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August 7, 2017 #204
August 7, 2017, Issue 204 - www.cbw.ge
Opinion Georgian Economic Policy with Populism Elements
Company Smart Supermarkets Close, Wendy’s Cutting Salaries
PR Person Lika Chokheli: PR is Moving Along Time and Develops With It’
Partly Suspension of Vintage Subsidization Damages the Sector
Internal Debt are More Expensive than External Debt Georgia’s state debts account for 13.8bln GEL as of May 2017, including external debts total 11.2 bln GEL, while internal debts account for 2.5bln GEL. It is worth noting that over the past years state debts comply with both international and domestic standards, however internal debts volume is growing at high paces. According to the 2016 indicators, state debts in relation to GDP accounts for 4.6%. Notice that under Liberty Act, top margin of this indicator is 60%. State budget started borrowing money from domestic market at the end of the 20th century. As a rule, Government used to place very short-term securities (7, 14, 21, 28 and so on) and interest rates ranged from 300% to 400%. Naturally, this practice would be impossible in case of valuable competition. There are serious doubts that in that period state securities were one of the sources of corruption. At the same time, in that period, this instruments was put into practice to make the country experienced of issuance and trade in securities.
Living in the Highest Inhabited Settlement of Europe
With the altitude of 2200 meters Ushguli is referred as the highest inhabited village in Europe. It is located at the feet of Shkhara, one of the highest Caucasian summits. Unlike many other villages high in the mountains it is still inhabited. Up to 70 families live in the area. There is a public school and an outpatient clinic in the village. The superb location of Ushguli and the unique lifestyle of the people in the village make this a popular and interesting destination to visit. Ushguli deserves attention of central and local governments as well as private sector. Road rehabilitation from Mestia to Ushguli has already started and it will solve most of the problems of local population. One of the unique projects implemented in the village was “MagtiSat’s Digital Broadcast in Pg. 9 every house of Ushguli”.
Government to Examine New Sectors with High Exports Potential
LEPL Produce in Georgia plans to examine sectors with high exports potential jointly with experts of GFA Consulting Group, a German consulting company, for the purpose of exports development and growth in the country.
Partnership Fund Offers EIB to Join GINO Green City Project
The Parties discussed the issue of constructing an eco-city near Tbilisi Sea and arranging various infrastructure, including, hotels, recreation complex, public school, kindergarten, medical center and various recreational zones.
Annual Inflation Declined to 6% in July
The consumer basket has cheapened in Georgia. Geostat, national statistics service of Georgia, noted that deflation constituted 0.9%. The figure has made influence on consumer basket and the inflation dropped to 6%.
July Records Inflow of 1 million Visitors
As to the upturn in tourist inflow in January to August period, the growth made up 30.2%. More than 1.8 million people have stayed in the country for more than 24 hours. A total of 3 978 657 visits were carried out in the country entirely.
BGEO Wins Contract to Upgrade Tbilisi Metro Ticketing System
The FTSE 250 company said that as a result, Bank of Georgia would continue as the sole provider of payment support services to the public transportation network, and operate mass retail branches for the next 10 years.
Rating of Commercial Banks due to ROE
ProCredit Bank was ejected from the list of Georgia’s top five major banks (7.3%). Only two commercial banks of 16 ones have ended the first half of 2017 in negative indicators (IS Bank and Finca Bank).
Georgia Air Traffic has Increased by 13.6%
According to the Air Navigation LTD of the Ministry of Economy and Sustainable Development of Georgia, based on 6 months statistics of 2017, the number of flights in Georgian airspace has increased by 13.6% compared to last year.
EU Bank Signs First Direct Loan To a Company in Georgia
The EU bank will provide a EUR 21.47m long-term loan to Tbilisi’s water utility – Georgian Water and Power (GWP) – to support its water and wastewater infrastructure development programme.
August 7, 2017 #204
The GIG will Build a 300 Megawatt Capacity Thermal Power Plant The largest Italian group Muratori & Cementisti – C.M.C.di Ravenna SocietàCooperativa signed cooperative memorandum with Georgia Industrial Group GIG.
Anaklia Development Consortium Signs Agreement with US-based SSA Marine
n a coinciding visit to Tbilisi, United States Vice President Mike Pence highlights the USGeorgia collaboration at the heart of the port project. Anaklia Development Consortium (ADC) today signed an agreement appointing SSA Marine as terminal operator for the Anaklia Deep Water Black Sea Port’s container terminal, which will establish an important new maritime corridor between China and Europe and stimulate national and regional economic growth. The agreement provides SSA Marine with operating rights to the port’s container terminal for the next 20 years. SSA Marine will also act as an equity investor for ADC. The agreement with SSA Marine, which is based in Seattle in the United States, further strengthens US involvement in the Anaklia Port project: SSA Marine joins Conti International, a major US-based developer of infrastructure and capital projects, which is co-leading the ADC together with Georgia-based TBC Holding. United States Vice President Mike Pence, who is in Tbilisi as part of a visit to the region, hailed the US-Georgia collaboration that is bringing the Anaklia Deep Sea Port to life and building on the growing importance of Georgia to regional and international economic development: “The Anaklia Deep Sea Port shows the potential of a stronger bilateral relationship
between our nations. American companies are investing alongside their Georgian counterparts in this multi-billion-dollar project. As we look toward the future, our two nations have untold opportunities to contribute even more to each other’s prosperity.” Georgian Prime Minister Giorgi Kvirikashvili commented: “Our goal is to create the best platform for US business interests in the region, and the involvement of US companies in large regional infrastructural projects is very important. Together with involvement of the Conti Group in the consortium to develop and construct the deep sea port in Anaklia, we are also glad that an agreement will be signed with leading world class US port operator SSA Marine to operate the container terminal and invest in the most important project in Georgia. This fact once more outlines the increasing interest of US business in Georgia and the huge potential of our country to become a regional hub.” Mamuka Khazaradze, founder of Anaklia Development Consortium, said: “Along with our American partners, we have been given the opportunity to open Georgia’s gateway to the sea and to mark Anaklia’s place on the world map and convert it into the most crucial logistic hub. The fact that such a powerful American company as SSA Marine is investing in Georgia
is itself a strategic and important precedent for our country.” SSA Marine was chosen and appointed as a container terminal operator for the Anaklia Port due to its significant experience as one of the largest terminal operators in the world. The group oversees more than 250 strategic operations across five continents, servicing 27.2 million containers (TEU) and managing terminals in nine different countries. In addition, SSA Marine handles over 75 million tonnes of dry bulk globally, manages cruise ship operations in Mexico and the United States and operates over 30 intermodal rail ramps for U.S. Class I railroads. ADC plans to start construction of the deep sea port by the end of this year, with the operational launch of phase 1 scheduled for 2020-2021. Development of Anaklia City and its Special Economic Zone has also commenced, which will become a focal point for international business and high valueadded service industries; they will attract light manufacturing production, as well as service sectors and will be open to global corporations, financial and insurance enterprises. The city, which will be built on green economy principles, will include an industrial park with residential and business complexes, an educational area and office space.
