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Issue no: 1196/203

• OCTOBER 22 - 24, 2019

• PUBLISHED TWICE WEEKLY

PRICE: GEL 2.50

In this week’s issue... Weekly Entrepreneurial News @entrepreneur.ge NEWS PAGE 2

Georgia is playing its historical role as a regional hub connecting Europe and Asia. Today, we play an increasingly important part in revitalizing the ancient Silk Road.

Georgia, UK Sign Strategic Partnership Agreement NEWS PAGE 2

FOCUS

ON THE TBILISI SILK ROAD FORUM

The Prime Minister welcomes guests

PAGE 3

August Data Keeps Growth Forecast Steady, but Downward Correction Looms ISET PAGE 4

Gov't Grants Permission for Dutch to Join Anaklia Port Project BUSINESS PAGE 5

PM Welcomes Guests to the 3rd Biennial Tbilisi Silk Road Forum

A Look at Georgia’s Progress in the National Strategy & National Human Rights Action Plans BY NINI DAKHUNDARIDZE

BUSINESS PAGE 6

Court Freezes 60% of Rustavi 2 Shares

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he National Strategy for the Protection of Human Rights 2014-2020 was adopted by the Georgian Parliament in 2014. With just a year remaining, and with the up-coming parliamentary elections, it was only appropriate to take a look at the progress achieved in the implementation of the National Strategy and associated National Human Rights Action Plans in Georgia. So, commissioned by the European Union, the United Nations Development Program (UNDP) and the Office of the UN High Commissioner for Human Rights (OHCHR), on October 18 an independent expert was invited to present a report on legislative and policy reforms of Georgia over the past six years.

Pioneer Cement to Develop $200 million Greenfield Cement Project in Georgia

BUSINESS PAGE 9

The assessment, prepared by independent human rights expert Maggie Nicholson, covered all major areas of Georgia’s National Human Rights Strategy for 2014-2020. The report showcased significant achievements of Georgia in protecting and improving human rights over the past six years. The report also included recommendations on closing human rights gaps. The country’s top priorities, according to Nicholson’s findings, include protecting the independence of judges and prosecutors, preventing discrimination, defending media pluralism and developing a culture of transparent, democratic law-making. “Respect for human rights is at the core of EU-Georgia relations,” said Ambassador of the EU to Georgia, Carl Hartzell. “It remains our goal to continue assisting Georgia in building a society where a culture of human rights takes firm root throughout the country and for all citizens. We are looking forward to supporting the development of the next national human rights strategy here in Georgia.” “Protecting human rights requires deeds as well as words,” said UNDP Head Louisa Vinton. “Although Georgia has made praiseworthy progress in almost all areas covered by the current strategy, much human rights business remains unfinished. Continued on page 5

USAID’s Peter Wiebler on ‘Empowered Citizens for Responsive Politics’ BUSINESS PAGE 11 Prepared for Georgia Today Business by

Markets Asof18ͲOctͲ2019

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GBP13.33

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GEOROG04/21

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GBP9.84

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GEORG04/21

106.09(YTM2.63%)

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12633,60

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NEWS

@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: Unmanned Air Technologies is Georgian tech that can fly without a pilot, ideal for everything from supporting rescue operations and discovering fire hazard zones to transporting medical loads. The idea united Ivane Maisaia, Amiran Ananiashvili, and Nikoloz Tsutskiridze who, with the support of Georgia's Innovation and Technology Agency, completed a test-run product. The three agreed on one goal: to found a small-scale enterprise which will produce Unmanned Air Technologies for European and American markets. They also want to develop methods that will become globally-important for producing unmanned air-transportation systems, and to interest the representatives of optics, robot-technology, electronics, alternative energies and other fields. Waffle Nest is the dream come true of 25-year-old married couple Ana and Anzori. They admit to having been inexperienced when they came to facing the challenges and tireless work, but their love for the job meant they kept at it. Their hard-work soon paid off and the café is now a favorite for many. Anzori and Ana decorated it themselves and work daily doing the job with love and dedication. At Waffle Nest, the most important thing is the comfortable, welcoming environment making guests feel at home. Brim Tbilisi is the name of the first eco-friendly hotel in Georgia. 70% solar powered, the hotel is the brainchild of German and Georgian creators for whom ecology and sustainable development while protecting the environment was something they wanted to focus on. Eco-friendliness is the policy inside the hotel, too – only ecological production is used in the menu and the design is as authentic as it could be while also keeping the “vintage effect” of Old Tbilisi. The founders of the 52-room hotel report that each person that decides to stay at Brim Tbilisi leaves the place very satisfied, but that this is “only the beginning.” 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

GEORGIA TODAY

OCTOBER 22 - 24, 2019

Georgia, UK Sign Strategic Partnership Agreement BY MARIAM MERABISHVILI

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n Monday, a strategic partnership and cooperation agreement between Georgia and Great Britain was signed in London, UK, which will enter into force after Brexit (the UK’s withdrawal from the European Union). For this important interstate agreement, Georgian Foreign Minister David Zalkaliani himself went to London. Georgia's Ambassador to the United Kingdom, Tamar Beruchashvili, noted that the post-Brexit agreement would replace the Association Agreement between Georgia and the European Union in bilateral relations between Georgia and the UK. The document covers a wide range of

cooperation and creates a legal framework for strategic partnership, as well as ensuring maintenance of a free trade regime between Georgia and the UK. According to the Ambassador, Georgia and the United Kingdom have long been strategic partners and the United King-

dom, as one of the major global actors, has been an active supporter of Georgia. This is evidenced even by the fact that Georgia is the first country in the EU's Eastern Partnership region with which the United Kingdom is concluding such an agreement.

Georgia’s Martvili Canyon Wins Council of Europe Award BY TEA MARIAMIDZE

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he Martvili Canyon Development Project, carried out by the Agency of Protected Areas of Ministry of Environmental Protection and Agriculture of Georgia, has been named winner of the Landscape Award held within the Council of Europe Landscape Convention.

Martvili village is located in the Samegrelo region of Western Georgia, 280 kilometers from Tbilisi. Martvili is one of the most popular canyons in Georgia and is divided into two parts, Upper and Lower. Paddle a dingy along the canyon from the Upper part to discover the 12-meter waterfall, or walk the renovated trail through the woods, past the steps ancient kings once used to access the natural pool. Due to the high humidity, the walls of the canyon are covered with moss, lending it a very green and jungle-

like appearance. Martvili Canyon received the Natural Monument status in 2013 after which the Martvili Natural Monument Administration was established in 2015. Before this, the site was popular only among the local population. The project reads that due to the lack of control, the site was much damaged, the fauna was suffering from illegal fishing and poaching and the flora was damaged. Continued on page 9


BUSINESS

GEORGIA TODAY OCTOBER 22 - 24, 2019

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PM Gakharia Welcomes Guests to the Tbilisi Silk Road Forum 2019

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would like to extend a warm welcome to all of our guests attending the 3rd Biennial Tbilisi Silk Road Forum. The Forum brings together government and private sector leaders, representatives of international institutions, and industry experts from all over the world to share ideas and explore new avenues of cooperation. This year’s global gathering builds on the successes of the Tbilisi Belt and Road Forum of 2017 and the Tbilisi Silk Road Forum of 2015. In hosting this Forum, Georgia is playing its historical role as a regional hub connecting Europe and Asia. Today, we play an increasingly important part in revitalizing the ancient Silk Road, which

serves our historical role perfectly. Our unique location connecting East and West and our business-friendly policies make Georgia an increasingly attractive destination for foreign investment. Today, Georgia has Free Trade Agreements with Turkey, CIS countries, EFTA, China and DCFTA with EU – comprising a 2.3 billion consumer market. The World Bank currently ranks us #6 in the world for ease of doing business. We have learned that adaptability and stakeholder engagement are critical drivers of success in this current era of disruptive technologies. In the midst of technological advancements, Georgia has emerged as a champion in utilizing Blockchain technologies in the public sector.

