georgia to learn about the country’s actions and efforts to integrate into the Euro-Atlantic space. EU Commissioner for European Neighbourhood Policy and Enlargement Negotiations Johannes Hahn arrived in Georgia for a two-day visit. While in Georgia, Hahn will take part in public events and official meetings to learn more about Georgia’s assimilation into the European space. Hahn’s two-day trip, part of a non-formal meeting of the Eastern Partnership, the EU official took part in a public event titled New European Neighborhood Policy and perspectives of regional cooperation. The EU official spent the day meeting highranking Georgian officials, members of the civil service and business sector representatives. While commenting on Hahn’s arrival, Georgian officials stressed this was Hahn’s second visit to Georgia this year and it showed a firm confirmation of the EU’s support for Georgia. Hahn announced his current visit to Georgia on November 17 after the second Association Council meeting in Brussels, Belgium, where top Georgian and EU officials discussed Georgia’s European future. Hahn made his poignant statement today in Georgia’s capital Tbilisi, after attending the 6th informal meeting of Eastern Partnership (EaP) countries, attended by local and foreign top political representations.

In the context of the renewed European Neighbourhood Policy (ENP) it is important to emphasise that Georgia is one of the leading countries in terms of the EU relations.” Now we should focus on the implementation

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of the Association Agreement (AA) and the Deep and Comprehensive Free Trade Area (DCFTA) agreement between Georgia and the EU, which together with the visa liberalisation issue, will be the main topic of my bilateral meetings in Tbilisi.” The EU top official stressed Georgia was “on a good path” but he also said continued efforts was necessary for the country to achieve its final goals.

But it is also important to underline that we need our and our neighbors’ bilateral efforts for the success of the European Neighbourhood Policy. The starting point is cooperation with our neighbors in our mutual interests”, said Hahn, adding the EU was interested in peace and stability in the neighborhood.

Editor: Nino Gojiashvili. Mobile phone: 595 050404 Reporters: Nutsa Galumashvili; Lazare Gvimradze; Shiva Parizad. Designer illustrator: Giorgi Magradze. Technical Assistant: Giorgi Kheladze

Source: www.commersant.ge, www.bpi.ge, www.gbc.ge, www.agenda.ge, www.civil.ge


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BUSINESS CAFÉ – SECOND MEETING OF THE JOINT PROJECT BY INSOURCE AND PASHA BANK

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onsultancy company Insource and PASHA Bank hosted the second meeting at Business Café. The meeting was held at Holiday Inn Tbilisi. Among the guests were representatives of top management of the leading Georgian businesses. The meeting was moderated by Mr. Alexander Jejelava and the main topic of this very interactive discussion was organizational corporate culture. The project aims to arrange meetings of top-management representatives from different companies where they will be able to discuss specific work-related topics and share experience with each other. The invited guests discussed the examples of the corporate culture of their own companies, its importance and the ways of its development. There is a rising interest in Business Café meetings from the managers of large and successful companies. The project will continue in 2016 and offer numerous new features to its guests. „PASHA Bank always tries to support the projects that aim at the professional development in business sector. We are more than happy to have the opportunity to join this interesting and useful initiative,” commented the Head of PR and Marketing Department of PASHA Bank.


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INTERVIEW caucasus business week

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WE PLAN TO LAUNCH FIVE NEW PROJECTS WORTH ONE BILLION USD Since the Georgian Dream coalition came to power in 2012, the then Prime Minister Bidzina Ivanishvili proposed setting up the Co-Investment Fund with focus on drawing foreign investments to Georgia and implementing largescale projects. The Fund united major investors from the very inception. The Fund was established two years ago and currently total investment value of the Fund’s projects portfolio is about 2 billion USD. A major part of the ongoing projects will be finished by the end of 2017. The Co-Investment Fund’s executive director GIORGI BACHIASHVILI talks about the ongoing projects, their importance for our country and the plans. Shekvetili Hotel and SPA Complex – the project was developed by the initiative of Bidzina Ivanishvili, one of the main contributors to the Co-Investment Fund, with the aim to promote the tourism sector development in Georgia and support the Black Sea resort zone development, to popularize the location and to extend the tourism season. The project’s total investment value makes up 50 million USD. The hotel will unite 220 suites in various categories, large conference halls and restaurants, a swimming pool penetrating into the sea waters in 150 meters, a winter garden and an aquarium. The complex will be operated by the Georgian company under the umbrella of an international brand. The project implementation will be finished in 2016. The Panorama Tbilisi projects calls for constructing four multifunctional complexes. We believe the project implementation will bring big economic benefit to the capital city. - The Co-Investment Fund considers the power sector one of the priority directions and you are implementing impressive investments in this segment. What are the Fund’s plans for making investments in the power sector and do you intend to launch any specific project in the near future? -The Co-Investment Fund of Georgia makes huge contribution to the Georgian economy development. In two years from the foundation, the total investment value of the Fund’s ongoing projects is about 2 billion USD. We are implementing large-scale projects in the power, agriculture, tourism, real estate and production sectors. Georgia is one of the richest countries in hydro resources and a major part of these resources remains unemployed.

Currently, three investments projects are being implemented in the power sector: Mtkvari HPP, Cascade of Oni HPPs and Cascade of Tskhenitskali HPPs. It should be noted total annualized generation of all three power facilities makes up 34% of Georgia’s current power generation. As to plans, we consider projects for making additional investments in the power sector. We will introduce several new projects to the society in the near future. Large-scale infrastructural projects, social programs will be carried out at various stages of construction of these HPPs and thousands of our citizens will be employed. Thanks to these efforts, Georgia will fundamentally increase the energy independence. -What projects do you have implemented for the real estate and tourism development? As reported, the Co-Investment Fund considers Panorama Tbilisi as one of the considerable projects in this respect. Many supporters

and objectors have already expressed their position concerning these plans. How important is this project for the development of Tbilisi and what economic results should we expect from the project implementation? -The Co-investment fund is implementing weighty investment projects for promoting the real estate and tourism sectors development. In the aftermath of the 2008 developments and the financial crisis, the housing sector came to standstill. However, the Co-Investment Fund’s engagement has ensured resuming the long suspended projects and they are being carried out at high paces today. Axis Towers – Georgian successful development company. In cooperation with Axis, we are constructing the highest twin skyscrapers. The Glass Tower will give room to a 5-star hotel of Pullman, a member of the Accor Group, and an A-class business center. The project’s total investment value makes up 83 million USD and it will be finished in 2017.

Architectural decision, functional load and quality of constriction works will make Axis Towers an exceptional project that will establish a new standard in the real estate market of not only Georgia, but the whole Caucasus Region. Gallery Tbilisi – In 2015, the Fund purchased the building of the former universal store on Rustaveli Avenue, where an A-class shopping mall will function. The project’s investment value exceeds 70 million USD and it is to renew the inactive building in the center of Tbilisi and to resume the suspended project. The shopping mall’s total space makes up 22 000 square meters. The project implementation will be finished in 2017. The project has been introduced at the MAPIC 2015 real estate international exhibition in Cannes by Colliers International company.

We will Implement 500 million USD investment project in Tbilisi. The construction works will employ 6 000 workers. After the project completion, 2 000 permanent job places will be created. The payroll fund will total 200 million GEL. It is worth noting a major part of the investments will remain in Georgia, because we will promote the development and growth of Georgian production. Tbilisi will become capable for hosting large-scale regional conferences. In this direction the capital city lacks for due infrastructure. For example, recently the Silk Road Forum and the EBRD annual meeting were hosted at theaters because of absence of due facilities. -The Fund plans to open BitCoin transaction processing datacenter in Gori. How interesting and viable is the digital mcurrency? And what specific effects will this project bring to the economic development? -The Fund has made investment in BitFury, one of the leading companies in the BlockChain technologies. The company has arranged the world’s major processing datacenter in Gori. BitFury is implementing very interesting and successful projects in the field of innovative technologies. Our cooperation as part of the Gori datacenter project turned out very successful. We are glad the company has enlarged the investment activity in Georgia and launched an independent project for constructing a technological park in Gldani, Tbilisi. As a result, Georgia will receive 100 million USD FDI in addition and the country will attract the world’s influential IT field agents. As to the potential of BlockChain technologies, it is considered the world’s weighty discovery, because it is an entirely new and innovative system to ensure protection of financial resources and assets at the highest level and to manage them efficiently. This technology will be installed

in various consumer services, including, the bank sector. The importance of BitCoin BlockChain technologies is proved by facts. Currently, more than 4 500 BitCoin startups operate worldwide serving 9 million consumers, up from 3 million users year on year. - Drawing investments to the agriculture sector was named one of the priority directions in the process of establishing the Fund. It is interesting whether investors show interest in the Georgian agriculture sector. Do you have any specific plans for the sector advancement? - The Fund provides active efforts in the agriculture sector too. We do our best to promote the production development in Georgia. We create competitive Georgian products and work on replacing the imports. To this end, we are introducing the world’s best experience and we are trying to attract the field’s leading companies. The Fund’s greenhouse complex project is a good sample for that. The project is being implemented in the Gardabani Municipality, Kvemo Kartli Region. The project’s investment value is 40 million USD and it aims at developing a greenhouse complex on 35 hectare land plot. The Fund also plans to carry out other interesting projects in the agriculture field, including for constructing a milk processing plant and a dairy farm. - I would like to ask you to provide a general overview of the Fund’s plans and perspectives for drawing new investments and name specific measures and steps for attracting new investors. -The management of the Co-Investment Fund of Georgia and the investment team have been providing intense job for outlining and developing new projects. In 2016, we will launch five new projects that will cover the Fund’s all investment directions. Total investment value of all five projects is about 1 billion USD. We have to fulfill a quite complicated mission, because so far no organization in Georgia has implemented such a number of projects with similar sophisticated character.

