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BUSINESS WEEK April 28, 2014 #51

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April 28, 2014, Issue 51

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BE INFORMED, DO BUSINESS

Mamuka Khazaradze Plans to Build Seaport and Mega Shopping Mall in Anaklia

GEORGIA GEORGIA’S FOREIGN TRADE IN Q1’14

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TALGAT BAITAZIEV COOPERATES WITH SEPARATIST REGIME

wo actions were filed against Talgat Baitaziev, General Director of Batumi Port, one to London Court of International Arbitration and the other to the Batumi City Court. Pg. 7

CIS GAZPROM SENDS UKRAINE $11.4BN BILL FOR UNSHIPPED GAS

ussia’s Gazprom, the world’s biggest natural gas producer, has sent a $11.4 billion bill to Ukraine’s Naftogaz. Pg. 10

AZERBAIJAN CHINA SHOWS INTEREST IN AZERBAIJANI SATELLITE PROJECTS

hina is planning to take part in Azerbaijan’s upcoming satellite projects. The statement came from the Ambassador of the People’s Republic of China to Azerbaijan. Pg. 11

WORLD NEWS THERE’S A SHOCKING CONNECTION BETWEEN EATING MORE CHOCOLATE AND WINNING THE NOBEL PRIZE

he above chart showing the relationship between a country’s chocolate consumption and Nobel Prize victories is making the rounds on Twitter, perhaps because it’s Easter. Pg. 13

SPRING WORKS COMING TO AN END IN MARNEULI AGRO

RUSSIA EMERGES AMONG GEORGIA’S TEN TOP WINE IMPORTER COUNTRIES

he real exports of Georgia wines to the Russian Federation in 2013 exceeded the initial plan twice. According to the RBC, in six months after the embargo removal, Russia imported 21 million bottles of Georgian wines. This move has included Georgia into the list of ten top importer countries, experts assert. In whole, in 2013 Georgian wines constituted 5.45% in Russia’s wine imports that is 2.42% of the total market. According to the Georgian Wine Agency, in the first quarter of 2014 the Russia’s ratio in Georgia’s total wine exports made up 71%. Vyacheslav Odegov, a head for ILS company marketing service, noted after the embargo removal many companies included Georgian wines in their portfolio. Georgian wine products have shown better indicators than expected initially. Moro, a Georgian wines exporter company, says the Russian customers have not forgotten Georgian wines for the last 8 years. At the same time, the Russian embargo on Moldova wines has also

promoted the Georgian products, the company representatives noted. Russian retailers say, despite the current situation, it is doubtful that Georgian Kindzmarauli will remain in the TOP-3 for longer time. France, Italy and Spain are the leaders in terms of sales. Experts assert the popularity of Georgian wines was mainly conditioned by the propaganda that started last year over the return of Georgian wines to the Russian market. The Russian customer gives preference to cheap wines from the secessionist Abkhazia, they say. Georgian winemakers calculate the price of a bottle of Georgian wine without logistics expenditures, customs taxes and other indicators and this price ranges from 3.18 to 3.2 USD, while the purchase price of imported wines in the Russian Federation ranges from 2.3 to 6.6 USD and these prices are higher compared to European products, ILS company representatives noted. Wine prices in Russian stores are triple higher compared to the purchase price, Vyacheslav Odegov noted.

Irakli Kovzanadze: The Main Thing is to Save Investment Direction Pg. 4

Israeli Ambassador to Georgia: Visa-Free Regime Remains Unattainable for Job Seekers Zurab Margvelashvili: Construction of Khudonhesi-scale power plants in necessary for the large electricity consumers

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SIX NEW STATIONS HAVE BEEN ADDED TO ROMPETROL GEORGIA’S NETWORK Pg. 5

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TBC BANK ISSUES MORTGAGE LOANS TO LISI DEVELOPMENT CLIENTS WITH 0% TO 8.44% INTEREST RATE Pg. 9

THE MAIN TOURISTIC BRANDS OF OLD TBILISI Pg. 6

MAIN EVENTS caucasian business week

April 28, 2014 #51

GEORGIAN ENERGY MINISTER TO KVIRIKASHVILI RECEIVED ROYAL MEET TRANS ADRIATIC PIPELINE PHILLIPS DELEGATION ice Premier of Georgia, Minsiter of Economy and Sustainable DePROJECT MEMBER COMPANIES AND velopment George Kvirikashvili received delegation of Royal PhilSHAREHOLDERS lips headed by executive director

ice- Premier and Energy Minister Kakha Kaladze will meet companies and shareholders participating in the Trans Adriatic pipeline [TAP] project.

The meeting is attended by Chairman of the Board of Directors of “TAP” consortium and “Statoil” Vice-President, Director of SOCAR in Georgia, Azerbaijan’s Extraordinary and Plenipotentiary Ambassador to Georgia and other members of the consortium member companies. The sides will discuss prospects of the “TAP” project and cooperation with Georgia. In the frames of the second phase of development of the Shah Deniz field in the Caspian Sea, the Consortium made a decision which includes the selection of the route for the transportation of natural gas in Italy through Azerbaijan, Georgia, Turkey, Greece and Albania. Trans - Adriatic Pipeline is a part of the transportation route from Greece to southern Italy through Albania and the Adriatic Sea. Its length is about 800 km while the throughput from 10 to 20 billion cubic meters. This is consortium’s first high- level visit to Georgia. “TAP” shareholders will pay a 2 - day visit to Georgia on April 22-23.

of the corporation Harry Hendricks. On the meeting the sides talked about ongoing processes in Georgian economy and investment potential. It was revealed that Royal Philips plans opening of the regional representation in Georgia. Through it the company will cover South Caucasus countries and work with Central Asia countries. Attention was also made on the innovation projects of Royal Phillips in energy and education. As vice premier, Minsiter of Economy and Sustainable Development George Kvirikashvili stated, all these are relevant to the new challenges, to which Georgia faces. “Georgian government has a clear position to maximally promote company’s activities”, - vice

premier, Minsiter of Economy and Sustainable Development George Kvirikashvili stated. Deputy minister of Economy and Sustainable Development Keti Bochorishvili and head of National Investment Agency George Pertaia also attended the meeting.

GEORGIA’S FOREIGN TRADE IN Q1’14

DAVID ONOPRISHVILI EXPLAINS “GEORGIAN DEVELOPMENT BANK’S” OPERATING PRINCIPLES

hairman of Finance and Budget Committee makes clarifications concerning “Georgian Development Bank”. The government bill providing for the creation of the

bank entered the Parliament’s bureau yesterday. Meanwhile, the government recalled a legislative package that involves renaming “Partnership Fund” into “Sovereign Fund” from Parliament, as the Development Bank is formed as a result of the reorganization of the Partnership Fund. David Onoprishvili says that a development bank operates in many countries and is not a commercial bank by any sign. According to him, such banks issue low-interest loans for strategically important projects or for the purpose of financing or refinancing and development of such sectors which are not funded by the private banks. According to the bill, “Development Bank” will be entitled to issue loans through a bank as well as the issue guarantees, bonds and insurance operations. However, it is prohibited from accepting deposits and payments.