New IFC Partnership in Georgia to Help Save Water, Conserve Power
FC, a member of the World Bank Group, has signed an agreement to help the Georgian Water and Power (gwp) company, a leading supplier of water in Georgia, conserve resources and become more energy efficient, improving its competitiveness and environmental performance. With IFC’s advice, gwp will benchmark its energy consumption against global and regional peers, and identify opportunities to save water, lower energy costs, and increase efficiency. The partnership is the first advisory engagement of IFC’s Europe and Central Asia Energy and Water Solutions for Corporates advisory program in Georgia, part of a larger effort by IFC to combat climate change, safeguard the environment, and help companies improve their bottom lines. “At GWP, we are always looking for ways to both protect the environment and become more efficient,” said Giorgi Tskhadadze, CEO of
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gwp. “With IFC’s support, we hope to identify measures to further increase the efficiency of our water supply operations, minimize energy consumption, and improve the quality of our services to customers, businesses and households.” Georgia is aiming to reduce its energy use by 17 percent by 2030 while maintaining GDP growth at over 5 percent, which will require significant energy efficiency improvements across the economy. IFC’s new program promotes investment in energy and water efficiency, helping companies and municipalities across the region become more productive and competitive. “IFC’s global experience working with more than 50 water utilities in over 20 countries demonstrates that using energy more efficiently is a win-win, both for business and the environment,” said Milagros Rivas Saiz, IFC Global Head of Advisory. “It can help reduce energy consumption by up to 30 percent and water
losses by as much as 80 percent.” Climate change remains a strategic priority for IFC. To date, IFC has invested $15.3 billion in long-term financing for renewable power, energy efficiency, climate smart agribusiness, green buildings, and smart cities, and mobilized $10.1 billion of capital from other investors into climate business. Georgia became an IFC member in 1995. Since then, IFC has committed around $1.6 billion in longterm financing, of which $774 million was mobilized from partners. That financing has supported 59 projects in the financial services, agribusiness, manufacturing, and infrastructure sectors. In addition, IFC has supported more than $331 million in trade through its trade finance program, and implemented a number of advisory projects focused on developing the private sector in Georgia. In fiscal year 2016, IFC invested almost $19 billion in developing countries worldwide.
Editor: Nutsa Galumashvili. Mobile phone: 595 380382 Reporters: Nina Gomarteli; Mariam Kopaliani; Merab Janiashvili Technical Assistant: Giorgi Kheladze;
Source: www.commersant.ge, www.bpi.ge, www.gbc.ge, www.agenda.ge, www.civil.ge
August 7, 2017 #204
Internal Debt are More Expensive than External Debt
Ilya Eloshvili Minister of Energy
State Budget Pays 0.5 bln GEL to Commercial Banks for Serving Debts
The tariff for gas has not been revised from 2007 to 2017. Is it fair?
Merab Janiashvili Economic Analyst
In 2009-2017 (the first quarter), 5.94 billion GEL state securities were sold. As of June 1, 2017 state internal debts constituted 2.655bln GEL, of which 2.159bln GEL is recorded for T-bills. This signifies 3.78 billion GEL has been already paid from 5.94 billion GEL issued over the past 8 years.
eorgia’s state debts account for 13.8bln GEL as of May 2017, including external debts total 11.2 bln GEL, while internal debts account for 2.5bln GEL. It is worth noting that over the past years state debts comply with both international and domestic standards, however internal debts volume is growing at high paces. According to the 2016 indicators, state debts in relation to GDP accounts for 4.6%. Notice that under Liberty Act, top margin of this indicator is 60%. State budget started borrowing money from domestic market at the end of the 20th century. As a rule, Government used to place very short-term securities (7, 14, 21, 28 and so on) and interest rates ranged from 300% to 400%. Naturally, this practice would be impossible in case of valuable competition. There are serious doubts that in that period state securities were one of the sources of corruption. At the same time, in that period, this instruments was put into practice to make the country experienced of issuance and trade in securities. In 2005 the Government decided to close this corruption segment and ceased issuing securities for a certain period. However, starting 2009, when economic crisis broke out worldwide, the Authorities faced a lack of financial resources and restored practice of taking internal debts through securities. Over the past years the volume of internal debts has been growing. As a rule, state securities are less risky and they have high liquidity level. As a result, rating companies give highest evaluation to state securities. At the same time, in the countries with developed financial markets issuance of securities gives additional benefits to economy. However, in Georgia, where securities market does not exist in practice, only a small part of entrepreneurs have access to state-issued T-bills and bonds, to be precise, only commercial banks enjoy such opportunity. Consequently, annual guaranteed revenues received from state securities are deposited on accounts of commercial banks. Starting August 2009 to July 2017 the Government has sold 3.176bln GEL T-bills (6-month and one-year) with averaged 7.7% yield. Averaged yield for 6-month securities is around 7%, while yield on one-year T-bills ranges from 4% to 14% over the past 8 years. As to bonds, starting February 2010 up to the third quarter of 2017, T-bills of 2.764bln GEL of 1-10 year maturity period were sold and their averaged interest rate totaled 9.7%. It is worth noting that the bond’s coupon is paid every six months. Coupon rate on 2, 5 and 10-year state bonds ranges from 5.2% to 15.5% due to years. In 2009-2017 (the first quarter), 5.94 billion GEL state securities were sold. As of June 1, 2017 state internal debts constituted 2.655bln GEL, of which 2.159bln GEL is recorded for T-bills. This signifies 3.78 billion GEL has been already paid from 5.94 billion GEL issued over the past 8 years.
This clearly was not fair. The tariff should correspond to the economic realities of the country. The fact that the tariff has been revised after 10 years is not correct. Now we embark on a normal policy when the tariffs will be reviewed constantly. The National Energy Regulatory Commission which has its own methodology for determining the tariff will deal with this issue. No one will tell you how often the tariff will be revised. Everything depends on several factors - on the amount of investments, on the exchange rate of the national currency, and on international gas prices. The tariff will be constantly revised depending on market conditions. - If the tariffs did not correspond to reality, then why they were not reviewed for so many years? - We worked on a new methodology for calculating the tariff jointly with European experts. As a result, new terms for the revision of tariffs and a new calculation methodology were adopted. - Your government has promised to cut gas prices, but in fact it increases them ... - We cut gas prices in 2013, and until 2017 the tariff was lowered and for this purpose the government introduced subsidies. - Under the new payment system, new users pay a little more than those who consume gas for many years. How true is this? - This is very true, firstly, because the difference in the tariff is very small. Secondly, the tariff should allow the company to invest in the development of the network. It’s naturally that gas supply to new subscribers requires new expenses and to cover them, tariff for them should be a little more than for those who use gas for many years. At the same time, the companies are unsatisfied that the difference in tariffs is not big enough. Business always requires more than it can receive. That’s why a commission for energy regulation cares how fair the tariff is in terms of market economy. I can assure everyone that the current tariff is absolutely fair. But it concerns only those subscribers who fall under the effect of a regulated tariff approved by the commission. And what will happen to unregulated which tariff is always higher? Recently, it was decided that the regulated tariff will be valid for all categories of consumers. In 2008 the decision to divide the supplied gas into regulated and unregulated was correct, but almost 10 years have passed and the situation has changed – we believe that all consumers should be on equal terms and all gas distribution companies will operate at a single tariff. - What is the situation with the so-called social gas? Why is it cheaper than other segments? - We receive gas as a transit fee from Shah Deniz and the North-South gas pipeline, and this gas, for obvious reasons, is cheaper than Russian or the Azerbaijani gas that we buy at a market price. Social gas has fallen in price from 120 to 105 dollars that made it possible to limit the growth of gas tariffs. Otherwise, it could have been much higher. - A lot is said about gas supply monopoly. Do you share this opinion? - There is no monopoly, we have several suppliers, we receive gas from Russia and Azerbaijan. We also have several gas distribution companies. Of course, not all companies receive gas at the same price, but this does not mean that there are monopolies in the market.
