Issue #828 Business

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Issue no: 828/19

• MARCH 22 - 24, 2016

• PUBLISHED TWICE WEEKLY

PRICE: GEL 2.50

In this week’s issue...

Armenia Suggests Creating Joint Regional Tourism Package with Georgia and Iran PAGE 2

BMW: Blocks My Way… Around Tbilisi!

ISET PAGE 4

FOCUS

ON THE WORLD IN 2016

Georgia Today Group brings together top officials and business leaders to analyze regional and global potential for growth

PAGE 3

Rose Revolution Square to Be Transformed into Recreation Area

BY EKA KARSAULIDZE

B

erlin-based GRAFT Architects, which designed and planned the refurbishment of the Radisson Blu Hotel Iveria in Tbilisi in 2009, are to undertake the reconstruction of the hotel’s surrounding territory.

The company announced their winning of the competition to develop a proposal to transform Rose Revolution Square (Rose Square) on their website.

According to their plan, Rose Square in the heart of Tbilisi will become more attractive to visitors with a new multifunctional public space offering a variety of features and facilities.

Continued on page 2

The new Rose Square,

by GRAFT Architects.

Photo from GRAFT’s official website

Georgia Wins Best Banknote Award 2016 PAGE 5

Georgian Delta Plans to Export Flak Jackets and Helmets PAGE 10

For the Love of WineAcclaimed Wine Writer Publishes Book about Georgian Wine PAGE 11 Prepared for Georgia Today Business by

Markets As of 18ͲMarͲ2016

Price

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Price

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GBP 20.21

+3,1%

+4,7%

GEOROG 05/17

100.56 (YTM 6.35%)

+0,1%

+1,5%

GHG (GHG LN)

STOCKS

GBP 1.58

Ͳ2,2%

Ͳ8,1%

GEORG 04/21

107.29 (YTM 5.21%)

+0,9%

+2,0%

TBC Bank (TBCB LI)

US$ 9.66

Ͳ2,4%

+1,7%

GRAIL 07/22

105.69 (YTM 6.63%)

+0,7%

+2,5%

GEBGG 07/17

103.69 (YTM 4.75%)

+0,2%

+0,5%

Price

w/w

m/m

41,20

+2,0%

+20,2%

1 255,40

+0,5%

+2,0%

Bank of Georgia (BGEO LN)

COMMODITIES Crude Oil, Brent (US$/bbl) Gold Spot (US$/OZ)

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GEL / USD

2,2800

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Ͳ8,1%

GEL / EUR

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2,5696

Ͳ4,1%

Ͳ6,7%

Price

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GEL / GBP

3,3126

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FTSE 100

6 189,64

+0,8%

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2,3621

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16 901,32

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0,0334

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9 950,80

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+5,1%

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0,7953

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Ͳ4,8%

17 602,30

+2,3%

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1,4122

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DAX DOW JONES NASDAQ

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126,61

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0,0857

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MSCI EM

826,75

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EUR / USD

0,8873

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SP 500

2 049,58

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GBP / USD

0,6908

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MICEX

1 914,02

MSCI FM

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CHF / USD

0,9695

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2 459,34

+1,6%

+7,3%

RUB / USD

68,2400

Ͳ2,1%

Ͳ10,7%

GT Index (GEL)

886,18

+0,0%

Ͳ0,0%

TRY / USD

2,8675

Ͳ0,0%

Ͳ3,4%

GT Index (USD)

755,80

+4,8%

+7,1%

AZN / USD

1,5850

Ͳ4,8%

+1,7%

2

BUSINESS

GEORGIA TODAY

MARCH 22 - 24, 2016

Syrian-born French billionaire, Mohed Altrad, meets with Georgia’s Prime Minister Giorgi Kvirikashvili

Franco-Syrian Billionaire Mohed Altrad Visits Georgia

BY TAMAR SVANIDZE

T

he 2015 World Entrepreneur of the Year Mohed Altrad, has been on a visit to Georgia’s capital Tbilisi.

The Syrian-born French billionaire met with Georgia’s Prime Minister Giorgi Kvirikashvili on Friday to discuss investment opportunities in the country.

Altrad also planned to conduct a lecture about entrepreneurship for Georgian university students.

Altrad owns France’s elite rugby club Montpellier and heads the namesake city’s Altrad Group,

Contact: www.edelbrand.ge Phone: 599 461908

one of the world's leading manufacturers of scaffolding and cement mixers, with 92 global subsidiaries and revenues exceeding USD 1 billion.

According to Forbes, Altrad is France’s 39th richest citizen.

Born in what is now ISIS’ de facto capital, Raqqa, Altrad left Syria for France at the age of 17 when he earned a scholarship to study in Montpellier.

Having arrived in the country with only USD 35 in his pockets, he later converted his misfortune into a multi-billion dollar business empire.

Altrad also met with the Georgian Minister of Economy and Sustainable Development, Dimitri Kumsishvili, and Deputy Minister Ketevan Bochorishvili during his stay.

Armenia Suggests Creating Joint Regional Tourism Package with Georgia and Iran

BY ANA AKHALAIA

A

rmenia is suggesting the creation of a joint regional tourism package with Georgia and Iran, says Mekhak Apresyan, head of the tourism department of the Ministry of Economy of Arme-

nia.

