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December 3, 2018 - www.cbw.ge

#263

WEEK

Georgia Elects Salome Zurabishvili as First Woman

President

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The 2018 Elections in Figures Political Parties and State Budget Spend about 100 million GEL in Pre-election Period Is it Really so Easy to Start and Run Business in Georgia Today?! Russia-Ukraine Conflict Escalation will Bring Direct and Indirect Effects for Georgian Economy


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Georgia Elects Salome Zurabishvili as the First Woman President

Government Plans to Privatize Post of Georgia and Georgian Railway

Salome Zurabishvili has won Georgia’s presidential election, becoming the first woman to hold the office. With nearly all votes counted, the French-born ex-diplomat had 59% of the vote with rival Grigol Vashadze on 40%. Ms Zurabishvili was backed by the ruling Georgian Dream party while Mr Vashadze was a united opposition candidate.

Government of Georgia plans to privatize Post of Georgia and Georgian Railway, Minister of Economy Giorgi Kobulia told the Bloomberg.

Traditional Georgian Wrestling Added to List of the Intangible Cultural Heritage Georgian Traditional Wrestling “Chidaoba” has been added to UNESCO Representative List of the Intangible Cultural Heritage of Humanity.

Effect by Georgian Tea: 1 GEL of State Budget Earns 0.44 GEL Investment According to Ministry of Environment Protection and Agriculture, as part of tea plantations rehabilitation program – Georgian Tea, a total of 39 projects were financed from 2016 up to August 31, 2018 and spaces of 907 hectares have been rehabilitated or are being rehabilitated.

EBRD Allocates 15 million euro to Develop Tbilisi Ecological and Social Enviroment Today, the Finance Minister of Georgia Ivane Machavariani and the Regional Director of the European Bank for Reconstruction and Development (EBRD) in the Caucasus, Moldova and Belarus, Bruno Balvanera signed a loan agreement on “Tbilisi Solid Waste Project”.

Fitch Revises Georgian Railway’s Outlook to Positive; Affirms at ‘B+ Fitch Ratings has revised JSC Georgian Railway’s (GR) Outlook to Positive from Stable while affirming the entity’s Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at ‘B+’. GR’s senior unsecured debt ratings have been also affirmed at ‘B+’. A full list of rating actions is at the end of this commentary.

Transportation of Oil and Oil Products Declines in Georgian Corridor Transportation of oil and oil products through Georgian corridor has fallen to minimum. Paata Tsagareishvili, founder of Transport Corridor Research Centre and the HUB Georgia expert told BM.GE that all three seaports of Georgia (Batumi, Poti, Kulevi) handled 31% less oil and oil products in January-October, as compared to the same period of 2017.

Ministry of Economy Releases Special Statement on Wizz Air We find it absolutely unacceptable to disseminate this misinformation aimed at misleading our population, destabilizing the situation and damaging the interests of not only one specific airline, but the whole business environment in Georgia. We would like to declare with full responsibility that no restrictions will be introduced against Wizz Air operation. On the contrary, we provide overall support for WizzAir business. The company grows year to year and this process will be continued in the future too.

General Plan to be Developed for Efficient development of Zugdidi Architecture and Infrastructure from 2019 The aim of the initiative is to completely eliminate harmful practice in other cities as chaotic constructions, maintaining the architectural appearance of the city and at the same time moving its urban development into a new stage that is necessary for attracting investments to improve the economic and living conditions of the local population.

SkyUp plans to operate from Kiev to Batumi in addition to Tbilisi The Ukrainian low-coster SkyUp plans to launch regular flights from Kiev to Batumi, besides Tbilisi.

The Editorial Board Follows Press Freedom Principles Publisher: LLC Caucasian Business Week - CBW Director: Levan Beglarishvili WWW.CBW.GE Address: Aleksidze Street 1 Sales: Mob: +995 591 01 39 36 Email: caucasianbusiness@gmail.com Editor: Nutsa Galumashvili. Mobile phone: 595 380382 Copy Editor: Ellie Rambo Reporters: Nina Gomarteli; Mariam Kopaliani; Merab Janiashvili, Economic columnist: Andria Gvidiani; Technical Assistant: Giorgi Kheladze;