“VAZIANI “ FOUNDER HAS THE AMBITION TO CHANGE GEORGIAN WINE MARKET

aziani “ founder Irakli Iashvili has the ambition to change the Georgian wine market. The businessman says that his company “ VAZIANI “ , which sells products only for export, will seriously correct the Georgian wine market in a few years. Iashvili states commersant.ge that “ Vaziani “ new modern plant, which was built in Telavi last year as a result of the company’s reorganization, plans to double the production volume by 2015 and produce more than 3 million bottles of wine. According to Iashvili, “VAZIANI “ is going to pour kvevri wine and next year will build an ultra-modern cellar for this purpose where the highest quality premium wine in this segment will be made. “This wine will be presented on the Georgian market as well” , - he said. As for the export area, the businessman notes that “ VAZIANI “ grows export every month and is in talks with various countries. In his

words, talks are underway with regard to the distribution with the giant European and American networks, but he has refrained from specifying information. The company has reached an agreement with China in terms of distribution and sale. Iashvili adds that the company’s representative office will be established in China in March and “ VAZIANI” will sell its products in this country itself. “Our wine is in a great demand in Kazakhstan. We can say that we are the first among Georgian companies in terms of sales , we sell over half a million bottles of wine in Kazakhstan annually “, - Iashvili notes, though, adds that unlike Kazakhstan , the situation has radically changed in Ukraine due to the political developments. “ Vaziani “ founder does not exclude the company will suspend exports of wine to Ukraine. The company also exports its products to Sweden, Poland, the Baltic countries, Vietnam, India and South Korea. One bottle of “Vaziani” wine costs 3 -12 USD.

Georgia’s foreign trade figures in first quarters of 2010-2014 in million U.S. dollars. Source: Geostat

eorgia’s foreign trade increased 18% year-to-year in the first three months of 2014 to USD 2.52 billion with the trade gap increasing 11.5% y/y to USD 1.13 billion, according to the state statistics office Geostat. Exports increased 23% y/y to USD 696 million in January-March, 2014 and imports increased 16% y/y to USD 1.82 billion. Turkey remains Georgia’s largest trading partner with turnover reaching USD 368.4 million in the first quarter of 2014, followed by Azerbaijan – USD 319.7 million. Russia, which was Georgia’s fifth largest trading partner in the first quarter of 2013, is now the third one with up to USD 190.3 million in January-March, 2014, 56.8% y/y increase. That increase is caused mostly by exports of Georgian wines and mineral waters to Russia, which was banned by Russia up until late spring, 2013. Value of Georgian wines exported to Russia in the first quarter of 2014 stood at USD 33.1 million, accounting up to 70% of total Georgian wine exports in January-March, according to Geostat figures. Value of mineral waters exported from Georgia into Russia in the same period stood at USD 16.65 million, accounting 48.4% of total exports of the Georgian mineral waters in the first quarter of 2014. Ukraine is Georgia’s fourth largest trading partner with USD 167.9 million turnover in JanuaryMarch, 2014, followed by China – USD 165.8 million; Armenia – USD 122.4 million; Germany

– USD 115.5 million; the United States – USD 108.7 million; Bulgaria – USD 89.2 million; Japan – USD 79.2 million. Georgia’s trade turnover with the EU increased 15% y/y in the first quarter to USD 635 million; export stood at USD 141 million, up by 45% from the same period of last year, and import was USD 495 million, a 9% y/y increase. Georgia’s trade with Commonwealth of Independent States (CIS) stood at USD 893 million in January-March, a 24% y/y increase, with exports increasing 31% y/y to 391 million and imports going up by 20% to USD 501 million. Re-export of cars still leads the pack in Georgia’s total exports with USD 152 million, followed by ferroalloys – USD 69.8 million; copper ores and concentrates – USD 51.2 million; wine – USD 47.4 million; nitrogen fertilizers – USD 45.6 million; mineral waters – USD 34.4 million; nondenatured ethyl alcohol and spirits – USD 24 million; railway locomotives – USD 22 million; hazelnut – USD 21.6 million; bars and rods of iron and steel – USD 16.6 million. Oil products topped the list of imports in the first three months of 2014 with USD 189.7 million, followed by cars with USD 149.7 million; hydrocarbons - USD 127.9 million; medicines - USD 63.2 million; mobile and other wireless phones – USD 36 million; copper ores and concentrates – USD 35.3 million; wheat – USD 28.7 million; computers – USD 21.3 million; metal construction materials – USD 19.3 million; cigarettes – USD 18.9 million

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PUBLICITY April 28, 2014 #51

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INTERVIEW 4 THE PARTNERSHIP FUND: THE MAIN THING IS TO SAVE INVESTMENT DIRECTION

April 28, 2014 #51

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An interview with the President of the Partnership Fund Irakli Kovzanadze - Recently, there were a lot of questions about the idea of the establishment of a state bank on the basis of the Partnership Fund. So it is important to know what the Partnership Fund represents. - The Foundation was established in 2011 and its goal is both the management of state shares in various business assets, as well as support for investments in such strategic sectors of the Georgian economy as energy, agriculture, real estate and manufacturing. First of all, it refers to financial participation in projects along with investors - it could be equity participation, subordinated loans, etc. The Partnership Fund includes such large state-owned companies as “Georgian Railway “, “Oil and Gas Corporation “, “ The State Energy System of Georgia” and a 24,5% share in the electricity distribution company “Telasi” . In 2013, the Fund participated in the investment of 3 projects - 2 hotels in resort areas and a large, modern equipped pig farm, which by our calculations, should master 20-25 % of the pork market in Georgia. The principle of the Fund activities is as follows - we contribute to the implementation of the proj-

MAMUKA KHAZARADZE PLANS TO BUILD SEAPORT AND MEGA SHOPPING MALL IN ANAKLIA

hairman of the Supervisory Board of “TBC Group” Mamuka Khazaradze spoke about the details of his own mega projects in “Business contact” program on TV channel “Maestro”. The businessman announced about these projects still in early March. Today Khazaradze says that they are waiting for the government’s decision to implement these projects. Khazaradze names Anaklia port construction among his mega projects which will be implemented in cooperation with American partners. He says it is a few billion project which, according to the businessman, will be not only economic but also a political project and in the case of its implementation, the residents of Abkhazia and Samegrelo will have the employment opportunity. Another project is mega -sized shopping centers,

whose design is already underway. One of them will be located in Tbilisi in a building bought by “TBC Bank” a few years ago. The second commercial object will be operational in Batumi. Khazaradze says that 100-130 million USD will be invested in the project, which will provide for local retail business development, as well as the introduction of new brands. In addition, Khazaradze says that his group plans to carry out a medical project. The project which refers to “TBC Bank” will also start. Khazaradze speaks about tea business noting that he wants to repeat the ‘Borjomi’ success, which has become a multinational company. According to the businessman, work on the capital attraction is underway in order to modernize “Gurieli” tea and to return the Georgian tea to the space which was known to it and to enter new markets, including South Africa.