Our performance is directly reflected on the economic development of Georgia and welfare of our citizens. Therefore, our team has doubled efforts to ensure 100% fulfillment of the goals for which we established this Fund two years ago. Opposition politicians and reporters frequently voice various ungrounded allegations. Many fraud TV plots and statements are also spread. We always show restraint towards similar attacks, because any interested party and body is able to see our investment projects and activities on specific sites and places. Giorgi Kapanadze


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GEORGIAN TEA

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GOVERNMENT TO BOOST GEORGIAN TEA PRODUCTION Georgian Tea Program will Boost Domestic Tea Production, but Its Competitive Potential against Imports Remains Questionable

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Mikheil Chkuaseli: This is the money of taxpayers and we should receive maximum effect from such investments

Tengiz Svanidze: Georgian Tea Ratio on Domestic Market is 18%, Imported Tea Controls the Remaining Portion

We welcome the Georgian government is interested in the tea production sector, enlargement of raw materials basis, growth in harvest, because the development of all these directions will increase export revenues, however, It is important what mechanisms the government will apply to manage these funds. The main thing is to reach maximum of efficiency from these investments, Mikheil Chkuaseli, a director for GeoPlant company, a Gurieli tea manufacturer, said. “Major investments are required to rehabilitate tea plantations, increase harvest and improve tea leaves quality. Besides investments, knowledge and experience also required to thoroughly meet agro technical standards. We know the state budget has allocated certain funds for this direction. I have no ground to assert this program cannot be implemented. At the same time, we should remember this is the money of taxpayers and similar investments should bring maximum effect. In other equal conditions similar state investment may be negatively appraised, because this signifies direct intervention in the business sector, but this step is justified for growing the agriculture sector’s output, employment, developing the traditional field, increasing exports potential

he Georgian Authorities has found impetus for promoting the Georgian tea production sector and drawn up the Georgian Tea state program that calls for rehabilitating the tea plantations. The state program consists of two components based on the cofinancing principle for rehabilitating both privately owned and leased tea plantations and creating modern primary tea processing enterprises. Only legal entities are welcome to the project, while cooperatives must possess the status of an agriculture cooperative. The cost of rehabilitation works on a hectare must not exceed 2 500 GEL (including VAT). If this cost exceeds 2 500 GEL per hectare, the co-financing amount will be determined on the ground of 2 500 GEL. The co-financing portion for legal entities makes up 60% of the total cost of the rehabilitation works (including VAT); while the co-financing portion for agriculture cooperatives makes up 80% of the total cost of the rehabilitation works (including VAT) and 50% of total cost of fertilizers to be applied in the first year after the additional pruning (including VAT). Meanwhile, the state-owned tea plantations rehabilitation conditions are as follows: the co-financing portion for legal entities makes up 70% of the total cost of the rehabilitation works (including VAT), while the co-financing portion for agriculture cooperatives makes up 90% of the total cost of the rehabilitation works (including VAT) and 50% of the total cost of fertilizers to be added in the first year after the additional pruning (including VAT). To maximally promote cooperatives, the involved cooperatives will receive free production machineries, inventories for primary tea processing. Technical assistance will be carried out for the program beneficiaries in terms of tea valuable processing technologies, marketing and organizing sales channels. The program budget for 2016 constitutes 3.5 million GEL. These funds are incorporated in the Georgian Agriculture Ministry budget bill for 2016.

Tengiz Svanidze, an executive director for the Tea Producers’ Association of Georgia, who has taken part in the Georgian Tea program development process, says the program was delayed, but it will bring positive results anyway. “Our association has taken part in the program development process. The government has taken into account many our recommendations, but some considerations were rejected. However, the process, in general, is positive, because the Georgian tea rehabilitation program is underway. I would like to add that the program was delayed a little, because the space of tea plantations has shrunk considerably. The rehabilitation process should have been launched after certification and inventory of tea plantations. However, certification and inventory process was not carried out and, therefore, we rely on the information of the Agriculture Ministry consulting centers. According to this information, Georgia owns 7-8 thousand hectares of tea plantations. I cannot say how reliable these figures are. In the first year, 2 000 hectares will be rehabilitated, the Agriculture Minister noted, but I doubt such space of tea plantations will be rehabilitated throughout 2016. Anyway, the main thing is that the program is underway”, Tengiz Svanidze said. The head of Tea Producers’ Association of Georgia doubts physical bodies who own 2-5 hectares of tea plantations are able to co-finance the program implementation, while legal entities, which own tea plantations and manufacture tea, are able to take part in the program implementation. „The issue is of rehabilitating the plantations and small funds will be directed to the output

growth, introduction of modern machineries and production of high-quality tea. Everything depends on the condition of tea plantations. The program will start in 2016 and if the plantation is to be pruned thoroughly, tea leaves will be picked in three years. If only a half part of the tea plantation is to be pruned, then tea leaves may be partly picked in 2017. Everything depends on the starting condition of tea plantations to be rehabilitated”, Tengiz Svanidze said. The Georgian tea ratio on the domestic market is only 18%, while imported tea controls the remaining market ratio. Anyway, the demand for Georgian tea is growing, he added. “We would receive disastrous outcomes without the tea plantation rehabilitation program, because tea leaves absent in practice. The program is very good, but delayed a little”, Svanidze said and stressed the importance of AD campaigns for the Georgian tea salvation. “Everybody realizes the importance of advertising campaigns. Today Georgian tea manufacturers produce absolutely good-quality tea, but we lack for advertising campaigns to grow perception of Georgia tea. Georgian enterprisers cannot afford taking these costs in most cases. Only major company Gurieli produces highquality tea and at the same time, conducts advertising campaigns. Other manufacturers also produce high-quality tea, but they lack for financial resources to hold advertising campaigns. They provide maximum efforts and somehow manage to sell a small part of their products, while a wider circle of consumers remains unattainable”, Svanidze noted.

and currency inflows, drawing potential investors. Therefore, mechanisms for attaining all these goals acquire crucial importance in terms of efficiency. It is also important that the submitted project does not call for compensating and subsidizing the price of raw material. The existing variant includes a part of capital expenditures that are necessary for plantations. A co-participation of private enterprisers are necessary. We should also realize that the program implementation will outline the total space of productive tea plantations in the country, as well as the real results the country should expect from these plantations. I believe the Georgian Agriculture Ministry project is very interesting”, Chkuaseli said. The tea plantations rehabilitation project is the result of joint efforts of the government and the private sector, he added. “Many people assert that the Government should assume the responsibility for planting tea bush, for production and sales of tea. This is a Communist-era approach. The USSR has collapsed and will never resurrect. Therefore, we should perform this job ourselves, we should produce high-quality tea ourselves. We should also learn developing brands”, Chkuaseli noted.

Maradidi Didmanidze: We Should Find Mechanisms for Making Georgian Tea Competitive against Imports The Maradidi tea enterpriser says he has already rehabilitated his own plantations. Nevertheless, he positively appraises the program and plans to take part in it in the future if necessary. Maradidi Didmanidze thinks that The government should develop mechanisms to provide equal conditions for domestic and imported tea products and to ensure valuable competition. “We welcome the government has taken efficient steps in this direction. I have leased 13hectare tea plantations from the Ajara Finance and Economy Ministry for a period of 36 years and I have rehabilitated these plantations through my own financial resources. Anyway, products sales remain the most challenge. I have stored my products and cannot sell them. The major challenge is that imported tea is cheaper compared my costs for domestically producing tea.