August 7, 2017 #204
As of June 1, 86% of sold state securities are owned by commercial banks, while the remaining 14% belong to National Bank of Georgia (NBG), resident and nonresident bodies. In 2011-2016 averaged weighed interest rate on T-bills ranged from 7.6% to 11.6%. This signifies the owner of state securities used to receive 8.6% yield over the past 6 years. It is worth noting that the state budget spends more and more resources on serving state securities. For example, in 2010 only 15 million GEL was spent on this direction, while the state budget paid 150 million GEL in 2016. In 2010-2017 (only the first quarter) the state budget has paid 584.4 million GEL interest rates for serving bonds and obligations. As a result, 4/5 of these payments have gone to commercial banks, because 86% of these securities are owned by commercial banks. This signifies over the past 8 years commercial banks have received about 502 million GEL revenues through crediting the state budget. It is impossible to provide precise calculation based on the divulged information. To provide precise estimations, we need information on what volume of securities was taken by this or that institution in this or that year and what the maturity period of those securities were. Despite external debts interest rates are lower, the Authorities have been enlarging issuance volume year to year. In 2011-2016 averaged weighed yield on T-bills was 8.6%, while external debt interest rate was 2%. For example, in 2013 annual averaged weighed interest rate on external debts was 1.92%. As of 2016, this indicator slightly rose to 2.03%. This signifies the state budget has to pay fourfold more money to serve internal debts. Despite Georgia’s total state debt stays far away from the critical margin, the internal debt amount, which has grown in record volumes, raises many questions, especially, when serving internal debt is 4 times expensive as compared to external debts. However, we should take into account that external debts, as a rule, have their purpose. This signifies the Government cannot spend it due to its will, while internal debts are able to cover liabilities. It should be also noted that the Georgian legislation blocks access to T-bills and bonds for ordinary citizens. Any deal is available only through commercial banks, where minimum amount is 50 000 GEL for initial offer and 1 000 GEL for the second offer. Therefore, 85% of the state budget loans are owned by commercial banks. This money is ejected from the economy. This signifies in other equal conditions, commercial banks would credit the real sector through these funds, but when they have chance to receive annual guaranteed 7-14% benefits from the state, they prefer to lend money to the state budget, not private entrepreneurs. Moreover, because of undeveloped securities market, T-bills and bonds market are monopolized in practice by the banking sector.
“We will deepen business relations and the ongoing reforms evidently prove your devotion to the policy of strengthening business relations with the west. I welcome that all citizens in Georgia will get wider economic opportunities. Anaklia seaport is the best evidence in this field. I would like to refer to the words of Donald Trump that we stand beside you”.
Mike Pence The US Vice President
August 7, 2017 #204
August 7, 2017 #204
Smart Supermarkets Close, Wendy’s Cutting Salaries
Crisis in Wissol Group
Wissol Group is one of the old business companies on Georgian market. The business group owned by brother businessmen Soso and Levan Phkhakadzes currently unites the following subsidiaries: Wissol Petroleum Georgia, Air Wissol, Wissol Gas, Vianor Georgia, Wissol Gas Distribution Company, Smart network of supermarkets, Wendy’s network of fast food restaurants, Villaggio development company and Alma advertising company.
As to Wendy’s, this network manages to continue operation, however, the network staff asserts that the company has considerably cut salaries. At the same time, employees cannot explain reasons for reduction of salaries. Wendy’s also seems to be failing competition on the market and it is not ruled out the management start closing facilities, following reduction in salaries.
nitially, Wissol Group owners took efforts on oil products market. In 2002-2006, the company was shaped under the Canargo Standard Oil brand and starting 2006 the brand of Wissol maintains its own place on oil products market. Wissol Group started active operation on oil products business in heavy times under the ruling of United National Movement. In that period SOCAR appraised as the business of two presidents, GULF ascribed to Kezerashvili and Saakashvili and several other companies used to operate on the market and do high-income business on oil products market. This was impossible without cooperation with the ruling Authorities. In that period all companies used to follow an agreed scheme and high tariffs were maintained artificially to raise huge revenues. By the way, all these facts were proved after the regime changed, when the competition agency accused five key oil products companies such as SOCAR, Wissol, Lukoil, Gulf and Rompetrol of cartel collusion and imposed a 55 million GEL fine on them. And 10.4 million GEL fine was imposed on Wissol. In those years Wissol Group and its owners used to receive huge revenues. After the power change, when business was exempted from pressure, the business group owners decided to invade new markets. As noted above, Wissol Group owns several subsidiaries, but the Group
decided to particularly develop Smart network of supermarkets and Wendy’s network of fast food restaurants. All opening ceremonies of supermarkets or restaurants were held in bustling atmosphere. As a result, the Group has opened 16 supermarkets of SMART and 10 fast food restaurants of Wendy’s. According to the statement by the management and owners, SMART was to become one of the most suc-
The fact is Wissol Group is demonstrating crisis signs. Wissol Group, which was a successful business group under the ruling of United National Movement, failed to maintain advanced positions on the market in new realities. cessful network of supermarkets, while Wendy’s was to provide real competition with McDonald’s that remains the most favorite network in Georgia. However, developments went in different way – Smart supermarkets are being closed one after another, while Wendy’s has started cutting salaries. At this stage, Smart has closed Vazisubani, Gldani and Vake branches and these facilities were sold to the competitor network of Carrefour.
Wissol Group seems to have failed competition and taken decision to transmit facilities to competitors. Smart is expected to close supermarkets at Saburtalo and Rustaveli Avenue too, because in Saburtalo District Carrefour opened a new facility in front of Smart and this fact is expected to lead the Smart supermarket to bankruptcy. As to Wendy’s, this network manages to continue operation, however, the network staff asserts that the company has considerably cut salaries. At the same time, employees cannot explain reasons for reduction of salaries. Wendy’s also seems to be failing competition on the market and it is not ruled out the management start closing facilities, following reduction in salaries. It seems Wissol Group owners have failed to get established on new markets and remain successful in real competitive environment. One can succeed on oil products market as a result of cartel collusions and maintain high profits margin, but it is an absolutely different situation when you have to act in real competitive environment. As to oil products market and Wissol Petroleum Georgia, the management seemingly plans to carry out certain changes. Supposedly, all or a certain part of Wissol refueling stations will be transformed into ECO refueling stations. For example, the station on Vazha-Pshavela Avenue has already started re-branding process and it is
colored in red and white colors instead of green color. Wissol Group has not made an official statement about this fact, however, the refueling station’s representatives noted that Wissol refueling stations will be transformed into ECO stations. We remind you that ECO’s fuel was one of the favorite products in Georgia because of its high quality standards, however under the ruling of United National Movement, this brand was expelled from the country in practice and in 2014 Wissol obtained fuel supply exclusive rights from ECO, as well as the right for use of ECO trademark in Georgia. Seemingly, now the company plans to use this right. The time will show whether all refueling stations will be rebranded or only several ones will be transformed. Nobody talks about reasons that have preconditioned these changes,whether Wissol has lost a great number of clients and has decided to rebrand the network or has just decided to return ECO brand to the market. The fact is Wissol Group is demonstrating crisis signs. Wissol Group, which was a successful business group under the ruling of United National Movement, failed to maintain advanced positions on the market in new realities. All other details will be outlined in the course of time and the Caucasus Business Week (CBW) will comprehensively cover this issue for our audience.
August 7, 2017 #204
Partly Suspension of Vintage Subsidization Damages the Sector Bustling vintage has become a traditional environment in Georgia. For many years peasants accustomed to state subsidies and they frequently find grape prices unacceptable. This year Government plans to suspend state subsidization of vintage in Kakheti Region. The program will be maintained in Racha-Lechkhumi Region for Khvanchkara varieties – Aleksandrouli and Mujuretuli – 2 GEL per kilogram.
Anyway, as compared to the previous year, grapes price will be higher. Winemaking companies have enlarged, sales have grown.