ISRAELI AMBASSADOR TO GEORGIA: VISA-FREE REGIME REMAINS UNATTAINABLE FOR JOB SEEKERS

srael’s ambassador to Georgia Yuval Fuchs made some explanations in connection with cases of refusal of the Israeli authorities to let the citizens of Georgia in the country despite the fact that visa-free regime between the two countries entered into force on March 6. According to him, it applies to tourists and visitors , but not to those who want to find work in Israel. “I do not remember a single occasion when a decision to abolish visas was adopted as quickly as against Georgia. I worked in Moscow when visafree regime between Russia and Israel was introduced, but it took a lot more time . Typically, the procedure for ratifying the agreement takes place within 90 days , but for Georgia it was decided not to pay attention to this rule . This acceleration of the process is a certain gesture of Israeli leadership towards Georgia, “- said Fuchs . In his words , in any case the final decision whether or not to let one or another visitor to the country, is taken be the Border Service , and anyone visiting Israel should consider a number of recommendations that will minimize the risk of failure. “There are a number of technical issues . Let’s

start with the fact that the visa-free regime applies only to tourists , those who wish to find a job still have to obtain visas. The final decision to let anyone in the country is taken by the Border Service . I can go to the U.S. , with which Israel has visa-free regime , but I can be brought back . The border police has a number of recommendations - foreign passport must be valid for at least another 6 months , a hotel must be booked, an amount should be sufficient in order to convince the authorities that you can afford to spend some time in Israel without work. It is also desirable to have insurance . It’s pretty simple conditions that significantly reduce the chance that you will not let into the country. Further details can be found in the Israeli consulate in Georgia “- said the Ambassador. According to him, there are no specific recommendations for the citizens of Georgia, there are general rules for all foreigners wishing to visit Israel. “Despite the fact that in the first two weeks the Georgian tourists may encounter some problems, I’m sure that if they follow all the rules and guidelines, in the future they will be able to avoid them,” - said Yuval Fuchs.

ect, and then after it becomes profitable, we go out of business and sell our stake to partners or find other interested investors. Most major projects that we carry out are dealing with energy - in particular, the Partnership Fundparticipates in the construction of a 230 MW thermal power plant in Gardabani, together with the Turkish company “Chalik group”. The total project cost is 210 million USD. A project of another major power plant is under development – Neskra HPP with a capacity of 210 MW. The construction of a new port on the Black Sea coast of Georgia is also in agenda. It is known that our major ports - Batumi and Poti have been almost mastered and there is the need to build a deepwater port capable to receive large ships, as the volume of dry cargo annually grows by 18%. Therefore, the decision was taken to build this port. At this stage, there is a general plan of the port with 6 berths, which would cost 540 million USD and construction will take 4 years. Now the most appropriate site is being selected in which the Japanese company is engaged. Roughly, in about 2 months we will know the best place to build a port.

As soon as the project is finally approved, we will announce a tender. The Fund will take a certain part in financing, but we will try to build the port at the expense of investors. - Recently, there is a lot of talk about the reorganization of the fund and creation of a stateowned bank on its basis. At what stage is the process and how much do you agree with the idea of creating a state-owned bank? - Everything is under discussion so far. When the bill is submitted to the Parliament and its discussionbegins, we’ll also take part in this. With regard to our position on this issue, the most important thing is to save the investment direction, as the country has a real problem of deficit of long-term capital rather than loans. Today, commercial banks have excess liquidity and they may lend, the only problem is that it is difficult to find good corporate clients, which could be given loans. In general, the Georgian economy faces a shortage of well-designed and brought up to standard high-level projects. We get a lot of projects, but after a more detailed study, it becomes clear that these are only ideas that have no financial justification or market research, or anything else.

HOW FORAGING FOR FRUIT IS CHANGING LIVES IN GEORGIA

eorgia is almost entirely dependent on agricultural imports and reliant on an inefficient soviet farming system. But with Oxfam’s support things are starting to change. To mark International Women’s Day, Caroline Berger, Oxfam’s media officer, travelled to Georgia to find out how foraging for fruit is changing the lives of women and opening up new trade opportunities for the country. Galavani on the outskirts of Georgia’s capital is home to hundreds of people who have been displaced by conflict in the early 90s and more recently in 2008. Lia, like many women living here, is struggling to make ends meet and reliant on lowly state pensions to feed her children, especially during the harsh winter months. Lia fled conflict in South Ossetia and arrived in Galavani with nothing. During the Soviet times, life was prosperous and Lia earned a decent salary exporting home grown apples to Russia. She wistfully remembers, ‘In those days, we had enough income and each harvest would help us to live. When we came to this village, we had to start all over again.’ To earn a living many women like Lia resorted to picking rose hips, a flavoursome berry known for its natural remedies which grows in abundance in the Georgian forests. But Lia earned little money selling rose hips to the local middle men. ‘During the harvest season it rained and the water affected the quality of our rose hips. We only received 80 tetri (20p) per kilo,’ explained Lia. With Oxfam’s support in the form of a solar drying green house, Lia and 30 other women who have been displaced from conflict are now able to dry their rose hips and get a better price for their produce. For Lia the extra income means she can take care of her family. Lia’s eyes light up when she talks about her new business; ‘Before we had to make tough choices between putting food on the table or paying bills to heat the house. Now we’re hopeful about the future, and I have a steady income.’ REAPING THE BENEFITS OF WORKING TOGETHER For the first time since the collapse of the Soviet Union, Lia and other women in the village are forming a cooperative and learning to reap the benefits of working together. Their cooperative, ‘The Gift of the Forest’ will be the first of its kind in Georgia. Lia explains, ‘During the Soviet times, I remember my family worked in a cooperative. We didn’t have the knowledge of how

to run a cooperative or the power to make decisions. We didn’t know where our product was being sold but now we have much more control and ownership.’ Nunu (right) is a member of the rose hip cooperative. Since joining the group, her profits have doubled. ‘Since we’ve had this greenhouse solar dryer, my income has increased by 300 lari (90 pounds) during the harvest season.’ The extra income means that Nunu can support her children’s education. She smiles, ‘Before we didn’t have enough money to pay for university but now my eldest son can finish his education.’ Rose hip juice has always been popular in Georgia due to its organic properties but few investors outside of the country knew its value. But all that changed when Oxfam and its partner the Rural Communities Development Agency (RCDA) exhibited the juice at an organic fair in London, which attracted the interest of a Japanese investor. Rose hip berries are famous in Japan as it’s believed they protect the immune system against radioactive materials. Since then Oxfam and the RCDA have joined forces with the private sector to buy dried rose hips from Lia’s cooperative and process this into juice for export as far as Japan. Giorgi Abashidze (above, centre) is the head of Bioproduct LTD factory. When the new factory opens this month, it will take as many berries as the women can pick during the harvest season, turning it into juice and providing a regular income for hundreds of people in the community. The factory has the potential to produce 4,000 bottles per hour, and sell some 30 tonnes at the local market. Giorgi has big ambitions, ‘We plan to export 50 tonnes of juice to Japan each year. In the future our goal is to expand and double our export sales’ Rostom Gamisonia, the head of Oxfam’s partner organisation RCDA (above, right), is excited about the possibilities the new factory will bring. ‘The rose hip juice has been certified as organic,’ he explains. ‘With this certificate it won’t be difficult to start exporting it to European countries.’ Rostom hopes the signing of new EU trade agreement will open up even more trade opportunities. For Lia, the cooperative represents more than just profits. ‘This project has given me hope,’ Lia smiles warmly. ‘Every morning, I feel like my life has new meaning.’ In the future, Lia plans to expand her business and find ever more forest fruits to export abroad. She hopes that one day the markets will depend on her. For now, Lia’s next venture is picking flowers and selling them forInternational Women’s Day.