Importers do not pay any additional taxes and the government should develop mechanisms to make Georgian tea competitive in relation to imported tea. I have to spend more than 5 GEL on producing one kilogram of tea. Moreover, electricity and gas tariffs have also increased and naturally, the production costs will further rise”, Maradidi Didmanidze said. According to the Georgian Agriculture Ministry, in 1980s the space of tea plantations in Georgia exceeded 60 000 hectares and the country used to produce 100-120 thousand tons of tea a year. After the 1990s developments, the country lost the main exports market and the output started declining. As a result, Georgia’s one of the most developed industries ruined and a major part of employees lost job places.

The Georgian Tea rehabilitation state program’s main objective is to: a) maximally employ the potential of Georgia’s tea plantations and promote the tea production; b) rehabilitate the existing wild tea plantations (both private and state one); c) promote the production of high-quality tea, including bio tea; d) boost the exports potential of Georgian domestic tea; e) employ Georgian citizens and improve their social and economic conditions; f) create a modern primary tea processing enterprise.


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GEORGIAN DEVELOPMENT BANK TO LAUNCH OPERATION IN SPRING 2016 After long considerations, thoughts and experiments, the Georgian government has taken a final decision on establishing the Georgian Development Bank on basis of the Partnership Fund. Organizational works are underway and the Georgian Development Bank will launch operation in spring 2016 with focus on financing business projects.

Bank Sector’s Competitor or Cheap Source for Financing Domestic Production

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he Bank or the Corporation for Development (the final appellation has not been selected yet) will be entitled to issue low-interest loans, guarantees, and bonds. At the same time, the Development Bank will not be authorized to accept deposits and provide payment services. The bank will make focus on financing small and medium business sectors, startups that commercial banks ignore like a leper. The bank will serve only legal entities and companies. The issue is of innovative projects that commercial banks avoid financing. Moreover, the bank will employ its own assets to draw financial resources for further making investments.

Founded in 2010 under the ruling of Mikheil Saakashvili, the Partnership Fund was to fulfill the same missions, in practice. However, our society associates the Partnership Fund’s operation until 2012 with a well-paid shelter for fired or quitted high-ranking officials (ex Prime Minister Nikoloz Gilauri, ex Finance Minister Dimitri Gvindadze and others). The Fund’s assets include the following stateowned enterprises: Georgian Railway (100%), Georgian Oil and Gas Corporation (GOGC – 100%), Georgian State Electrosystem (GSE100%), Electricity System Commercial Operator (ESCO – 100%) and JSC TELASI (25%). In the first months after the change in power, the new Authorities decided to maintain the Fund’s format and appointed EBRD’s senior banker Irakli Kovzanadze as the Partnership Fund’s executive director. Under the management of Irakli Kovzanadze, the Partnership Fund has implemented large-scale projects, including a whortleberry plantation and a processing plant, a construction materials plant, a new steam power plant in Gardabani, hotels such as Rixos Borjomi in Borjomi, Gino Valley SPA in Akhaltsikhe, Royal Baton in Kvareli, a cattle-breeding complex in the Kvemo Kartli Region. In this period, two major projects were also inaugurated – Nenskra HPP and the new seaport in Anaklia to handle big cargo ships. Somehow or other, the decision has been taken and the Development Bank will be established on basis of the Partnership Fund. Efficient and valuable interaction with

international finance institutions will be the most important factor for the Georgian Development Bank’s success. The Georgian Development Bank is expected to replace finance institutions in comparatively small transactions (100 000 to 5 million USD). At the same time, finance institutions will be able to finance the reliable projects prepared by the Development Bank. Specialists assert that a financier, not a politician or a doctor, should manage the Development Bank. Hence, if the Government follows the suggestions of economic experts, the Partnership Fund head David Saganelidze cannot be an appropriate candidate for the new position. Everybody agrees that a team of professionals with rich experience of working in the finance system and without questionable traces in their reputation should lead the finance institution of similar scales.

Prime Minister Bidzina Ivanishvili initiated to establish a bank or a corporation and added the developing countries vitally needed similar finance institutions. At this stage, the Partnership Fund’s management is conducting consultations with Chinese colleagues around creating the Development Bank. The Partnership Fund’s head David Saganelidze has visited China several times. “We started our consultations with Chinese colleagues in summer 2014. The Chinese Development Bank’s management was astonished to learn Georgia had no similar bank”, David Saganelidze said and added about 250 similarformat banks operate in the world, including in England, France, Germany (KfW was founded in 1947 to overcome crisis in Germany), as well as in the Near East, Czech Republic, Slovakia, Poland, Ukraine, Turkey, Russia, Greece. The Chinese Development Bank is one of the largest among similar bodies with 1.4 trillion USD foreign assets. The bank’s net profits in 2014 marked 11 billion USD, Saganelidze noted. “Following our verbal agreement, the Chinese Development Bank separated the South Caucasus Region from its branch in Turkey. The new unit with a representative office in Tbilisi embraces three countries: Azerbaijan, Armenia, and Georgia. The Chinese Development Bank has conditionally allocated 0.5 billion USD for Georgia as the first tranche. Chinese colleagues promised to make considerable investments in

our country if Georgia sets up an analogical bank. If we finance this or that project by 10 million USD, the Chinese party shows readiness to invest much more investments in the same project”, Saganelidze said. Specialists stress that foreign capital are frequently attracted for developing other economies, but in most cases, similar-format banks rely on state sources, especially, on reserve funds that are formed on the ground of surplus budget. By the way,

At this stage, the State Treasury keeps more than 600 million GEL as a balance amount. A part of economists suggests the Government to apply these funds for making investments. Therefore, these sums may be redirected to the coming Development Bank. Specialists think that private enterprises, who are ready to make investments in state projects, can also keep shares in the Development Bank. These considerations imply major businesses (not small ones), as well as international finance organizations that are making investments in both private and state sectors. The commerce sector showed certain restraint concerning the idea of creating the Development Bank, because it considered the new finance institution as a major competitor. The most part of bankers were saying after the announcement of this idea that the State Bank for Development, if established as a competitor to the commerce sector, would frustrate the country for several years. Bankers suggested setting up an agency like a finance corporation, not a state bank, because this decision would send a bad signal to foreign private investors. However, today

A majority of specialists is sure the Development Bank cannot be competitor to commercial banks, because its accents and priorities will differ from ones of commercial banks. The Development Bank will not accept deposits, will not open corporate and individual accounts, will not issue retail credits. It will not need

the National Bank’s licenses for implementing its activities and consequently, it will not be subject to regulations. If the Development Bank makes focus on drawing foreign capital and efficiently investing them in the state economy, this will bring positive economic effects, specialists noted. Commercial banks, in practice, do not foster development of the domestic production. Therefore, the coming Development Bank is expected to play a decisive role. Unlike commercial banks, the Development Bank will finance domestic enterprisers, not foreign ones. The new institution will also resolve the issues that cannot be dealt by the private sector because of lack of capital or high risks. Georgia owns one of the most valuable and perfect bank systems in the region, but no other components of the finance sector have been developed in the country. The bank sector controls 90% of the finance sector’s assets. Nonbank bodies control 5%. Credit associations have no share in deposit and crediting transactions. There were five leasing companies in 2013, but the leasing system remains undeveloped in Georgia. The insurance sector with 492 million GEL assets also remains less developed. The existing five pension funds own only 15 million GEL assets. The stock market still remains at the level of a germ. There are a wide range of bank products in Georgia, in theory, but, in reality, the business sector, especially small and medium business sectors, has restricted access to loans.

Bank loans remain as one of the conservative products in Georgia and commercial banks make focus on making enormous profits through issuing short-term loans. Commercial banks have set many restrictions to the business sector and these barriers limit an access to loan products. For instance, business loans greatly depend on real estate guarantees and this factor points to limited potential of the bank sector for meeting loan needs of enterprises. Incapability of commercial banks for issuing loans to small and medium business sectors directly generates problems in the economic growth. Economic experts noted that, according to the 2014 Global Competitiveness Report of the World Economic Forum (WEF), 18.8% of the business sector consider a limited access to bank products to be a main problem, after the inadequately educated workforce factor, that exceeds all other challenges indicated in the report.


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CURRENCY caucasus business week

November 30, 2015 #124

EPHREM URUMASHVILI: BITCOIN IS LEAST RISKY CRYPTO CURRENCY The present-day finance system is actualizing the technology of crypto currencies. Fortunately, Georgia is zealously pursuing the development of this innovative technology and our country is expected to lighten up on the global map of new technologies thanks to the very BitCoin Mining. The last developments, acts of terrorism in Paris and intensified terrorism threats have necessitated making financial transactions safe and transparent. In these realities, BitCoin’s perspectives draw much interest, even more so Georgia is constructing a big processing datacenter. EPHREM URUMASHVILI, a representative of BitFury Group in Georgia, talks about this innovative technology.

- Increased terrorism hazards may generate certain restrictions in relation to crypto currencies. Will these restrictions touch BitCoin too? - We should know estimations by leading economic editions and the economic world, in whole, to valuably assess the current situation around money mass turnover, in this case, the turnover of digital currency.