We seek to become a test-bed for other technological innovations. We are also working to forge deeper connectivity with the global economy, so that we might reap the full benefit for our people of increased globalization. I hope that you will enjoy your time in Georgia. Please take advantage of the ample opportunities to network and build business relationships with colleagues from Georgia and around the world. We share a commitment to revitalize the Silk Road to promote peace and prosperity. It is my great honor and pleasure to host you for the 2019 Tbilisi Silk Road Forum. Sincerely, Prime Minister of Georgia

Georgia is Hosting Tbilisi Silk Road Forum BY EMIL AVDALIANI

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n October 22-23, Tbilisi is hosting the Tbilisi Silk Road Forum. The event follows on from the success of the Tbilisi Silk Road Forums of 2017 and 2015. The 2019 gathering will provide an excellent platform to discuss new ideas and opportunities in the fast-changing world and to initiate high-level discussion on potential cooperation in the areas of trade, transport, infrastructure, innovations and energy. All goes back to 2015 when Georgia, one of the first countries to respond to the Silk Road Forum initiative, signed with China on 9 March 2015 a Memorandum of Understanding on the New Silk Road which was initiated by China in 2013. Hosting the Silk Road Forum in Tbilisi serves the purpose of boosting not only Georgia’s economic development, but that of the entire region and beyond. The aim is to attract international business communities to explore investment opportunities and further sustainable development in Georgia. The Silk Road Forum has already been transformed into a platform for an annual high level meeting where interested parties work together to explore opportunities, align visions and enhance bilateral partnerships in four main areas of cooperation: transport, energy, trade and business-to-business contacts. This year, the forum will specifically focus on discussions/issues related to understanding stability and sustainable growth patterns, artificial intelligence as a key to innovation driven growth and the impact of its development on the global economy. The changing landscape of global trade, increasing role of energy corridors through developing the energy belt on the New Silk Road, as well as emerging opportunities for improvement of transport links under the New Silk Road will be discussed at various side events and many panels during the twoday event. Among the panels will be: Trade2Win, The Future of Energy -

Emerging trends, Security and Sustainability of the Silk Road Energy Belt and beyond, Innovation driven growth - Artificial Intelligence (AI) for the Silk Road. Particular attention will be paid to High Level Dialogue, Towards the Common Future: Understanding Stability and Sustainable growth patterns; and Connecting to Europe – The Development of the Extended TEN-T. The forum, in which hundreds of foreign investors and politicians from 60 countries will participate, will also strive to define the means of cooperation and chart a common vision for overcoming obstacles in the increasingly unstable modern world. Doing this through dialogue, research, initiatives and joint projects will be a defining outcome of the forum. Yet another importance of the forum will be its emphasis on showcasing Geor-

gia as a growing destination for new investment opportunities, possibilities for networking, exchanging ideas and finding the means for business, and, most of all as a rising place on the Silk Road connecting Europe with China and other Asian states. One of the high dignitaries of the forum will be the Undersecretary of State of Foreign Affairs of Italy, Mr. Ivan Scalfarotto. “The Silk Road Forum offers a valuable platform to discuss trade, energy and connectivity with qualified public and private sector representatives,” he said. “This precious initiative is a testimony to the commitment of Georgia to taking full advantage of its geostrategic location, at the crossroads of two continents, and serving as a convenient corridor between east and west, along the old and new Silk Road.

“If Georgia is a natural host of the Silk Road Forum, Italy is a natural participant,” Scalfarotto went on. “Italy has always been a terminal of the Silk Road (suffice it to think of Marco Polo, the famous Venetian merchant). Enjoying the second manufacturing trade surplus in the EU and the fifth at a global level, our country is naturally oriented towards an open, rules-based trade system. In a moment when international trade is facing unprecedented challenges, it is important to provide opportunities of dialogue among States, but also private companies and civil societies, in order to foster inclusive and effective solutions.” Georgia historically has played an important role in the development of the ancient Silk Road, which connected China and Central Asia to Europe and vice-versa. Georgia’s historic ability to

engage with both East and West was largely conditioned by its crucial location at a strategic regional crossroads. It continues to play this role today and is likely to grow ever more as a transit trade point between China and Europe in the coming decades. The country will develop its regional infrastructure, such as new Black Sea ports and improve its East-West rail networks, which will provide crucial new corridors from Europe to the growing economies of China and Central Asian countries. Due to its geographical location, Georgia has the potential to perform an important function in the transcontinental trade corridor. The Silk Road, as a global initiative, implies joint projects, enhanced trade, attracting more investments and enhanced economic cooperation between the countries involved in the project. Georgia has all the resources to fulfill the function of regional, transport and infrastructural, financial and industrial hub in the Europe-Asia Transport Corridor. Georgia's involvement in the new Silk Road project enhances trade-economic ties between Georgia and the participating countries, contributes to attracting additional investments and creates new jobs,” said Otar Sharikadze, Managing Director of Galt & Taggart. Georgia has all the resources to fulfill its regional, transport-infrastructure and industrial hub function in the EuropeAsia Transport Corridor. To this end, the Government of Georgia is undertaking major reforms and projects to develop Georgia's land, rail, maritime transport infrastructure, build transport-logistics centers, increase ports, new terminals and cargo service opportunities. In the long run, Georgia's Free Trade Agreements with China and European countries, its geographical location, attractive investment environment and market openness, correct economic policies and reforms, positively assessed by international financial institutions and authorized ratings, and its growing economy are important foundations for achieving the goals that should bring Georgia back to its historic gate and further enhance its role in modern economic relations between Europe and Asia.


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BUSINESS

GEORGIA TODAY

OCTOBER 22 - 24, 2019

August Data Keeps Growth Forecast Steady, but Downward Correction Looms BY DAVIT KESHELAVA AND YASYA BABYCH

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SET-PI has updated its forecast of Georgia’s real GDP growth rate for the third and fourth quarters of 2019. The highlights of this month’s release are as fol-

lows:

HIGHLIGHTS • ISET-PI’s forecast of real GDP growth for the third quarter (July-September) of 2019 remains at 7.1%, unchanged from last month’s prediction. While, the third estimate for the fourth quarter (OctoberDecember) growth forecast stands at 5.5%. • Geostat recently published its preliminary estimate of real GDP growth for August, which currently stands at 5.8%. As a result, the real GDP growth estimate for the first eight months of 2019 was reduced to 5%. • Based on the data from August, annual growth in 2019 is expected to be 5.5%. Although the growth forecast remains stable, we expect a downward correction of annual GDP growth towards the end of the year because we have not fully taken into consideration impeded tourist inflows, deteriorated foreign direct investments, and the increased risk of negative external shocks. It is notable that the average real GDP growth in the first two months of the third quarter of 2019 was around 6.0%. Due to a combination of factors, ISETPI’s growth projection for the third quarter of 2019 has likely overestimated the actual quarterly growth rate. Crucially, our model has not yet wholly factored in the negative consequences of significantly deteriorated tourist rates (Gavrilov’s effect), reduced foreign direct investment at its historic minimum since 2011, and the increased risk of negative external shocks. Nevertheless, considering the economic landscape, using data from August, several variables have changed significantly and affected growth predictions in a variety of ways. In particular, improved external statistics and increased domestic currency deposits contributed to the overall growth projections, whereas higher-than-targeted inflation and the restrictive monetary policy dampened the growth forecast. Georgia’s external statistics continue to improve; with exports growing by 12.3% year-over-year in August 2019. This was largely driven by an increased export/re-export of copper ores and concentrates to Romania and Bulgaria; significantly larger re-exports of motor cars and trucks to Armenia; increased exports of mineral fertilizers and