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The 2018 Elections in Figures Political Parties and State Budget Spend about 100 million GEL in Pre-election Period In 2018 Government of Georgia has spent about 65 million GEL on election preparations and funding political parties. Averaged 40 million GEL is spent on elections in Georgia, while 12-15 million GEL is paid to political parties a year. The statistics of election costs after 2012 shows that about 35-40 million GEL is spent on each election process. At the same time, funding of political parties and other expenses of Central Election Commission (CEC) keeps growing, such as improving the election environment and so on. For example, in 2012 the CEC budget was 52 million GEL, in 2013 – 58 million GEL; in 2016 – 69 million GEL, in 2017 – 60 million GEL and in 2018 – 67 million GEL, but the runoff poll increased the expenses by about 10 million GEL. Moreover, as compared to the previous years, the election costs considerably increased in 2018 because of the runoff poll and the fact the 2018 presidential elections were announced 2 months earlier. «About 39 million GEL was allocated for the 2018 elections, but the election was appointed not 60 days earlier, but much earlier and the longer period increased the election costs too. Ad hoc members were also appointed in the election administration. As reported, the CEC elects only one member in districts, while the remaining 6 members are appointed by political parties. The extended election period grows salary costs too. As a result, the state budget revision was required. Increased expenses increased the demand by 4 million GEL, but the CEC had reserves of 700 000 GEL and the actual demand constituted 3.4 million GEL. This demand has been already submitted to the Ministry of Finance. Total expenses for the 2018 elections will be about 42 million GEL, of which 1.2 million GEL will be spent on rating issues, 9 million GEL - on TV time of qualified political parties and their representatives”, Tamar Zhvania, the CEC chairperson, said. As to the presidential runoff poll, the state budget has allocated 10 583 022 GEL, of which 167 000 GEL will finance trainings of the election staff. At the same time, under the government resolution, representatives of the election participant bodies will be funded by 381 450 GEL. To better imagine the amount of the election costs, we can draw parallels with other costs. For example, the country spends as much money for each election process as on professional military education (43 million GEL), international peacekeeping missions (40 million GEL) and vocational education (40 million GEL). Expenses for one election process amounts to the total funds spent on immunization (22 million GEL), AIDS management (10 million GEL), providing medications to patients with chronic disorders

(10 million GEL) and drug addicts treatment (9.2 million GEL). Pre-election costs that political parties take are as impressive as millions of GEL spent from the state budget for administration of elections. According to the 2017 indicators, 39 political parties spent more than 39 million GEL on advertising campaigns, business trips and salaries. Two third of these funds (20 607 450 GEL) was spent by the ruling party. It should be also noted that not only influential political parties receive significant funds from the state budget, members of which win seats at the parliament and take more or less active part in the political life of Georgia. The so-called invisible political parties also get portions from the state budget. For example, in 2017 Union of Traditionalists of Georgia received 533 017 GEL from the state budget, Freedom – Zviad Gamsakhurdia’s Way – 543 421 GEL, the New Christian-Democrats – 543 017 GEL. Majority of these funds are spent on salaries. Namely: Freedom – Zviad Gamsakhurdia’s Way spent 306 517 GEL on salaries, Industry will Save Georgia issued bonuses, besides salaries, and total amount made up 237 300 GEL in 2017. As to private donations, Salome Zurabishvili leads in this component too. According to the State Audit, since August 1 through October 28 the presidential candidates have spent about 14 million GEL, including Salome Zurabishvili – 6 351 949 GEL, United National Movement – 1 133 536 GEL and European Georgia – 1 026 784 GEL. These expenses comprise both budget funds and donations and various categories of costs. According to Transparency International Georgia, from August 1 to October 15 Salome Zurabishvili, backed by the ruling party, and five other candidates of qualified political parties spent 6 911 676 GEL, including Salome Zurabishvili 4 124 047 GEL (60%), Grigol Vashadze – 1 485 604 GEL and David Bakradze – 882 313 GEL. According to these indicators, the costs taken by Salome Zurabishvili exceeds Grigol Vashadze’s expenses three times and surpasses consolidated expenses of all five opposition presidential candidates 1.5 times. In the runoff period, the ratio of Salome Zurabishvili in total donations made up 87% (3 592 724 GEL). As to Grigol Vashadze, supporters donated 535 599 GEL to him (13% in total donations). According to the organization indicators, a total of 621 persons made donations to Salome Zurabishvili and 157 of them had made donations to other political parties in previous years. A total of 137 physical bodies have donated to Georgian Dream and they have transferred 1 750 900 GEL to Salome Zurabishvili, which is 22% in total donations.