BUSINESS April 28, 2014 #51

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SIX NEW STATIONS HAVE BEEN ADDED TO ROMPETROL GEORGIA’S NETWORK

dditional 6 stations have been added to Rompetrol Georgia’s stations network. According to the management new stations have been opened in: Sanzona District (Guramishvili ave #64), Varketili District (Javakheti St, near the market), Isani District (Near the Southern entrance of the market), Marshal Gelovani avenue (in 250 meters from the main trafficlights), on Agmashenebeli valley 13th km (near CEC building) and on Kakheti Highway (on the crossing of the former Tsekavshiri” base). With the growth of the network it will be more easy and comfortable for the customers to purchase fuel. New stations after restling are mostly presented in white, orange and red colors. On all six stations up to 60 persons have been employed. The seventh station is currently under works after opening of which in the nearest future number of newly employed people will increase up to 70. In accordance with the codex of labor station attendants will work in four shifts. Rompetrol Georgia has been operating on the

Georgian market for aready 9 years, is expanding steadily and successfully and offers customers excellent service terms and fuel of European quality. Substantial investments will be made in the development and expansion of the network. We are glad that we have created additional jobs and employed people. As for the future plans, this year the process of network expansion will continue countrywide. We are planning to open 10 additional stations” stated the General Manager of Rompetrol Georgia Mr. Serik Salikov. Currently 71 stations under Rompetrol brand operate countrywide. In order to ensure the exactness of the refuel, starting from 2008 Rompetrol constantly carries out automation of the network. In the nearest future company will offer interesting and incentive based projects and actinos. It must be highlighted that for already second month “Rompetrol Georgia” is managed by the new General Manager – Mr. Serik Salikov. Transnational Company Rompetrol represents one of the largest fuel suppliers on the Georgian Market. Headquarters of The Rompetrol Group is

located in Amsterdam and unites up to 50 companies under its hood. Currently Rompetrol supplies the Georgian Market with 5 types of fuel.

Three types of gasoline - Euro Regular, Efix Euro Premium, Efix S and two types of diesel - Efix Euro Diesel and Euro Diesel.

COMPANY NATAKHTARI WON THE NOMINATION IN GREEN TECHNOLOGY

he Ministry of Natural Resources and Environment Protection awarded companies in various nominations of Georgian Green Business Award. Companies meeting environmental

requirements in their activities were declared as winners. Company Natakhtari was among successful enterprises and won the Green Technology nomination. As stated at the award ceremony, the Ministry announced the contest for the first time and seventeen companies applied for participation. Five enterprises received the Certificate of Appreciation and 12 got awarded. The contest had 9 nominations: grand prix - Green Business of the Year, Green Product / Service, Green Practitioner, Green Building, Sustainable Vision of the Year, Green Company and Green Mobility. The contest winners were identified in two ways: by monitoring group (staffed with representatives of the Environment Supervision Department, NGOs and independent experts) and through voting (facebook and / or webpage). “Company Natakhtari is delighted that it came as

a winner of the contest - Georgian Green Business Award. It is especially gratifying that promotion of enterprises caring for the environment is so important for the state. It is worth to note that winners got identified from various industries, I congratulate them all. We are proud of such award, since we consider ourselves obliged to take care of the environment. Sewage water purification premises were constructed in 2011 in the company and the investment made exceeded GEL 6 million. You would agree that the volume of this sum emphasizes significance of the project implemented in cooperation with the EBRD. I would like to thank the organizers of this event and express hope that the number of participants will increase in the future,”- said Nikoloz Khunshakishvili, Natakhtari’s Director of Corporate Affairs. The Contest Georgian Green Business Award of the Ministry of Natural Resources and Environ-

ment Protection was announced in last October. 17 Companies expressed desire to take part in the contest. Companies of all sizes (small, medium, large) were encouraged to participate. Green Business implies such company or an enterprise, which takes into account environmental requirements in its activities and aims to fulfill those, provides information to each stakeholder or customer on importance of environment protection and assists employees to make decisions beneficial for the environment and sustainable development of the country” – explained the Ministry representatives. The Contest aims to encourage Georgian business representatives to operate within the environmental and social responsibility framework, increase motivation of entrepreneurs, incentivize those companies that care for the environment and introduce the best practice by manufacturers.

SPRING WORKS COMING TO AN END IN MARNEULI AGRO Cucumber Yield is expected by the end of May

ajor spring works launched for the year of 2014 at Marneuli Agro are coming to an end. The first stage, covering growing of cucumber and tomato seedlings, ended for which special species designated for industrial production were selected. “At this stage cucumber is being sowed in the open ground. The advantage of cucumber sowed in this way is determined by a well developed root; in addition the period of harvesting is longer. We are expecting yield at the end of May. Crops cover 26 hectares this year, which is much more compared to the previous one, respectively we are expecting bigger yield,” – said Vano Tsukilashvili, Marneuli Agro’s Director. Marneuli Food Factory is planning to increase production volume, respectively the area of cultivated land also increased. For the purpose of improving the harvesting technologies, the company acquired additional tractors and cucumber pickers. Three new cucumber pickers will arrive at the end of April from Germany. Investments were made in trailers. Eight new trailers will be added to machinery park of Marneuli Agro that will ensure prompt transit of harvested products. New investment will simplify supply from field to factory, which will improve the quality of products. Marneuli Food

factory expects to receive the first yield of cucumber from the end of May. Georgian consumers will have the opportunity to buy Georgian cucumber in 200 ml – 18kg packages. As regards the tomato yield, it needs to be noted that tomato processing starts in mid-July and goes till September. The factory receives raw materials from its own farm Marneuli Agro and local farmers. After harvesting the product, the tomato processing is conducted by means of Fenco Italian machinery, the production capacity of which reaches 500 tons during 24 hours. Automated production process fully ensures high quality of products. Marneuli Food Factory is a part of Margebeli Holding established in 2007 and represents one of the largest enterprises in Georgia. The factory, equipped with the European quality machinery, produces over 50 natural and tasty jarred products made of Georgian raw materials. The factory receives raw materials from Marneuli Agro, one of the holding members, and local small farmers. Technical capacity of the enterprise, along with high quality of raw materials allows to manufacture products, with no alternative on the Georgian market. Each piece of product placed in a jar is harvested on Georgian land and is 100% Georgian. Respectively, the sign M has become a synonym for high quality and healthy food.

JIM NEUBAUER, AN EXPERT, VISITED MARNEULI AGRO VEGETABLE PRODUCTION

im Neubauer, a vegetable production expert visited Marneuli Agro within the framework of the USAID Program Farmer2Farmer. American expert is observing the process of preparations, namely land processing and planting for 2014 season during several weeks and is sharing his farming experience. The Company will permanently receive information on vegetable growing at later stages as well as advices and recommendations as to what measures are needed for increasing the yield volume. The guest reviewed spring works during his visit and positively assessed Marneuli Agro’s potential in terms of agricultural development. „It is my fourth visit within this mission framework. During three visits I was working with Marneuli Agro. Agriculture is the most complex though the most interesting sector at the same time. Marneuli Agro acquired great experience and is coping with well. Direct sowing is the best and approved method across the world and Marneuli agro is effectively doing it,” – said Jim Neubauer. „Jim Neubauer visited us several times and gave us very interesting recommendations. This year,

we were facing a problem in terms of rotten tomato cone, which was reducing yield by 40%. He shared his experience with us with respect to this issue. In general this problem is determined by three reasons: seeds are not resistant, irrigation is unequal and fertilizer is less diverse. The first reason was excluded, since we are buying seeds from a well-known brand. At this stage we‘ll focus on irrigation and also introduce some changes in the composition of fertilizers,” – explained Vano Tsukilashvili, Director of Marneuli Agro. Marneuli Food Factory is a part of Margebeli Holding established in 2007 and represents one of the largest enterprises in Georgia. The factory, equipped with the European quality machinery, produces over 50 natural and tasty jarred products made of Georgian raw materials. The factory receives raw materials from Marneuli Agro, one of the holding members, and local small farmers. Technical capacity of the enterprise, along with high quality of raw materials allows to manufacture products, with no alternative on the Georgian market. Each piece of product placed in a jar is harvested on Georgian land and is 100% Georgian. Respectively, the sign M has become a synonym for high quality and healthy food.