The newest information reports that the UK Treasury has developed a research after the acts of terrorism in Paris. According to this research, a crypto currency is assessed as the least risky currency.

As to the structure of BitCoin and its vulnerable aspects in terms of terrorism financial support, about a month ago the US Justice Ministry organized a meeting in San Francisco, where BitCoin manufacturing companies agreed to share information on the digital currency to the due services. The absolute reality of the platform enables to fulfill this agreement. BitCoin is a crypto currency with a specific nomination or code. Moreover, the protocol of BitCoin, i.e. the process of making a BitCoin is absolutely open information. - Is it a relevant and grounded opinion that the internationally wanted criminals may take control over BitCoin as the system independent from any central finance institutions? - The global practice proves BitCoin is the least risky digital currency that is least applied in this sort of transactions, i.e. forbidden and criminal transactions. All operations that may be financed through BitCoins, including trade in drugs, trafficking and so on, will be immediately investigated by the FBI and other relevant services and all criminals will be identified.

Today, the persons interested in the Black Market maximally avoid using BitCoin in their transactions. They find electronic money the most convenient instrument. Unlike BitCoin, the electronic money has no nomination and so on. Therefore, BitCoin is the most transparent digital currency that is controlled by the due services. - What are the crypto currency perspectives in Georgia? - We should consider BitCoin in the light of

global importance. At the same time, we should also consider BitCoin in the light of Georgia’s nearest future. After the BitCoin processing datacenter in Gldani, Tbilisi, launches full-scale operation, our investors will learn that 90% of BitCoin’s full capacity is accumulated in Georgia. This signifies our country possesses cutting-edge technological systems and the datacenter modernized through modern technological systems. This is a shining signal to investors to consider Georgia as an interesting country, especially, in terms of digital currency production.

This innovation surpasses the potential of 100 plants. This signifies Georgia owns an entrance ticket to the future on the global map. This fact is the same success as drawing any other major investment. The investors of our company aim to create a modeled place in Georgia, like a silicon field, where enterprises will enter from the nearest markets to finish their technological process in Georgia. I would like to refer to several facts proving the BitCoin’s global acknowledgment. Namely, the European Court has recognized BitCoin as a currency. Moreover, Fidelity, the world’s biggest foundation with 1.5 trillion USD assets, has incorporated BitCoin technologies in making charity donations. As a result, the Fidelity’s BitCoin payment database currently registers more than 26 000 users. At the same time, outstanding payment companies, including American Express, are investors in this business. All these facts prove that BitCoin becomes the most requested and popular payment mechanism and we should be proud in the near future 90% of BitCoin mining will be carried out in our country, Georgia.

TBC CAPITAL: INVESTMENT OPPORTUNITIES IN GEORGIAN ENERGY SECTOR

A Growth & Opportunity Play

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eorgia’s energy sector is one of the country’s most attractive investment opportunities. Hydropower is the cheapest source of renewable power for Georgia and we strongly believe the sector will continue to be attractive for investors over the mid-term. The investment story is rooted in Georgia’s massive untapped hydropower potential: current electricity production represents just 40% of Georgia’s estimated annual hydropower output potential of 15 TWh. In addition to 22 hydro plants currently under construction or in the licensing stage and MOUs signed for the construction of 72 small and medium hydro plants, the Ministry of Energy has an additional 80 HPP projects available for investment. The energy sector is a key driver of the Georgian economy: over the last 5 years the sector was the 2nd largest contributor to total foreign direct investment (FDI) with US$ 750mn (15% of total FDI). Over the last decade Georgia’s hydropower sector has attracted numerous strategic investors. Currently, 22 hydropower plants with planned total capacity of 1,500MW (around 50% of the existing total installed capacity) and investment

value of US$ 2.6bn are either under construction or in the licensing stage. Over the last 5 years, 8 small and medium HPPs with total installed capacity of 146MW have been built. Both local and international investors participated in these projects. Additional generation assets will be needed to meet growing electricity consumption. Generation capacities are falling short of growing consumption. Georgia’s electricity generation has not kept up with growing consumption since 2012. Over the last 5 years output increased 23% to 10.4TWh as of 2014, while consumption grew 27% to 10.2TWh, largely in-line with GDP growth. We expect consumption growth will continue to track GDP trends. Wholesale electricity prices are on the rise. In 1H 2015 the average balancing electricity price at which ESCO (market operator) surged 55% y/y, driven by increasing consumption on the back of insufficient growth in generation capacity, with the shortfall being bridged by more expensive sources like imports, thermal power, or newly built hydropower plants. Newly built HPPs are still by far the cheapest source of electricity. Georgia’s neighbor and key trading partner

Turkey is an attractive market for exports due to growing consumption, geographical proximity, and an inverse consumption pattern (shortages in the summer when Georgia has a surplus). A new 700MW capacity transmission line now connects the two countries, which will allow for rapid growth in exports. Georgia is on its way to establishing a fully competitive electricity market, which will enable producers to sell electricity at competitive prices. The Georgian government aims to develop a true competitive market and harmonize regulation with Turkish and EU standards. The reforms are

aimed at establishing a trading mechanism to help create a competitive market with transparent pricing and a stable environment. Georgia’s goal is to become a regional hub for electricity transit and increase cross-border transmission capacity with its neighbours. In addition to exporting its own electricity to Turkey, Georgia can also transmit Russian and Azeri electricity to Turkey and Russian electricity to Iran through Armenia. Georgian State Electrosystem (GSE) plans to increase transmission capacity to Armenia, Russia, and Turkey by 4.5x, 1.8x and 2.1x, respectively.


November 30, 2015 #124

EU

caucasus business week

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GEORGIA’S CHALLENGES IN FREE TRADE REGIME WITH EU The report published a year later after the DCFTA enactment proves, that, despite serious obstacles, Georgian agriculture products are paving the way to the European markets anyway. The January to July performance demonstrates that Georgia exported 100.5 million USD agro food products to Europe, up 83.9% compared to the same period of 2014 and up 148.9% compared to the same period of 2013. Georgia’s main exports items on the EU market are represented by filbert, mineral and spring waters, wines, alcoholic drinks, vegetables and fruits. www.eugeorgia.info

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oday it is indisputable fact that the EU market, along with strict quality compliance requirements, provides many preferences and advantages, first, stability and favorable prices. Everybody agrees the EU market is an accomplished market with refined and balanced rules of game and Georgian farmers have to get to know these regulations just today. To penetrate the EU market, the enterprisers and peasants have to resolve many tasks simultaneously in terms of quality and production of ecologically clean products, laboratory exploration, protection of international standards and finding customers in the EU market. Succeeded Georgian farmers have independently resolved all these tasks and only elementary logistics issues hinder them to make a final breakthrough.

“Today timely and valuable transportation of Georgian Products to Europe is much more serious problem than winegrowing, pressing grapes, highquality winemaking, packing and finding the customer”. Currently, Iago Bitarishvili, who makes Georgian bio wines in pitcher on husks of grapes, as required by the Georgian winemaking traditions, fully sells his products in the EU market, but he has provided tireless job and overcome many obstacles for the last 10 years. He exported the first consignment of Georgian wines to Denmark in 2006. The European customers, who seek bio products, liked pitcher wine in a short period. Soon, Iago Bitarishvili entered England, France, Italy and Sweden too. One bottle of the wine costs 8-10 EUR in the wine cellar of the village of Chardakhi, the Mtskheta District, while the price is far higher in specialized stores in Europe and the USA. „It sells at 21-22 EUR at stores. The price at least doubles at restaurants and bars”, Iago Bitarishvili said and expressed his regrets he has to sell the product mainly on the domestic market. “I have to sell wine products here, while the transportation issues are usually resolved by the customer. Naturally, I would sell my wine at higher prices in Europe, but I suppose I will fail to ensure timely and valuable transportation or I will have to take too high expenditures and, therefore, I prefer to follow the existing regime”, he said. Heavier problems exist in the small and medium segments that export unprocessed fruits and vegetables to Europe. They could not find foreign partners that would assist in arranging and managing storehouse there. For example, Georgian company Nergeta carried out the first export of kiwi grown in the village of Ingiri, the Zugdidi District, to the EU in 2014 and the Georgian kiwi was represented for sales at the network of Lidl supermarkets, the Europe’s one of the major trade networks. Since the foundation Nergeta made focus on penetrating the EU market. Moreover, the company has satisfied the GLOBAL GAP standards for excellent production practice. The company

obtained the standard certificates and harvested high-quality crop. Hence, Nergeta planned to considerably increase kiwi supply to the German network, but the company faced serious problems. The Georgian kiwi with unique tastes is still awaited in Antwerp, Rotterdam, Stuttgart and their nearby towns, but the Georgian company is facing serious problems with transporting the product to the European cities.