Moreover, winemaking companies will receive additional 35 Tetri if they pay 70 Tetri for one kilogram of Rkatsiteli and Kakhetian Green for production of brandy spirits and concentrated grapes syrup. Georgian Agriculture Minister Levan Davitashvili said that the government will show new mechanisms for the 2017 vintage because of current situation in winemaking field. «Wine exports is growing and winemaking field has considerably recovered over the past years. We have expectations that the vintage process will proceed in organized form and private sector will show much interest and demand for purchasing grapes. Consequently, state subsidies will not be necessary for main industrial varieties such as Saperavi, Rkatsiteli and Kakhetian Green», Levan Davitashvili said. The Minister also noted that Government continues promotion of brandy production through various mechanisms, including preferential agro loans. “Over the past years we have seen that quality of Georgian brandy and consequently, production process was improved and we will receive 35 Tetri compensation for Rkatsiteli and Kakhetian Green if companies produce brandy and concentrated grapes syrup, so as their price policy be competitive and they have more motivation to join the process. In this way, we promote brandy spirits production”, Levan Davitashvili said. Certain new mechanisms will be applied in Racha-Lechkhumi regions for the field recovery, the Minister said. “For the purpose of protection of place of origin of Khvanchkara, we have changed wine specifications, under which starting 2019 Khvanchkara processing will be carried out only in the zone of origin and this is a very important issue for the region’s residents and domestic winemakers. This should be a painless transition and we will give a time to winemaking companies to get ready for 2019”, Levan Davitashvili noted. Over the past period, as a result of state measures, today we have the following situation in viticulture-winemaking field: 24 new enterprises are financed in addition (strong drinks production, brandy production), 48 enterprises have enlarged (winemaking, brandy production). As part of agro insurance state program, vineyards have been insured on 5 123 hectares. Exports markets are actively diversified, exports of wines and strong drinks grows in stable regime and consequently, the demand for grapes has also increased. Based on the above-mentioned, there is no necessity of issuing state subsidies for high-quality grapes during the 2017 vintage in Kakheti Region. Under the government decision, winemaking companies will receive additional 35 Tetri from the Authorities if they pay at least 70 Tetri forone kilogram of Rkatsiteli and Kakhetian Green for production of brandy spirits and concentrated grapes syrup. For the purpose of protection of place of origin, in the 2017 vintage period, state subsidization will be maintained in Racha-Lechkhumi region on Khvanchkara varieties – Aleksandrouli and Mujuretuli – 2 GEL for one kilogram. It is worth noting that starting 2019 transportation of Khvanchkara grapes (Mujuretuli, Aleksandrouli) will be restrictedfrom Racha-Lechkumi region to other regions for processing. The Government’s decision to subsidize Mujuretuli and Aleksandrouli as part of the 2017 vintage aims at promoting a development of winemaking companies in Racha Region. For the purpose of conducting the 2017 vintage in an organized way, under the government decision, a coordinating board will staffed by LEPL National Wine Agency, Ministry of Agriculture, Ministry of Economy and Sustainable Development and Ministry of Interior, Agriculture Project Management Agency and representatives of State Governors
Subsidization program cannot achieve initial goals in several years. This is a strategy designed for tens of years and if Georgia aims at expanding exports markets, the decision to suspend subsidization today, will frustrate this strategy.
This will increase our competitive environment and grapes quality will be improved in long-term perspective.
(Kakheti, Racha-Lechkhumi and Kvemo Svaneti Region). Special places will be allocated in self-governed cities for sales of grapes. For the purpose of growth in production, loans will be issued to wine and strong drinks companies as part of preferential agro credits project. Economic expert Gia Khukhashvili explains that the Government’s decision for partly suspension of vintage subsidization is a wrong step. Vintage subsidization should be suspended, but not now, Gia Khukhashvili said. Subsidization program cannot achieve initial goals in several years. This is a strategy designed for tens of years and if Georgia aims at expanding exports markets, the decision to suspend subsidization today, will frustrate this strategy, Khukhashvili noted. “I do not mean specific social themes and peasants promotion on local level. I do not mean social aspects. I talk about field development strategy that cannot be implemented in several years. We know that wine market is saturated and supply exceeds the demand and if our strategy is to develop exports markets, Government should continue the sector support to develop exports markets, not to support peasants”, Khukhashvili noted. As a result of the mentioned decision, Georgia’s winemaking sector’s condition will further worsen, he said. Professor Rati Abuladze, doctor of economics, explains that agriculture sector is a field, where political goals and government programs are of decisive importance for the field development. Consequently, agriculture sector subsidization is one of the important efforts for attaining state objectives. Subsidy, as a state form of assistance, should be perceived as social-economic, political and strategic necessity that, first of all, strengthens farmer families, he noted. •The policy of subsidies should be considered as: •instrument for stimulation of economic activity; •the strategy for maintaining local population in rural areas (migration restricting process); •Price reduction mechanism (that we need amidst imports of huge volume of food products); •measures for protection of domestic manufacturers from foreign competitors; •risks reduction measures, support in low-productive land tillage and growth in production capacity. Rati Abuladze noted that change in subsidization policy should be based on research and analysis. Preliminary evaluation needs the following factors: •How production, as well as number of farmer families, tillage of low-productive lands will decline due to geographical locations; •How the subsidization policy will affect agriculture sector employees, migration paces and other factors; •How agriculture sector development tendency will change; •How will it affect economic potential of farmer families; •How will it affect ecosystem management, existing space scales; •If farmers families become unable to plough and sow or cover expenditures for picking grapes, how the negative affects of subsidization policy will affect on long-term state goals? •How many economically active farmers will bear losses and go bankrupt (because of climate change and agro loans). It is easy to change subsidization policy, while development of agriculture sector efficient programs is difficult. For conclusion, Rati Abuladze explained that, based on social and economic condition of regions, the country needs agro subsidization regime; •Subsidization measures should be a flexible instrument for attaining social and economic benefits. •Each farmer family needs various sorts of assistance. Therefore, they should be categorized and this will enable the Government to satisfy the demand of each family through various schemes of subsidization; subsidization should be carried out purposefully and this purpose should be controlled scrupulously; •It is recognized that inefficient governance preconditions inefficiency of subsidization system. In certain cases subsidization may be unjustified, but it is necessary for social purposes. The reality suggests that subsidization is neces-
sary to lower food imports volume; overcome heavy socialeconomic background ( that cannot be eradicated by only social assistance); •Naturally, subsidization policy should be revised for longterm perspective, however, amidst existing economic volume and economic programs, it is not expedient to change subsidization policy; •When the country achieved economic progress, then subsidization regime should be corrected/abolished. How the private sector meets the decision by Agriculture Ministry? Is it still relevant to issue subsidies in the regions and how this decision may affect grape prices? Zurab Ramazashvili, head of supervisory board of Telavi Wine Cellar winemaking company, hails the Government’s decision. According to his information, in this case market mechanisms will be applied for pricing of grapes and neither Government not other parties will make influence. Grape prices will reflect real market value, he said. This will increase our competitive environment and grapes quality will be improved in long-term perspective. Producer of low-quality grapes will lose motivation to produce lowquality products. In this case, farmers will have to work in competitive environment and they will have to produce better grapes to sell it at higher prices, Ramazashvili noted. When the Authorities subsidize vintage, the motivation disappears and farmers maintain chances for reception of minimum price, Ramazashvili said. “Ultimately, this decision will bring better results for everybody. Today this decision may make someone discontent, I mean farmers, who fail to reap high-quality grapes and sell them for desirable price. After this decision, both farmers and winemaking companies will make benefits, because farmers will receive real market price and the companies will buy high-quality products, consequently, better wines that will be sold for higher prices”, Ramazashvili noted. As to grapes market price during the 2017 vintage, Ramazashvili noted that the price is determined by market principles and it is difficult to preliminary forecast the price. “This look like a preliminary determination of price of shares at the exchange. Everything depends on demand and supply”, Ramazashvili said. Telavi Wine Cellar will buy grapes in 2017 too, Ramazashvili said and added that the Government decision proves there is real demand for grapes. Winemaking companies sales grow. Both exports volume and sales have increased on domestic market too, he added. Gia Shengelia, director of Badagoni winemaking company, noted that it is time to improve grapes quality in the country and the government decision will stimulate the issue resolution. When farmers receive subsidies, they feel more confident and do not care much for sales market and they have guaranteed minimum revenues. Therefore, after the government decision they will pay higher attention to grapes quality, Shengelia said. We expect high demand for grapes in 2017 and grapes price will also increase, he said. “Anyway, as compared to the previous year, grapes price will be higher. Winemaking companies have enlarged, sales have grown. Several new companies have entered the market. In Kakheti region additional 4 000 hectares vineyards have been arranged”, Shengelia noted. This year Badagoni company will buy a quite huge volume of grapes. As reported, Government started subsidizing grapes in 2013. As part of the 2016 vintage, the Authorities allocated 25 million GEL for subsidization program and a subsidy for a kilogram of Rkatsiteli and Kakhetian Green made up 45 Tetri, one kilogram of Saperavi – 20 Tetri, 1 kilogram of Aleksandrouli and Mujuretuli – 2 GEL. In November 2016 Prime Minister Giorgi Kvirikashvili noted, when introducing the 2016 vintage results, that 178 companies had taken part in purchasing and processing of grapes in Kakheti Region. As a result, more than 100 000 tons of grapes were processed and Kakheti residents’ revenues exceeded 97 million GEL. As to vintage in Racha-Lechkhumi, 24 companies bought grapes and more than 500 tons of grapes were processed. Racha residents’ revenues in the vintage period exceeded 2.5 million GEL.