COMMUNITY 6 THE MAIN TOURISTIC BRANDS OF OLD TBILISI caucasian business week

he beginning of touristic season in Georgia makes tourist companies work and to rearrange their forces to offer something new to the visitors of the country. The main brands of Tbilisi mainly are located in old city and concretely on the territory on Shardin and Bambis Rigi street. Here you can see all the brands that country and the capital offers to the visitors. Georgian souvenirs, Georgian enamel, café bars with the mix of European, Asian and Georgian culture are full of tourists and local visitors. The main theme that attracts the tourists are local traditional ways of cooking and also natural materials of the souvenirs. “We mainly offer to the tourists souvenirs made

from traditional, natural materials: wood, teqa (wool of sheep) and they often ask about the origin of items and want Georgian handmade ones. There are companies that order Georgian toys and souvenirs in China that’s why they prefer originals”, said the owner of souvenir shop “Pirosmani” located on one of the popular places of Tbilisi Bambis Rigi Street Juli Egiazariants; “90 percent of my souvenirs are Georgian handmade and we try to keep this tradition. We also have silver handmade jewelries and I have to say that our shop owns exclusive right to sell the creations of Tornike Jgerenaia. He is participant of Georgian fashion week and also he signed contract with Roberto Cavalli,” she added. The idea that the shop was named as Pirosmani

Dear Sir/ Madame,

Marjanishvili State Drama Theatre has a pleasure to invite you to join the celebration of Shakespeare’s 450th Birthday. On April 29, 2014 we present performance William Shakespeare’s “AS YOU LIKE IT “ of Marjanishvili Theatre. The performance is with English Subtitles. We will be delighted to host you in Marjanishvili Theatre with this wonderful show! Briefly about performance: ‘AS YOU LIKE IT” was premiered in GLOBE, in London, UK in 2012. It was staged specially for a world Festival of Shakespeare “GLOBE TO GLOBE”. The Festival presented 37 plays of William Shakespeare in 37 languages from 37 countries. Georgian AS YOU LIKE IT was amongst them . The Performance had a great success with public and press - THE GUERDIAN rated the performance with 5 stars and wrote : “If all the theatre in Georgia comes anywhere close to the standard of the Marjanishvili company, then the job of theatre critic there must be the most covetable in the land…” We hope to see you in Marjanishvili Theatre, on April 29. The performance starts at 20:00. Subtitles are in English. Running time: 2:15 with one intermission. Address: Marjanishvili Street 8, Tbilisi, 0102 We will be waiting for your confirmation not later than April 26. Please, confirm us the number of complimentary tickets you would request by e-mail: Nato@marjanishvili.com or Nutsa@marjanishvili.com For more information, you can call: Nutsa Burjanadze: + 568 08 05 23 Nato Ebanoidze : +995 599 71 90 76 With Respect Ekaterina Mazmishvili General Manager HIS WORD IS IMPORTANT IN ALL TIMES AND FOR ALL GENERATIONS ! … The theatre he has built on SouthBank in London, was named GLOBE and till now, it is the center of creativity and world of performing arts ; his plays are special and unique part of biography of all artists, stage directors and theaters! The world of theatre and cinema is his “fun” for more 4 centuries! The wisdom , love and kindness in his poetry and plays have no limits ! William Shakespeare ! He was born on 23 April, 450 ago and all theaters in world celebrate his birthday !

is not accidental. This name is one of the main ‘brands” and important part of cultural heritage that is offered to the tourists. Pirosmani was part of Tbilisian everyday life and his art and creations cover nearly 40-50 percent of souvenirs that are for sale in shops of old Tbilisi. Very important part of Tbilisi touristic life is Shardin street and Bambis Rigi Street Café Bars and restaurants that offer special atmosphere mix of Georgian European and Asian culture and cuisine. Ketevan Kifshidze owner of European Georgian Café-Bar Midway on Shardin street: “We offer Georgian and European cuisine to the visitors of our bar. We have also special offer and this is hookah. We have very good specialist of hookah and the price begins from 30 lari and there are different tobaccos with different fruit smells and tastes. It is absolutely pure product made from fruit. The tourists are especially appealed by the open terrace with view on old town. Besides we offer service till late night and we work till last guests will not leave the bar.” Among galleries in old Tbilisi there is Enamel Gallery “Ornament” that offers to the guests of the town Georgian enamel. Georgian enamel has long tradition and is connected to Christian Orthodox art and its history of counts many centuries. This tradition was lost and only restored in 20th century. Right now this is one of the most popular arts and Georgians as well as foreigners learn the techniques of combining different colors to create new images: jewelries, icons and etc. Enamel is expensive art and is created with precious metals that’s why it is tough to be afforded. We talked to the founder and owner of Enamel Gallery “Ornament” situated on Erekle II street Khatuna Babunashvili. CBW. As it is known the technique of creating Georgian enamel was restored in 20th century. How it is happened? Khatuna Babunashvili: “Our gallery played important role in this process as we have school-

April 28, 2014 #51

workshop where we teach to the technology how to create enamel. Our gallery was founded in 2001 and the school is active from 2002. So I can say that our gallery is the one that is oriented on cloisonné and I have to underline that our exhibits are created taking into account old traditional technology. There is also possibility to order and it will take 10 working days. CBW. How do tourists show interest in Georgian enamel and if there are themes that they are most interested in? Khatuna Babunashvili: “During one year we’ve got 20 foreign students in our school-workshop who learned the technology of Georgian enamel. They were from Ukraine, Russia, Kyrgyzstan and also from Japan. We also have master classes in different countries of Europe. As for the interest of tourists I have to say that 80 percent of income of our artists comes exactly from tourists because this product is quite expensive. Prices are from 100 till 5000 or 15 000 lari.” One of the important places in old Tbilisi is Museum of History of Tbilisi “Karvasla”. The museum offers history of the city as well as souvenirs and contemporary art gallery. Business Week talked to Keti Trapaidze, the manager of educational department of Museum of History of Tbilisi of National Museum: “We offer temporary exhibitions. We present modern art creations. We also give space to large scale cultural events such as “Artisterium” - international project. Also there took place “Meetings with Pirosmani” and representatives of 25 countries took part in. This is international project created by Gocha Gulelauri. The theme of Pirosmani is offered to painters, graphic artists, sculptors and etc. One German artist said that we have to visit Pirosmani and not to make Pirosmani to come to us. So we offer to the local visitors as well as to the tourists interesting events and one can have all the impression about the history of Tbilisi and contemporary art as well.” Ketevan Charkhalashvili

