Issue #834 Business

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Issue no: 834/22

• APRIL 12 - 14, 2016

• PUBLISHED TWICE WEEKLY

PRICE: GEL 2.50

In this week’s issue...

Prime Minister Promotes Georgia as Trade and Logistics Hub PAGE 2

FOCUS ON THE NEW WORLD OF FDI

The Samtredia Redemption Prime Minister and Ruler of Dubai: Arab businessmen have a growing interest in investing in Georgia’s economy, with a particular interest in tourism PAGE 7

Airline Company Atlas Global Supporting Check In Georgia to Boost Tourism

Georgia's Healthcare Sector GALT & TAGGART PAGE 6

Georgian GMP to Export Medicines to EU Countries PAGE 8

Cannes Young Lions Competition Kicks Off in Georgia

BY ANA AKHALAIA

T

urkish airline company Atlas Global expressed its desire to participate in promoting the planned festivals and concerts of world star musicians in Georgia.

The Georgian Government launched its 29 million GEL (USD 13 million) Check In Georgia project last week which aims at promoting the country’s tourism potential. The project will include a series of high profile events beginning in April and continuing until the end of the year.

Continued on page 2

ISET PAGE 4

PAGE 9

Atlas Global is forming tour packages which it plans to offer to target groups within the Check In Georgia project

The 2nd Edition of Georgia Today Education out NOW! PAGE 11 Prepared for Georgia Today Business by

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BUSINESS

GEORGIA TODAY

APRIL 12 - 14, 2016

Prime Minister Promotes Georgia as Trade and Logistics Hub

BY ANA AKHALAIA

Contact: www.edelbrand.ge Phone: 599 461908

G

eorgia’s Prime Minister Giorgi Kvirikashvili gave an interview to Chinese television CCTV during which he discussed the importance of the ‘New Silk Road’ project and the Free Trade Agreement with China.

The PM expressed hope that the agreement will increase the interest of foreign investors and spoke of his belief in Georgia’s ability to become a trade and logistics hub and support trade between Europe and Asia.

He further added that Georgia has a large-scale

plan for renovation of the infrastructure and in case of its implementation, the competitiveness of the country will increase. He says the ‘New Belt - New Road’, initiative of the President of China offers new opportunities to countries engaged in it.

“The project ‘New Belt - New Road’ is a very important initiative for Georgia, offering a lot of opportunities for all countries across the length of the Silk Road. We consider recovery of the economic route of Silk Road not only as an initiative as a sole route, but as a network of many roads. This is about competitiveness, contacts between individuals and modernizing infrastructure,” PM Kvirikashvili said in the interview.

Airline Company Atlas Global Supporting Check In Georgia to Boost Tourism

Continued from page 1 “When we announced Check In Georgia, we said that the project would have partners from the private sector,” stated the Minister of Economy, Dimitry Kumsishvili. “One of the first was the airline Global Atlas, expressing its readiness to place advertising and promotional materials of the upcoming concerts and events in all of its many destinations. Its support is very important for the project.”

Atlas Global has already started forming tour packages and offering them to the target groups in order to bring additional tourists to the planned events under the Check In Georgia project.

The company has already received three, five and seven-day tour bookings from European countries.

They offered the target groups a list of hotels and important places to visit in Georgia.

Atlas Global will provide famous tour operators with detailed information about planned events in Georgia, create tour packages and promote the Check In Georgia project.

From April 24th live concerts and festivals will be held in cities across the country with the participation of well-known local and international artists including Italian pop singer Eros Ramazzotti and Britain’s Robbie Williams, as well as world renowned Spanish opera tenor Jose Carreras and US pop rock band Maroon 5.

In addition, it is planned to offer exhibitions and sales of local agricultural products, wine and cheese festivals, as well as bicycle tours and hikes in Georgia’s protected areas.

BUSINESS

GEORGIA TODAY APRIL 12 - 14, 2016

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Hualing Kutaisi Free Industrial Zone Enters Active Phase of Development

H

ualing Kutaisi Free Industrial Zone (Hualing Kutaisi FIZ), operational since October 2015, has entered the active stage of its development. The Hualing FIZ represents one of the most important investment projects of Hualing Group in Georgia. It is located in Kutaisi city, on the territory of a former automobile factory, and covers 36 hectares. In accordance with legislation, companies registered within the Hualing FIZ are fully and permanently exempt from profit and property tax, dividend tax, VAT, and import duties. A customs checkpoint is in place in the Hualing Kutaisi FIZ and it operates 24/7, thus enabling companies to carry out import/ export operations in the shortest possible time.