Apresyan says Armenia is planning to develop new markets in the field of tourism and to create new tourist products, and enhancing contacts with Iran and Georgia will be discussed in this regard.

He explained that, taking into account the recent developments in Iran, Armenia is going in the direction of intensifying tourist plans and is offering to create a joint tourist product.

“It is possible that the project will engage Georgia,” said Apresyan, adding that the fact that Georgia has recently eased the visa regime for Iranian citizens has contributed to the potential of the

Mekhak Apresyan, head of the tourism department of the Ministry of Economy of Armenia

project. “I believe that such cooperation can be useful for all three countries, as a result of establishing the ‘Tourism Corridor’,” he said.

Apresyan added that Armenia’s visa clearance procedure is quite simple and that a visa can be received in a foreign country, as well as at the borders of Armenia. Further, he said, taking into account that daytime flights are temporarily limited in Tbilisi airport due to the rehabilitation of the runway, Armenia airport is able and willing to take on all necessary passenger flow.

Rose Revolution Square to Be Transformed into Recreation Area Continued from page 1 While currently Rose Square is only an inbetween space used as a parking area, it has great potential. Specifically, the new Rose Square will consist of a folded surface. Floating above the ground, it will hover over the city center and serve as a connection between different levels and areas.

“Positioned along a slightly inclined surface, the new Rose Square creates a connection to the underground areas the square was built on during the 1970s. There will be new retail and restaurant areas and sunken gardens. A new underground pedestrian path will connect the Radisson Blu Hotel Iveria with Rustaveli Avenue. The design reflects the distinct features of the capital’s terraced topography and re-animates to date unused potentials of variating urban landscapes,” the project description says.

The main area at the very heart of the new Rose Square is conceived as an urban amphitheater, a platform for public and spontaneous performances. The area in front of the Radisson Blu Hotel offers the possibility to create water mirrors and fountains which will refresh the visitors during the hot summer months. Moreover, in winter, it can be transformed into a space for ice-skating, as seen by the success of the temporarily installed ice-rink this past season.

This second project by GRAFT in Tbilisi is expected to be carried out this year.

GRAFT Architects was founded in 1998 and has today become one of the most well-known design studios. It has implemented dozens of projects around the world and has won many awards, among which were Design Award of the Association of German Architects 2013, European Prize for Architecture 2011, International Architecture Award 2009 and more.

BUSINESS

GEORGIA TODAY MARCH 22 - 24, 2016

3

Analyzing Georgia's global potential for growth The conference, sponsored by SOCAR, Microsoft, 2030 and Adjara Group, brought together ministers, local industry leaders and foreign experts for a day of panels

BY ROBERT ISAF

G

eorgia’s brand-new Technology Park hosted a packed conference last Friday celebrating the launch of The Economist's ‘The World in 2016’, Georgian edition by the Georgia Today Group. The conference, sponsored by SOCAR, Microsoft, 2030 and Adjara Group, brought together ministers, local industry leaders and foreign experts for a day of panels on topics ranging from Georgia’s agricultural outlook to the challenges facing its highest-tech entrepreneurs.

The Economist’s annual “World in…” issue is a book-sized special edition of the venerable Britain-based magazine, published at the beginning of each calendar year with a raft of predictions for the coming twelve months. “The World in 2016” is the 30th such publication. The Georgia Today Group, which owns the Georgian rights to the magazine, has

licensed the annual “World in…” edition every year since 2009, publishing it in Georgian and with roughly 20% additional localized content.

According to George Sharashidze, founder of Georgia Today Group, the aim of Friday’s conference was “to generate new ideas for a more efficient performance of both the government and private sectors through critical analysis of Georgia’s challenges and potential for growth in both a regional and global perspective.” The panels narrowed that focus to questions of agriculture, tourism, entrepreneurship and innovation, and the economy generally.

On balance, an optimistic tone was struck regarding ongoing developments here in Georgia. Minister of Agriculture Otar Danelia managed a particularly breathtaking tightrope act in his commentary, which, following questions, grew to be quite extensive. On the one hand, he smiled, “our farmers are now cultivating lands that have been cultivated before,” speaking to a spike in interest in and investment into Georgia’s

definitive sector. On the other, he highlighted the very real shortcomings that remain, and create a situation where, despite the nation’s growing output, “we have about 25% in losses because we cannot store it properly.”

That lack of sufficient storage facilities and practices served perhaps as well as any other issue to highlight the three main problems that emerged again and again in panels throughout the day: technology, infrastructure, and education. On all fronts, although further action was urged, panelists assured their audience of the work already underway. Acknowledgement of the work already completed, meanwhile, was somewhat inescapable, the government-initiated ‘Tech Park’ hosting the conference having only been inaugurated a number of weeks ago.

On the infrastructural front, Dimitri Kumsishvili, Minister of Economy and Sustainable Development, was able to boast about the more than USD 3 billion which is already allotted for projects over the next five years, including fiscal year 2016. Those projects include a tun-

nel from Mestia to Racha, and a number of new train lines branching off the trunk line through Kutaisi. Bruno Balvanera, from the European Bank for Reconstruction and Development (EBRD), “fully subscribed to” and followed up the minister’s comments with some lucky numbers to play. “This is a country that has been building 50, 60, 70 km of road every year,” he said. “This cannot be… now, the country needs to build 170, 200 km a year. Because the world is not going to wait for Georgia to have these roads.

