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NEWS
GEORGIA TODAY
MARCH 10 - 12, 2020
Forbes: Why Does Everyone Suddenly Want a Free Trade Deal With Georgia? @entrepreneur.ge Gamarjoba! I’m the Editor-in-Chief of the Georgian edition of Entrepreneur magazine and I’m here to share the top weekly Entrepreneurial news with you: The ‘Georgian Drivers Academy’ (GDA) is set to speed up development of the tourist sector. Rento Group, the “best transportation management company in Georgia,” is working with Opera Management to improve the quality of transportation service in the country, and bring it to the highest level. This includes English language courses and a cycle of trainings on transport service protocol, international etiquette, and more. Tsvara is a Georgian company that in its design traditions dates back to the V-VI cc. BC Georgia. Making it a contemporary business is the work of scientist, painter and jeweler, Vazha Kutateladze, whose handmade pieces are unique. 25 galleries in Georgia have Tsvara’s beautiful jewelry on display, as do online platforms, and the personal store of Tsvara. Soon, Tsvara is planning to show the world the wonders of Georgian jewelry traditions. Bottiglia Di Vino’s wine is made in Kakheti, at the base of a wine factory, but the company is building its own branded factory on its own land in 2020 as it is currently producing 200,000 bottles a year. The brand offers 9 kinds of wine: Saperavi, Mukuzani, Kindzmarauli, Khvanchkara, Alazani Valley White, Alazani Valley Red, Pirosmani Red, Pirosmani White, Akhasheni, Rose, and Tsinandali. The company is already exporting to China, Greece, and Lithuania and has plans to expand further afield. Follow the Entrepreneur Georgia Instagram page to get the latest updates from Georgian Entrepreneurs. For doing business with Georgian Entrepreneurs, write us on business@entrepreneur.ge
BY ANA DUMBADZE
W
hy does everyone suddenly want a Free Trade Agreement (FTA) with the small, Black Sea nation of Georgia? The answer to this question can be found in an article recently published by Forbes, a leading American financial-economic magazine. The author of the article, Kenneth Rapoza, notes that the idea is that free trade deals with smaller nations don’t really hurt the American blue-collar labor force as they are not going to be ideal places to relocate corporate resources to, or build new factories in. "Georgia’s been supportive in Afghanistan, a war Trump finally wants to wind down after more than 18 years there. How about giving them something in return? That’s part of the sales pitch," the author emphasizes. The article reads that in November, former Congressman from Florida James Bacchus, the ex-Chairman of World Trade Organization’s Tribunal, wrote in favor of an FTA with Georgia in the Financial Times. An FTA with them “would reassure other countries in the region that…the US continues to offer an alternative to acquiescence to the authoritarian regimes that surround and threaten them,” he wrote, an obvious nod to the Russians. Georgia shares a border with Russia. President Trump prefers one-on-one trade deals rather than to follow World Trade Organization norms for tariff rates among member nations. As such, “until we can revive the multilateral negotiating process, we should be negotiating bilateral trade agreements with some of the economically emerging countries that are our friends as well as with our major
The National Bank Decides to Simplify Regulation of Lending to Individuals BY MARIAM MERABISHVILI
T
he Financial Stability Committee of the National Bank of Georgia has decided to simplify the regulation of lending to individuals. As the National Bank explains, mitigat-
ing the regulation means reducing the administrative burden for credit lenders, increasing risk management flexibility and reducing the number of income margins determined for loan service coefficient. It is not yet known exactly how much the loan margin will be lowered. “It should be noted that the basic principle of regulation is unchanged and the lending organization should not impose a
trading partners,” Bacchus said in an interview. “Georgia should be on this list.” In addition, the author notes that a month prior, James Carafano and Alexis Mrachek from the conservative Heritage Foundation made similar arguments. "Their support centers around Heritage’s popular Economic Freedom Index. It ranks Georgia on par with Luxembourg. Actually, in 2019, it ranked one point ahead of them," he claims. The Forbes article notes that Georgia was invaded and occupied by Soviet Russia in 1921. "It became independent during the unwinding of the Soviet Union in 1991. But the Russians came back in 2008 and illegally occupied territory in Georgia’s South Ossetia and Abkhazia regions." The author writes that the main directions of the Georgian economy are: services, tourism, raw materials, wine and light manufacturing. It is ranked 7th in
the world in the World Bank’s Ease of Doing Business index, one place behind the US, ahead of the UK, Norway, and Sweden. They have a six-year-old Association Agreement with the European Union, meaning there is free movement of goods and people between the EU and Georgia, and already have FTAs with China and Turkey. "Heritage has been pushing for a USGeorgia FTA for roughly eight years, citing the China free trade deal with them as another reason why the US should do it. "The idea resurfaced out of the Washington think tanks and into congressional offices in 2015 during the Obama Administration. The timing of the push for a Georgia FTA coincided with Russia’s push to annex parts of Ukraine. A Georgia FTA was viewed as both a shrewd political and commercial move to bolster security and American business opportunities," reads the article.
Coronavirus Leads Ryanair to Reduce Flights from Italy to Georgia
financial obligation on the debtor whose service is of considerable financial difficulty to the consumer”. The provision on lending to individuals came into force on January 1, 2019. At present, loan servicing ratios are divided into four groups according to their monthly income: up to GEL 1000, GEL 1000 to 2000, GEL 2000 to 4000 and more than GEL 4000.
BY ANA DUMBADZE
I
rish budget airline Ryanair will reduce flights from Italy to Georgia due to the new coronavirus outbreak, the airline said on its official website. “Ryanair has been forced to cancel up to 25% of all Italian short-haul flights for a three week period from the 17th March to 8th April, in response to the Covid19 virus. "All impacted customers have been notified by email and SMS and given the option to request a refund, rebook or re-route their journey,” the airline said
in a statement. Ryanair said Milan-Tbilisi flights would be performed until March 7, while the number of flights will be reduced to two from March 8 to April 7. Bologna-Kutaisi flights were carried out until March 7, and suspended from March 8 to April 7. Some restrictions are being imposed on flights from Italy to Joran, Israel, Czech Republic, and Montenegro. Hungarian low-cost airline Wizz Air has also reduced the number of flights from Kutaisi Airport to several Italian cities due to the coronavirus risk. The company representatives claim that the reason for the restriction is a decline in demand for flights to Italy.