At present over 10 companies are making use of the advantages offered by the Hualing Kutaisi Free Industrial Zone, among them fully functioning wood and stone processing factories, and enterprises producing furniture, mattresses and construction materials.

The Hualing Kutaisi FIZ is rapidly establishing its role as an import/export and processing center in the region.

Companies of various profiles show increasing interest in using the Hualing Kutaisi FIZ for production as well as for import/storage/export purposes.

The reasons for this are many, and include: Strategic internal and regional location of Hualing Kutaisi FIZ, wide availability of ready-made buildings of various size at unique leasing tariffs, simple and cheap business operations, and access to cheap labor broadly avail-

able in the city and region.

As a further important benefit, Hualing Kutaisi FIZ offers no limitations on the maturity of lease contract. Companies also can benefit from already adopted services like cargo loading and unloading, custom brokerage and other services.

Hualing Kutaisi FIZ plans continuous infrastructural develpoments meeting the needs of the registered enterprises, including: high standard internal road expansion, setting up a new railway terminal and connecting it to the main railway, as well as improvement of util-

ities and technical optimization.

The above mentioned advantages, along with numerous other financial and business operational benefits, makes it more and more attractive for the small and medium-size enterprises to operate in Hualing Kutaisi FIZ.

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BUSINESS

GEORGIA TODAY

APRIL 12 - 14, 2016

THE ISET ECONOMIST A BLOG ABOUT ECONOMICS AND THE SOUTH CAUCAUS

www.iset-pi.ge/blog

The ISET Policy Institute (ISET-PI, www.iset-pi.ge) is an independent think-tank associated with the International School of Economics at TSU (ISET). Our blog carries economic analysis of current events and policies in Georgia and the South Caucasus region ranging from agriculture, to economic growth, energy, labor markets and the nexus of economics, culture and religion. Thought-provoking and fun to read, our blog posts are written by international faculty teaching at ISET and recent graduates representing the new generation of Georgian, Azerbaijani and Armenian economists.

The Samtredia Redemption UNINTENDED CONSEQUENCES

Nino Kakulia with her classmates graduating from the International School of Economics

BY ERIC LIVNY

N

ino Kakulia was born in Samtredia on 15 October 1991, in the last days of the Georgian Soviet Socialist Republic. By the time Nino and independent Georgia were celebrating their 13th birthdays, the Georgian government embarked on a series of long overdue reforms, one of which was about cleansing the country’s higher education system from corruption.

This was undoubtedly an excellent and timely reform for Nino, an ambitious student in Samtredia’s

school. Until then, to get admitted into a public university, Nino or, rather, her family, would have had to bribe the gatekeepers, i.e. “academics” serving on the university admissions committee. After 2005, the gatekeepers could no longer take bribes because the keys to academic heaven had been appropriated by a higher up agency, the National Assessment and Examination Center (NAEC).

From now on, decisions about admissions and government grants were to be made based on only one factor: achievement on three nationally-administered standardized tests: Georgian language and literature, foreign language, and problem solving skills. No more corruption, no more reliance on “connections”, and no more nepotism.

Combined with a swift government action to revoke the licenses of almost 200 higher education diploma mills, NAEC dealt a death blow to corruption in the university system. Paradoxically, however, the introduction of standardized tests suddenly made public schooling an irrelevant concept. Private tutoring – directly geared towards success in these tests – has now become the main game in Samtredia. As Nino recalls, school attendance dropped to very low levels with both students and teachers looking the other way (to the private tutoring market).

Merely passing the standardized tests was not a problem for Nino and many other mathematically gifted kids in Samtredia. The challenge was to do better than their peers in order to get into prestigious university programs in Tbilisi (as opposed to those in the nearby Kutaisi) and qualify for government scholarships.

With the entire extended family – aunts and uncles included – providing financial help, Nino started taking private lessons. All went well, and by the end of the 10th grade she was confident in her ability to prepare for the NAEC-administered tests.

Moreover, since Georgia was about to extend the period of (now useless) public schooling from 11 to 12 grades, Nino decided to save a year by moving to Samtredia’s Russian language school, which was not immediately subject to this reform.