August 7, 2017 #204
PR is Moving Along Time and Develops With It’
Interview with Head of the Public Relations Department of the CoInvestment Fund of Georgia Lika Chokheli.
- Which media outlets do you follow? - It’s hard to highlight just one, because of my profession. I try to stay updated daily through various media outlets; Maybe that’s what distinguishes PR specialists from other professions- We should not select just one but have to follow all, every day. - What’s the difference between PR and Advertising? - PR- the word itself says-Public Relations. It means the relations between society and company/organisation. They are directed to harmonize relations with partners or inside organisation. As for advertising, it’s one of the technology of marketing which commercializes a product. - Tell us about your project or period that you proud of… - Each project implemented by me is very important and makes me proud. Not because it was the best (maybe it was), but I learned some-
There has been some negative attacks, but I’m glad that you can’t remember anything specific,as it seems I successfully dealt at the very beginning, using right strategy. This is also a challenge that gives you a great experience and makes your career more interesting.
thing new during that, and it became an inspiration to a new one. - How will you react if a client or a manager disagrees with your PR strategy? - It’s quite natural and healthy process, when you witness different opinion while developing PR strategy. It usually helps us to achieve the best result. That would be more scary if I never had a difficulty; A lot is depended on your skills as a PR Specialist, to be able to balance and compare people’s visions. The biggest mistake one can make is not to listen to others. I always try to look events from someone else’s perspective, listen to people, that’s exactly what Public Relations stand for, communicating with society, not a document of your own interests. - Share your experience of negative media attacks that you dealt with? - There has been some negative attacks, but I’m glad that you can’t remember anything
specific,as it seems I successfully dealt at the very beginning, using right strategy. This is also a challenge that gives you a great experience and makes your career more interesting. - What would you improve? - The PR field is very interesting because of its essence. On the one hand each member of the society is interesting himself, on the other hand their unity gives us a different picture. Unfortunately, PR specialists are lacking of the opportunity to approach individual members of society and often have to sum up a common thought or belief, which gives us professional discomfort as a Public Relations whose main aim is a constructional relation with society. What would I improve? Hard to give a specific example, because PR, like other fields, requires constant development. There are no united formulas, PR is moving along with time, accordingly, it develops with it.
August 7, 2017 #204
Living in the Highest Inhabited Settlement of Europe
With the altitude of 2200 meters Ushguli is referred as the highest inhabited village in Europe. It is located at the feet of Shkhara, one of the highest Caucasian summits. Unlike many other villages high in the mountains it is still inhabited. Up to 70 families live in the area. There is a public school and an outpatient clinic in the village. The superb location of Ushguli and the unique lifestyle of the people in the village make this a popular and interesting destination to visit. Ushguli deserves attention of central and local governments as well as private sector. Road rehabilitation from Mestia to Ushguli has already started and it will solve most of the problems of local population. One of the unique projects implemented in the village was “MagtiSat’s Digital Broadcast in every house of Ushguli”. MagtiSat has provided digital satellite television signal to each household of the Georgian village Ushguli via SES’s satellite. The project was implemented during the terrestrial digitalization of Georgia in 2015 and its initiator was SES, world-leading satellite operator which provides satellite communications services to broadcasters, content and internet service providers, mobile and fixed network operators, governments and institutions worldwide. Terrestrial digitalization was not an easy process for Georgia especially for its mountainous regions. But with this unique one-time project SES with the help of MagtiSat managed to digitize a rural mountainous village Ushguli just in a couple of days. Terrestrial digitalization was an obligatory of Georgia in 2015. TV digitalization should have been finished by 2015 not only in Georgia but in the whole Europe according to the decision of International Telecommunication Union and EU. Moving to the digital TV for Georgia was one more step toward developing of the country and
its general digitalization. Before it, at the beginning of 2012 one significant step toward digitalization in Georgia was already made. In January 2012 the first-ever domestic digital satellite TV in Georgia – MagtiSat - was launched. It happened after the long-term agreement was signed between Magticom, the Georgian telecommunication company and SES, one of the world’s largest satellite operators. “The village is significantly developing in the last period. The project of the road rehabilitation is priceless. There is only 45 km from Mestia to Ushguli, but because of the bad road driving the distance takes more than 2 hours. This is a huge problem for us. Rehabilitation of the road has already started and we hope it will be finished soon. Good road will help local population significantly. As a result communication between Ushguli and other world will be simplified. Better road will somehow support improvement of medical service,” – says Beso Charkseliani, representative of local governor in Ushguli. “Education system and medical service is really improving the village. We have a public school here but we don’t have teachers of mathematics, physics and sports. We haven’t had an outpatient clinic for a long period, which has been opened, while ago. But its service is not enough for us and it needs to be much improved. Getting perfect first aid service is not available here. Implementing modern technologies is essential for local population as well. For example, Project of Magticom and SES was very important in the history of Ushguli. All the necessary equipment for digital satellite broadcasting and installations were provided by MagtiSat. The population of the village will enjoy 25-channel package free of charge for the unlimited period of time,” – added Charkseliani. Young generation better realize need of modern telecommunication systems in the village. 28 years old Bakar Nijaradze daily work in fields with his family. Agriculture as well as tourism is main source of income for the family.
“It’s summer now. There are lots of people in the village. Joy and happiness is in any point of Ushguli. Winter is totally different as there are not much people in Ushguli. They stay at home during most time of the day watching TV and waiting for summer. TV and satellite broadcasting is very important for the village. Via TV we won’t lose daily contact with the world,” – says Bakar Nijaradze. Local population learns a lot from the information received by TV. They better learn hospitality standards, watch how developed resorts host tourists and try to do the same. On the other hand, they get information about foreign visitors’ needs and requirements. As a result, young generation of Ushguli gets more and more interested in tourism. They are deeply involved in the ongoing process of tourism development in the village, do their best to have high standard guest houses and offer perfect service to the tourists. Analyzing tourism potential and existing opportunities Rusudan Ratiani decided to get high education in tourism. After graduating Gori State Teaching University she went back to her home village and now is operating a guest house with her parents, 5 sisters and 2 brothers. “Tourism is developing very fast in Svaneti. Therefore I decided to get education in this field. Tourists especially like towers, local cuisine and handicrafts. Number of tourist is increasing from year to year. Tourism has become main source of income of local people. It is hard to do any other job in Ushguli. There is nothing to entertain for young generation as well. We watch TV when we have free time. Main source of information is TV. I personally love music and therefore often watch musical programs. I often sing with my sisters and brothers as well,” says Rusudan Ratiani, 22 years old. 40 years old Laerti Charkseliani lives in Ushguli with his wife and two kids. Their café is one of the best in Usghuli and is often full of tourists. Charkseliani says that increased number of tourist is a result of the road rehabilita-
tion to Mestia and developed telecommunication in Ushguli. “Ushguli honestly deserves attention. The village is among UNESCO World Heritage Monuments. Tendency of the development of the village is clear. But much more is needed. You will often hear the phrase here – summer is good, but what should we do in winter? Local population mostly stays at home and enjoys watching TV during winter days. There is nothing else to do in winter. I am glad that we have free TV broadcasting. This is not a place to make surprised by internet, TV or smartphone. But still it is very pleasant for us that someone cares about us in this regard. Development of telecommunication is essential for developing our tourism potential,” – explains Laerti Charkseliani. This is how people live in Ushguli. Local population host tourists in summer and watch TV in winter. But it is the most important that they don’t lose the hope… Hope that everything will be changed in a better way, all started projects will be finished successfully and the highest inhabited settlement in the Europe will be developed as much as it deserves. In 2015 Georgian mobile and telecommunication company MagtiCom with the support of global satellite operator SES has launched the project “MagtiSat’s Digital Broadcast in every house of Ushguli”. MagtiSat has provided digital satellite television signal to each household of the Georgian village Ushguli via SES’s ASTRA 5B satellite in 31.5 degrees East. All the necessary equipment for digital satellite broadcasting and installations were provided by MagtiSat free of charge. The population of the village will enjoy 19-channel “G” package free of charge for the unlimited period of time. As a result, the village of Ushguli is 100% digitalized at the moment and all families can enjoy the superior quality of the satellite signal. The population of the village enjoys with 25-channel “G” package free of charge for the unlimited period of time.