Georgia needs to have these roads for the world to come.”

Mr. Balvanera continued to make an impassioned case for specialized education, whether in order to train a generation of young, tech-savvy innovators or to bring standards of hospitality service up to international levels, as necessary in keeping Georgia competitive internationally. “It is extremely important that wherever you go in Georgia you have very good service,” he said. “Service at international standards; service in English; service in Russian. And in that

respect I think it’s very, very important that we also focus on enhancing the capability and to help successful entrepreneurs like Adjara Group.”

Adjara Group, for its part, was represented by Valeri Chekheria, who, speaking briefly but very effectively, radiated dynamism on behalf of the company and sector. Speaking of the Group’s flagship Rooms Hotel, he found his fire not in attracting international clientele to the properties in Georgia, but on expanding the properties to Europe, where at least two Rooms projects are underway and where, he noted, “we’re in negotiations with a few capitals.”

Speaking of the yet-unnamed 350-bed hostel being pursued in Tbilisi, he emphasized that, although Adjara Group hoped to attract more – “and new” – visitors to Georgia, the hostel will also be actively courting its domestic clientele. “The strategy we have at the moment is directed towards Georgian Management of a Georgian Product,” he said.

This is not just a business interest – this is in the interest of the country.”

4

BUSINESS

GEORGIA TODAY

MARCH 22 - 24, 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.

BMW: Blocks My Way… Around Tbilisi!

BY FLORIAN BIERMANN

T

he Quality of Living Survey 2012 of the international consultancy group Mercer ranks 222 cities in the world according to how livable they are.

Tbilisi was ranked on Place 213, provoking furious reactions by many Georgians. On the internet, it is easy to find wild slanders against those who created the ranking and even against those who just referred to it, and there was even an online petition initiated against the ranking.

Without any question, the survey does not capture crucial factors that impact the quality of life.

Tbilisi, unlike Lagos in Nigeria that was ranked on Place 202, is a city where one can walk around even at night without being harassed or mugged. Street crime has been completely eradicated. Moreover, since the anti-corruption measures took effect, Tbilisi’s citizens and visitors are not bothered unnecessarily by government representatives. There is no abuse of power by the police, and government

officials do not charge bribes for their services.

This is worlds apart from other cities that were ranked close to Tbilisi, like Khartoum in the Sudan.

Last not least, Georgians have a culture of decency and hospitality that largely prevents them from cheating or ripping off guests and their fellow citizens. This hugely increases life quality. And one could further extend this list of Tbilisi’s advantages...

However, if one compares Tbilisi with some of the cities in the top 10 of the ranking, like Vienna (Place 1), Zurich (Place 2), Vancouver (Place 5), and Copenhagen (Place 9), there is one striking factor that distinguishes all these places from Tbilisi. The most livable cities in the world go a long way to make the inner city districts attractive for pedestrians, not for cars. Tbilisi, on the other hand, is a city for cars, not for people.

ANTIQUATED CITY PLANNING Up to the 60ies of the preceding century, the ideal of a “car city” was pursued by progressive city planners worldwide. The idea of pedestrian subways originated in that time – while cars had the

BMW parked on the sidewalk, Zandukeli Street, Tbilisi

privilege to drive on the surface, enjoying sun and fresh air, pedestrians had to go through tunnels that were built under the streets. Complex road structures as the one on Heroes Square in Tbilisi were typical for those times and could be found all over Europe. Nobody anticipated the problems of automobile transportation, everybody was expected to have a car, and it was deemed unnecessary to take into account pedestrians’ needs. On the wave of car enthusiasm, even public transport was reduced. Many cities got rid of their light rails (trams), considered to be mere obstacles for smooth car traffic. While this happened in many cities decades ago, in Tbilisi the light rail was scrapped after the Rose Revolution.

Very soon, however, the vision of a car city turned into a nightmare. As we know today, positive atmosphere in a city is a comprehensive experience that consists of shopping opportunities, cafes and restaurants that preferably have their tables under the open sky, and walking around in a nice environment that comprises green areas, street artists, and beautiful buildings. In a car city, on the other hand, walking around is unpleasant. There is noise and pollution, and cafes and restaurants do not have their tables outside. Street life is non-existent, and with it any positive urban atmosphere goes down the drain. Due to the lack of customers, shops and department stores disappear, and the inner districts of car cities become concrete deserts. The pedestrian subways become stinky, dark tunnels, and people go a long way to avoid using them.

Already in the 70ies, municipalities all over the world tried to correct their mistakes. Broad sidewalks came at the price of having fewer lanes for the cars. Not so in Tbilisi: on the newly renovated Agmashenebeli Ave the sidewalks are often so crowded that one can walk only at snail’s pace. At the same time, the planners decided to have three car lanes in the middle. The Agmashenebeli concept would already have been outdated in the 70ies.

In many car cities, the inner districts had transformed into giant parking decks. The beauty of buildings was hardly enjoyable if cars piled up in front of them, and the sidewalks were misused as parking space, further deteriorating the walking experience. Tbilisi today gives a good impression how it was elsewhere in the world in the beginning of the 70ies. In response, cities began to reserve parking lots to the residents of the inner city districts, and parking bans were strictly enforced.