Not surprisingly, Nino was not the only one to employ this tactic. Nominally, her class included more than 70 people from all over western Georgia – Poti, Kutaisi, and, of course, Samtredia. On one or two occasions, when most of them did show up for some official business, there were not enough seats for everybody.

Nino remembers her time as a student at Samtredia’s “Russian school” as one of the best periods in her life. United by a common ambition, she became very friendly with her “classmates”. Working in small groups of 5-10 students, they went to the same tutors, and constantly bumped into each other on Samtredia’s streets while going from one “class” – a tutor’s private house – to another.

Samtredia’s private tutoring became a fiercely competitive industry. The best guys in the market, like Nino’s math tutor Murman Kashia, could afford to be selective. With a deep voice and plenty of charisma, Murman became an idol for Nino and her groupmates. To get into his group one had to be smart and motivated.

The entire group of Samtredia’s overachievers graduated from the Russian school – which they hardly attended – in spring 2008 at a ceremony hosted by the local culture house. All five of Nino’s groupmates and most others qualified for governSAMTREDIA is a small town in Imereti, 27 km west of Kutaisi. With a population of less than 30 thousand, Samtredia is one of the most important road and railways hubs on the transport artery linking the Black Sea and the Caspian Sea. It was built in 1870s around a critical railway junction and acquired a town status in 1921.

Due to its strategic location, Samtredia played a prominent role in Georgia’s fight for independence and the ensuing civil war between pro- and anti-Gamsakhurdia forces. From July 26 to 31, 1990, the Samtredia junction was blocked by opposition groups forcing the Soviet Georgian leadership to adopt a liberal election code, thus paving the way for Zviad Gamsakhurdia’s election as Chairman of Georgia’s Supreme Council on November 14, 1990. The junction was again blocked in March-April 1991, this time by Gamsakhurdia’s government, in an attempt to pressure the central Soviet authorities into accepting Georgia’s independence, which was announced on March 31, 1991. In late October 1993, Samtredia became a major battleground in Georgia’s Civil War when forces loyal to Gamsakhurdia briefly controlled the town, threatening all communications to Tbilisi and further east.

Once a food and wood industry center, Samtredia lost its entire manufacturing base. Major local employers are the Georgian Railways, local government and commercial banks. Most occupations are about security, small trade and subsistence agriculture

ment scholarships, redeeming themselves of their underprivileged Samtredia childhood.

REDEEMED, OR NOT? Georgia’s success in establishing a meritocratic system of university admissions was, of course, a great step forward. Yet the system of university education turned out to be much more resilient to change as far as quality is concerned.

There was nothing heavenly about the four years (2008-2012) Nino spent as a student at TSU’s business and economics faculty. In fact, she has a hard time remembering anything she studied there except for math (which was taught at a fairly good level). Most economics and business lecturers appeared to be one chapter (and sometimes only one page) ahead of the students. Gone were the corrupt gatekeepers, but very little changed inside the university walls.

Nino continued her engagement with economics by going through ISET’s MA program. The intensity of ISET curricula and all the hard work she had to put in reminded her of the year she spent at the Russian school in Samtredia. She also found wonderful friends – Nino Mosiashvili, Iako and Natia Katsia, as well as many, many others.

However, acquiring an EDUCATION remained Nino’s elusive dream. Not technical knowledge she learned at ISET. Not econ and business jargon she memorized for TSU exams. Not “problem solving” skills she was taught by Murman Kashia, her Samtredia idol. EDUCATION in the broad sense, of the kind kids around the world acquire at schools and in colleges. EDUCATION that comes with reading and discussions. EDUCATION that helps one navigate ethical dilemmas, judge other people’s views and values, defend own positions, or find purpose in life.

I came to appreciate Nino’s thirst for EDUCATION when, soon after graduating from ISET’s economics MA program, she told me of her plan to get a degree in history. History? – I asked in disbelief. Yes, history, she confirmed. She did not explain, but I think I understood.

STAYING BEHIND IS CERTAINLY NOT A GOOD OPTION Whether Nino Kakulia will get a history degree or not, making it thus far marks a great success. University education (not to be confused with EDUCATION) remains the main channel of social mobility for Georgia’s rural youth. Yet very few are able to take advantage of Georgia’s meritocratic and corruption free university admissions system given the chronic weakness of rural schools, and the lack of funds to hire private tutors or cover the cost of university tuition and living expenses in Tbilisi.