August 7, 2017 #204
Tsinandali Fest Agreement on Cooperation Signed in Switzerland
Natural, Family Wine Produced at Tedo’s Cellar The interest towards family and natural wines increases day by day, accordingly, the number of small cellars is growing. Tedo’s Cellar is a family cellar that produces qvevri wines accordance bio standards. every work is done by family membery, Tedo’s daughter Eto Gzirishvili works on branding direction with her spouse. She had an interview with marketer about their product and types of wine. What caused your interest in producing wine? My father, Tedo Gzirishvili is a winemaker, he live in Sagarejo and produces wine in family cellar. 1 year ago, I came up with the idea to pour wine in bottle s and sell them. Family style wines have become more popular in Georgia and we decided to give it a try. We do every work at home, only family members are involved, even etiquette is made and sticked by us, that’s how we emphasize that it’s a small amount family wine. Me and my spouse worked on branding (startup Levanccio Arts&Crafts), Logo expresses Dionysus, as he is a god of grape harvest in Greek mythology.
In the Swiss town of Verbier, founders of Tsinandali Festival and Verbier Festival Martin Engström and Avi Shoshani have signed a cooperation memorandum for foundation of Tsinandali International Music Festival and Musical Academy. Verbier is distinguished as a homeland of one of the most popular classical music festivals in Europe www.verbierfestival.com. Analogical Festivals will be also held in Tsinandali starting 2019. The signing ceremony was held at one of the sightseeings of Verbier, Chalet D Adrien.
Seedstars World Startup International Competition in Tbilisi With the support of “BIA” and “Alliance Group Holding” (AGH), the Worldwide Startup Competition – Seedstars World will be held in Tbilisi. On September 6, 10 best Georgian startups will fight to present their country at the SeedStar summit and win $ 1,000,000. Seedstars World visits Georgia for the second time. The competition will be held on September 16 in Georgia’s Innovation and Technology Agency / GITA. “BIA” calls startups in its online database to use the opportunity and participate in the competition.
Ushba.io – Georgian Online Platform for Crypto Currency Trades Ushba.io is a new Georgian platform for crypto currency trades. The platform enables people to exchange currency and contact each other through a mediator (Peer to Peer trading). At the same time, consumers are able to exchange crypto currency into traditonal currency (Flat Exchange) or place it in protected space (Cold Storage), while through Cloud Mining it enables to implement crypto currency investments. The company representatives noted that UshbaCoin enables to become a company owner. Luka Kobalia, Ushba marketing manager answers the Marketer’s questions. -We know BitCoin already exists, What is UshbaCoin? -BitCoin and other similar crypto currencies are generated through mining. As to UshbaCoin, it is one of the shares of Ushba.Io crypto currency trade platform, that is a company stake. All owners of Ushbacoin will receive respective dividends from company profits at the end of all months. This unique component differentiates UshbaCoin from other crypto currencies. Crypto currency trading platform uses the name of famous mountain of Ushba. It was created for operation on international market.
Karavela Creates Handmade Tents for Children for their Private Space Karavela is a new product for children on Georgian Market. It creates tents which is a private, healthy space for a child and helps them to feel comfortable there. Each of them are handmade, therefore unique. CBW had an interview with a founder, Barbare Galdava: How did you come up with the idea to create Karavela? I have to children and the idea came up while playing with them. Children love their own private space and I created small size home tent, they loved crawling in and playing there. When I was a child I loved to play that way, and always wanted to own something similar. As we know Karavela is handmade, how did you learn setting up? which material do you use? I read construction instructions on internet. I learn sewing actively and started to create templates. I use cotton material and wood for the tent. In order to achieve softness of mattress I put antiallergic material- synthipon. As every tent is handmade, each
of them are unique. Our tents are numbered, this detail is also embroidered, which makes Karavela tents distinguished and special. What’s the feedback from customers? This is a new brand, few people know about Karavela but we have expectations. Do you have competitors on Georgian Market? No, there is nothing similar in Georgia so far. How do you think, what’s the role of Karavela in development of a child? First of all, it develops motor skills and coordination. supports them in imaginary games and most importantly, it helps in social relations if they invite their friends in their private space. Do you plan to produce other products and place them in the stores? I want to create a line of children production: soft toys, sleeping mask, etc. Tents are available online at this stage, we are not planning to place it at the store for this time.