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Is it Really so Easy to Start and Run Business in Georgia Today?! According to the World Bank's Doing Business report for 2018, Georgia has moved from 16th to 9th place among the countries where doing business is most attractive. There are several components which Georgia have improved since the last year including insolvency and contract enforcement process, tax administration, real estate registration and starting of business operations. As the Ministry of Economy and Sustainable Development of Georgia says, Georgia is still distinguished in the European and Central Asian region as a country that has taken significant steps towards better and more effective regulation. Prime Minister of Georgia, Mamuka Bakhtadze stated that the strategy of the government political team is to make Georgia an economic and financial hub for the entire region. According to him, the government is doing everything to improve the business and investment environment. Even while Mr. Bakhtadze was Minister of finance, he noted that, in Georgia registration of companies and opening of bank accounts will be available online for non-resident persons. This will be an unique opportunity to become Georgia the region's financial center, Prime Minister says, but the reality is different. . Commercial Expert, Chairman of the Tax Committee of the International Chamber of Commerce of Georgia and Managing Partner of GLCC Law Firm Mr. Irakli Gaprindashvili speaks about the hindering factor of foreign investments in Georgia:

with relationship with the commercial banks not only in case of cross-border transactions but even within opening of a bank account, not only for non-resident companies which is almost impossible today, but also for the local companies. Banks became a hindrance especially for the companies that are registered in Free Industrial Zones which are located in Georgia and which are operation according to the Governmental decrees and law of Georgia on Free Industrial Zones (FIZ).

Is it really so easy to start and run business in Georgia today?

Well, the reason banks declare is a risk of money laundering, but I think this issue was and will always be on the agenda and it is not reasonable to justify limited opening and operating of FIZ companies accounts for this purposes.Till now Government has no reaction over this issue and as I’m aware there is no instruction from National Bank of Georgia to commercial banks for this purposes, so the banks are just avoiding additional headache and control obligations of cross-

As we are all aware, starting of business is not only connected with registering a company in one day and for this purpose you also need at least to open a bank account for your company which gives you possibility to start financial operations with your business partners, including cross border financial operations which till mid of 2018 was very common and easy to do from Georgia. Nowadays foreign investors face significant problems

What role does Georgian Government have in this process? Till now, Georgian Government has been promoting this sector in almost every international business forum and tries to attract more foreign investors in Georgian FIZs. But how the foreign investor will start business if every 2nd request for opening of a bank account is rejected by almost all Georgian commercial banks without any justification for FIZ companies? Of course none of foreign and even local investors will try to enter FIZ if this issue will not be solved or regulated in such form that it will be known in advance

what kind of requirements are for bank transactions and what kind of limitations business may face. What is the reason behind it and why Government has no reaction on this problem?

border transactions with simple rejection on opening of bank accounts. But why does this limitation apply only to the FIZ companies or it also covers other companies? This is a question that I also have in mind because FIZ company is an ordinary Georgia based Company and the difference is only in taxation part. FIZ Companies have tax preferences according to the Tax Code of Georgia and that’s why it was attractive for international investors to register FIZ Company. Otherwise, this is an ordinary Georgian Company that should follow all local laws and regulations. Therefore, I do not see any common sense in this situation. What is the solution from your perspective and what will be outcome if this problem is not solved? I attended Ukrainian Business Forum held in Kiev last week and there was a big interest towards Georgia and especially to FIZ institution form participants but almost all of them were aware of the problems that their colleagues are facing with the banks right now. I see huge perspective for developing Georgia as a business and financial hub of the region today but the problem should be solved before it becomes more painful in frames of attracting new investments in the country. Government should be more involved in such issues and as a banking system is a regulated system, there should be a clear rule and standards for the banks as well as for the business how to act in a proper way to proceed business operations with good faith, otherwise we will lose millions of foreign investments which could be accumulated in or transferred through the Georgian financial institutions. By Diana Inanashvili