There are very few good options for those who drop out of high school or fail to advance beyond it. A quick survey Nino conducted among her Samtredia classmates is quite revealing in this regard.

More than 2/3 remain in Samtredia or the nearby Kutaisi. The vast majority are lacking professional qualifications. Some of the girls found refuge in early marriage. Others serve as assistants in shops or beauty parlors. The most ambitious among the guys work (or are hoping to get jobs) as security guards, rangers, police or military personnel. Others are doing nothing, or worse. * * * Unified national admission tests are a symbol of Georgia’s Rose Revolution. “Simple and transparent”, they represent everything that was good about Georgia’s first-generation reforms, reforms that put the country on a path towards modernity. Yet, though necessary, such reforms are not a sufficient condition for reaching that elusive destination.

While eliminating corruption in the university admissions system, exclusive reliance on standardized tests tends to aggravate other aspects of the education system. In particular, as we have seen in Samtredia’s example, they reduce the role of schools and weaken students’ incentives for schooling. The ultimate Samtredia redemption will require Georgia to move beyond “simple and transparent” measures and invest –quite heavily! – in the quality of public schools and universities.

BUSINESS

GEORGIA TODAY APRIL 12 - 14, 2016

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PASHA Bank Sponsors ‘Innovations and Digital Economy’ Forum

Construction of Aircraft Manufacturing Factory to Start in Spring

BY ANA AKHALAIA

T

he Partnership Fund, a State-owned investment fund, met with representatives of the Israel-based international defense electronics company, Elbit Systems – Cyclone Ltd., to discuss an aircraft manufacturing factory project, the construction of which is planned to start at the end of spring in Tbilisi, Georgia.

The two parties spoke about the implementation process of the factory project; in particular, the ordering of high-tech equipment and construction-related issues, as well as the possibility of involv-

ing international financial institutions in the project.

According to the Partnership Fund, at this stage, the final construction permits are being worked on and infrastructure issues are being specified, including those with utilities and service provider companies and Tbilisi City Hall.

Final procedures are underway regarding selection of equipment manufacturing companies for the factory and the signing of contracts. JSC Aerostructure Technologies Cyclone (ATC), established for management of the project by the Partnership Fund, and Elbit Systems – Cyclone Ltd., have started selecting specialists, a number of whom will be trained in Israel.

The factory will employ 300 special-

ists, 60 of which will be trained and employed prior to launching the factory.

Elbit Systems – Cyclone Ltd., a subsidiary company of Elbit Systems, produces composite aircraft materials in the city of Haifa, Israel. The company chose Georgia from a number of alternatives to create a reserve capacity.

An estimated USD 85 million has been invested by the Israeli company in partnership with the Partnership Fund. The factory will produce civilian aircraft components with renowned companies, such as aircraft manufacturers Bombardier, Boeing and Airbus – the world’s most profitable companies in the aerospace industry – expected to be among its customers.

P

ASHA Bank supported the ‘Innovations and Digital Economy’ business forum hosted by Tech Park on April 8th, 2016 at which Georgian companies presented their latest successful projects to an avid audience.

PASHA Bank, one of the sponsors of the Forum, provides corporate and investment banking services to large and mediumsized enterprises in the region. The Bank has been operating in Georgia since 2013 and has supported a range of events aimed at development of the Georgian economy.

The latest Business Forum was a joint initiative by the World Bank, magazine Business Georgia and GITA (Georgia's Innovation and Technology Agency) and covered such topics as supporting innovations in business, challenges and spotlighting successful cases.

“Fostering an innovative business environment is of major importance for the country’s economic growth. We were happy to have had the opportunity to contribute to this process by supporting the Innovations and Digital Economy Forum,” said Goga Japaridze, Chief Commercial Officer at PASHA Bank.

A special guest from the World Bank, Mr. Uwe Deichmann, presented the World Development Report 2016 with a main focus on innovations and digital trends prepared by the World Bank’s development research group.

Representatives from Wissol Group, Geocell, ACT, TBC Bank and other companies discussed their innovative projects and experiences at the panel meetings.

The forum hosted over 200 guests from business sector, government and diplomatic corps.