mechanical equipment to Turkmenistan; and raised exportation to Uzbekistan, Kyrgyzstan, the United Kingdom, and Poland. However, Georgian exports to Russia (with a reduced export of ferroalloys) and China (a reduced re-export of copper ores and concentrates) experienced a notable drop in August. During the same period, imports decreased by 3.7%. The trade balance thus improved significantly, by 12.5%, compared to August 2018 and reached 435.1 million USD. Furthermore, both remittances and tourism showed yearly increases. Money transfers increased by 7.8% in the eighth month of 2019, driven by a rise in remittances from Kazakhstan (69.8%)1, Italy (25.6%), Greece (16.9%), Poland (69.1%), and Ukraine (68.8%). However, remittances from Russia declined significantly (-2.8 ppt). The number of international visitors to Georgia increased by only 4.4% in August 2019 compared to the previous August (the growth rate reduced notably compared to previous months), while the number of tourists increased by 2.3% annually and accounted for 69% of all international visitors. According to our model, remittances made a substantial positive contribution to the GDP growth forecast, though the positive impact of tourism on GDP growth

in August was quite limited. It is, however, significant that our model cannot yet fully take into consideration the markedly deteriorated growth rate of tourism inflow. The Real Effective Exchange Rate (REER) depreciated by 0.5% relative to July, and by 13.6% relative to the same month of the previous year. Notably, the lari real exchange rate depreciated against the national currencies of the major Georgian trading partners. The GEL/TRY and GEL/RUB real exchange rates depreciated compared to the same month of the previous year, by 23.3% and 13.7% respectively. The lari real exchange rate experienced moderately less depreciation against the US dollar and the euro (falling by 10.7% and 7% respectively in annual terms, and decreasing by 1.2% and 0.4% respectively in monthly terms). Overall, REERrelated variables had a negative contribution to the Q3 and Q4 real GDP growth projections. The other group of variables that experienced remarkable monthly and yearly changes, and made a significant positive contribution to the Q3 and Q4 forecasts, was the volume of domestic currency deposits in commercial banks. In particular, the total volume of domestic currency deposits increased by 11.7% annually. The largest yearly increase

was observed in national currency time deposits with a maturity of more than 12 months – a 59.3% increase relative to the same month of the previous year. The second largest yearly increase was experienced within currency in circulation – a 30.9% increase year-over-year. Whereas, national currency time deposits decreased annually by 7.4%. The accumulation of national currency deposits further promotes savings, which will consequently be transformed into investments and thus foster economic growth. Undeniably, National Currency Deposit related variables have made a positive contribution to our GDP growth projection. The recent depreciation of the lari against the currencies of major trading partners will most probably lead to increased prices of imported products, which would further exacerbate the upward pressure on prices and therefore inflationary expectations will emerge. Hence, the National Bank of Georgia increased the Monetary Policy Rate (MPR) twice in September,2 by 0.5 percentage points each, reaching a

level of 7.5%, which restricts borrowing and is expected to have a negative impact on the future growth rate. In addition, Consumer Price Index (CPI) inflation amounted to 4.9% in August,3 and annual inflation of food prices even reached 8.5%. According to our model, the inflation rate has a negative contribution to the growth forecast. Our forecasting model is based on the Leading Economic Indicator (LEI) methodology developed by the New Economic School, Moscow, Russia. We have constructed a dynamic model of the Georgian economy, which assumes that all economic variables, including GDP itself, are driven by a small number of factors that can be extracted from the data well before the GDP growth estimates are published. For each quarter, ISET-PI produces five consecutive monthly forecasts (or “vintages”), which increase in precision as time goes on. Our first forecast (the 1st vintage) is available about five months before the end of the quarter in question. The last forecast (the 5th vintage) is published in the first month of the next quarter.

1 Contributed to the annual growth by 0.8 percentage points. 2 The Monetary Policy Committee (MPC) of the National Bank of Georgia (NBG) held an extraordinary meeting on 25 September 2019 and decided to raise the refinancing rate by 0.5 percentage points up to 7.5 percent. 3 The annual inflation rate reached 6.4% in September.


BUSINESS

GEORGIA TODAY OCTOBER 22 - 24, 2019

Gov't Grants Permission for Dutch to Join Anaklia Port Project

BY ELENE DZEBISASHVILI

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he Dutch company Van Oord has recently become the owner of a 4% share of Anaklia Development Consortium (ADC) for $5 million. The Ministry of Regional Development and Infrastructure confirmed that the gov-

ernment allowed the ADC to sell its shares to Van Oord. Van Oord carried out seabed deepening works for the Anaklia Port last year. Together with the Van Oord company, the Anaklia Development Consortium has also presented another possible investor to the Ministry of Regional Development and Infrastructure- Meridian. The agency has until October 29th to make its final decision.

United Nations Week Marked in Ushguli

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n October 19, with joint efforts of the Office of the UN Resident Coordinator in Georgia and the United Nations Population Fund (UNFPA) Georgia Country Office, the United Nations Week was marked in Ushguli, together with other towns and municipalities of Georgia. Sabine Machl, UN Resident Coordinator in Georgia, and Lela Bakradze, Head of the UNFPA Georgia Country Office, attended the activities. An exhibition of photographer Dina Oganova was opened in Ushguli School showcasing two photo projects: “Girls from the Future” and “Peers for Equality”. The photo project “Girls from the Future” combines photos with texts to tell the stories of girls aged 10 to 16 living in various towns and villages in Georgia. The project aims to highlight that the full realization of girls’ potential, creation of equal conditions and an equitable environment for them, and access to health and education, play a crucial role in the prosperity and development of every country; that every girl should be given an opportunity to complete her education and make informed decisions about her life and health. “Peers for Equality” tells the stories of 12 youth. Within the framework of the photo project, they talk about gender equality, a healthy lifestyle, reproductive health, education, activism and their own initiatives. Both photo projects were supported by the UNFPA Georgia Country Office, and are part of widescale advocacy work which the UNFPA is carrying out to eliminate the harmful practice of early marriage and to promote reproductive health and the rights of adolescents and youth.

In cooperation with the National Parliamentary Library of Georgia, an “Equality Corner” was opened in the Ushguli Library. The Equality Corner will enable the youth in Ushguli to raise awareness on equality with the help of contemporary fiction. Giorgi Kekelidze, a writer and the Director of the National Library of Georgia, opened the Equality Corner. Within the framework of the event, he delivered a public lecture on the idea of gender equality and its significance. The opening of the Equality Corner aims to support the realization of the potential of adolescents and youth. Authors of the initiative consider that it is of utmost importance to have as many spaces as possible in Georgia where adolescents and youth are able to get an informal education, enjoy meaningful free time and share ideas. The events were held within the framework of UN Week, in cooperation with the Ushguli local government.