Some cities set up large central parking decks, but it turned out that the ample parking space they provided drew additional cars into the city. The most prudent municipalities therefore opted for artificially restricting the availability of parking space, forcing people to resort to means of public transport.

Pedestrian subways were systematically shut down. In order to allow people to cross streets, there was a high density of traffic lights and pedestrian crossings. Speed limits reduced pollution and made cycling less hazardous. Today the central

avenues in cities that live up to modern standards have strictly enforced speed limits. Rustaveli Avenue, on the other hand, is like a 6 lane high way.

But who wants to drink a coffee and enjoy street life next to a highway?

Prudent cities try actively to deter people from entering the inner city districts by car. All over the world, there are now sophisticated systems in place that allow commuters to park their cars in the outskirts and then continue to the city center by public transport. This requires an upgrade of public transport, which indeed takes place in many cities – new light railways are built from Jerusalem to Berlin at high costs. In some cities that now build new light rails, trams were abolished 50 years ago.

WHY CHANGE ANYTHING? Don’t dismiss the Mercer ranking too lightheartedly – if you are used to Tbilisi and you walk through Vienna or Copenhagen, you will feel the difference immediately. Tbilisi’s city planning is not lagging some years behind, but it is outdated by 40 years.

Yet it is not only some ranking where Tbilisi could improve considerably through the application of modern city planning. The issue has also concrete economic implications.

One is health. Georgia ranks Place 98 according to its life expectancy. Switzerland, represented with Geneva and Zurich in the top 10 of the Mercer ranking, is the country with the second highest life expectancy in the world. While the average Georgian gets 73 years old, the average Swiss citizen dies at an age of 83 years. Of course, there are multiple reasons that cause this difference, but there is no question that car pollution is highly detrimental for health. This is particularly true in a country like Georgia, where many cars with old and very old engines are populating the streets.

In the last years, it became clear that so called particulates emitted from car engines are highly carcinogen and can cause lung problems. These tiny particles, much smaller than ordinary dust, can get into the finest capillaries of the lung and from there even into the blood vessels. As a reaction, strict regulations have been imposed in the European Union, on some days forcing municipalities to block cars from entering the inner city districts to keep the particulate density below the allowance. Without any doubt, the European standards are violated in Tbilisi each and every day.

Another issue is tourism. I was amused to read that an official of the tourism authority claimed that tourists were more concerned about the availability of public toilets in Tbilisi than about the difficulties to cross streets. While virtually no tourist uses public toilets, walking around in Tbilisi is a stressful and unpleasant experience no tourist can escape from. Surely, this is no minor concern for people who want to enjoy their holidays here.

While many problems of Tbilisi are related to a lack of financial resources, making the city attractive through a modern city planning would cost nothing.

BUSINESS

GEORGIA TODAY MARCH 22 - 24, 2016

5

Georgia Wins Best Banknote Award 2016

BY EKA KARSAULIDZE

T

he National Bank of Georgia was awarded the Best Regional Banknote of the Year 2016 at the High Security Printing Europe conference. The upgraded Lari currency series shared first place with Kazakhstan’s 20,000 Tenge banknote. Reconnaissance, the organizers of the Conference, revealed the winners by their outstanding achievement in design, technical sophistication and security of banknote series in Bucharest, Romania, on March 15.

The Georgian winners were the new 20 and 50 Lari banknotes which went into circulation in February 2016. The new designs were based on the existing series, featuring Georgia’s cultural and historic heritage, but were given a distinctly different and more modern appearance. The new banknotes are fitted with safety signs, obtained as a result of a high-tech process, which are easily noticeable to the consumer. They also include plotted plates to facilitate the visually impaired to identify denominations.

Reconnaisance uploaded on its official website other advantages of the new Lari series. “The new notes include a holographic stripe in which the image matches the portrait on the note, iridescent stripe and a demutualized color shift window thread. The mould-made watermark also matches the portrait, and is supplemented by an electrotype with the denomination and the currency symbol for the Lari. Additional security features include visible and UV fluorescent fibres, latent image,

Essential Oil Crop Production to Get GEL 3.5 Million Investment

BY ANA AKHALAIA

Photos by National Bank of Georgia

see-through feature and microtext.”

The National Bank of Georgia noted that this was the first redesign in the currency’s 20 year history. The upgraded 5, 10 and 100 Lari banknotes will soon be released into circulation throughout Georgia.

The Regional Banknote of the Year Award is an international award among European and CIS countries. Other countries nominated in the Award, alongside

G

eorgian company Green Village is to invest 3.5 million GEL in essential oil crop production in the Guria region of western

the Lari and Kazakh Tenge, were the new 20 Euro by the European Central Bank; the Swedish Krona, new series by the Swedish National Bank; the new 20,000 Forint by the Hungarian National Bank; the new 200 Shekel by the Bank of Israel; the 500 Hryvnia by the National Bank of Ukraine; the 100 Jubilee Ruble banknote by the Central Bank of Russia; and the banknote series by the National Bank of the Republic of Belarus.

Georgia.

The company plans to build a citrus oil processing plant on 272 hectares of land in Ozurgeti municipality, Guria, cultivate bergamot and bitter orange species on 60-60 ha land plots and use remaining land for planting and experimental farming of other essential oil crops, such as iris, jasmine, eucalyptus, camellia and laurel. The production will also introduce new breeds. In total, more

than 150,000 crops are to be placed in the area.