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BUSINESS

GEORGIA TODAY

APRIL 12 - 14, 2016

The Galt & Taggart Research team comprises Georgian and Azerbaijani finance and economic experts who have broad experience of covering the macro and corporate sectors of the two countries. Our current product offering includes Georgian and Azerbaijan macroeconomic research, Georgian sector research, and fixed income corporate research.

For free access to Galt & Taggart Research, please visit gtresearch.ge or contact us at gt@gt.ge.

Georgia's Healthcare Sector FOR GEORGIA TODAY BY DAVID NINIKELASHVILI

S

ector research is one of the key directions of Galt & Taggart Research. We currently provide coverage of Energy, Healthcare, Tourism, Agriculture, Real Estate, and Wine sectors in Georgia. In the previous article, we provided an overview of Georgia’s healthcare reform, while in this article we discuss the sector’s current state. The full report on Georgia’s healthcare sector can be found on Galt & Taggart’s website - gt.ge.

There are 5 major healthcare issues that governments around the world, including Georgia, face: aging population, chronic diseases, access to care, costs, and technology. While the effects of these issues are influenced by local factors, the challenges are shared around the world to varying degrees, as are the opportunities to solve them.

As elderly people demand more care, an aging population is a serious global challenge that burdens healthcare systems. The global population aged 60 or above has tripled over the last 50 years and is expected to more than triple again to nearly 2bn by 2050. The share of 65 and older age group in the total population is at 14.1% in Georgia and is expected to grow further in the long run. While the share is well above the global average of 8.1%, it is in line with the figures in peer countries.

Chronic diseases are the leading cause of mortality globally, responsible for about 80% of deaths.

Chronic diseases include heart disease, stroke, cancer, chronic respiratory disease, and diabetes, all of which are common among the aging population.

According to the WHO, about 30% of cancer-related deaths are due to 5 leading behavioral and dietary issues: obesity or emaciation, insufficient consumption of fruits and vegetables, a lack of physical activity, and tobacco and alcohol use.

Georgia has one of the highest mortality rates by

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chronic diseases of 89.7% compared to regional and income-level averages, despite having relatively low GDP per capita. Generally, real incomes and the share of chronic diseases in mortality rates are positively correlated - Georgia’s real incomes grew 2.9x or a 14.1% CAGR over 2004-12 and the share of chronic diseases increased from 82.4% in 2004 to 89.7% in 2012. Georgia’s share of chronic diseases as a cause of mortality has historically been in line with those of developed countries, where chronic diseases are a more prevalent cause of mortality as non-chronic diseases are preventable in most cases.

Access to care is another serious issue, as globally, at least 1bn persons suffer from a lack of access to

care. The number of hospital beds per 1,000 persons varies greatly, from 1.5 in Mexico to 11.0 in Belarus - a clear sign of the discrepancy in access to healthcare around the world. Over 2002-13, Georgia dramatically cut its excess stock of hospital beds, a Soviet legacy, from 4.2 to 2.6 per 1,000 persons. A major part of new hospital beds came from new hospitals and obsolete bed stock has been partly renovated and partly disposed of. In terms of number of healthcare personnel, Georgia has the 2nd most physicians (4.1 per 1,000 persons) among peers (average of 3.0). In contrast, Georgia has relatively few nurses (0.8 per physician) compared to peers (2.1 average). Moreover, Georgia is the only country

among peers with a ratio below 1 - a negative indicator for the healthcare sector. The WHO, in turn, recommends a 4 to 1 ratio. The undersupply of nurses imposes costs on the healthcare system, due to the resulting inefficient use of physicians’ time and skills.

Across the globe, healthcare costs are increasing rapidly, posing a serious challenge. Based on projected population growth rates, healthcare spending per capita is expected to grow an average of 4.4% annually through 2017, according to Deloitte.

For about 5.6bn people around the world, over half of all healthcare costs are out-of-pocket and 100mn people are pushed into poverty annually due to mounting healthcare costs. Evidence suggests that access to care improves with a larger share of prepayment and a smaller share of out-of-pocket payments. Despite the significant increase in public healthcare spending, Georgia still had the 2nd highest share of out-of-pocket expenditure among peers at 61.9%, compared to the peer average of 34.3% as of 2013. Annual healthcare spending per capita in Georgia has increased 5.5x from US$ 64 in 2002 to US$ 350 in 2013, a 16.6% CAGR. Globally, healthcare is in urgent need of innovation to help stem the tide of rising costs. Advances in technologies and data management can be a tailwind for the sector, facilitating cost savings and accelerating new diagnostic and treatment methods.