A Look at Georgia’s Progress in the National Strategy & National Human Rights Action Plans Continued from page 1 Coming just a year before the strategy ends, this new assessment provides a helpful and timely roadmap for Georgia to follow in advancing its human rights journey.” The ‘Human Rights for All’ program helped with the implementation and monitoring of Georgia’s National Human Rights Strategy for 2014-2020 and accompanying Action Plans for 2016-2017 and 20182020 in areas prioritized by EU-Georgia agreements. These included the rights of minorities and vulnerable groups, internal and external oversight of law enforcement, labor rights, freedom of expression and information, the protection of privacy and personal data as well as child rights. The EU and the four UN agencies worked hand in hand with Georgia’s government, parliament,

civil society and human rights institutions to increase national capacities for the protection of human rights, adopt new legislation and improve existing policies, promote a human rights-based approach in law-making and operation of the state agencies, and advocate a culture of human rights across society. Monitoring and impartial analysis of the human rights situation in Georgia was one of the priorities of the program. Two surveys released in 2017 and 2018 probed public perceptions on human rights, and independent assessments by expert Maggie Nicholson were commissioned in 2017 and 2019. The report was commissioned under the joint EU-UN ‘Human Rights for All’ program which was implemented over nearly four years by four UN agencies: UNDP, OHCHR, UNICEF and the International Labour Organization (ILO).

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BUSINESS

GEORGIA TODAY

OCTOBER 22 - 24, 2019

Pioneer Cement to Develop $200 million Greenfield Cement Project in Georgia

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he UAE based Pioneer Cement Industries (“Pioneer Cement”), part of O m a n - b a s e d R ay s u t Cement Company SAOG (RCC) is in the process of setting up a 1.2 m ton per annum capacity integrated cement plant in Georgia, Eastern Europe. Pioneer Cement owns concession to limestone mines in Georgia that will provide the key raw materials to this project. Georgia provides Pioneer Cement an opportunity to diversify from the Middle East into a market with large infrastructure growth and shortage of clinker and high-quality cement, the company said in a statement. The plant will be located near Tbilisi, adjacent to the limestone mines. The debt and equity arrangements for the project are currently being finalized and the construction work in the project is slated to commence from Q4 2019. The value of the project is estimated at $200 million. “We have embarked on an aggressive and ambitious expansion strategy in the region with specific focus on Africa and

neighboring regional countries, and in this context setting up Pioneer Cement Georgia is a significant geographical diversification,” said RCC Group CEO Mr. Joey Ghose. Speaking about the project, B.S. Rajan General Manager Pioneer Cement said, "The Georgia expansion is a major milestone for Pioneer and its parent company Raysut, as it opens up a diverse market for us in terms of growth potential as well as new challenges. We are confident that this move will further strengthen and complement our aggressive expansion strategy in regional and global markets and grow into a development partner in economies across a wide geographical footprint." The Georgia expansion of Raysut comes close on the heels of the company’s announcement of signing a land lease agreement and Port of Terminal services agreement with Port of Duqm Company SAOC for building a new grinding unit in Oman at an investment of $30 million. The Duqm plant is being set up as part of the company’s aggressive expansion strategy in the local and regional markets.

This year Raysut also joined hands with MSG Group in East Africa to set up a $40 million cement grinding unit in Berbera, Somaliland as well as acquired Sohar Cement Factory LLC at a value of $60 million. Pioneer Cement Industries was incorporated in 2004 and is part of Oman based Raysut Cement Company SAOG. Pioneer operates a state-of-the-art integrated cement plant with a capacity of 1.5 million tonnes of cement. The plant is located 45km north of Ras al Khaimah and about 1 hour from Dubai, UAE. The company is one of the market leaders in the UAE and also exports its product to regional markets. The plant produces high quality cement which meets British, European and American standards. Raysut, headquartered in Salalah, Oman, is a leading cement company in the Middle East, with clinker and cement manufacturing assets in Oman, Yemen and the UAE. Raysut has 3.6 million tons of integrated cement manufacturing capacity in Salalah. The current capacity of Raysut Cement stands at 6.4 million tonnes per annum.

Georgian Gov’t to Establish Employment Agency BY TEA MARIAMIDZE

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he Georgian government is working on establishing an Employment Agency which will be a legal entity under the Ministry of Internally Displaced Persons from the Occupied Territories, Labor, Health and Social Affairs. Its aim will be to reduce the level of unemployment in the country and to train qualified workers for potential employers. The agency is set to be established less than a year before the 2020 parliamentary elections. According to official information, it will aim to provide public employment support services and pursue active employment and labor market policies. The Ministry of Internally Displaced Persons from the Occupied Territories, Labor, Health and Social Affairs said that due to the priority of the issue and its effective implementation, within the current reform process and budget, a separate agency for employment promotion was established. The Ministry also explains that special emphasis will be placed on promoting legal employment abroad. Labor market services provided under the existing state program will also be developed. However, the Ministry does not specify exactly what measures are planned within the project. Akaki Zoidze, the Chairman of the Parliamentary Healthcare Committee, said that the main goal of the project is to promote employment in Georgia, with special emphasis on those who have problems finding a job. He explained that one of the priorities of the Employment Agency will be to find job opportunities for socially disadvantaged people in order to keep them and their families financially secure. There are already several employment promotion programs in Georgia, including a 2016 Active Labor Market Strategy Resolution approved by former Prime Minister Giorgi Kvirikashvili in 2016, which

includes an action plan for 2016-2018. The purpose of the document was precisely the integration of the population into labor, productive employment and increasing income generation. The document reads that particular emphasis should be placed on vulnerable groups in the labor market. According to Zoidze, this program is still underway, with more than GEL 4 ($1.35 million) having being spent. “Within the new strategy, the employment problem should be in focus and effective work should be done to solve it. The employment agency will facilitate the implementation of this program, as it does not have an institutional patron at this stage, and the agency will be able to provide this patronage,” Zoidze told Netgazeti. The lawmaker added that the main responsibility of the agency should be

Image source: bestpersonnel.ca

acting as a mediator between the potential employer and the job seeker. According to Zoidze, the project should include several key points, according to which the state will be able to play the role of a bridge between two entities. These main points are: • Research should be carried out to identify not only unemployed people but also those who are poorly employed and who do not have adequate remuneration; • These people should be trained and become qualified in order to meet the requirements of some vacancies; • Systems should be regularly updated where both parties can find the desired workforce or job; • The state should assist employers and employees to establish proper communication. The Chairman of the Healthcare Com-

mittee stated that if the agency's goal, among other changes, is not to meet these requirements, he will not support its creation. "Otherwise it will just be a new form of bureaucracy and I will not support it in any way," he noted. Paata Sheshelidze, an expert in the field of economics, assessed the project as bureaucracy from the very beginning. "The creation of an agency will be a waste of money. Employment is a free process of the open market and if the government wants to promote the employment sector, it has to help the open market and create a situation where people can use their land, property and resources for various activities,” the expert stressed. Sheshelidze believes that the government itself has contributed to the problem of unemployment in the country as

a result of reforms which have tightened the procedure for citizens to borrow from the bank, and restricted the transfer ownership of land and the work of taxi drivers. Political analyst Gia Khukhashvili agrees the only way to reduce unemployment is to assist the open market. “The government should not start promoting employment by directly and mechanically setting up an agency, but by increasing economic activity and stimulating market development. It should implement protective policies towards the private sector, which itself will create jobs and will not need the help of the government,” Khukhashvili said. The annual unemployment rate in Georgia decreased by 1.2% to 12.7% in 2018, according to the National Statistics Office of Georgia (Geostat). Geostat data reads that in 2018, the economically active population amounted to 63.9% of the working age population and, compared to 2017, the economic activity rate and employment rate decreased by 1.9 and 0.9 percentage points respectively. Geostat data about QI 2019 reads that the unemployment rate in Georgia decreased by 1.2% compared to the same period of the previous year and equaled 12.8%, while in the second quarter the unemployment rate in Georgia decreased by 0.7 % compared to the same period of the previous year and equaled 11.4%. The statistics show that, traditionally, the unemployment rate is higher for men than for women. Last year, this indicator was 2.7 times higher for men compared to the corresponding indicator for women. In Q1, 2019 the unemployment rate was 3.9% higher for men compared to the corresponding indicator for women while in Q2 of the same year, unemployment rate is 2.6% higher in men compared to women. Over the last 10 years, the highest unemployment rate was observed in 2009- 18.3%. A year after the 2008 Georgian-Russian August war, the unemployment rate was 17.9%. According to the statistics, in 2008-2018, the unemployment rate decreased by 5.2%.