Visit renovated Mardi Plaza with quality service and good conditions Despite the season and weather, Batumi Plaza remains the most populous place in Batumi. Over the years Plaza has become the centerpiece of Batumi, the point of reference. Plaza is a unique combination of retail, residential and office spaces, here operates: hotel, sports-club, the Olympic standard swimming pool and fitness center. A few months ago, the construction and development company Mardi Holding took over the management of the plaza. The new management aims to make the Plaza a safe, regulated and comfortable shopping and leisure center for the customers, as well as the building and services. The building and the services has been renovated: the indoor and outdoor perimeter was planted up, all lifts and escalators were started, the bathrooms were repaired, the front line of the plaza is regulated by external trade, video surveillance cameras were installed to improve security, the Qualified Security Service was invited to provide security for all the facilities and all the existing trading points. Mardi Holding’s management tries to make the prices acceptable to consumers, hence providing favorable prices for services, for example, one visit fee within the Pool Tourist package is only 10 GEL (the price
includes fitness, sauna, jacuzzi). The Olympic standard pool is unique in Georgia since it has a rolling roof, that is closed or open due to weather. Thus, it is very impressing for the guests to see the sky when swimming. The Plaza Sport and Fitness Club offers its customers a wide range of services, a modern sports hall, aqua aerobics, sauna and jacuzzi (additional services: massage, fitness instructor, individual swimming lessons). Any guest can get a sunbath on the Mardi Plaza Veranda with the beautiful views of Batumi on the background. In the Mardi Plaza there is a fourstar hotel that offers the best service to the locals and visitors. With the special offer, a double room booking is available for only 100 lari. Mardi Plaza is an attractive area for advertising where several thousand people move around for different purposes and the adverts in the building are combined with the interior which does not irritate the consumers and gives companies opportunity for direct advertising. Mardi Plaza promises many more innovations, including making additional parking lots. The Mardi Plaza will provide you quality service and comfort. www.mardiplaza.ge
August 7, 2017 #204
Georgian Economic Policy with Populism Elements
Rati Abuladze Professor, Doctor of Economics
ocial and economic environment in the country is always preconditioned by the state policy. This year Georgia’s economy started livening up and growing: foreign trade, economy, number of registered companies, number of employees (according to the statistics). Immunity of Georgian economics has strengthened for overcoming global and local problems. It should be noted that the Government has showed political will to care for social and economic problems: social programs are implemented, poverty eradication measures are carried out, financing component grows for overcoming social problems through establishing foreign experience, amidst growth in debts and obligations. Today, key challenge consists in economic policy. Experience suggests that economic turnover and growth
forecasts are not sufficient. In this situation state management standards are not based on achieved results, fulfilled programs, reduced debts and obligations, while results of certain program are positively appraised, due to certain criteria (for example, loans Larization program). Shaping global development and strategic vision by the Authorities raises more questions and generates public discontent and this is reflected in distrust to the current system, low economic activity, apathy and embarrassment. It should be noted that amidst current «political inheritance”: • We have heavy social and economic environment, where separate components of global and local problems dominate; • Confidence has declined because of results of the carried out policy, economic activity, efficiency of political developments and public involvement have also decreased; • Political environment has shaped economy, where its certain components function by inertia, while other fields remain in uncertain condition; • Re-branding of old policy and superficial political changes could not make essential influence on economic development and public welfare. Political system could not shape economic policy commensurate with public demands. It should be noted that poverty in this country has political roots and only politics is able to defeat it. Regretfully,
economic policy has not become a key challenge that would unite Georgia’s political forces around one orbit. Today, public rage can be still curbed, however, the wave of rage cannot be controlled endlessly, because all resources for problem resolution have expired (political and administrative resources). It should be noted that Georgia’s economic policy serve rather unclear than populism goals. This policy does not follow specific goals and are not of reformatory character. Consequently, the country has never had such necessity of changes as today, because state debts grow, global challenges sharpen, economic policy is inefficient, social inequality grows, productive and strategic resources of the government is ignored (academic resource). Conclusion Thus, the current realities such as political class, current rules of game, political system and analysis of operation suggest the country needs a new political class. If we want to receive social and economic welfare in the country, this can be achieved by not growth in obligations, but economic policy, economic activity, new political and geostrategic resources. This can be achieved by shaping a new political force. We should consider re-branding of old policy as the political Frankenstein, which will be represented by the same social and economic result.
If we want to receive social and economic welfare in the country, this can be achieved by not growth in obligations, but economic policy, economic activity, new political and geostrategic resources.
When shaping a new political system, genetic resources of old policy may be used in certain processes, as an ingredient. However, an entirely new system should be shaped. Only new political class can: • make education and science a state priority • fundamentally transform public management environment and generate new political activism; • carry out efficient policy, make efficient economic policy and achieve economic growth; • create job places; resolve social problems and remove social inequality; unite society and grow political reliability; • Increase exports and reduce ratio of imported resources; Georgia should not remain among importer countries; • Instead of outsourcing, management processes should be carried out by Georgian specialists (strategic planing, research, analysis, evaluation, development of and implementation of programs). • Cut external and internal debts through economic growth; • Shape strong state system as soon as possible and carry out global policy. Naturally, changes should be brought by an accelerator and academic resources should act as this accelerator, as a new political force with new economic visions, leadership activities and organizational resources. In whole, Georgia’s future policy should be based on academic principles.
August 7, 2017 #204
Brand History Telavi Wine Cellar
elavi Wine Cellar winemaking company was founded near the city of Telavi in 1915. The history has tightly interconnected with innovations at the Wine Cellar for more than one century. Devoted to Kakhetian winemaking traditions, we also follow modern tendencies and create wines through adaption of our historical experience with the most modern methods. Our wines satisfy the taste of the most refined consumers all over the world. Telavi Wine Cellar wines combine individual character of Georgian winemaking and viticulture, diversity and our aspiration – to comprehensively outline special correlation of diversity of domestic grapes varieties, climate conditions and soils. White and red grapes are equally portioned in vineyards, which cover 22 500 hectares, on 250-650 meters above the sea level. There
are 7 main zones. Tsinandali, Vazisubani, Akhasheni and Mukuzani zones have been arranged on the right bank of the river Alazani, while Napareuli, Kvareli and Kindzmarauli microzones are located in the picturesque foothills of the Caucasus. There are locations of origin that became famous worldwide thanks to elegant white and full and complex red wines. Company Foundation Idea – The company has one-century history of wine production. Zurab Ramazashvili, head of the supervisory board, purchased the company jointly with partners in 1997. In that period the company was on the brink of bankruptcy, in very heavy financial condition. New owners had to take huge efforts to make the company successful. We had to perform huge job, first of all, plant vines, supply technical equipment to the com-
pany, ensure marketing, boost sales and so on. This process successfully continues for 20 years. About Brand’s Success – Stable quality is a key achievement of the company. The company had never conducted large-scale advertising campaign. The brand achieved success because of stable quality, Ramazashvili noted. “Consumers have advertised our products and made our wines brand products», Ramazashvili said. Main challenges in Brand’s Establishment Process – Initially, the company started production of one variety of wine (white wine). Later, assortment broadened and today the company produces
more than 70 wines. As to challenges, they exist that we could overcome them, Ramazashvili noted. Our Logo and Brand History – Telavi Wine Cellar Company has restored its historical name. In Soviet period this winery was called as Kurdghelauri Winery. We have regained historical name and selected the word of MARANI as a brand name. It is related to a boy with two Kvevri on shoulders. This is a very beautiful Georgian basrelief in clay. It was modified for easier perception. This is our joint symbol. This name and this logo have been registered in almost all countries of the world.
August 7, 2017 #204
Russia’s Banks Get Serious About Digital Currencies
Philip Morris Plans to Reduce Production of Traditional Cigarettes Philip Morris, multinational cigarette manufacturing company plans to reduce traditional cigarette production and replace it by smokefree product IQOS. “When 50-60% of consumers move to new product, we will be able to fully stop cigarette production. Otherwise, we will receive illegal products”, the company executive director noted. The company intended to launch process on small markets, where changes are carried out quickly, he said. “We have been working under strict legislative restriction for more than 10 years. Future development of our business will be oriented on production of innovative products. I mean product that is less harmful compared to ordinary cigarettes. The Authorities are to recognize legal status of this product” he noted. We remind you Philip Morris talks about reduction of production of traditional cigarettes and the importance of new products. IQOS is neither smoking nor electronic cigarette. It is considered a tobacco product that is predominantly oriented on heating, not on burning (Heated Tobacco Products). The company assures that this product is much safer compared to any ordinary cigarette. IQOS is successfully used in Japan and a part of European Union. The company’s key brands are: Marlboro, Parliament, L&M, Chesterfield, Bond Street.
IFC to help Azerbaijan in agricultural risks’ management The International Finance Corporation (IFC) will help Azerbaijan in risks management in its agricultural sector, says a message of Azerbaijan’s Ministry of Agriculture posted on its website. According to the message, this issue is reflected in the project on agricultural insurance, which has been recently discussed by Azerbaijani Deputy Minister of Agriculture Seyfaddin Talibov and Head of the IFC’s Baku office Aliya Azimova. The project’s main goal is to develop an agricultural insurance program and with its help to expand the country’s access to financial resources. The project will also improve the financial sustainability of family farms. During the meeting, representatives of the Azerbaijani Ministry and IFC discussed the cooperation as part of modernization of agricultural insurance mechanisms in the country. According to Talibov, implementation of the agricultural insurance project is one of priorities for the ministry. “Our main tasks are the improvement of the relevant legislative basis, as well as the adoption of new laws related to the agricultural insurance,” added the deputy minister. Azerbaijan has been cooperating with the IFC since 1995. The IFC’s portfolio on Azerbaijan exceeds $400 million and these funds were allocated for implementation of more than 70 projects.