However, R&D costs trickle down into prices. To spur the introduction of new equipment, the Georgian government, in 2010, restricted inpatient use of equipment produced before 1998. After the reforms of 2010-11, new hospitals have been opened and additional equipment has been acquired, but up-todate data is not available.

By and large, Georgia’s healthcare sector’s midterm outlook looks favorable on the back of steadily increasing public and private spending. In addition, consolidation that is underway in the sector is expected to allow greater economies of scale, help improve the supply of technology and lead to better cost control, in our view.

BUSINESS

GEORGIA TODAY APRIL 12 - 14, 2016

Georgian PM in Dubai to Promote Georgia as the Best Place to Invest According to Sultan Al Mansouri, Georgia and UAE can even think about the creation of joint tourism packages not only for Arab visitors but for international travelers coming either to Georgia or Dubai. There is an already-established three-hour direct flight between Dubai and Tbilisi providing a fantastic opportunity for tourism connections. The vision is on the international potential of attracting visitors to both countries by utilizing that connection.

PM Kvirikashvili did not miss a chance to focus on Georgia’s highly growing potential to interest foreign companies in investing in the Georgian economy.

He said the key factor and the most important and strongest reason for that is the government’s attempt to build a business-friendly environment.

“We need to transform and reposition our government as a more open and

Prime Minister and Ruler of Dubai: Arab businessmen have a growing interest in investing in Georgia’s economy, with a particular interest in tourism

BY GEORGE SHARASHIDZE, FROM DUBAI, UAE

T

o facilitate Georgia’s positioning as a new destination for Foreign Direct Investment (FDI) on the global business map, Georgia’s Prime Minister Giorgi Kvirikashvili attended the Annual Investment Meeting (AIM) Congress 2016 in Dubai on Monday. AIM, the World’s leading emerging markets FDI platform, is the biggest investment event bringing government and business leaders from over the world to Dubai to discuss new opportunities

for international investment. GEORGIA TODAY, as the key media partner of AIM 2016, was invited to see and feel the spirit behind the organizers’ intention to make Dubai a real platform for discussion of the world’s FDI opportunities.

In addition to participation in the Global Leaders Debate focusing on the new world of FDI, Georgia’s PM had an official meeting with patron of AIM, H.H. Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai.

According to Sheikh Mohammed, Arab businessmen have a growing interest in investing in Georgia’s economy, with a particular interest in tourism.

This statement from Dubai’s Prime

Minister was proven true by a specially organized roundtable meeting hosted by the Minister of Economy, H.E. Eng. Sultan bin Saeed Al Mansouri, which gave the chance for UAE business leaders to listen to Georgian government high officials, lead by the PM, presenting their selected specific investment opportunities across Georgia, mainly in the tourism industry and, more importantly, to meet and discuss investment opportunities with Georgian businessmen, including top business names such as TBC Holding’s Mamuka Khazaradze representing Anaklia Development Consortium, Georgian Industrial Group’s David Bejuashvili, m2’s Irakli Burdiladze, and others.

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transparent institution involving society and the public sector and learning from a fast-changing environment. We are focusing on the creation of a modern state. We are here in Dubai to establish even closer bilateral relationships between the two countries. Despite having already existing investments in logistics and tourism, UAE investors are even more welcome in Georgia. We are glad to discuss new business opportunities.

Georgia is the most open economy in this part of the world. To ensure that there is long lasting stability in Georgia despite the regional and global turbulence, we will keep a constructive relationship with all our neighbors. Georgia is a place of stability and strong economic growth,” PM Kvirikashvili told the UAE business community, of course hoping to increase their investment portfolio in Georgia’s economy.

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BUSINESS

GEORGIA TODAY

APRIL 12 - 14, 2016

Georgian GMP to Export Medicines to EU Countries

BY ANA AKHALAIA

Georgia to G Go Solar

BY ANA AKHALAIA

A

solar power plant is to be built in Gardabani, eastern Georgia. Solar potential studies have already begun, according to the Ministry of Energy, which signed a Memorandum with the ‘Solar Energy Company’ for construction, ownership and operation of the future power plant.