BUSINESS

GEORGIA TODAY OCTOBER 22 - 24, 2019

The Story of the Staropramen Lottery

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lexandre Chaduneli won the joint lottery of Staropramen and Beer House, getting a fabulous seven-day trip to Prague for he and his wife and the chance to attend a concert dedicated to the 150th anniversary of Staropramen. But in reality the trip was won by others. The story goes like this: four friends took part in the Staropramen lottery, drinking copious amounts of beer in Beer House. Their enthusiasm yielded results, as they were recognized as having drunk the most Staropramen, and won the trip to Prague. However, the lottery envisaged only one winner and the trip was meant for two. Four friends put

their heads together to decide which of them would visit one of Europe’s most alluring cities. In the end, they decided to make their friend happy and offer him the chance to visit Prague with his wife. This friend turned out to be Alexandre Chaduneli. “My friends offered me the trip to Prague that they won in the Staropramen lottery,” Chaduneli said. “This was a mind-blowing surprise! Me and my spouse stayed in Prague for 7 days. I am delighted. Staropramen’s factory tour was enchanting; and the concert dedicated to Staropramen’s 150-year anniversary was stunning! We had an amazing journey. I feel very lucky to have such friends!”

Radisson Blu Iveria hotel, Tbilisi Celebrates 10th Anniversary

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adisson Blu Iveria Tbilisi celebrated 10 years of hospitality with a spectacular event, with partners of the company, special guests, local celebrities and media representatives in

attendance. Guests were invited to experience a varied musical program, an international and traditional culinary journey, an impressive show and lots of surprises. Radisson Blu Iveria was the first Radisson to open in Georgia, in 2009. Through the years, the iconic hotel promoted Georgia and especially Tbilisi as a top destination and has hosted countless guests, delivering to each high quality service and memorable moments. In its ten years, the hotel has been honored to receive numerous international and local awards in the fields of tourism and hospitality. The history of the building itself began in 1967 during the Soviet government when it was a premier luxury hotel under the name of an ancient kingdom - Iveria. In 1992, as a result of the war in Abkhazia, the hotel became a refugee camp for some ten years. Later, Silkroad Group reconstructed the hotel and gave it a new life. Completely rebuilt as a modern luxury business hotel, managed by the

Radisson Hotels Group, it reopened in 2009 as the Radisson Blu Iveria Hotel. Radisson Blu Iveria unites 249 guestrooms and suites and two restaurants: Italian restaurant ‘‘Filini’’ and Asian Fusion restaurant “Umami’’. Oxygen Bar is located on the 18th floor of the hotel. Stunning panoramic views, modern music, and refreshing cocktails make it the perfect place to enjoy your time. While, with soft background music and excellent drinks, Surface Bar is an ideal place to meet up with friends and partners. The exclusive 1,600-square-meter Anne Semonin Spa perched on the hotel’s top two floors overlooks Tbilisi. Guests can enjoy spa facilities and an indoor and outdoor pool. Designed to exceed expectations, the 830 sq. conference facilities make an ideal place to host meetings, banquets, conferences and other special events. Radisson Blu Iveria is named among the safest hotels in the world. Every year the hotel is audited in accordance with The Global hotel security standard and is granted Certification from the Safehotel Alliance. On the special day of the anniversary, the Radisson Blu Iveria team made a donation to charity fund “First Step,” which supports children with special needs.

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BUSINESS

GEORGIA TODAY

OCTOBER 22 - 24, 2019

Prospero’s Books Turns 20

An Unmissable Two Day Only ‘Dinner in the Sky’ Event in Mtskheta

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mong the most extraordinary dining experiences in the world, successfully operating in 71 countries all over the globe over 13 years, Dinner in the Sky was launched in Georgia this May, offering an unforgettable fine dining experience in the sky, 50m off the ground, in an exclusive atmosphere together with a breathtaking view of the city and cuisine prepared by a top chef. 270 success events and over 5000 fully satisfied guests later, the Tbilisi Dinner in the Sky, a unique “flying restaurant” is going to offer guests something special in one of the oldest areas of Georgia and its former capital, Mtskheta on October 26-27. Recognized as a UNESCO World Heritage Site due to its ancient culture and historical monuments, this fine dining experience in Mtskheta is a great opportunity for guests to enjoy a panoramic fourdimensional view of the area and its fancy surroundings; to soak up the exciting scenes of Jvari Monastery and the mountains embracing it; the confluence of two famous lovers, the rivers Argavi and Mtkvari; and the renowned Svetitkhoveli Cathedral, Bebris Tsikhe and Samtavro Monastery, all in one frame. If you haven’t yet tried a Dinner in the Sky event, check out their online videos to get a taste of this exceptional experience. The event will be located in Marani Hall where the artful chef of Marani will join guests at a height of 50 meters to prepare and serve dishes in the pop-up kitchen, and have a friendly chat with you about the characteristics of the exclusive menu, which consists of a cooking show in the Sky in

front of the guests, a master class of Pelamushi making, a four-course fancy menu, and unlimited wine and beverages for each guest. In a word, all Georgian pleasures- Georgian dishes, Georgian wines, and Georgian landscapes and ambiance, are now intertwined into this once-ina-lifetime, extraordinary event that is not to be missed! Booking is available on the following link: www.dinnerinthesky.ge/mtskheta

BY KATIE RUTH DAVIES

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ast Thursday, Prospero’s Books, a combined book-and-stationery store and café tucked in a sunny courtyard just off Rustaveli Avenue, invited long-term friends and customers to celebrate the 20th year since it first opened its doors. The idea, and recognition of a need for a book store selling English books, was identified by author, trekker and guide, Peter Nasmyth and Irakli Topuria. While it started out as a casual discussion following the opening of the International House bookshop, and a toast to a wish coming true, Topuria was quick to find just the right place: an unloved courtyard at Rustaveli 34. The funds were raised to buy the property, with Nasmyth putting in almost all he had, and the renovation work began. Finding investors was hard, Nasmyth reports, but along came current General Manager of Hotel Betsy’s, Steven Johnson and his brother, and Steve’s wife Tamara (Tako).

“Tamara has worked extremely hard to make this work,” Nasmyth said, thanking the Manager in particular for her energy and dedication. GEORGIA TODAY spoke to manager Tako Johnson about the Prospero’s journey. “The highlights have been that I personally enjoyed giving some benefit to society, meeting wonderful people and customers from all over the world and making them feel at home. The challenges have been many over these 20 years: among them was feeling the gaps between the Western standards and local established practices, maintaining the professionalism and quality of service.” Many praise Prospero’s for being an island of western calm in the Tbilisi urban sprawl, offering numerous works of fiction, non-fiction and educational material to Georgia’s English-speaking community. It also plays host to book launches, meetthe-author signings and a variety of educational events. Already boasting three branches in Tbilisi, Prospero’s future goals include opening another store on Abashidze Street and expanding to other cities of Georgia.