Maiko Chitashvili: "Be Friends with Media, It’s Your Second Half!" Interview with Project Manager of Communications Agency "Publicity Group", Strategic Communications Expert Maiko Chitashvili. Why did you decide to enter this field, and what kind of opportunities does it give in terms of career growth? At the age of 18, when I was choosing a profession, I wouldn’t say I knew my dream or desirable profession would be in the direction of communication. Now that I remember, my dreamed looked like being a journalist, working at television, at least being a weather-girl. in the 90s, when I was an abitur, it was almost impossuble to have an access to this fild, and generally, communication and marketing seemed even exotic to us. That was the time I wanted to try something diffrent, and was lucky that Public Relations faculty was opened. I think appearing in this space defined success. This field developed along with me and my colleagues, when there was time I found it difficult to even explain what this profession meant. We had first NGO working on PR’s development, that now is a part of history. This generation has more resource to make their career better. Me, my friend and sister established first advrtising-education magazine, that was huge innovation back then, we would create, work, and increase demand in this direction ourslves. This is important to create your own image and reputation and make your resource desirable. What does it take to create successful brand and creative concept, what are the steps for it? When we start branding, which combines complex activities, it's important to define who we are, what our audience is like, what we want to show the customer and how we want to be conceived by target group, how to compose and what will it distinguish us in a competitive environment from others that can easily remember our product. These are the basic stages that are necessary during work. However, if you do not have a simple plan with a creative and different approach, what's outstanding, it will be difficult to talk about a particular result. Tell us about the most successful campaigns you have implemented and what was the key to success? Activities in this area does not include work only on campaigns. There are many interesting and memorable details in the strategic planning process and daily activities. I think campaigns are the simplest and most obvious and visible component that I remember most. One of the most interesting campaigns is the last case when I was working on the topic of Mustafa Chabuk, a Turkish teacher, my devoted friend. There was a large scale and multifaceted process, starting from the idea of formation

to lobbying campaign at the European Parliament level. Perhaps it is noteworthy as it was not only for one person’s saving to extradatiom, but it was a big step for country’s image too. We created a precedent that ultimately played a positive role, and most importantly, we have achieved the goal. I think the success of the project has come from a well-calculated plan and tireless work. When you tell yourseld ‘’I can do it!’’ - That will work out. In addition to our specialty, we should be quick, creative, thinker, quick response to situations. I think my 9-month working process and especially the last 3 months campaign has become a success not only for me but for many people. I have a great sense of responsibility when I am working on a correctly planned plan, it is a game of chess, where you know more and more about what the competitor will do and you are ready to make his move. What three tips would you offer someone just starting out in PR? Be creative, spread the wings! manage any situation quickly and wisely! Be friends with media!it’s your second half. Describe your typical work week. The typical working week necessarily involves several projects simultaneously. Meet with partners and customers, go to regions, or at least communicate with regional media. I am starting a week with a team meeting and distributing weekly themes. Planning, shooting, and working on the media component - are common trends during the week. Busy schedule is a common component of each week. However, it is interesting every day, and most importantly, it is not tedious and does not work on one topic or one product for a week. One of my projects gives me the opportunity to work with young people, which is another stimulus, learning more from a new generation. What has changed in the PR industry over the last five years? Change and dynamism are active in our profession. The representatives of the field became more multifunctional. We are planning to create content, write, get, distribute, share, meaning we do a lot of things in a short time. Social media development and the rapid growth has increased our not only activity but also the pace and made us more mobile. Time, pace, technological changes - these are the factors that make our field’s representatives learn to overcome new challenges, we need to focus on content and not on traditional approaches. Time is a crucial factor- especially for our job.

What skills are needed for a successful PR Manager? Writing skill is very important, if we put it more accurately, one needs to know how to create content. Strategic planning is a must-have for PR Specialist. What are some of the growing trends in the public relations industry? Last year we worked in the direction of publicity. ge in terms of video releases and new directions of virtual reality. At that time we had to contact public relations specialists and media representatives. The survey revealed what are the expectations of the media, what they are asking for and what actually works in the field of communications. Keys that were successful 3 years ago, might not affect society nowadays. Demands are made by public, which forces us to use those approaches. These trends are: • Complete transformation into new media, ie, traditional press releases should stay in th past - that has already been revealed in recent years; • Real-time Marketing - "We sell" stories in the moment and in that period when the news is hot; • Visualization. Visual perception probably is one of the main challenges, which has caused by a shaky pace and even competition. This can be video or pictur that sells brand/product; • Content Marketing; • Influencer Markting- especially through micro influencers; • The involvement of opinion leaders is still actual; • Acquired social media and traditional social media integration. • Digital storytelling and mobile reporting; • Measurement of engagement, and this refers to the measurement of data that allows us to determine the dose, character, attitude What your predictions about PR industry, what challenges will it face in 5-10 years? Recently with the initiative of our organization Mr. Denis Wilcox, one of the well-known experts of the sphere, held a meeting of the representatives of communications. One of the topics that we have addressed is the challenges that will be more clear in a few years. It will be a few years since the digital industry and digital media will completely transform and replace traditional media. In fact, the field goes on to reduce the cost of human resources.Specialist needs to become a multi-functional in this field to be successful.