Essential oils will be obtained from the raw materials in the company-owned processing factory which is to be built in Kobuleti, Adjara region.

The projected GEL investment will be spent on the purchase of planting materials, seedling growth, infrastructure, planting, equipment purchase, construction works for processing, a laboratory, and office buildings.

After implementation of the project, the company will employ an additional 45 people and 400 people during the crop harvesting period.

The company Green Village was founded in 2011 and its main business is growing and processing oil-bearing crops.

6

BUSINESS

GEORGIA TODAY

MARCH 22 - 24, 2016

LAW: CoE Ministers Discuss the “Mass Deportation Incident” with Georgia, Russia Comes Out Unscathed

Committee of Ministers of the Council of Europe examine how Russia implemented the European Court of Human Right’s judgments

PREPARED BY VAZHA TAVBERIDZE

O

n March 8-10, the Committee of Ministers of the Council of Europe examined how Russia implemented the European Court of Human Right’s judgments, including on the case “Georgia v. s.Russia (I)” (judgment final on 03/07/2014) which concerned the arrest, detention and expulsion of large numbers of Georgian nationals from the Russian Federation from October 2006 until the end of January 2007. The Court established that, from October 2006, a coordinated policy of arresting, detaining and expelling Georgian nationals had been implemented in the Russian Federation, amounting to an administrative practice.

This practice led the Court to find the following violations: • the expulsion of Georgian nationals without a reasonable and objective examination of the particular case of each individual (Article 4 of Protocol No. 4); • arbitrary arrests and detentions of the Georgian nationals (Article 5 § 1 and 13); • the absence of effective and accessible remedies available to Georgian nationals against the arrests, detentions and expulsion orders (Article 5 § 4); • conditions of detention in police stations and detention centers for foreigners and a lack of effective remedy regarding the same (Articles 3 and 13).

The Court also found that the Russian authorities had failed to comply with their obligation to furnish all necessary facilities to the Court in its task of establishing the facts of the case (violation of Article 38).

Finally, the Court invited the parties to submit observations on the same within 12 months.

The Russian authorities submitted

initial information on 22 October 2015 and an action plan on 17 December 2015, while the Georgian authorities submitted an analysis of the judgment on 8 December 2015.

With regard to general measures, the Russian authorities note that the European Court established that the administrative practice in question concluded in January 2007. They consider that there is nothing in the judgment, nor are there any subsequent European Court judgments, to indicate that similar violations have taken place since. Furthermore, they explain that, since January 2007, Russian domestic law and practice have been fundamentally reformed to provide adequate safeguards against administrative practice and the collective expulsion of foreign nationals in the future. They indicate that the available statistics show that, under the new mechanisms in place, Georgian nationals are treated fairly: in 2014, more Georgian nationals entered the Russian Federation than left (32.3 thousand v. 28.2 thousand, respectively).

They considered, therefore, that the current Russian law and practice have established adequate legal and institutional safeguards against the use of administrative practices, inter alia, concerning Georgian nationals.

The Committee of the Minister acknowledged that the Russian authorities have submitted a large amount of information related primarily to general migration policy as well as the procedures and safeguards governing administrative detention and administrative expulsion now in place in the Russian Federation. The ministers conceded that a number of developments have taken place since the relevant period, including legislative amendments, changes to domestic court practice and jurisprudence, new governmental resolutions, and new orders and instructions for agencies involved in administrative expulsion and detention.

Notwithstanding the above, the Euro-

pean Court maintains its firm opinion that a coordinated policy involving, inter alia, the police, the Federal Migration Service and the courts had been implemented in the Russian Federation at the relevant time (from October 2006 until January 2007). All the violations found by the European Court were set against the background of this coordinated policy and the large number of Georgian nationals involved. Indeed, the European Court did not doubt that, even at the relevant time, remedies existed before the higher courts in the Russian Federation against arrest and detention and against expulsion orders.

However, it considered that, during the period in question, there were real obstacles for the Georgian nationals in using them as a result of the procedures carried out before the Russian courts, as described by Georgian witnesses.

These witnesses stated that they had been brought before the courts in groups; some had had an interview with a judge lasting an average of five minutes and with no proper examination of the case; some had not been allowed into the courtroom at all and had waited in corridors or even in the bus that had delivered them to the court; they had been ordered to sign court decisions without having been able to read the contents or obtain a copy; they had had access to neither an interpreter nor a lawyer; and they had been discouraged by both judges and police officers from appealing as they were informed that there was an order to expel Georgian nationals. The Court also noted in that respect the climate of precipitation and intimidation in which the measures were taken.

In conclusion, the Deputies welcomed the detailed information submitted by the Russian authorities regarding, in particular, the developments in the Federal Migration Service, in the supervision carried out by prosecutors and the practice of the domestic courts.

10 Galaktion Street

Burchaladze’s Foundation Focuses on Economic Relations with the US

BY EKA KARSAULIDZE

F

ormer famous opera singer, Paata Burchuladze, is currently conducting a number of highranking meetings with local authorities in the United States (US). The head of ‘Paata Burchuladze – Georgia Development Fund’ also announced the opening of the Foundation’s office in Washington. Burchuladze claimed that one of the main priorities for his Foundation will be establishing better economic and trade relations with the US. In the framework of the working visit, Burchuladze held a series of meetings with senators and representatives of the US Atlantic Council, civil society and business in which they discussed significant issues such as Georgia’s justice system, the transparency of government activities, foreign trade and the country’s ability to attract foreign direct investment, agriculture, education, science, innovation development, as well as Georgia’s participation in peacekeeping missions.