BUSINESS April 28, 2014 #51

caucasian business week

TALGAT BAITAZIEV COOPERATES WITH SEPARATIST REGIME

wo actions were filed against Talgat Baitaziev, General Director of Batumi Port, one to London Court of International Arbitration and the other to the Batumi City Court BICT (Batumi International Container Terminal) already filed an action to London Court of International Arbitration. David Chkonia, a Lawyer of the Company stated: “In this case, subject of dispute is that Batumi Port was impeding the terminal operations illegally and with breaching of the Agreement provisions; therefore, the Terminal was forced to defend its interests in the London Court of International Arbitration.” Based on the same motive, Trans System Company filed an action against Talgat Baitaziev in Batumi City Court. According to Dimitry Gabunia, a Lawyer of the Company, law enforcement bodies have to express their interest towards Talgat Baitaziev and his activities in Batumi Port. It is the most significant strategic object of the country being managed by a notorious person. Talgat Baitaziev creates threats not only for specific companies, but also for development of the entire Batumi Port, which naturally would negatively impact the country’s economy. Talgat Baitaziev, who is engaged in criminal transactions of one of the criminal groups in his country, brought Batumi Port to a collapse.” As Dimitry Gabunia stated, there was one more “black spot” in Talgat Baitaziev’s background, he was cooperating with the Separatist regime. “I would like to inform the public that Talgat Baitaziev is the person who is making investments in Separatist Trans - Dniestr Province. As you know, Moldova was deprived of this region and it represents a self-declared separatist region

recognized by Russia. Therefore, this person, who is not restricted with any legal boundaries, may shortly place investments in Sukhumi Port against us...” Baitaziev in fact has investments in self-declared Trans-Dniestr Province, as confirmed by quite a few articles published in this region. Agency tv.pgtrk.ru brings quotes of Talgat Baitaziev. Pursuant to the Article, Talgat Baitaziev, along with Evgeny Chevchuk, the President of the self-declared republic is opening a mill. The total value of the project equals 8 million. 5 million are already invested and Baitaziev is planning further expansion. Talgat Baitaziev : “We developed a business plan starting from flour production to its storage. Also, we are planning to make a bread bakery, later we’ll acquire land and grow wheat ourselves.” Apart from the Mill, according to the disseminated information, Baitaziev owns a mortgage bank in Trans-Dniestr Province. As regards the Kazakh Media, Baitaziev is referred to as an Oil Scandal Hero there and many articles were published about him. As local media reported, criminal persecution was in progress against the company lead by Baitaziev. forbes.kz: “Oil scandal started in February 2013. Governor of one of the large regions was announced wanted who was accused of establishing criminal group consisting of 35 people. The losses inflicted by this group to the state amounted to 71 billion Tenge. Kazakh media reported that Baitaziev used to work as an Oil Processing Plant Director in Atirau. The aforementioned criminal group was operating in this region. Its members were establishing companies for money laundering purposes. Director of Batumi Industrial Holding was

suspected in establishing the similar companies and money laundering. According to Denis Karamanov, a journalist of Taszhargan.info, Baitaziev is hiding from investigation in Cyprus. As the journalist noted: “This is the reason why he visits Batumi so rarely and does not appear in his home country at all. Employees of Batumi Port also confirmed that they almost did not see their Director.” Based on the information of Kazakh Prosecutor’s Office, this group was pursuing illegal trade with oil and this activity was also related with Baitaziev’s Company. The case was initiated for illegal sale of 200,000 tons of oil, of which 33,000 tons were sold within the country while 168,000 tons without any accounting got exported from Kazakhstan. thenews.kz : “Several top managers of Atirau Oil Processing Plant were accused of illegal lobbying

of companies. This concerned famous companies in Atirau AVALON TRADE and Euro Oil against which the businessmen complained. The scheme used was extremely simple. According to aggrieved businessmen the main actor in this scheme was the plant’s former commercial director and the current Deputy Director of Atirau Oil Processing Plant Rufat Khurzhlakov. He used to convince small traders who did not have serious political support or big capital to cooperate with these companies and not directly with the factory. Overall, due to strict conditions businessmen were forced to start cooperation with these companies. Insidious traders, on their side, were not fulfilling assumed liabilities. Dimitry Gabunia, a Lawyer, stated that he would file an action in the Chief Prosecutor’s Office as well.

BATUMI PORT HAS A NEW DIRECTOR ccording to the decision of Ba- not depend on the working of Batumi or Poti ports.

AFTER THE MEMBERSHIP OF ARMENIA IN CUSTOMS UNION, SALES REDUCTION IS EXPECTED ON GEORGIAN CAR MARKET

fter the membership of Armenia in Customs Union, sales reduction is expected on Georgian car market. As a marketing manager of auto market MYAUTO Akaki Grigolia sated to GBC, the market will need some time to adjust to the new reality, although in the long-term Armenia will start car import from Georgia, because import of both new and same category vehicles will be more expensive from Russia. Besides, even from Russia purchase cars in Georgia. “When Kazakhstan entered to Customs Union, that time was some impediments in terms of sales. But then all kinds of statistic approves that both domestic consumption and export on the market did not reduced, but considerably increased. Therefore we hope that in several months period situation will stabilize”, - Grigolia considers. As Armenian information agencies report, after the membership of Armenia in the Customs Union value of the cars imported from Georgia may increase by 304 times due to customs clearance. It’s noteworthy that even in February head of Automobile Association of Armenia Tigran Ovanisian mentioned that import of the cars from

Georgia would be more comfort by all means than from Russia. He said that the cars produced in Russia are more expensive than second-hand vehicles brought from Europe to Georgia. He also said that purchase even of the Russian cars in Tbilisi is more comfortable than for instance in Vladikavkaz. Besides, Georgia, which is not a member of Customs Union, can establish barriers on the vehicle transit. It’s also told in Armenia that after the membership I Customs Union, sharp increase of the customs rates may not occur. Information was also released that Armenian government propose during negotiations not to increase customs rate on the car import. It’s still unknown according to which terms Armenia will join to the Customs Union. Besides, according to the released information, on April 29 in Minsk Armenia will not sign any document about the entrance in Customs Union, but will determine terms for preparation terms for preparation of the respective agreement. Minister of Economy of Armenia Vagram Avanesian states that “Agreement will be signed after the negotiations are over about the cancellation of the customs rates for the goods that are sensitive for Armenia.”

tumi port manager Kazakh investor, Minian Katamadze will head the port 37-years old Mirian Katamadze is a lawyer. He has been working in Batumi port since 2006. Mirian Katamadze replaced Irakli Tsivadze on the position of the port’s director, who will work on the technical issues of the port. As head of Kazakh actives manger in Georgia Zurab Shurgaia states, personnel change is related to the new tasks facing to the port. “With guidance of Irakli Tsivadze port infrastructure and technical equipment were approved. Currently other issues are more important, such as marketing, improvement of the legal issues, attraction of the new cargos. That’s why, based on the decision of the Kazakh side, internal change occurred. It’s a common process and because of team principle strengthening of the direction, which is important and actual for the port, is on the first place”, - Zurab Shurgaia stated to GBC. He said that recently cargo movement dropped in the trans-Caucasus corridor, which of course does

In addition to various factors in the region, tariff increase on Georgian Railway cargo shipments and united tariff policy of EU countries, to which Georgia can hardly compete, also determined cargo reduction. Meanwhile, as Zurab Shurgaia mentions, Georgia, in particular Batumi port has their advantages. “We offer carriers quality service, there is no ship waste, wagon delay, corruption. All these occur in the Russian port. IN the first quarter freight turnover reduction was mentioned. IN January Batumi port fulfilled freight turnover plan with 94%, in February-March - only 55-60% of the plan, although in April already 80% is fulfilled”, Shurgaia states and mentions that despite freight turnover decline, port administration fully performs social and salary obligations. Moreover, the persons working on the holidays got 700GEL bonuses. Zurab Shurgaia considers that Georgia has to work in terms of the competitive transportation fees and it’s necessary that all players involved in the business were able to elaborate competitive fee policy.