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8 December 3, 2018 #263

Business News Georgia Closer to EU Forestry Standards and Practices

On January 25, the iconic club Berghain will host a showcase of BASSIANI, where HVL, Kancheli, Zitto, Ndrx, Anastasia Kristensen, Machine woman, Temp-Illusion and the anonymous guest will perform.

An EU twinning project between Georgian, Lithuanian and Hungarian forestry civil servants has resulted in recommendations to bring Georgia closer to EU forestry standards and practices.

Tiflistex Company to Export Georgian made Socks to EU The Tiflistex Company’s socks will be sold in the EU. The company will send its first batch to the EU at the end of the month. Radisson Blu Iveria Tbilisi awarded “Best Business Hotel” by Business Traveller Magazine Readers Infrastructure from 2019

Outdoor Wrestling Arena Constructed in Borjomi With the support of the EU and Borjomi Municipality, an outdoor wrestling arena has been constructed in Akhaldaba village as part of a rural development project under the European Neighbourhood Programme for Agriculture and Rural Development (ENPARD).

Hotel Autograph Collection Builds Hotel in Abastumani With the initiative of the Georgian Tourism Development Fund, a 5-star hotel of Marriott International Network Autograph Collection will be built in Abastumani. General Plan to be Developed for Efficient development of Zugdidi Architecture and

The aim of the initiative is to completely eliminate harmful practice in other cities as chaotic constructions, maintaining the architectural appearance of the city and at the same time moving its urban development into a new stage that is necessary for attracting investments to improve the economic and living conditions of the local population.

Radisson Blu Iveria hotel Tbilisi is proud to be announced as the “Best Business Hotel” in former CIS region and neighbouring countries at the award ceremony held by Business Traveller Magazine on Friday 16th of November in Moscow. m² Company Opens Construct2 Civil Engineering College

Stamba Hotel Wins Award of Concept of the Year at AHEAD Awards Europe

On the 19th of November 2018, at the awarding ceremony held in London, Stamba Hotel received the prestigious AHEAD Awards Europe prize for the best New Concept of the Year.

m² Real Estate company has held a ceremony for inauguration of Construct2 civil engineering college. Representatives of m², BK Construction, local self-government and news agencies attended the ceremony. The project is to prepare professionals for the construction sector and foster the sector development.

Berghain Meets Bassiani – Berlin to Host Bassiani Night

Bins for Waste Separation Placed in Tbilisi Bins for waste separation have been placed in Tbilisi. Deputy Mayor of Tbilisi Maia Bitadze got familiarized with the working process at Tamarashvili Street in Vake district. Pursuant to her, each residual that will be placed in this stands will be processed as a secondary product.