Burchuladze assessed the meetings as very productive and said that the US side had expressed great interest in what

is happening in Georgia. “Ratification of the Document on Free Trade with the United States will contribute to the deepening of trade and economic relations between the two countries. This will help to attract foreign investment and strengthen Georgia’s position in the international arena, as a strategic partner of the US,” stated Burchuladze at his meeting with senator Cory Gardner.

In addition, Burchuladze also introduced the authorities to the aim of the creation and mission of his Foundation.

“I want Georgia to choose freely and in an educated way. That is why I ended my operatic career and created a foundation which will unite the Georgian community and contribute to the economic growth of the country,” he said.

Paata Burchuladze launched his social and political Foundation in December 2015 to “finish an era of fear and unprofessionalism in the country.” Moreover, Burchuladze himself does not exclude that the Foundation may become a political party and take part in the parliamentary elections in October 2016, “if the country needs it”.

The former opera singer has already opened the first US office of the ‘Paata Burchuladze – Georgia Development Fund’ in Washington and plans to create another in Los Angeles.

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

BUSINESS

GEORGIA TODAY MARCH 22 - 24, 2016

7

Visa International: Georgia One of Leading Countries in Region in Implementing Innovative Technologies

BY MERI TALIASHVILI

V

isa International representatives Mandy Lamb, Andrei Aleikin and Hector Rodriguez visited Georgia to share information on the latest global trends in the digital payments industry, visa strategy on prevention fraud scheme and the company's vision for the future development of the market opportunities in the country.

At the press conference it was stated that Georgia was the first in the region to implement HCE (Host Card Emulation) technology in online payments.

The country was the first to issue Visa PayWave and contactless micro tag stickers in the South Caucasus, with 28% of all face-to-face Visa transactions in Georgia made on Visa PayWave cards in September 2015.

Additionally, Visa International plans to invest more in the development of the online payment industry in the future, launching innovative products; providing secure and reliable payments for its clients and deepening established partnerships with Georgian leading

Mandy Lamb, Andrei Aleikin and Hector Rodriguez on their recent visit to Georgia

banks, government and law enforcement agencies.

“Visa’s business is focused on growing electronic payment and displacing cash in the system,” said Mandy Lamb, Group Country Manager in the Commonwealth of Independent States (CIS) & South East Europe (SEE), at the press conference. “With Georgia one of the most progressive and innovative coun-

tries in the region, and a flagship market for Visa PayWave and contactless payments, we believe that we are very much on track to achieving this goal.”

According to Andrei Aleikin, Senior Director, Emerging Products & Innovations CIS&SEE, Visa offers its users a payment ecosystem and a safe and reliable payment system for a variety of commercial practices for vendors and

financial institutions.

“Visa introduced a new network system called ‘Visa Developer’ – an open platform for developers which enables customers to have direct access to new Visa services. In this direction, we plan to further deepen new e-commerce practices for our customers who increasingly rely on mobile payment practices,” Aleikin said.

“In the footsteps of the innovative trends in the world, Visa’s aim is to provide its customers with reliability and safety any time they use a visa card.

Our team is working on prevention of fraudulent schemes and establishing a data security standard in online payments - we are collaborating with Georgian partners in this direction,” said Hector Rodriguez, Regional Risk Officer in Central and Eastern Europe, Middle East and Africa (CEMEA).

Visa International is a global payments technology company connecting consumers, businesses, financial institutions and governments in more than 200 countries and territories to fast, secure and reliable electronic payments. The company operates one of the world’s most advanced processing networks— VisaNet—that is capable of handling more than 56,000 transaction messages in a second, with fraud protection for consumers and guaranteed payment for merchants. Visa is not a bank and does not issue cards, extend credit or set rates and fees for consumers. Visa’s innovations, however, enable its financial institution clients to offer consumers more choices: pay now with debit, ahead of time with prepaid or later with credit products.

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BUSINESS

GEORGIA TODAY

MARCH 22 - 24, 2016

Castello Mare Hotel to Open in Summer in Tsikhisdziri

Porta Batumi Tower to be Completed This Summer

BY ANA AKHALAIA

C

onstruction of the multifunctional residential complex and hotel, Porta Batumi Tower, is scheduled to be completed in summer, 2016.

The construction process was inspected

by Georgia’s Prime Minister, Giorgi Kvirikashvili, on March 16th.

Construction of the multifunctional residential complex and hotel in Batumi started in June 2013 and USD 70 million

has been invested so far.

Porta Tower is designed to world-class standards and will be the highest residential complex and hotel in Georgia.

Porta Tower is equipped with various sized studio-type and two-three bedroom apartments, as well as 12 penthouses with a view of the sea and mountains.

Aside from the residential spaces, Porta Tower also includes a two-story underground car park for residents and 12 shopping areas on the ground floor. The complex will also add a 100-room hotel with terrace restaurant and fitness-spa center, café and office spaces.

BY ANA AKHALAIA

C

astello Mare Hotel is set to open in summer, 2016, in Tsikhisdziri, a town located on Georgia’s Black Sea coast.