BUSINESS

GEORGIA TODAY OCTOBER 22 - 24, 2019

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Huawei's Revenue Rises 24.4% in the First Three Quarters of 2019 Comparing to Previous Year

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uawei today announced its business results for the third quarter of 2019. During the first three quarters of this year, Huawei generated CNY610.8 billion in revenue, an increase of 24.4% year-on-year. The company's net profit margin in this period was 8.7%. Huawei has maintained its focus on ICT infrastructure and smart devices, and continued to boost the efficiency and quality of its operations. This contributed to increased operational and organizational stability and solidified the company's performance in the first three quarters of 2019. In the carrier business, commercial deployment of 5G networks around the world has sped up. Huawei has continued to launch innovative solutions with leading carriers like 5G Super Uplink, smart & simplified transport networks. The company has also worked with industry partners to establish an industry alliance and an industry innovation base for 5G deterministic networking to enable the innovation and growth of carriers. To date, Huawei has signed more than 60 commercial contracts for 5G with leading global carriers and shipped more than 400,000 5G Massive MIMO active antenna units (AAUs) to global markets. The production and supply of Huawei's optical transmission, data communications, and IT products grew steadily.

In the enterprise business, the company launched the Huawei Horizon Digital Platform. This converged, open, and efficient platform was built on Huawei's extensive technological experience. With it, Huawei aims to work with customers and partners to build a foun-

dation for the digital world, creating a digital transformation industry worth trillions of US dollars. This platform will also help various sectors like government, public utilities, finance, transportation, and electricity to speed up their digital transformation.

Court Freezes 60% of Rustavi 2 Shares

By the end of Q3 2019, more than 700 cities, 228 Fortune Global 500 companies, and 58 Fortune Global 100 companies had selected Huawei as their partner for digital transformation. Huawei's cloud service development has been accelerating. In Q3, Huawei

announced its computing strategy and released Atlas 900, the world's fastest AI training cluster. Other innovative products the company has launched include the HUAWEI CLOUD Ascend AI cluster services, 112 new services powered by Kunpeng and Ascend processors, and Industrial Intelligent Twins. These products achieved major breakthroughs in government, Internet service provider (ISP), automotive, finance, and many other industries. Three million enterprise users and developers have used HUAWEI CLOUD to develop products and solutions. In the consumer business, Huawei's smartphone business has grown steadily. Huawei's smartphone shipments in the first three quarters of 2019 exceeded 185 million units, representing a yearon-year increase of 26%. The company also saw rapid growth in other new businesses like PCs, tablets, wearables, and smart audio products. The Vision smart screen, featuring unique innovations in software and hardware, was also launched in Q3, gaining high acclaim from the industry and consumers. A more robust ecosystem that focuses on consumers and delivers a more seamless intelligent experience across all major user scenarios is now taking shape. The Huawei Mobile Services ecosystem has also developed rapidly, covering more than 170 countries and regions. It has attracted over 1.07 million registered developers worldwide.

Image source: Agency of Protected Areas

Georgia’s Martvili Canyon Wins Council of Europe Award Continued from page 2

BY ANA DUMBADZE

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bilisi City Court has started reviewing a lawsuit filed by Jarji Akimidze and Davit Dvali over the Rustavi 2 case and frozen 60% of Rustavi 2 shares, - lawyer Kakha Kozhoridze said today. “We demanded they freeze 60% of Rustavi 2 shares since there was the dan-

ger that Kibar Khalvashi could sell it before the ownership dispute was resolved. The court satisfied this motion and froze 60% of the company shares. We will receive the court judgment today and will formally register the sequestration at the Public Registry office,” Kozhoridze noted. The founders of TV Company Rustavi 2, Jarji Akimidze and Davit Dvali, filed a lawsuit to Tbilisi City Court against the current owner Kibar Khalvashi after he won the channel ownership dispute at the European Court of Human Rights

in July 2019, requesting the return of 60% of the company shares. “In 2004, our shares at Rustavi 2 were illegally seized. However, we were and still are its founders and demand these shares be returned. The lawsuit is based on legal processes that began in Georgia and continued in Strasbourg. These processes have opened a legal way for us to start a civil dispute. So far, we have only applied to the Prosecutor's Office through legal proceedings and have requested an investigation,” Dvali said.

Moreover, due to the lack of infrastructure, tourist safety was at risk. However, the situation changed rapidly when in 2015 the Agency of Protected Areas of Georgia, in the frame of co-operation with the Municipality of Martvili, started to implement the new project ‘Martvili Canyon Sustainable Development.’ As a part of the project, a visitor center, shelter and docks for boats, walking trails, viewpoints, and bridges were built and a 19th century water mill was rehabilitated. On the River Abasha, a communication system was constructed which serves to alert tourists of potential flooding. Canyon cleaning activities are carried out on a regular basis and where in the past one would have found dozens of bottles and plastic packaging in the canyon, now the area is fully clean and safe. The program reads that the Government of Georgia decided to give boating territory with a 5-year lease to the local populations’ limited company Oputsokhi. This company invested GEL 90,000 (EUR 27,200) to purchase 25 high quality boats, safety vests and rescue equipment. Boaters and rescuers have also been trained. The Ministry of Environmental Protection and Agriculture of Georgia reports that 23 projects from member states were

nominated for the Landscape Award. These 23 projects have played an important role in landscape restoration and set an example of how landscapes should be restored and managed. Levan Davitashvili, the Minister of Environment and Agriculture, received an official letter from Maguelonne Déjeant-Pons, Executive Secretary of the European Landscape Convention, which notes that the Martvili project won the prize for its contribution to raising public awareness on environmental issues as well as for its special importance. The 2020 Award Ceremony will be held in the framework of the Council of Europe Landscape Forum. Martvili Canyon is one of the most distinguished natural monuments of Georgia. In 2019, it was the most popular protected area. During the first eight months of this year, 150,000 people visited the canyon. The European Landscape Convention aims to promote the protection, management and planning of landscapes and to bring together European co-operation in this field. It is the first international treaty exclusively devoted to all dimensions of European landscape. Taking into account the landscape, natural and cultural values of the territory, it contributes to promoting the quality of life and wellbeing of Europeans.


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BUSINESS

GEORGIA TODAY

OCTOBER 22 - 24, 2019

VEON Georgia Head of Digital and Innovations on the Latest Digital Tendencies BY KETEVAN KVARATSKHELIYA

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elecommunication services are of crucial importance in the 21st century, requiring the permanent development of companies and suppliers operating in the field. Georgia spares no effort to come hand-in-hand with latest developments in the digital sector and introduces world’s leading players on the local market. Part of the world-renown company VEON Group, Veon Georgia (brand Beeline) is undoubtedly among them, which entered the telecommunication sector of Georgia several years ago and has already strongly established itself. GEORGIA TODAY sat down with Tamar Jikia, Head of Digital and Innovations, Veon Georgia, to discuss the tendencies observed in the mobile industry, challenges of the field, as well as the plans for the future.