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Russia-Ukraine Conflict Escalation will Bring Direct and Indirect Effects for Georgian Economy On November 25 Russian naval vessels rammed and arrested two Ukrainian military motorboats and tugboat in Kerch Strait. Kyiv announced 60-day martial law. As a result, the confrontation between two countries reached a new peak. Naturally, new challenges arose before Georgian economy. The reason is clear – Russia and Ukraine are one of the major trade partners. Consequently, developments in Ukraine are reflected on Georgian-Ukraine bilateral economic cooperation too. Ukraine has become Georgia’s key exports market, especially in the years, when Russia closed borders for Georgian product. Russia-Ukraine confrontation affects economic positions in both countries, as well as on their trade-economic partners, including on Georgia. Effects will become evident later. Consequently, experts only keep supervising political and economic developments in the context of Ukraine-Russian confrontation. American and British officials appraised the recent Russia-Ukraine sea confrontation in the Azov and Black Sea waters as a hazardous escalation, violation of international norms, regional destabilization, encroachment on territorial integrity of Ukraine, economic expert Rati Abuladze noted. At the same time, Russian officials appraised the situation Ukrainian provocation and hazardous incident. They referred to necessity of de-escalation and dialogue for the problem resolution. The Region and neighbouring countries, including Georgia, will have to pay serious price in case of the conflict escalation and new aggression. Regretfully, Georgian economy remains vulnerable to regional challenges. Therefore, conflict resolution issues will make direct and indirect effects on Georgian economy. We can specify the following economic challenges that accompany regional conflicts: downturn in investments, foreign trade turnover, consumer and business activities, tourism and capital flows, fluctuations on financial markets, Rati Abuladze said. “Today Ukraine and Russia are Georgia’s one of the major trade partner countries (the list also includes Turkey, China, Azerbaijan, Germany, the USA, Armenia, France and Italy). Georgia actively uses exports and imports potential of the mentioned countries. Actual facts prove that in January-October 2018 Georgia’s trade turnover with Ukraine and Russia constituted 1.675 billion USD. In the same period, imports from Ukraine and Russia made up 1.12 billion USD, while exports to Ukraine and Russia amounted to 486.9 million USD. It should be noted that 80% of products from Ukraine are exported by sea (through Azov and Black Sea) and escalation and destabilization may become one of the challenges to Georgia’s trade environment. The volume of foreign direct investments from Russia and Ukraine are also very important. Namely, in 2017 FDI inflows from Russia made up 47.7 million USD, while FDI inflows from Ukraine constituted 5.3 million USD. Number of visitors arriving in Georgia from Ukraine and Russia has been also growing year to year. Namely, in 2017 their number reached 1.3 million persons, in January-October 2018 the number of visitors exceeded 1.4 million persons from the mentioned countries. Regretfully, it should be noted that amid the regional conflicts Georgia remains face to face with the country with geostrategic interests. Georgia remains face to face with political challenges, frozen conflicts and border problems, while the country lacks resources for resolving the mentioned challenges. Ultimately, I would like to note that in short-term perspective, UkraineRussia conflict will not be resolved and therefore, amid the expectations of conflict escalation, Georgia should increase its readiness in terms of financial, economic and geopolitical aspects, Rati Abuladze said. The fact Ukraine has announced martial law signifies economic positions in this region and the neighbouring countries (turnover in the Black Sea basin) may worsen and these developments may effect Georgia too, economic expert Vakhtang Chumburidze noted. Considering the mentioned circumstances, banking institutions will suspend

issuing money resources near the conflict zones. Moreover, the World Bank (WB) abstains from allocating assistance packages to the countries, which announce martial laws, referring to risk factors, until resolution of conflicts and de-escalation of situation, Chumburidze said. “It is also noteworthy that Ukraine announced the counter-terrorism operation in the conflict regions for a period of only 4 months. This decision was related to assistance that the country has been receiving over the past years and visa liberalization process. We have seen that the 4-month counterterrorism regime is being continued for 4 years. I think there is jeopardy that the recently announced 30-day martial law may be continued in Ukraine for a longer period”, Chumburidze noted. As to the effects on Georgia, Chumburidze explained that Ukraine suffers from the same Russia aggression as Georgia. Territories of both countries have been invaded. If the Georgian Authorities passes a resolution in support of Ukraine, Russia may carry out the same attack or take any other aggressive steps against Georgia. “ I would also recall one fact – when the borderline was shifted in Tusheti and protest rallies erupted in Ingusheti, these developments were related to Russian provocation to a certain degree. As to economic situation, if Russia starts blocking the Black Sea basin, cargo turnover will decrease in the direction of Georgia too, because Poti and Batumi seaports are related to Odessa seaport to a certain degree, where Odessa and Ilichevich seaports shape a reception and distribution corridor. I believe Georgia should show caution, because we do not have favourable political and economic situation and in case of Russian provocations, our economy will reap disastrous outcomes”, Chumburidze said. There is a pre-crisis situation in Ukraine, economic expert Vakhtang Khomizurashvili says. Any hostilities and political tension effects economic positions. There may be certain risks in this situation, including for exporters, because Ukraine and Russia are major trade partners for Georgia and payments may grow risky, Khomizurashvili noted. A lot of partners of Ukraine may become unable to fulfil their liabilities, Georgia’s exports to Ukraine may decline and this will make negative effect on money flows, he added. As to new presumable sanctions against Russia and Georgia’s role in this respect, Khomizurashvili noted that 60-70% of Georgian exports depend on Russian market and similar scenario will bring negative outcomes for our country. “Prior to taking a political decision, our Authorities should analyse all expected outcomes of this political step. Therefore, I believe we should follow the interests of Georgia. We should comprehensively analyse these expected outcomes. Negative effect implies a decrease in money flows and this fact will naturally effect and stage extra burden on GEL. Therefore, the GEL exchange rate may become uncontrolled”, Khomizurashvili noted. We remind you that both Russia and Ukraine are Georgia’s major trade partners. Following Azerbaijan, Russia ranks second as Georgia’s trade partner. January-October exports to Russia made up 351 million USD. Trade turnover is growing with Ukraine too. The January-October exports to Ukraine exceeded 135 million USD. Russia and Ukraine remains major trade partners in terms of imports too. As to key commodity items that Georgia exported to Russia in January-October, ferroalloys rank first, wines rank second and spring water is third. Imports from Russia is also growing. In the reporting period, oil and oil products ranked first. As to Ukraine, according to Geostat, national statistics service of Georgia, Georgia exported vehicles to Ukraine. Spirits, wines and spring waters are also reported in top five exports items. Imports from Ukraine mainly consists of cigars and tobacco products. Steel fittings and other solid wastes are also registered in the list of imports items.