The project is being carried out by the company Green Cape, who

say the hotel should have opened at the end of 2015, but was delayed.

According to the company’s representative, Vako Kuvshinov, construction of the hotel is nearing completion. The hotel will be managed by an as yet unnamed foreign company with whom negotiations are apparently on-going.

According to Kuvshinov, the information that penthouse rooms will cost USD

20,000 per night is not true. The pricing policy will be determined by the management, however, hotel prices will be acceptable, starting from USD 200 for a standard room.

The five-star hotel will include 125 rooms, 4 conference rooms, a restaurant for 250 people, parking for 100 cars, sauna, spa centers, medical and other services. The project will cost USD 30 million.

BUSINESS

GEORGIA TODAY MARCH 22 - 24, 2016

Georgian Wool to Be Exported to EU

BY ANA AKHALAIA

T

wo Georgian companies named ‘Georgian Wool’ and ‘Georgian Wool Company’ have received permission from the European Union (EU) to export wool to Europe. Georgia was added to the list of third countries which can export raw (unwashed) wool. It is the first Georgian product of animal origin to be allowed to enter the European market.

According to the National Food Agency, the State's role in the successful completion of negotiations was large and the government did everything necessary to get recognition of Georgian wool from the EU. At this stage, both companies are carrying out negotiations.

“The State has taken a major responsibility on itself for quality control,” Deputy Director of the National Food Agency, Mikhail Sokhadze, told Georgian media outlet Business Contact. “The frequency and the export price, of course, depends on the business. They need to collect the quantity and quality of wool that the partner demands. In

this case, our European colleagues felt confidence not only in a private company, but the country as a whole. In fact, Europe has acknowledged that the veterinary system is functioning in Georgia.”

Sokhadze says the Veterinary Service periodically controls those enterprises in which wool is collected and at the same time constantly monitors sheep and goats. It is important to collect the wool only from healthy animals. In the future, the State will provide all wool-producing companies with recommendations that meet the EU criteria.

Georgian Wool is holding negotiations with several European countries, including Germany and Estonia, and plans to send small containers from the outset while, according to Georgian Wool Company Director Zaur Kuliev, his company is currently in negotiations with British partners and plans to export 22 tons of wool. If the British are satisfied with the quality, the company will expand export.

The Georgian Wool Company exports wool to Ukraine and India but the market price is significantly low there which is why the company plans to hold further negotiations with Germany, Estonia and Italy and hopes to deliver up to 200 tons of wool monthly.

Georgian Livestock Exports Top USD 1 million in 2016

BY TAMAR SVANIDZE

G

eorgian livestock exports to Qatar and Saudi Arabia have exceeded USD 1 million so far this year, the Ministry of Agriculture’s National Food Agency reports.

Up to 11,800 Georgian sheep have so far been exported to both respective Gulf States in 2016.

National Food Agency Ministry of Agriculture

carries out veterinary checks throughout Georgia in order to induce the export potential of livestock.

“In order to ensure animal health, the National Food Agency continues to monitor and carry out vaccinations for a variety of diseases. This significantly contributes to livestock safety and increases export potential,” said Mikhail Sokhadze, Deputy Head of the National Food Agency.

According to the statistics of the Agricultural Ministry, the main importers of Georgian livestock are Iran, Azerbaijan, Saudi Arabia and Qatar.

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10

BUSINESS

GEORGIA TODAY

MARCH 22 - 24, 2016

Georgian Delta Plans to Export Flak Jackets and Helmets Georgia’s Azeri Community Celebrates Novruz

BY TAMAR SVANIDZE

BY ANA AKHALAIA

G

eorgianMilitaryScientificTechnical Center (STC) ‘Delta’ plans to export its flak jackets and helmets, before which it will be able to fully meet the requirements of the Georgian army.

According to STC Delta, the company’s production capacity will fully meet the needs of the Georgian Armed Forces who will be supplied with STC Delta produced flak jackets and helmets as ordered by the Georgian Min-

istry of Defense.

“In the near future another Georgian battalion will leave for Afghanistan and it will be the first unit to have equipment produced in Georgia,” states STC Delta.

In the process of creating individual protection systems, STC Delta’s specialists took into account international standards and requirements of the military unit. The technology has been improved and new products have a much higher standard.

STC Delta is engaged in the Defense Industry and provides technical support for the Georgian Armed Forces concerning ammunition, military vehi-

cles, specialized buildings and fortifications, implementation/application of new weapons systems and their subsequent support, humanitarian demining and demilitarization works.

The main mission of STC Delta originated from the state interest of Georgia and their national defensive strategy. The main task of the Center is facilitation of the development of the national military industry, designimplementation in the production of up-to-date and innovative military technology, design, creation and serial production of combat equipment and armament that meets the requirements of world tendency.

G

eorgia’s minority Azeri community is celebrating the arrival of spring with the traditional Persian New Year festival of Novruz.

Originally an ancient Zoroastrian religious celebration, Novruz dates back more than 3,000 years and is one of the most popular holidays of the diverse nationalities that once comprised the vast Persian Empire.

Azerbaijan, Iran, Iraq, Lebanon, Afghanistan, Mongolia, Pakistan, Uzbekistan, Turkmenistan and Tajikistan all mark Novruz as a national public holiday.