“Nergeta owners cannot make use of the Batumi-Burgas ferry because of unstable schedule, while this is the only and shortest active seaborne route that directly connects Georgia with EU member Bulgaria”. Consequently, valuable functioning of this route would lower transportation costs and time for the beginner enterprise. Vanrik Agro Group, that exports bog whortleberry, is facing heavier problems. The company successfully exported the first test consignment to the United Kingdom and the Guria Region’s low-income residents were full of new hopes and expectations. “Bog whortleberry needs acid soil and the Guria Region mainly contains this sort of soil”, Vanrik Agro Group financial manager Archil Paichadze noted. He planned to expand his 50hectare plantations in the village of Laituri, the Ozurgeti District, to about 400 hectares, but now the company has trial against one of the transportation companies. Long-distance transportation is related to more complicated issues.

It takes 12 days to transport consignments from Georgia to Great Britain through the fastest and mobile automobile. The disordered schedule of the Batumi-Burgas ferry is useless for the Georgian bog whortleberry transportation too. The problem aggravates as Georgian farmers and peasants are paving their way to the European market just now. Therefore, unaware farmers and peasants have to take higher expenditures to transport their products to uninformed customers in Europe in small test volumes (2-3 tons). “This factor increases the losses, because we are just now starting our cooperation with the European consumers. We are just now sealing first agreements and the breaching frustrates the further cooperation. Even more so, the European market with 500 million consumers record sharpest competition and other suppliers from other countries have not problems with valuable transportation, while the EU market offers the most attractive prices for our bog whortleberry among potential exports markets”, Archil Paichadze said.

Transportation Routes and Opportunities

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ighways connect Georgia with Azerbaijan, Armenia and Turkey. Georgia has direct railway connection with Russia, Azerbaijan and Armenia, but the outdated railway modernization will be expectedly completed in 2019. The Baku-Tbilisi-Karsi railroad section completion was rescheduled for at least one year because of various reasons. This route is to serve cargo transportation from the Central Asia through Georgia and Turkey to Europe. Seaborne Routes – Georgia owns two main seaports in Batumi and Poti. The Batumi Seaport with universal services receives and handles both passenger and cargo ships, but the seaport is connected with only Burgas from the EU cities through ferry. The same situation is in the Poti Seaport. The Black Sea region’s main seaports are Odessa and Sevastopol in Ukraine, Poti and Batumi in Georgia, Novorossiysk in Russia, Constanta in Romania, Burgas and Varna in Bulgaria, Eregle, Samsun and Trabzon in Turkey. Small consignments are also transported by airplanes, but the air transportation service costs are 1.5-2 times higher compared to automobile services. Therefore, farmers cannot afford air transportation services.

Batumi-Burgas Ferry

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fter a 6-year break, the Burgas-Poti-Novorossiysk ferry communication was resumed in 2014. The ferry is able to transport 150 trailers and 250 passengers. The ferry transportation services are performed by Drujba ship. Its Georgian representative Temur Barqaia says the ferry sails within the triangle. Because of unstable supply of cargoes, the ferry performs services only three times a month. The price of transportation of one truck to Burgas makes up 850-900 EUR. This service is much cheaper and faster compared to land transports, he said. The ferry performs the direct transportation to Burgas for 36 hours, while the route through Novorossiysk takes 48 hours. The current workload makes up 60%-70% and the ferry is waiting for the winter period, when the Larsi Checkpoint is closed and the consignments for Russian and the North European countries are redirected to the ferry. “There are major problems at the Larsi checkpoint because of queues. Heavy snow in the winter period worsens the situation and this ferry remains an only alternative to the checkpoint”, Barqaia said. He also expressed major hopes for attracting cargo from the Near East and China. The Iran’s direction is also very promising, because the shortest way to Europe crosses Georgia. After the removal of sanctions against Iran, the first consignment, mainly containers loaded on vehicles, are heading to Europe through Georgia.

Government Policy

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he Georgian Economy Ministry Department for Transport that determines a strategy for seaborne, land and airborne communication, says that the priority is given to harmonizing with the international legislation and expanding Georgia’s engagement in the global transportation corridors. The Department Head Ketevan Salukvadze talks about perspectives for deepening cooperation with China, two successful pilot projects implemented jointly with China, but the main opportunity of this cooperation of regular transportation remains unimplemented. She hopes a valuable company will win tenders for constructing the Anaklia seaport and constructing an international hub and Georgia’s seaborne potential will increase several times. As to the only and irregular ferry communication with Europe after the DCFTA signature, she noted this is an affair of the private sector, but she added she had offered the ferry owner to add another ferryboat and intensify the transportation capacity. She even suggested the owner to apply to the Partnership Fund for obtaining financial resources. As to the upgrading of awareness of enterprises and their assistance, after the DCFTA signature, as well as assistance in transporting pilot and test consignments to Europe, provision of specific suggestions about cheapest and favorable transports and routes, efforts for improving transportation quality and prices, the Transport Department Head directed us to the Economy Ministry Department for Foreign Trade. The Foreign Trade Department head Mariam Gabunia noted no one had applied to the Department with similar problems and she had no similar information and consequently, the department was taking no efforts in this direction. The next instance was the Partnership Fund and it informed that at this stage no project is planned for either improving transportation ties with Europe or promoting land and ferry transportation.


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REAL ESTATE caucasus business week

November 30, 2015 #124


November 30, 2015 #124

HEALTHCARE caucasus business week

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WHAT ARE GENERICS – HEALTH MINISTER DAVID SERGEENKO EXPLAINS

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he Ministry of Health plans to implement a new standard in controlling the quality of drugs in Georgia. Consequently, the Ministry considers expanding Generic segment as a prerequisite, for increasing affordability on drugs and encouraging local production. To successfully implement this it is important to set the system of quality control on drugs properly, on which The Ministry of Health has started working intensively, the real results will be known to public soon. A generic drug is identical–or bioequivalent–to a brand name drug in dosage form, safety, strength, route of administration, quality, performance characteristics and intended use. The vast majority of prescription drugs sold in the U.S. – 86 percent –are generic and the recalls keep coming. As for the Georgia, 70 percent of drugs sold on the pharmaceutical market are generic drugs. The Ministry has announced its intention to introduce additional Generic drugs, due to increased prices of medicines. What are generic drugs? The Minister of Health David Sergeenko explains:

“I am obliged to explain to our people, what Generic drugs really mean. Generic drugs’ initial active ingredient is a brand” When the drug is developed and manufactured, its producer enjoys the first 15 years of copyright. Accordingly the price of brand drugs is usually very high”. “I have repeatedly stated that I welcome expanding affordability on generic drugs, because it is a cost-effective step for the country. We also care about creating properly working control system, which will protect us from lowquality drugs”. Recently the board Chairman of Global Alliance and Bernard Kouchner noted that Generics need to be offered to public at affordable prices. He welcomed the initiative of encouraging local production and expanding the Generic segment on Georgia’s pharmaceutical market.

2016 BUDGET: ADDRESSING HEALTH MINISTERS AT #EAP INFORMAL DIALOGUE: DISEASES HEALTHCARE IN FOCUS DO NOT RECOGNISE BORDERS OF SOCIALORIENTED BUDGET

The Government of Georgia believes next year’s budget has a clear “social orientation” that focuses on the social needs of citizens. On a Governmental meeting members of the Government discussed how to divide the 2016 state budget – and they decided to spend money on social sectors that would greatly benefit the Georgian population. Increasing the amount of money allocated to Georgia’s healthcare and education systems was part of the social-oriented budget, which also focused on providing better assistance for refugees.

The sixth informal meeting of Eastern Partnership (EaP) countries, bringing together European Union (EU) and regional high representations, has concluded in Georgia’s capital Tbilisi Speaking about health issues the EU top official, Johannes Hahn stressed “access for all to high quality health care was proven to contribute not only to individual people’s health but also to economic growth of countries.”

We are faced with complex and common challenges when it comes to cross-border threats to health. We do have a joint health

security interest especially in the context of increased travel and trade flows which bring great benefits but also enhance the risk of cross-border spread of communicable diseases. Therefore, investing in resilient and sustainable health systems and promoting public health is essential for the development of human capital. It also fosters more prosperous societies in our

countries,” he said. It is crucial that we focus our collaborative efforts to reinforce prevention, control and our preparedness to respond rapidly and effectively to common health threats.” Hahn added €41 million had been spent by the EU on more than 40 projects between 2007 and 2013 to address local health issues. Addressing the same health topics Georgia’s Health Minister Davit Sergeenko said Georgia’s health reforms “have been positively assessed by Georgia’s partners.” The Minister stressed that his ministry was working on an action plan on how to make overthe-counter medicines more available for the public. He added the Government covered all the cost medicines at hospitals and other health institutions.