According to the Memorandum, within 12 months the company must carry out a feasibility study and public discussions

in Gardabani, prepare a report on the environmental impact assessment, and submit the relevant proposal of power plant construction to the Ministry of Energy of Georgia.

The solar power plant is expected to have an annual capacity of 120 million kilowatt hours while the total investment of the project is USD 120 million. The generated electricity is to be solely for the Georgian market.

The Solar Energy Company is a representative of the American company Headwall Power International which has many years’ experience in the field of alternative energies.

eorgian company GM Pharmaceuticals (GMP) is preparing to export its medicines to the European market. At this stage, the company produces more than 200 types of drugs and exports more than 100 medicines to 12 countries.

“Our medicines are being sold in the CIS, Central Asian countries and Ukraine.

Soon we will reach the countries of the Far East. We want to cover African and Arab countries and to sell Georgian products in the European market,” said GMP’s General Manager, Giorgi Antadze.

In order for Georgian medicine to enter the EU market, it should pass a number of legal procedures as set out in European Union (EU) legislation, “which is quite tedious and time c o n s u m i n g ,” says Antadze. Before the registration of Georgian medicine on the European market, the quality of medicines should

be checked in laboratories by experts, local authorities should carry out on-site inspections, submitted documents of each medicine should be evaluated and, if European standards are met, then access to the EU market is allowed.

GMP plans to invite an audit in order to pass every procedure necessary to get its medicines onto the EU market. Registration will take about a year and the company expects to be given permission within eighteen months.

GMP plans to compete with high quality and lower prices against European medicines. According to the company’s General Director, producing medicines in Georgia with

the local labor force will enable the company to make its products 20-40 per cent cheaper than those imported from Europe.

GM Pharmaceuticals, located in Tbilisi, Georgia, is the only domestic manufacturer of pharmaceutical products fulfilling GMP (Good Manufacturing Practice) requirements during all lines of operation. Using modern technologies, the company manufactures tablets, filmcoated tablets, sachets and hard gelatin capsules.

BUSINESS

GEORGIA TODAY APRIL 12 - 14, 2016

9

Cannes Young Lions Competition Kicks Off in Georgia the qualifying round, which is already a great achievement. “Many participants emphasized that in one day they have to manage to do a job that usually takes them a few months. So even if they don’t win, it will still be a great experience for them,” he said.

The participation of Georgian specialists in the Young Lions Competitions enables to the country and local companies to promote themselves at both a national and international level. “The participants

Ako Akhalaia and Levan Lepsveridze, representatives of the festival, and Minister of Economy Dimitry Kumsishvili

BY EKA KARSAULIDZE

A

t the qualifying stage of Cannes Young Lions Competition, more than 200 young creative people and marketers are fighting for the chance to represent Georgia in four categories: Marketing, Print, Design and Cyber. Now is the active stage of the competition and the winners will be announced after April 18th.

The organizers of the Georgian selection say that the essence of the competition is to close all participants in the same room for the whole day to work on a specific task. In the Marketing competition, young specialist are expected to produce a two-page brief that would be presented to a communications agency. In the print competition, an art director and a copywriter have to create a print ad. The Design competitors have to create a logo while the Cyber competition asks a copywriter and a web designer to create an online campaign.

The first stage of the qualifying round was held on April 9 and 10 and will continue on April 16 and 17 after which a jury of 30 people, made up of foreign and local experts, will identify four teams of two in each category, which in June will go to the Young Lions Competitions in Cannes – the largest gathering worldwide of advertising professionals, designers, digital innovators and marketers under 30 years old.

Georgia is taking part in the competition for the second time and, in contrast to the first year, the country is already fighting in more categories. “Last year we presented in only one category – Design and got good results,” said Ako Akhalaia, representative of the festival in Georgia. “Later, we were able to get a prize at a second big advertising competition, the ‘Eurobest European Advertising Festival.’ After that, the organizers of Cannes recognized the pool of potential talent in Georgia and allowed us to send experts in three more categories.”

Akhalaia also added that leading advertising agencies and marketers of Georgia are participating in

of the contest claim to be the best in their field.

And I’m sure they really are and the winners will be honored to represent the country at Cannes,” said Dimitry Kumsishvili, the Minister of Economy and Sustainable Development of Georgia during the launch of the qualifying round. “It is well known that advertising and marketing in particular is one of the major driving forces of the economy. Therefore, this competition is very significant for us,” the Minister added.