Special springtime foods, extensive cleaning and elaborate family gather-

ings mark the holiday. On the eve of Novruz, families gather to decorate the graves of relatives as an act of remembrance.

Preparations for the holiday begin a month prior to the arrival of spring. The four weeks leading up to Novruz are dedicated to the Earth’s main elements - water, fire, earth and wind. Each Tuesday, celebrants mark the day by honoring one of the four elements.

Georgia’s Azeri community celebrates Novruz with popular national sweets including baklava, sugar cookies with nuts known as shakarbura and shorgogal - layers of pastry flavored with saffroncolored turmeric and fennel seeds.

Azeri tables are set with large silver or copper trays with a pot of wheat grass in the center; surrounded by pastries, cookies, dyed eggs and candles.

BUSINESS

GEORGIA TODAY MARCH 22 - 24, 2016

11

For the Love of Wine- Acclaimed Wine Writer Publishes Book about Georgian Wine American wine writer and natural wine advocate Alice Feiring

BY MAIA KAY KVARTSKHAVA / VOICE OF AMERICA

F

amous American wine writer and natural wine advocate Alice Feiring talks about her newly released book titled ‘For the Love of Wine: My Odyssey Through the World’s Most Ancient Wine Culture.’

THIS IS YOUR FIFTH BOOK ABOUT WINE AND THIS TIME IT’S ONLY ABOUT ONE PLACE GEORGIA. GEORGIAN PEOPLE, GEORGIAN WINES, FOOD AND OF COURSE ABOUT GEORGIA’S ANCIENT WINEMAKING CULTURE. WHY GEORGIA? Why Georgia… When I first landed in Georgia in 2011 for my first visit, I wasn't really thinking about a book. But I quickly realized I had a mission with Georgia. It

was an emerging old region trying to bring its wines to the rest of the world. At that time there was a very small clutch of people working old style, very naturally.

At the same time there were many people from outside Georgia who were wine consultants and who were trying to convince the winemakers that they had to modernize; to change the way they made wine; plant other varietals of vines, no matter that Georgia has its own indigenous 525 varieties; that the wine needed to be more modern and palatable to American and European drinkers.

I thought it was a total disservice and I decided that I wanted to do as much as I could to show the world how fabulous Georgian wines are, just the way they are.

IN THE WORLD OF WINE WRITERS YOU ARE FAMOUS FOR ADVOCATING NATURAL, ORGANICALLY MADE, BIO WINE WITH MINIMAL ADDITIVES.

PUBLISHER & GM

George Sharashidze COMMERCIAL DEPARTMENT

Commercial Director: Iva Merabishvili Marketing Manager: Mako Burduli

GEORGIA TODAY

EDITORIAL DEPARTMENT:

Editor-In-Chief: Katie Ruth Davies

CONSIDERING GROWING INTERNATIONAL INTEREST, HOW CAN GEORGIA CONFRONT MODERNIZATION AND PRESERVE ITS STRATEGICALLY IMPORTANT PRODUCT? At that first international conference in 2011, there were about 7 or 8 Georgian wines. Now, five years later, there are over 30. Not all are commercialized on the international market, but they are well on the way and the sector is growing. The only thing the producers have to do is to show up at tastings and make a little bit more wine so there is more to sell. It’s growing- even the bigger, more commercial, higher volume wineries have revitalized making wine in Qvevri. Now pretty much all have a Qvevri line… And it’s happening not only in Georgia but also in the rest of the world.

the book in various ways. I think 2013 was the first vintage of ‘Mandili,’ made by two women friends. That was the first wine made by women for Georgia’s market. It was Mtsvane and it was delicious!

There is also the Ateni Monastery where nuns have started making wine.

ARE THERE ANY PLANS TO TRANSLATE YOUR NEW BOOK INTO OTHER LANGUAGES, MAYBE INTO GEORGIAN? Well, that’s not up to me. I would love to see it in Georgian. There is the chance it’ll be published in Georgia, Japan and France as these places are the ones where this kind of wine is extremely popular.

SOME YEARS AGO YOU TOLD ME THAT THERE IS NO OTHER PLACE IN THE WORLD WHERE WINE IS SO DEEPLY IMBEDDED INTO THE CULTURE AS IT IS IN GEORGIA. DO YOU STILL THINK SO?

MARCH HAS BEEN NAMED AS WOMEN’S HISTORY MONTH IN THE UNITED STATES. THE UN ALSO CELEBRATES MARCH 8 AS INTERNATIONAL WOMEN’S DAY. WHAT CAN YOU TELL

I have never experienced a culture that so embraces wine in this way. And I travel a lot all over the world, to the big wine producing countries. People would say: Really? More than in Italy? More than in France? And I say: You have no idea!

Journalists: Tony Hanmer, Tamar Svanidze, Zviad Adzinbaia, Beqa Kirtava, Meri Taliashvili, Eka Karsaulidze, Zaza Jgharkava, Maka Bibilashvili, Karen Tovmasyan, Dimitri Dolaberidze, Maka Lomadze, Tim Ogden, Ana Akhalaia, Robert Isaf, Joseph Larsen, Will Cathcart, Vazha Tavberidze, Nugzar B. Ruhadze

US ABOUT THE GROWING NUMBER OF WOMEN WINEMAKERS IN GEORGIA? This is something that I do bring up in

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