PM: In order to implement the Universal Healthcare Program without any obstacles, it was decided 570 mln GEL will be allocated from next year’s state budget “If in 2012 the expenses of Georgia’s Ministry of Health amounted to 1.8 billion GEL, next year it will exceed 3 billion GEL, which means it almost doubled,” Irakli Garibashvili added. Next year 85 million GEL will be allocated to the Ministry of Internally Displaced Persons from the Occupied Territories, Accommodation and Refugees of Georgia. This will be a 240 percent increase on the 25 million GEL allocated to the Ministry in 2012.


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PUBLICITY caucasus business week

November 30, 2015 #124


November 30, 2015 #124

WORLD NEWS caucasus business week

ECONOMY 2016

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Here’s What You Need to Know Where to Find Growth Next Year

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ometime around April 2016, a third set of locks on the Panama Canal will begin handling ships as much as 2.6 times the size of the biggest ones now able to ply the waterway. U.S. ports from New York to Galveston, Texas, have been gearing up for the traffic. The Port of Houston Authority just finished installing four cranes that are 30 stories high. “More trade means more jobs,” Port Chairwoman Janiece Longoria said earlier this year. The opening of the Panama Canal locks is just one likely event in what promises to be an eventful year for the global economy. The Trans-Pacific Partnership trade agreement could win approval from 12 nations that together account for 40 percent of global output. There will be presidential elections in the U.S. and Taiwan, a Summer Olympics in Brazil, and a new five-year plan in China. The biggest event of all could be a referendum in the U.K.—possibly in October—on whether to remain part of the European Union.

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he world economy next year is shaping up to be stronger than in 2015 and roughly in line with long-term growth averages, according to the International Monetary Fund and economists surveyed by Bloomberg. But “a return to robust and synchronized global expansion remains elusive,” the IMF said in its October outlook. The fund’s economists project world growth of 3.6 percent, up from 3.1 percent this year and about the same as the 3.5 percent average from 1980 through 2014. Those numbers are based on the IMF’s preferred method of measuring output, using the real purchasing power of national currencies. Measured the standard way—using market exchange rates—the IMF’s projections and historical figures would be about 0.6 percentage point lower. The coming year will be “OK-ish,” says Adair Turner, former chairman of the U.K.’s Financial Services Authority and author of a new book, Between Debt and the Devil. More pessimistic than the consensus, he worries there will be undeclared currency wars as Europe and Japan try to cheapen their money to boost exports and employment at home—essentially stealing growth from their trading partners.Here’s the mainstream outlook in a nutshell: China will continue to decelerate. The U.S. will continue to outperform its rich-nation peers. With global demand soft, the price of money (interest rates) and the prices of oil and other commodities are likely to remain low. Central bankers Janet Yellen, Mario Draghi, and Haruhiko Kuroda will be in the spotlight as the Federal Reserve attempts to nudge rates higher and the European Central Bank and Bank of Japan look for ways to stimulate growth.The most important variable for 2016 is China, where the annual gross domestic product growth rate dipped below 7 percent in the third quarter of 2015 for the first time since the 2008-09 financial crisis. Developing nations that have come to depend heavily on China as a customer for their resources include Brazil, Chile, Indonesia, Malaysia, the Philippines, South Africa, Thailand, and Vietnam. But the world’s appetite for Chinese goods isn’t growing at the same

pace anymore, and China has no urgent need for more of the infrastructure it’s been furiously building. Like his predecessors, President Xi Jinping is having a tough time guiding the economy toward domestic consumption as a new source of growth. “China finds itself in a particularly tricky starting position,” Louise Keely, president of the Demand Institute, a venture of Nielsen and the Conference Board, wrote in an August blog post.The IMF projects that China’s growth will slow to 6.3 percent in 2016, from 6.8 percent this year. That’s tolerable, albeit seemingly below the “medium-high” growth the country’s leaders said again in October that they want. More pessimistic is Willem Buiter, chief global economist of Citigroup. “We consider China to be at high and rapidly rising risk of a cyclical hard landing,” he wrote in September, citing excess capacity and high debt loads. With Russia and Brazil already in recession, a sharp slowdown in China would drag other emerging markets down, Buiter warned. Most rich nations depend less on exports to China, so they “will not experience recessions themselves but will merely grow more slowly,” he wrote.

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heap oil is one key factor that makes most economists more optimistic than Buiter. While the low price harms exporters, including Russia and members of OPEC, it boosts importing nations in the developing world—most of Latin America, Africa, and Asia, including China. Cheap oil also helps developed nations such as the U.S., but fuel costs are a smaller portion of their total expenditures. Unfortunately for macroeconomists, oil prices are even less predictable than the Chinese economy, depending on everything from OPEC politics to strife in the Middle East. One theory says the price of crude could drop below $40 a barrel next year, because production is exceeding consumption and the world is running out of places to store the excess. An unprecedented amount of crude is afloat on tanker ships while its owners look for buyers. Oil bulls counter that the low price will depress exploration and production enough to create shortages and drive the price back up. Emad Mostaque, a strategist for Eclectic Strategy in London, says a barrel of oil could fetch $100 or even $130 by 2017. Between those two extremes, traders are betting that prices will rise only a bit, with the Brent crude benchmark reaching $56 a barrel by the end of 2016, up from about $49 now. Some of the benefits of cheap oil might be undone by unusually bad weather around the Pacific Rim. What’s shaping up to be one of the three strongest El Niños since 1950 will cause “major disruptions, widespread droughts and floods,” says Kevin Trenberth, distinguished senior scientist at the National Center for Atmospheric Research in Boulder, Colo. He estimates the El Niño of 1997-98 killed at least 30,000 people and caused $100 billion in damage. For the U.S., 2015 was supposed to be the year the economy was finally healthy enough to get off the life support of near-zero interest rates. Yet the Federal Reserve has pushed off its first hike in the federal funds rate to the very end of the year—Dec. 16—at the earliest. March 2016 is looking more likely. There’s even a slim chance that it will delay liftoff past the end of 2016. Judging from the misery index, which combines the latest reported inflation rate and unemployment rate and was 5.1 percent in October, the U.S. economy is as good as it’s been since the 1950s. But if the misery index is this low, why are so many people miserable? One big reason is that wages haven’t risen as much as they usually do when the jobless rate is this low. According to Sentier Research, median household income in September was 1.7 percent lower than in January 2000 after adjusting for inflation. Wages are expected to grow a bit faster in 2016: Private companies surveyed by PricewaterhouseCoopers in the third quarter predicted they’d raise wages next year by 3.1 percent, the first time since 2008 the number hasn’t been below 3 percent. The upside of America’s slow growth is that the economy is way short of inflationary overheating, so there’s no need for the Fed to jack up rates rapidly and potentially kill the expansion. “Recessions come out of excess,” says Liz Ann Sonders, chief investment strategist at Charles Schwab. “We’re still in recovery mode. We’re not even in expansion mode.” American families have paid off debt since the 2007-09 recession, and they have pent-up demand, particularly for housing. “The millennial generation is moving out of the basement of their

parents’ homes,” says Steve Rick, chief economist of CUNA Mutual Group, which sells insurance and investments to credit union members. Strength in consumer spending could embolden businesses to invest to upgrade plants, equipment, and software. The updates are overdue. “If anything, both consumption and investment have been too weak throughout this expansion,” Deutsche Bank Chief Economist Torsten Slok wrote to clients in October. “As a result, I continue to believe that we are several years away from the next recession.” Europe and Japan are weaker. Unlike the U.S. economy, which has grown slowly but steadily since 2009, both have suffered periodic setbacks. The ECB could push short-term interest rates deeper into negative territory even before 2016 starts, and the Bank of Japan is getting ready to increase bond purchases to lower long-term rates. The Greek financial crisis, out of the headlines now, could wind up back on Page 1 by late 2016 if Prime Minister Alexis Tsipras can’t win approval for the spending cuts, tax hikes, labormarket reforms, and privatizations that creditors have demanded. After observing the Greek tragedy from afar, British citizens are glad they kept their pound sterling. Next October they’ll go to the polls for a referendum on a more radical step: leaving the EU entirely. An “out” vote “would seriously undermine business confidence in Europe,” says Russ Koesterich, global chief investment strategist for BlackRock, the big asset manager. Europe’s refugee crisis is a fresh stress on the EU. The strange thing is that it may stimulate short-term economic growth, at least in Germany. “We think it will be a boost for GDP,” says Malte Rieth, head of global economic forecasting at the German Institute for Economic Research in Berlin. The organization, known by its German acronym DIW, calculates that the government will give aid to the refugees, who in turn will spend it, mostly on domestic goods and services, adding 0.1 percent to 0.2 percent of GDP growth. Developing nations are watching the Federal Reserve, concerned that investors will yank money away from them and invest it in the U.S. when the Fed hikes rates. The fears are probably misplaced. Investors have had at least two years to move their money around. “Surely few would be taken by complete surprise when the FOMC [Federal Open Market Committee] finally gets on with the job of raising interest rates, probably in March,” economists at Capital Economics wrote in October. It’s been a hellacious year for Brazil (political crisis, oil) and Russia (sanctions, oil). The IMF is expecting both countries’ economies to continue shrinking in 2016, but not as rapidly. No other major economies are expected to be in recession next year. The IMF looks for India to outpace China again, accelerating slightly to 7.5 percent growth, while Mexico grows 2.8 percent, Nigeria expands 4.3 percent, and South Africa manages a bare 1.3 percent increase in output. OK-ish growth might just be as good as it gets from here on, says Stephen King, senior economic adviser to HSBC in London. He argues that the strong world growth of 1950 to 2000 was an anomaly and says the world economy is returning to the slower pace of the preceding 150 years. In other words, it’s not just a matter of applying the right stimulus here and there. “The problem,” King says, “is deeper.” www.bloomberg.com