With Russia looking to cure its economy of a hydrocarbon addiction, a consortium of the country’s biggest banks is proposing that it explores a different kind of gas for the answer. The lenders, including Sberbank PJSC and VTB Group, aren’t developing gas of the natural variety. It’s also the name of a virtual unit based on the blockchain of ethereum, the world’s biggest cryptocurrency after bitcoin. The banks are hoping that by adopting the technology they will make payments safer and faster, while thrusting Russia to the forefront of a trend that’s transforming the financial industry. Two months after President Vladimir Putin met the founder of ethereum, the banks have developed a distributed ledger dubbed Masterchain that uses a modified ethereum protocol while complying with national security standards, according to the country’s central bank-backed FinTech Association. “Russia’s not a very developed banking market,” said Vyacheslav Putilovsky, an analyst at
Moscow-based rating company Expert RA. “The top banks here are betting that they can catch up and maybe even overtake their western competitors in their adaptation of this type of technology.” Blockchain -- the technology used for verifying and recording transactions that’s at the heart of ethereum and bitcoin -- can also be used to verify contractual agreements, intellectual property rights and public online ledgers without intermediaries. Applications like these may reshape the global financial system and other industries. R3, a global consortium similar to Russia’s FinTech Association, raised $107 million from its members including Bank of America Corp. and HSBC Holdings PLC in May. Moving the record-keeping of mortgage certificates to a distributed ledger may cut costs by as much as 80 percent, speeding up business by cutting out intermediaries such as public notaries, according to a whitepaper from the association, whose members also include Bank Otkritie FC, Alfa Bank and TCS Group Holding PLC.
Armenian Government approves decision to establish Meghri Free Economic Zone CJSC
Siemens and Turkish partners win billion-dollar wind energy tender A consortium of German giant Siemens and Turkey’s Türkerler and Kalyon Enerji holdings won a billion-dollar wind energy tender on Aug. 3, offering the lowest price to the state with $3.48 cents per kilowatt hour. A consortium of Chinese company Mingyang and Turkish company İlk İnşaat competed until the end of the reverse auction before getting eliminated, quitting in the 30th round. The tender came at a time when Turkish economy officials accelerated efforts to tone down a recent row with Germany, vowing that German investments in Turkey were safe and citing a “communication mistake” for reports about an anti-terror probe against hundreds German companies in the country. “The tender ended with a win by German company Siemens. We can say that this picture sends an important message to the region and the world,” Energy Minister Berat Albayrak told the media after the auction. “When the 200-year-old cooperation between Turkey and Germany is considered, I think this result will make an important contribution to TurkishGerman relations,” he added. Eight consortia, including four German giants, participated in the Energy Minis-
try’s 1,000-megawatt (MW) wind power project tender on July 27. In addition to the German and Chinese firms, Danish Vestas also took part in the bidding, as well as the U.S.’s General Electric, along with their local partners. The winning consortium is expected to make an investment of more than $1 billion in the project, which stipulates the gradual local production of wind turbines. Albayrak said the locally produced turbines would be installed by early 2019 and added that the price was a record. For his part, Siemens Gamesa Turkey CEO Hakan Yıldırım noted that the company has been active in Turkey for the past 160 years. “We will do whatever we can to cut the unit price for electricity,” Yıldırım said. Some 64 percent of the project, YEKA, will be domestic, while 35 percent of the necessary equipment will be imported, said Türkerler Chair Kazım Türker, the construction firm in the wining consortium. “We plan to finance the equipment from foreign resources and use local banks for the remainder,” Türker added. Kalyon Holding Energy Group Chairman Murtaza Ata described the tender as “strategic.”
The Government of Armenian approved at a meeting on Thursday the decision proposed by Armenia’s Ministry of Economic Development and Investments to establish Meghri Free Economic Zone CJSC, the ministry’s press service told Panorama.am. The establishment of the company aims to facilitate the launch of the free economic zone, to provide maximum coverage of the zone’s potential, as well as to attract foreign investments. The construction of a free economic zone at Armenia’s southern Syunik Province, in the area bordering Islamic Republic of Iran, launched at the early 2017. Being a EAEU member, having a privileged trade regime with the EU and sharing border with Iran, with attractive business and investment environment set by international standards, Armenia can attract strong interest for organizing export-oriented production in Armenia, as well as using commercial and logistic opportunities due to the country’s geographical position in case of establishing free economic zone with Iran. The construction of the economic zone features several stages. At the first stage, it is planned to construct the area near the Meghri customs checkpoint, thus ensuring the main production and storage areas, which will make the products manufactured in the zone more competitive to find their way into other markets (namely the Iranian market). This will become a platform for strengthening West-East and North-South ties.
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September 21, 22 Dead Centre, Ireland About Performance:
International Program Dead Centre and Anton Chekhov
Chekhov’s First Play Directed by Bush Moukarzel and Ben Kidd
Venue: Kote Marjanishvili State Drama Theatre | Big Stage Duration: 70 minutes, without intermission Tickets: Parterre – 55; 40 GEL; Balcony – 30; 20 GEL; Beginning: 20:00
I’m having absolutely nothing to do with the theatre or the human race. They can all go to hell.’ – Anton Chekhov During the turmoil of the Russian Revolution in 1917, Maria Chekhov, Anton’s sister, placed many of her late brother’s manuscripts and papers in a safety deposit box in Moscow. In 1921 Soviet scholars opened the box, and discovered a play. The title page was missing. The play they found has too many characters, too many themes, too much action. All in all, it’s generally dismissed as unstageable. Like life. Dead Centre, creators of the OBIE award-winning LIPPY (winner of a Fringe First, Herald Angel Award and the Irish Times Theatre Award for Best Production), return to do injustice to a great playwright. Chekhov before he was Chekhov.
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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: email@example.com; firstname.lastname@example.org United Kingdom of Great Britain and Northern Ireland Embassy 51 Krtsanisi Str., Tbilisi, Tel: 227-47-47 E-mail: email@example.com Republic of France Embassy 49, Krtsanisi Str. Tbilisi, Tel: 272 14 90 E-mail: firstname.lastname@example.org 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: email@example.com Republic of Estonia Embassy 4 Likhauri St., Tbilisi, Tel: 236-51-40 E-mail: firstname.lastname@example.org Republic of Lithuania Embassy 25 Tengiz Abuladze St, Tbilisi Tel: 291-29-33 E-mail: email@example.com Republic of Latvia Embassy 16 Akhmeta Str., Avlabari, 0144 Tbilisi. E-mail: firstname.lastname@example.org 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: email@example.com 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: firstname.lastname@example.org 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: email@example.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 76-g Chavchavadze Ave., Tbilisi Tel: 231-11-61, 231-14-54 E-mail: firstname.lastname@example.org 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 email@example.com Consulate General in Batumi 9 Ninoshvili Street, Batumi Tel: 422 25 58 00 firstname.lastname@example.org Republic of Azerbaijan Embassy Kipshidze II-bl . N1., Tbilisi Tel: 225-26-39, 225-35-26/27/28 E-mail: email@example.com 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: firstname.lastname@example.org 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: email@example.comRomania Embassy
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Freedom Square 0114 Tbilisi, Georgia Tel: +995 32 225 06 19 e-mail: firstname.lastname@example.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: email@example.com
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: firstname.lastname@example.org Website: http://www.hi-tbilisi.com River Side Hotel With incredible service and views Addr: Mari Brosse street turn, Old Tbilisi. Tel: +995 32 2242244; +995 32 2242288 Fax: +995 32 2 242277 Email: email@example.com Website: www.riverside.ge
Restaurants Corner House Tbilisi, I. Chavchavadze ave. 10, Tel: 0322 47 00 49; Email: firstname.lastname@example.org 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,
15 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
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LimelightTravelinfoCenter Address: 13 Sioni Street, 0105, Tbilisi (at the end of Shardeni Street) Phone: +995 322 999 123 E-mail: firstname.lastname@example.org Web-page: www.limelight.ge Facebook page: www.facebook.com/limelight.ge
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
August 7, 2017 #204