IMPORT TAX EXEMPTION REVOKED TO THE LARGE IMPORTERS

rom June 1 special regime of VATtaxation for large importers revokes. Amendments in the Tax Code made by Parliament of Georgia enter into force from June. As a result, importers with over 200 000 GEL turnover will not enjoy exemptions. Changes were made in the Article 162, Tax Code. The paragraphs, which determined special rule for import VAT taxation, were abolished. In particular, paragraph 2 of the article 162 was abolished, according to which the person, for whom the amount declared according to the taxation operations during 12 continuous months and VAT paid in budget would exceed 200 000 GEL, was entitles to transfer to the special VAT taxation regulation of import. Also the article was abolished, which authorized head of Revenue Service to transfer individual to the special VAT taxation rule of import, if he would submit written obligation that during next continuous 12 calendar months after the transfer to this regulation he would have made import of the com-

modities for usage as a main tool of the enterprise and/or determined for the main tools of the enterprise for no less than 5 million GEL customs value. Parliament faction Georgian Dream-Entrepreneurs prepared the Tax Code amendment. The bill authors consider that this article created uncompetitive environment to the individuals, who did not have turnover of this amount (such as representatives of small and medium-size business) and at the same time importers were in the beneficial conditions in comparison with the local businessmen, because during the commodity import the entrepreneur could benefit from the special taxation regime and pay taxes after the appearance of so called free money during a certain period, but the individual could not do so in the case of purchase of the local goods. Because in this case the product price includes VAT amount and respectively, individual pays VAT during the product purchase. It’s noteworthy that the persons of so-called “golden list” enjoy with some benefits, which have 30-day terms for the payment of import VAT.

HPP caucasian business week

April 28, 2014 #51

SECRET OF OFF-SHORES - WHY FAMOUS BUSINESSMEN OPT THEM

hat in fact is an off-shore zone? Is it dangerous to establish business relationship with a company registered there and how the off-shore industry got developed? In Georgian reality the word off-shore became synonym of something hidden and it is deemed that all companies registered in off-shores are pursuing secret activities. Such opinion was not groundless. Under the previous government there were many facts when some off-shore companies existed only on paper, while the journalist investigation would find out that Georgian officials or their relatives were behind such companies. Such facts take place even now, therefore, off-shore companies in Georgia cause suspicion. However, in developed countries off-shores have completely different meaning… Guria News decided to find out with experts and lawyers whether off-shores were dangerous and if they were bearing some risks why businessmen would prefer to use them?

According to experts, off-shore business turned into the most significant component of the global economy due to incentives and its scale contributed to formation of so-called off-shore industry, which became the strategic development line for off-shore countries. Off-shore businesses play a special role in global circulation of capital and substantially widen the opportunities for penetration into international markets. Off-shore business is based on the complex of legislative acts, which include: acts that define tax incentives for owners of off-shore companies; legislative acts regulating confidentiality of information about owners; international agreements on avoidance of double taxation; anti-money laundering legislation and the other legal acts related with registration and activities of a company. Irakli Leqvinadze, an Economic Expert in his interview with Guria News noted: “Majority of investors in Georgia use funds coming from off-shores, they establish a company in Georgia subject to Georgian jurisdiction, pay

taxes set under the Georgian legislation and the information on founders is open. As regards the practice of off-shore companies, such practice is adopted not only in Georgia but also in the other post-soviet and developing countries, which increases degree of security for investments and reduces the risks of their losing. Political situation in developing countries is fragile, the company registered in an off-shore, entering the country as a founder, is protecting the company from political vibrations, that may be reflected in losses.” However, opponents that protest against entrance and involvement of this or that investor on the market are stating absolutely the opposite. According to them if a shareholder of the company is registered in an off-shore this is related with risks. For example, in case of one of the largest projects, Khudoni HPP, the main counterargument of opponents is related with the off-shore zone indeed. In this regard Guria News asked a question to Bupendra Cansagra, Khudoni HPP investor, when he met with representatives of Georgian media. “Trans Electrica Georgia implementing the Khudoni Project is registered in Georgia and will pay all due taxes in accordance with the Georgian legislation. One of its owner companies, because of taxation reasons, is registered in off-shore. All transactions will be funded by the Georgian party, we stand behind these off-shores and we are founders, this was done for mitigation of risks..” – said Bupendra Cansagra. How much do off-shores reduce tax liabilities and how sound this argument is? Levan Kalandadze, an Economic Expert in an interview with Guria News states that the off-shore issue on the international market has completely different constituents: “I also expressed doubts many times when the issue concerned off-shore company. However, this subject is to be divided into two parts: the first when off-shore represents the means for resolution of technical and financial aspects and the second – when the persons behind the off-shore

company are hiding. If we take the Khudoni HPP issue, the project implementing company Trans Electrica Georgia is a Georgian company, which is to pay taxes in the country. As regards the founder Indian company, it really represents an off-shore one. When investments are being sought on the international market this is an adopted practice, since it is very simple for investment banks to deal with companies registered in off-shores. When I have a complaint against any off-shore company, not because it is bad to be registered on Virginia Islands but rather to know who is behind the specific company. Under the previous government there was a practice when off-shore companies were being formed and we did not know who were behind those. If investors come, meet media representatives, talk to them and answer their questions why should we be suspecting anything? Even Telasi and the other energy companies are working in an off-shore regime in Georgia currently. For example, SOCAR implemented a transaction and now it has a co-founder in off-shore. This is a common practice. The main thing is to cover taxpayer by the Georgian jurisdiction and that its activities are transparent. A very specific topic can be brought here, e.g. Crimea. You can imagine that if investments made in Crimea were only local and not made by off-shore companies currently the Ukrainian investments would have been turned into the Russian ones. Such risks unfortunately exist not only for our region but also for the entire world in general.” Disputes and difference of opinion regarding off-shores will exist for a longer period, however it is the fact that during recent years many American Corporations regularly were attracting revenues from off-shores. Within the last four years 48 corporations added 518 billion USD to off-shore revenues. Among them were such famous companies as: Apple, Microsoft, and Google. Overall, according to 2012 year data, the USA collected approximately USD 1.9 trillion from off-shores…”

DIRECTOR OF TBILVINO: CONSTRUCTION OF KHUDONHESISCALE POWER PLANTS IN NECESSARY FOR THE LARGE ELECTRICITY CONSUMERS

irector and one of the founders of Tbilvino Zurab Margvelashvili states that for the large consumers of the electricity, among which is his company needs construction

of Khudonhesi-scale power plants. The businessman agrees with opinion of the energy specialists and economists that only large power plants are guarantee for maintenance of the stable electricity fee. Margvelashvili considers that in the other case the electricity fee, which is high currently and will increase in the future. It will be reflected on the production issue cost and respectively, on the consumer prices, competitiveness of the production on the export markets. “We consume a lot of electricity in the Tbilisi and Kvareli plants and therefore we are large consumers. In the case if electricity fee increases, respectively our expenditures will rise. As you know, increase of the expenditures also increases product cost, which will be definitely reflected on the consumer prices. We will have to consider increased price in the expenditures, which will increase market price of our products. Approximately, to say harshly, prices on our products will increased with the same extent for how many Tetri electricity price increases”, Margvelashvili stated. Energy specialist and economists say that small power plants, construction of which is required by part of the ecologists, is not alternative for the large, dam power plants, because in the case of their construction getting electricity is possible only by seasons. In the case of the refusal of the projects of Khudon-hesi scale (installed capacity 702 MW), increased demand on electricity in the next few years should be met by electricity import and the electricity produced by thermal power plants, which will definitely influence electricity fees in the future.