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EVENT

caucasus business week

November 30, 2015 #124

TOYOTA UNVEILS REGIONAL TRAINING CENTER OF GREAT IMPORTANCE IN TBILISI • Electricians training zone • Hybrid Automobile Service System • Training zone for service of aggregates • Theoretical Training Zones • Two training zones for training service management specialists (department of sales, customer service department, spare parts department) • Kaizen Dojo class simulation (service and sales management) • Storehouse • Shower

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oyota’s official training center was unveiled at Kindzmarauli Street 5, Tbilisi on November 27. To celebrate Caucasus’ biggest training center launch, Toyota Caucasus, the Toyota’s official representation in the Caucasus region held a solemn reception. To ceremony was attended by heads of Toyota training divisions from European head office, which arrived in Georgia for this special occasion. All domestic and regional dealers, partners from Ukraine, and Russia were present at the ceremony. Representatives of state offices, media and business sector were also seen on the event. Among the honorable guests was Japanese Ambassador in Georgia Mr. Toshio Kaitani

The training center opening is truly a significant event not only throughout Georgia, but for the entire Caucasus region, and this step directly reflects the philosophy of Toyota, the company representatives noted. “We do not just build cars, we build people!” - This well-known motto clearly mirrors company’s basic principles. It is a widely recognized fact that Toyota philosophy KAIZEN, (continuous improvement) and respect for people, represents the foundation of years of success that runs throughout the company history which also implies continuous care for development and professional growth of employees. “Every step forward in the field of education

and professional training yields remarkable results and outcome throughout the entire Toyota network. We are proud to have initiated the regional scale project in Georgia”, the Toyota Caucasus representatives noted. Considerable investments were made for the training center launch. Multifunctional training center spreads over 850 square meters. Built on Toyota’s top standards, the center embraces the cutting-edge machinery, modern technologies, systems and equipment. The training center includes: • Three sections with 4-ton crane • Emissions Pumping System • Tire Fixation Complex

Ms. Natalia Rud, the manager consumer experience training at Toyota Motor Europe, and Mr.Yuji Wagata, Toyota Caucasus president, delivered speech at the event. “The Toyota training system will enable technicians to apply modern technologies and refine Toyota automobile service skills. It should also be noted that prior to commencement of sales in regional markets, each new model will be studied in details so as Toyota personnel be fully equipped with knowledge and skills when introducing new automobiles to consumers. All these efforts ensure ultimate comfort and safety to the customers. Toyota considers consumers to be top priority instance (following the principle: Customer First). The driving mechanism of the company’s whole performance is conveyed in the distinguished expression of Akio Toyoda: “Our goal is to be number 1 in the hearts and minds of customers”, Toyota Caucasus officials noted. On basis of the training center, Toyota Caucasus plans to implement expanded educational projects on the regional level in the future. Toyota Caucasus (TCA), a Toyota’s official distributor in the South Caucasus, has been operating with its head office in Tbilisi since 2006. The official representation also serves Azerbaijan and Armenia markets, in addition to Georgia.


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Embassy United States of America Embassy 11 Balanchivadze St., Dighomi Dstr., Tbilisi Tel: 27-70-00, 53-23-34 E-mail: tbilisivisa@state.gov; askconsultbilisi@state.gov United Kingdom of Great Britain and Northern Ireland Embassy 51 Krtsanisi Str., Tbilisi, Tel: 227-47-47 E-mail: british.embassy.tbilisi@fco.gov.uk Republic of France Embassy 49, Krtsanisi Str. Tbilisi, Tel: 272 14 90 E-mail: ambafrance@access.sanet.ge Web-site: www.ambafrance-ge.org Federal Republic of Germany Embassy 20 Telavi St. Tbilisi Tel: 44 73 00, Fax: 44 73 64 Italian RepublicEmbassy 3a Chitadze St, Tbilisi, Tel: 299-64-18, 292-14-62, 292-18-54 E-mail: embassy.tbilisi@esteri.it Republic of Estonia Embassy 4 Likhauri St., Tbilisi, Tel: 236-51-40 E-mail: tbilisisaatkond@mfa.ee Republic of Lithuania Embassy 25 Tengiz Abuladze St, Tbilisi Tel: 291-29-33 E-mail: amb.ge@urm.lt Republic of Latvia Embassy 16 Akhmeta Str., Avlabari, 0144 Tbilisi. E-mail: embassy.georgia@mfa.gov.lv Greece Republic Embassy 37. Tabidze St. Tbilisi Tel: 91 49 70, 91 49 71, 91 49 72 Czech RepublicEmbassy 37 Chavchavadze St. Tbilisi ;Tel: 291-67-40/41/42 E-mail: czechembassy@gol.ge Web-sait: www.mzv.cz Japan Embassy 7 Krtsanisi St. Tbilisi Tel: +995 32 2 75 21 11, Fax: +995 32 2 75 21 20 Kingdom of Sweden Embassy 15 Kipshidze St. Tbilisi Tel: +995 32 2 55 03 20 , Fax: +995 32 2 22 48 90 Kingdom of the Netherlands Embassy 20 Telavi St. Tbilisi Tel: 27 62 00, Fax: 27 62 32 People’s Republic of China Embassy 52 Barnov St. Tbilisi Tel: 225-22-86, 225-21-75, 225-26-70 E-mail: zhangling@access.sanet.ge Republic of Bulgaria Embassy 15 Gorgasali Exit, 0105 Tbilisi, Georgia Tel: +995 32 291 01 94; +995 32 291 01 95 Fax: +99 532 291 02 70 Republic of Hungary Embassy 83 Lvovi Street, Tbilisi Tel: 39 90 08; E-mail: hunembtbs@gmail.com State of Israel Embassy 61 Agmashenebeli Ave. Tbilisi Tel: 95 17 09, 94 27 05 Embassy of Swiss Confederation’s Russian Federation Interests Section Embassy 51 Chavchavadze Av., Tbilisi Tel: 291-26-45, 291-24-06, 225-28-03 E-mail: RussianEmbassy@Caucasus.net Ukraine Embassy 75, Oniashvili St., Tbilisi Tel: 231-11-61, 231-12-02, 231-14-54 E-mail: ukraina_pu@wanex.net; emb_ge@mfa.gov.ua Consular Agency: 71, Melikishvili St., Batumi Tel: (8-88-222) 3-16-00/ 3-14-78 Republic of Turkey Embassy 35 Chavchavadze Ave., Tbilisi Tel: 225-20-72/73/74/76 embassy.tbilisi@mfa.gov.tr Consulate General in Batumi 9 Ninoshvili Street, Batumi Tel: 422 25 58 00 consulate.batumi@mfa.gov.tr Republic of Azerbaijan Embassy Kipshidze II-bl . N1., Tbilisi Tel: 225-26-39, 225-35-26/27/28 E-mail: tbilisi@mission.mfa.gov.az Address: Dumbadze str. 14, Batumi Tel: 222-7-67-00; Fax: 222-7-34-43 Republic of Armenia Embassy 4 Tetelashvili St. Tbilisi Tel: 95-94-43, 95-17-23, 95-44-08 E-mail: armemb@caucasus.net Web: www.armenianembassy.ge Consulate General, Batumi Address: Batumi, Gogebashvili str. 32, Apt. 16 Kingdom of Spain Embassy Rustaveli Ave. 24, I floor, Tbilisi Tel: 230-54-64 E-mail: emb.tiflis@maec.esRomania Embassy