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BUSINESS

GEORGIA TODAY

APRIL 12 - 14, 2016

A Faberge egg designed for Russia’s Romanov Dynasty. Photo: Art Palace

Private Collection of Georgian Nobility Goes on Display

BY MERI TALIASHVILI

P

recious antique items from many of Georgia’s historic noble families will for the first time be exhibited and sold at Georgia’s Art Palace.

David Lazashvili, the collector who first became interested in acquiring antique pieces from Georgia’s ruling class in 1985 while in the southern Russian city of Astrakhan, will display artifacts from the Bagrationi, Mukhranbatoni, Chavchavadze and Amilakhvari families.

“For me, the main thing is not to sell them but that they finally see the light of day. This collection should stay in Georgia and future generations should be able to see how rich our culture is,” Lazashvili told GEORGIA TODAY. The exhibition also brought together French, Russian, Spanish and Chinese items including imperial vessels belonging to Tsar Nicholas I, paintings from Spain’s Bartolomé Esteban Murillo school and Faberge eggs designed for Russia’s Romanov Dynasty.

Visitors will also be able to see 18-19th century Russian paintings.

The exhibition runs until the end of April at Kargareteli Str. 6, Tbilisi.

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Project Modeled on TEDx Launched in Abkhazia

Tel: (995 32) 2 45 08 08 E-mail: info@peoplescafe.ge

BY TAMAR SVANIDZE

G

eorgia’s breakaway region Abkhazia launched a local analogue of the highly touted TEDx educational conferences with the support of the United Nations Development Programme (UNDP. According to local Abkhaz news agencyApsnypress, a series of interactive presentations for students kicked off at Abkhazia State University on March 29 with the goal of introducing students to modern communication methods.

Gaspar Bergman, the UNDP program manager told local media that the style of the conferences are modeled on the internationally known TEDx talks, which actively encourage interaction between the presenter and audience.

Bergman said the Abkhaz variant had been dubbed the “ASU talks” in reference to the university being used as the venue.

A deputy rector of ASU, Medea Chegiya, was quick to point out that this is not the first collaboration between the university and the UNDP, saying that the UNDP had organized a number of activities to support the educational process at ASU in 2013-2015.

As part of the project, the UNDP is

The conferences are modeled on the internationally known TEDx talks, which actively encourage interaction between the presenter and audience

creating an electronic library for the university where all of ASU’s books will eventually be available.

Abkhazia was devastated by a secessionist war fought against the Georgian government in the early 1990's, immediately after the collapse of the Soviet Union.

Georgian government forces fought three wars against Russian-backed separatist forces in Abkhazia and South Ossetia between 1991-2008. The wars left thousands dead and led to the ethnic cleansing of a quarter million ethnic Georgians.

Once known as a prime holiday destination for the Soviet elite, Abkhazia remains a frozen conflict zone that is not internationally recognized as a state.

Following a brief war with Georgia in 2008. Russia recognized the independence of both Abkhazia and South Ossetia.

The international community and the United Nations continue to state that the regions remain integral parts of Georgia.

BUSINESS

GEORGIA TODAY APRIL 12 - 14, 2016

11

The 2nd Edition of Georgia Today Education out NOW!

BY KATIE RUTH DAVIES

P

acked full of inspiring and entertaining stories, students and teachers are guaranteed to find something they want to Read. Learn. Enjoy.

Meet British billionaire Sir Richard Branson and learn how he made his fame and fortune starting with a magazine and a dream. Alongside him you can learn about a number of young Georgian entrepreneurs who have set up their own businesses to help their local communities. Find out more about the 1.8 million year-old Dmanisi skull and how it changed our perception of human evolution, meet our Editor-inChief, a published Vampire Author, and discover how Earth Hour was celebrated in Tbilisi and around the world. On that ecological theme, we hear from two pupils living in Pankisi Gorge and get their take on the damage we humans

are doing to the environment. Learn new words, get new info and think critically.

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George Sharashidze COMMERCIAL DEPARTMENT

Commercial Director: Iva Merabishvili Marketing Manager: Mako Burduli

GEORGIA TODAY

EDITORIAL DEPARTMENT:

Editor-In-Chief: Katie Ruth Davies

What are you waiting for? Get your copy of Georgia Today Education at any Biblus store or order on 2 29 59 19.

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