TELL US ABOUT THE LATEST DIGITAL TENDENCIES IN THE CONTEMPORARY MOBILE INDUSTRY AND THE STRATEGIES APPLIED BY VEON GEORGIA TO OFFER THE CLIENTELE THE BEST SERVICES. Digital is currently challenging sectors in all industries and society. Moving towards digital drives telco businesses not only to provide their own digital products or services but also the essential connectivity infrastructure that allows other sectors to function and grow in the digital economy. This trend requires a fundamental shift in business model and processes to provide customers with a superior digital experience. Key tendencies of telco industry are the Internet of Things (IoT), Artificial Intelligence (AI), cloud computing, 5G, Big Data and real-time insights that deliver a truly exceptional customer experience. Veon Georgia’s key focus is to deliver a superior digital experience. We enrich our digital channels with new features and capabilities meeting customer expectations. Developing innovative products

for our customers and B2B partners is a top priority. In addition, we are actively working with local and international companies to deliver new products and services which best satisfy customers and eases their everyday lives.

SHARE YOUR VIEWS ABOUT ARTIFICIAL INTELLIGENCE. By definition, Artificial Intelligence is the simulation of human intelligence processes by machines. The process involves learning, reasoning and selfcorrection. AI is expected to change industries and experiences for the customers as AI is incorporated into a variety of different types of technologies, such as system or process function robotic automation, machine learning science of getting a computer to act without programming thought of as the automation of predictive analytics; machine vision, the science of allowing computers to see, natural language processing (NLP); robotics focused on the design and manufacturing of robots, self-driving cars and more. AI will change the way customer service is delivered and internal processes are managed. It is expected to enhance service personalization and more automation through advanced analytics to drive significant benefits and better crossing opportunities. AI nowadays has various implications on healthcare, business, education, finance, law and etc. The telecommunications sector is one of the industries that will be dramatically transformed, as the combination of AI, 5G and IoT will create an environment of ‘Intelligent Connectivity.’ This will enable AI-driven algorithms to anticipate and determine users’ intent, and create new services and customer solutions.

WHAT ARE THE MAIN CHALLENGES IMPACTING THE GLOBAL TELECOM INDUSTRY TODAY? The key challenge of the global telecom industry is the competition from OTT services. Nowadays, customers use at

least one messaging/voice app in everyday communication. These apps are popular as they deliver a great customer experience. Telco operators should not compete with OTT providers but find effective ways of collaboration in order to enable customers use the services they want in an effective manner.

WHICH TECHNOLOGIES WILL HAVE THE MOST IMPACT ON THE MOBILE ECOSYSTEM IN 2020? The top impact for the next year on mobile eco system will come from the development of AI, IoT and cloud services in correspondence with BIG data. This will have the biggest impact on the mobile ecosystem in 2020

TELL US ABOUT THE ADVANTAGES AND DISADVANTAGES OF MOBILE PAYMENTS, WHICH HAVE BECOME AN INSEPARABLE PART OF OUR LIVES. Mobile payment is designed to allow users to make online payments for goods and services through a mobile phone device or to use it in physical stores. The biggest advantage is that it makes it easier for customers to pay you. Instead of having credit cards or cash, mobile payments support contactless payments via their smartphones. Mobile payments make it possible to integrate loyalty and reward programs since customer information is stored in the app, enabling customers to be sent targeted offers. Mobile payments can also provide customer data, such as how frequently they shop at your business, how much they spend, and what their preferred payment method is. Considerable disadvantages of mobile payment services are that there are many stores that do not support this payment method. In addition, not all the devices support the Near Field Communication (NFC), technology enabling transaction data to be sent to the payment terminal. There is a risk of transactions being performed in case of the phone theft. Security is a top concern.

DOES VEON GEORGIA HAVE ANY COUNTRY-SPECIFIC DIGITAL PROJECTS SET FOR THE NEAR FUTURE? Digital development and providing innovative products to customers is among the core strategies of Beeline. We actively work on enrichment and modernization of existing digital channels. In the near future, we plan to launch several new digital projects delivering new digital experience for our customers and B2B clients. Virtual assistant, modern self-service virtual offices, as

well as other innovations will be introduced.

WHAT DO YOU THINK THE MOBILE INDUSTRY WILL LOOK LIKE IN 10 YEARS’ TIME? In 10 years, 5G with a combination of AI will have reshaped not only mobile but also all other industries. Development of new directions: smart houses and cities, transports without pilots, robotics, digital hospital services and more, is to be expected. This in turn will change the way organizations operate.

Transparency International (TI) Georgia: Signs of Nepotism in Public Service BY TEA MARIAMIDZE

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on-governmental organization Transparency International (TI) Georgia studied the asset declarations of public officials and identified cases when their family members are employed in the same agency, related administrative agencies or sub-agencies. Most cases were found in local authorities, but similar cases have been revealed in the central government and judiciary field. The NGO says that questions occur when the family members of some officials, who had no prior experience as civil servants, were employed right after said officials took their posts. TI study revealed more than 350 such cases in different regions of Georgia, noting that this may be a sign of nepotism and conflicts of interest. The study revealed that in the local government, it is common for public servants to hire family members after being appointed to a managerial position. “There are cases when family members of officials work in the same agency,

Image source: smallbusiness.co.uk

violating the Law on Conflict of Interest and Corruption in Public Institutions, except in cases of competition,” TI said. The NGO added that there are often cases in the judicial system where family members of judges work in the same

system, and in some cases in the same district court. TI stressed that the tendency to employ family members in the public service has also been revealed in the Parliament of Georgia.

“All MPs whose family members are employed in the public service are members of the parliamentary majority,” the organization said. TI also underlined that the mentioned cases do not necessarily imply that all people affiliated with the officials have been employed in public service by bypassing or violating the competition rules and it also does not question the professionalism of particular persons. “However, given the shortcomings in the enforcement of anti-corruption legislation in Georgia, the number of such cases indicates the existence of a systemic problem and the need for an effective response,” the NGO said. The results of recent sociological surveys show that a significant portion of the population lacks confidence in the process of employment in the public service. The research conducted by the Caucasus Research Resource Center (CRRC) commissioned by TI Georgia in FebruaryMarch 2019, revealed that 59% of respondents believe abuse of power by public officials is widespread. Among those who believe that abuse of power is widespread, 91% believe that officials use their position to employ family members, relatives, and friends.

According to a CRRC Georgia survey released by Open Society Georgia in April 2019, 68.8% of respondents believe that relatives of ministers will be employed in public service more easily than a candidate with professional skills and knowledge. The survey shows that 53% of respondents think corruption is widespread in ministries. Among those, 63% believe that corruption is a form of nepotism, with 51% saying that corruption is widespread in local governments and 59% referring to nepotism. Moreover, 47% of respondents believe that corruption is widespread in the courts, while 49% claim there is nepotism there. To note, in the Corruption Perceptions Index (CPI) 2018, released by Transparency International in late January, Georgia leads Eastern Europe and Central Asia countries with a score of 58. Georgia has advanced its score by two points since last year, taking 41st place among 180 countries. In the ranking, 100 points indicate the lowest level of perceived corruption while 0 – the highest. Georgia’s CPI scores during the recent years are: 2012 – 52 points, 2013 – 49, 2014 and 2015 – 52, in 2016 Georgia was placed 44th with a score of 57 and in 2017 – 56 points and 46th place.


BUSINESS

GEORGIA TODAY OCTOBER 22 - 24, 2019

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USAID’s Peter Wiebler on ‘Empowered Citizens for Responsive Politics’ the country to grow its economy in a more inclusive way, strengthen its democratic institutions and, in a broader sense, move closer to the Euro-Atlantic community. In a developmental sense, we are trying to help Georgia reach a level where foreign assistance is no longer necessary. We don’t pick favorites. We don’t favor one political party over another. Through our assistance, we’re helping Georgia achieve goals that its citizens have already set. Which party or parties lead Georgia closer to those goals, is for the Georgian people alone to decide.