TBILISI GUIDE

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caucasus business week

7 Kushitashvili St., Tbilisi Tel: 38-53-10; 25-00-98/97 E-mail: ambasada@caucasus.net Republic of Poland Embassy 19 Brothers Zubalashvili St., Tbilisi Tel: 292-03-98 Email:tbilisi.amb.sekretariat@msz.gov.pl Web-site: www.tbilisi.polemb.net Republic of Iraq Embassy Kobuleti str. 16, Tbilisi Tel: 291 35 96; 229 07 93 E-mail: iraqiageoemb@yahoo.com Federative Republic of Brazil Embassy Chanturia street 6/2, Tbilisi Tel.: +995-32-293-2419 Fax.: +995-32-293-2416 Islamic Republic of Iran Embassy 80, I.Chavchavadze St. Tbilisi, Tel: 291-36-56, 291-36-58, 291-36-59, 291-36-60; Fax: 291-36-28 E-mail: iranemb@geo.net.ge United Nations Office Address: 9 Eristavi St. Tbilisi Tel: 225-11-26/28, 225-11-29/31 Fax: 225-02-71/72 E-mail: registry.geo@undp.org Web-site: www.undp.org International Monetary Fund Office Address : 4 Freedom Sq., GMT Plaza, Tbilisi Tel: 292-04-32/33/34 E-mail: kdanelia@imf.org Web-site: www.imf.ge Asian Development Bank Georgian Resident Mission Address: 1, G. Tabidze Street

Freedom Square 0114 Tbilisi, Georgia Tel: +995 32 225 06 19 E-mail: adbgrm@adb.org; Web-site: www.adb.org World Bank Office Address : 5a Chavchavadze Av., lane-I, Tbilisi, Georgia ; Tel: 291-30-96, 291-26-89/59 Web-site: www.worldbank.org.ge Regional Office of European Bank for Reconstruction and Development Address: 6 Marjanishvili St. Tbilisi Tel: 244 74 00, 292 05 13, 292 05 14 Web-site: www.ebrd.com Representation of the Council of Europe in Georgia Address : 26 Br. Kakabadze, Tbilisi Tel: 995 32 291 38 70/71/72/73 Fax: 995 32 291 38 74 Web-site: www.coe.ge Embassy of the Slovak Republic Address: Chancery: 85 Irakli Abashidze St. Tbilisi, 0162 Georgia Consular Office: 38 Nino Chkheidze St. Tbilisi, 0102 Georgia Phone: 2 222 4437, 2 296 1913 e-mail: emb.tbilisi@mzv.sk

Hotels in Georgia TBILISI MARRIOTT Tbilisi , 13 Rustaveli Ave. Tel: 77 92 00, www.marriott.com COURTYARD MARRIOTT Tbilisi , 4 Freedom Sq. Tel: 77 91 00 www.marriott.com RADISSON BLU HOTEL, TBILISI Rose Revolution Square 1 0108, Tbilisi Tel: +995 32 402200 radissonblu.com/hotel-tbilisi RADISSON BLU HOTEL, BATUMI Ninoshvili Str. 1, 6000 Bat’umi, Georgia Tel: 8 422255555 http://radissonblu.com/hotel-batumi SHERATON METECHI PALACE Tbilisi , 20 Telavi St. Tel: 77 20 20, www.starwoodhotels.com SHERATON BATUMI 28 Rustaveli Street • Batumi Tel: (995)(422) 229000 www.sheratonbatumi.com HOLIDAY INN TBILISI Business hotel Addr: 1, 26 May Square Tel: +995 32 230 00 99 E-mail: info@hi-tbilisi.com Website: http://www.hi-tbilisi.com BETSY’S HOTEL With Marvellous Tbilisi Views Addr: 32/34 Makashvili St. Tbilisi Tel: +995 32 293 14 04; +995 32 292 39 96 Fax: +995 32 99 93 11 E-mail: info@betsyshotel.com Website: http://www.betsyshotel.com

Restaurants CORNER HOUSE Tbilisi, I. Chavchavadze ave. 10, Tel: 0322 47 00 49; Email: contact@cornerhouse.ge RESTAURANT BARAKONI Restaurant with healthy food. Georgian-European Cuisine Agmashenebeli Alley 13th Phone: 555 77 33 77 www.barakoni.com CHARDIN 12 Tbilisi , 12 Chardin St. , Tel: 92 32 38 CAFE 78 Best of the East and the West Lado Asatiani 33, SOLOLAKI 032 2305785; 574736290 BREAD HOUSE Tbilisi , 7 Gorgasali St. , Tel: 30 30 30 BUFETTI - ITALIAN RESTAURANT Tbilisi , 31 I. Abashidze St. , Tel: 22 49 61 DZVELI SAKHLI Tbilisi , 3 Right embankment , Tel: 92 34 97, 36 53 65, Fax: 98 27 81 IN THE SHADOW OF METEKHI Tbilisi , 29a Tsamebuli Ave. , Tel: 77 93 83, Fax: 77 93 83 SAKURA - JAPANESE RESTAURANT Tbilisi , 29 I. Abashidze St. , Tel: 29 31 08, Fax: 29 31 08 SIANGAN - CHINESE RESTAURANT Tbilisi , 41 Peking St , Tel: 37 96 88 VERA STEAK HOUSE Tbilisi , 37a Kostava St , Tel: 98 37 67 BELLE DE JOUR 29 I. Abashidze str, Tbilisi; Tel: (+995 32) 230 30 30 VONG 31 I. Abashidze str, Tbilisi Tel: (+995 32) 230 30 30 BRASSERIE L’EXPRESS 14 Chardin str, Tbilisi Tel: (+995 32) 230 30 30 TWO SIDE PARTY CLUB 7 Bambis Rigi, Tbilisi Tel: (+995 32) 230 30 30

Cinemas AKHMETELI Tbilisi. “Akhmeteli” Subway Station Tel: 58 66 69 AMIRANI Tbilisi. 36 Kostava St. Tel: 99 99 55, RUSTAVELI Tbilisi. 5 Rustaveli Ave. Tel: 92 03 57, 92 02 85, SAKARTVELO Tbilisi. 2/9 Guramishvili Ave. Tel: 8 322308080,

SH. RUSTAVELI STATE THEATRE Tbilisi. 17 Rustaveli Ave. Tel: 93 65 83, Fax: 99 63 73 TBILISI STATE MARIONETTE THEATRE Tbilisi. 26 Shavteli St. Tel: 98 65 89, Fax: 98 65 89 Z. PALIASHVILI TBILISI STATE THEATRE OF OPERA AND BALLET Tbilisi. 25 Rustaveli Ave. Tel: 98 32 49, Fax: 98 32 50

Galleries ART GALLERY LINE Tbilisi. 44 Leselidze St. BAIA GALLERY Tbilisi. 10 Chardin St. Tel: 75 45 10 GALLERY Tbilisi. 12 Erekle II St. Tel: 93 12 89

Real Estate International Real Estate Company (IREC) Tbilisi. 9 P. Aslanidi St. Tel: +995 32 238 058 Mob: 599 95 76 71 Email: Info@irec.ge www.irec.ge

GSS Car rental offers a convenient service for those who are interested in renting car in Georgia. Rental fleet mainly consist of Japanese made SUV’s, the company has various models of cars including sedans and minivans which are in good technical condition. Contact information: Email: info@gsservices.ge. Address: Shalva Dadiani 10

Akhvledianis Khevi N13, Tbilisi, GE. +995322958377; +995599265432

Theatres A. GRIBOEDOV RUSSIAN STATE DRAMA THEATRE Tbilisi. 2 Rustaveli Ave. Tel: 93 58 11, Fax: 93 31 15 INDEPENDENT THEATRE Tbilisi. 2 Rustaveli Ave. Tel: 98 58 21, Fax: 93 31 15 K. MARJANISHVILI STATE ACADEMIC THEATRE Tbilisi. 8 Marjanishvili St. Tel: 95 35 82, Fax: 95 40 01 M. TUMANISHVILI CINEMA ACTORS THEATRE Tbilisi. 164 Agmashenebeli Ave. Tel: 35 31 52, 34 28 99, Fax: 35 01 94 METEKHI – THEATRE OF GEORGIAN NATIONAL BALLET Tbilisi. 69 Balanchivadze St. Tel: (99) 20 22 10 MUSIC AND DRAMATIC STATE THEATRE Tbilisi. 182 Agmashenebeli Ave. Tel: 34 80 90, Fax: 34 80 90 NABADI - GEORGIAN FOLKLORE THEATRE Tbilisi. 19 Rustaveli Ave. Tel: 98 99 91 S. AKHMETELI STATE DRAMATIC THEATRE Tbilisi. 8 I. Vekua St. Tel: 62 59 73

THE BEST GEORGIAN HONEY OF CHESTNUTS,ACACIA AND LIME FLOWERS FROM THE VERY HART OF ADJARA MATCHAKHELA GORGE IN THE NETWORK OF GOODWILL, NIKORA AND SMART


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PUBLICITY caucasus business week

November 30, 2015 #124