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World News

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The EU Plans to Test an AI Lie Detector at Border Points Trials for AI lie detection at border patrol checkpoints are set to begin soon in the EU. The program, called iBorderCtrl, will run for six months at four border crossing points in Hungary, Latvia and Greece with countries outside the European Union, as reported by Gizmodo.

Armenian Restaurants Close their Doors in Protest at Tax Hikes Azerbaijan, UK to Discuss Co-op in Alternative Energy Field The next UK-Azerbaijan Joint Intergovernmental Commission (JIC) is planned to be held on April 4-5 2019 in the UK, Steve Smith, the Head of Trade and Investments Department of the UK Embassy in Baku told Trend.

Armenia’s restaurants are set to protest the new tax regulations by closing their doors for a one-day strike. The new regulations will see restaurants forced to pay tax on turnover – at 10 per cent.

Armenia is the Largest Exporter of Brandy within CIS Business Armenia has released a marketing package presenting investment opportunities of agro-food sector. It is addressed to foreign investors and is presented under “Select Armenia” brand with “Make your move, Select Armenia” slogan.

ASB Group Opens Budapest Office Turkish Rönesans, Sonatrach to Invest $1.2 bln in Petrochemical Plant Turkish conglomerate Ronesans Holding and Algeria’s Sonatrach have announced they will invest $1.2 billion to build a petrochemical facility in southern Turkey.

“The Hungarian market is a great opportunity for ASB Group,” said Petr Studnička, managing partner of ASB Group. “The Hungarian economy shows interesting macroeconomic indicators for foreign investors and the real estate and retail markets, in which ASB Group has a strong presence, are growing very rapidly and are very attractive.”

Ukraine-Russia Sea Clash: Merkel Rules out Military Solution German Chancellor Angela Merkel has stressed there is "no military solution" to the naval confrontation between Ukraine and Russia off Crimea. On Sunday Russia fired on three Ukrainian ships sailing towards the strait between the Black Sea and the Sea of Azov, and seized their crews. Ukrainian leader Petro Poroshenko has urged Nato to send ships to the area. Mrs Merkel blamed Russia for the crisis, but said it could only be resolved through "sensible dialogue". IMF's Lagarde Warns of worse Trade Hit to Global Economy How Did Microsoft just Overtake Apple as the World's most Valuable Company? The software giant took the top spot on Monday, after concern over lower iPhone sales sent Apple shares lower — eliminating the margin of just a few billion dollars that had separated the companies.

The impact of escalating trade tensions on global growth are worse than feared just one month ago, and threatened US car tariffs could cut a large chunk out of the world economy, the IMF said today. over from the electric car maker's founder, who remains chief executive.


Profile for Caucasian Business Week

Caucasus Business Week #263  

1. Effect by #Georgian #Tea: 1 GEL of State #Budget Earns 0.44 GEL Investment 2. #EBRD Allocates 15 million euro to #Develop #Tbilisi Ecolog...

Caucasus Business Week #263  

1. Effect by #Georgian #Tea: 1 GEL of State #Budget Earns 0.44 GEL Investment 2. #EBRD Allocates 15 million euro to #Develop #Tbilisi Ecolog...

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