USAID/Georgia Mission Director Peter Wiebler presenting USAID’s new elections initiative. Photo credit: USAID/Georgia

EXCLUSIVE INTERVIEW BY BEKA ALEXISHVILI

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n 18 October, USAID held a public event titled ‘Countdown to 2020: Empowered Citizens for Responsive Politics.’ During the event, USAID presented its new Elections and Political Processes initiative. The four-year initiative covers a broad range of non-partisan activities supported by the American people and implemented by nine different organizations, including six Georgian CSOs. The initiative focuses on supporting more responsive and citizen-centered political and electoral processes. It is the U.S. government’s primary electoral assistance initiative for Georgia’s upcoming 2020 and 2021 electoral cycles. Nine different organizations are involved in the program: the International Foundation for Electoral Systems (IFES); the International Republican Institute (IRI); and the National Democratic Institute (NDI); the Georgian Institute of Politics (GIP); the Eastern European Centre for Multiparty Democracy (EECMD); the Georgian Young Lawyers Association (GYLA); the Inter-

national Society for Fair Elections and Democracy (ISFED); the Public Movement Multi-National Georgia (PMMG); and Transparency International Georgia (TI). Together, they will carry out various activities to support better civic engagement and increased oversight over the country’s political system. The budget of this program encompasses approximately $14 million over four years, with a large portion of the money going to support the work of local organizations to empower citizens for the approaching election cycles and beyond. This is particularly important as Georgia is currently undergoing a transition to a new proportional system of elections. Moreover, this shift emphasizes the need and the role of watchdog organizations to conduct monitoring and ensure the integrity of elections and political processes. GT had the honor to sit down with USAID/Georgia Mission Director Peter Wiebler to discuss the details of the program and Mr. Wiebler’s personal outlook on the USAID project.

WHAT IS THE OVERALL GOAL OF USAID SUPPORT FOR GEORGIA? The overall goal for USAID, which is part of the US government and is carrying out official policy in Georgia, is for

"RESPONSIVE POLITICS" IS A MAIN THEME OF USAID SUPPORT IN THE ELECTIONS AND POLITICAL PROCESSES SPHERE. HOW DO YOU DEFINE RESPONSIVE POLITICS? WHY IS THIS IMPORTANT TO GEORGIA'S DEMOCRATIC DEVELOPMENT? The classic American answer to that is ‘government of the people, by the people, for the people.’ That is enshrined in our constitution, and that’s the way Americans look at the world. We understand that not everybody looks at the world that way, but I think that this point holds true. Government exists to serve the interests of the people, and the authority of governments comes from the people. So, when we talk about responsive politics, it means that we want to help Georgia build a system where the citizens drive the government’s agenda.

HOW IS USAID HELPING SUPPORT MORE RESPONSIVE POLITICAL PROCESSES? The program we’re talking about today has a number of interesting parts. USAID has supported Georgia’s electoral processes for quite a while now. Now, we’re doing it in a different way than we did before. We’re announcing a program to strengthen Georgia’s democraticallyoriented political parties, to help citizens engage more in electoral and political processes overall, and to strengthen electoral oversight so the entire electoral system has more integrity and better serves the will of citizens. Also, we seek to help Georgia’s underrepresented

Partners, political experts, and citizens participated in USAID’s launch event. Photo credit: USAID/Georgia.

groups, ethnic minorities, people with disabilities, or folks from the regions who normally don’t get as big a voice in Georgia’s political system. We are trying to help those people become better represented. That’s the idea behind the program we are announcing today.

USAID HAS SUPPORTED GEORGIA FOR NEARLY 30 YEARS. WHAT IS DIFFERENT ABOUT YOUR NEW INITIATIVE?

with a much bigger pool of partners, including, most impressively, numerous Georgian partners and CSOs through which we will be implementing the program. Of note, we have doubled the number of Georgian implementing partners and doubled the amount of funding provided to these partners.

WHAT ARE YOU MOST EXCITED ABOUT?

Three things are different about this initiative. One is that, instead of focusing mostly on strengthening political parties and supporting the electoral system, we are putting the Georgian citizen at the center of this new program. The activities are designed to give citizens more tools, information, and opportunities to get involved in the political process. The second point is that the program emphasizes engaging citizens living in Georgia’s regions. We are putting a bigger emphasis on support for regions-based civic groups and community organizations to get involved in the political process. We are also supporting stronger monitoring by Georgian organizations working in the regions to ensure that elections and political processes in general are played by the rules. The third point is that we’re working

First of all, I’m excited about Georgia because Georgia has a great future. Regardless of where you come from in the political spectrum here, you look at the political environment, and there’s freedom of speech. You hear people criticizing the government, also you hear people supporting the government. Georgians have neighbors to the north where you can’t do that, and neighbors to the south where you can’t do that. I think it’s important to highlight that point. Secondly, I’m excited to work with our partners and the Georgian people to get citizens more involved. That’s the only way the country will move toward more responsive democracy. That’s what I’m most excited about. We have an exciting year ahead of us as we look toward 2020. But most importantly, I’m just excited about this country and the fantastic future it has.

regrettably had lots of in our region these past few years, and the international challenges, Georgia’s economy has still found ways to stable development,” said Matchavariani. The Minister also talked about the country’s goal of economic growth for the next year and of ways Georgia can continue to enjoy the full support of internationally important economic figures.

“We jointly assessed that a 5% growth that we have planned for the next year, is quite courageous and ambitious considering the givens,” he said. “The most important thing is that we keep on with our reforms. Each on-going reform needs to be fulfilled. Institutional and fiscal reforms must also be kept up. Our partners say that if we sustainably follow this direction, they will continue to support us.”

ADB President: Georgia Can Have a Big Role in Strengthening Trade between Asia & Europe BY NINI DAKHUNDARIDZE

T

he President of the Asian Development Bank, Takehiko Nakao, met with the Minister of Finance of Georgia Ivane Matchavariani. At the meeting, Nakao assessed Georgia’s potential, saying that “Georgia can play a big role in strengthening economic trade between Asia and Europe.” Within the frames of the annual talks of the International Monetary Funds and World Bank, the sides discussed prioritized directions connected to Georgia that should be taken in the years 20192023. The plan aims to strengthen regional ties, encourage the private sector, boost transportation infrastructure to support

urban development and expand the role of the ADB in the fields of education, professional development and public management. "I had an efficient meeting with the Georgian Finance Minister,” Nakao said. “I visited Georgia last year and I was amazed by the great effort the country is making to improve the business environment.” The Asian Development Bank is an important partner for Georgia. A regional development bank established in 1966, the ADB is headquartered in the Philippines, maintaining 31 field offices around the world to promote social and economic development in Asia. To date, the funding the ADB has provided for Georgia stands at around $2.4 billion. The key development priorities of ADB in Georgia are to foster inclusive and

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sustainable economic growth, accelerate poverty reduction, and enhance regional connectivity. Priority sectors include transport, water supply and sanitation, energy, public sector management, and finance. In October 2016, Georgia became the 11th member of the Central Asia Regional Economic Cooperation (CAREC). Minister Matchavariani evaluated Nakao’s outlook on the importance of Georgia in the world of economy, saying: “The International Finance Institute and our partners have praised Georgia’s successful reforms.” He reported that during every meeting that was held within the frames of the annual talks, Georgia’s progress was emphasized. “It is especially evident to our partners that despite the shocks, that we have

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Profile for Georgia Today

Issue #1196 Business  

October 22 - 24, 2019

Issue #1196 Business  

October 22 - 24, 2019

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