GEORGE SETURIDZE: WITHOUT KHUDONHESI INDUSTRY AND ECONOMY WILL NOT DEVELOP

hudonhesi should be build by all means, - head of International Investments Coordination Center George Seturidze considers. He says that any energy project should be implemented in Georgia, because there is no alternative for the development of industry and economy. “I am not expert in energy, although I think that Khudoni, Namakhvani and other power plants should be built to develop industry and economy. As I know about Khudoni, there are several projects, but the state and investor make choice. The project should be implemented by all means and

the most acceptable version should be constructed”, - Seturidze considers. Head of International Investments Coordination Center says that resettlement of the population is always difficult and problems related to it is wellknow to any developers, although it’s inevitable and the investor should manage to agree with the population and offer profitable alternatives to the locals. It’s noteworthy that International Investments Coordination Center also works on the construction of the small power plants. They are negotiation with the German investors in this direction, which will have a business visit in Georgia in May. After that project details will clarify.

BANKING NEWS April 28, 2014 #51

caucasian business week

BILL ON DEVELOPMENT BANK IS INITIATED IN THE PARLIAMENT

he bill was initiated on the Thursday bureau session. The economic council of the Prime Minsiter prepares it. As explanatory card of the bill states, new financial institute will be created after reorganization of Partnership Fund. JSC Development Bank of Georgia will be established. Development Find of Georgia will be authorized to provide issue of the loans through commercial banks, as well as issue of guarantees, insurance operations, emission of obligations, other activities allowed by Georgian government. Besides, Development Bank has prohibited receipt of the deposits and payment services. “The bill aims to provide maximally effective utilizations of the economic potential of the country,

attraction of the investments, development of the spheres that are of less attractive for the private financial institutions and important for the state, promote innovative activities, strengthening of the financial sector and state support to the entrepreneurship”, - says the explanatory card. Supreme body of the Development Bank is supervision board with no less than 7 and no more than 11 members. Supervision board will include: Prime Minsiter, who will be head of the board, also Ministers of Finance and Economy. The bank will have a president, vice president, executive director and directors. Bank’s supervision board appoints and dismisses president of Development Bank, with presentation of Prime Minsiter, for 7 years term.

VTB SUMMARIZED FINANCIAL DATA 2013

ctives of VTB Bank Georgia increased twice more than total actives of the sector. The bank management summarized 2013 year and sated about sharp improvement of the financial indicators. Actives increased by 53% and exceeded to 833 million GEL. Annual growth of the credit portfolio is 33.6% and equals to 504 million. Highest growth of 44% was mentioned in the retail loans portfolio, deposits increased by 77.4%, to 520 million GEL.

During 2013 actives of VTB Bank increased by 53%, of the banking sector - 20,35, market share of the bank 0 from 3,8% to 4,8%. Credit portfolio increased by 38,5%, total portfolio of the sector - by 21%, share - by 14%, from 4,2% to 4,8%. Net profit (13,3 million GEL) increased by 58%. Return on Actives (ROA) equaled to 1.98%, Return on Equity (ROE) - 16.08%. The bank also stated that working with international financial institutes considerably increased. Attracted amount increased by 84%.

LIBERTY WILL DISTRIBUTE DIVIDENDS ON MAY 8

tockholders of Liberty Bank will determine amount of the dividends from last year profit on May 8. Distribution of the dividends from 2013 profit is one of the issues, which will be discussed on the stockholders meeting. The session is scheduled on May 8, at 9:00 in the head office of the bank. The stockholders will approve consolidated financial report of 2013 fiscal year, audited by IFRS method, including profit distribution; they will also determine record date for the payment

of 2013 convertible privileged stocks and according to emission prospectus, approval of dividend payment of 5 179 064 privileged stocks. Another issue is approval of the changes in the bank’s supervision board. Iaap Vilem Rotgan leaves the board Dan Costache Patriciu is presented as third member of the supervision board. The meeting also should appoint LTD Ernst % Young as independent auditor of Liberty Bank for 2014. Supervision board of the bank and directors recommend stockholders to support all issues in the agenda.

BANK OF GEORGIA COMPLETED Q1 WITH 47,8 MILLION GEL PROFIT

SC Bank of Georgia completed Q1 with 47,8 million GEL profit (01/03/14 -33,3 million). By April 1, 2014 bank’s actives equal to 5,8 billion GEL (01/03/14 -5,8 billion

GEL), market share - 34% (01/03/14 -33,6%). According to loan portfolio (3,4 billion GEL) its share is 32% (01/03/14 -32,3%). The bank is a market leader according to almost all indicators.

BANKING SECTOR COMPLETED Q1 WITH 94.575 MILLION GEL NET PROFIT

anking sector of Georgia completed Q1 with 94.575 million GEL net profit (Q1 2013 - 65,3 million). In March net profit equaled to 16,5 million GEL. 17 banks out of 21 are profitable (Q1 2013 - 12 banks out of 21). According to statistic of National Bank of Georgia (NBG), quarterly incomes of the sector equaled to 60-8,8 million GEL (Q1 2013 - 529,2 million, Q1 2012 - 550 million GEL), expenditures - 497 million GEL (Q1 2013 - 457,4 million, Q1 2012 -

527,3 million GEL). For the reporting period own capital of the banking sector (stock capital) exceeds to 3 billion GEL (Q1 2013 - 2,5 billion; Q1 2012 - 2,2 billion GEL). Supervision capital is 3,1 billion GEL (Q1 2013 - 2,6 billion; Q1 2012 - 2,5 billion GEL); capital adequacy coefficient - 18% (Q1 2013 - 17,7%; Q1 2012 - 18,1%). For the reporting period Return on Equity (ROE) is 12,7%, Return on Actives (ROA) - 2,2% (Q1 2013 - respectively 10,5%, 1,8%; Q1 2012 2,9%, 0,5%).

PROCREDIT COMPLETED Q1 WITH 3,4 MILLION GEL PROFIT

SC ProCredit Bank (Georgia) completed Q1 with 3,4 million GEL profit (Q1 2013 - 3,3 million). The bank reports that by April 1, 2014 deposit amount is 552 million GEL (Q1 2013 - 525,2 million), credit portfolio - 722 million GEL (Q1 2013 -720,2 million), overall obligations - 875,7 million GEL (Q1 2013 - 873,9

million). Bank’s actives are 1,011 billion GEL, market share - 5,7% (Q1 2013 - 1,011 billion, 7,2%). JSC ProCredit Bank is a member of international banking group, operates in Georgia since 1999. It’s mainly oriented on the crediting of small and medium-size businesses. Stock capital of the bank equals to 135,2 million GEL.

TBC BANK ISSUES MORTGAGE LOANS TO LISI DEVELOPMENT CLIENTS WITH 0% TO 8.44% INTEREST RATE

BC Bank and Lisi Development company offer a joint product to the clients of Lisi Veranda project. Namely, specially for Lisi Development clients TBC Bank has introduced a new bank product in the form of a new mortgage loan with 0% to 8.44% interest rate. TBC Bank representative Nino Kacheishvili says the mortgage loan with the maturity period of about 15 months is interest-free, while the mortgage loan with about 5-year maturity period is charged 8.44% interest rate. TBC Bank has developed a very good and interesting product jointly with Lisi Development. The product enables the customers to buy Lisi Development apartments at quite affordable prices. The interest rate on 5-year mortgage loan is 8.44%, but if the clients take a 15-month loan, the product is interest-free. Anyway, the highest demand is recorded for 5-10 year loans”, Nino Kacheishvili noted. The Lisi Veranda project consists of several phases. The first phase of the constuction works have been almost completed. At this stage, 80% of the apartments have been already sold. The investor has put 30 million USD in the first phase construction works, Lisi Development representatives noted. The Lisi Veranda project is located on Godziashvili Street, near the Lisi Lake (behind the building of the 112 service). This is the concept of an entirely new and ecologically clean settlement with multifunctional recreation zone and modern refined architecture. In the future the Lisi Development residential complex will cover 35 hectares. Buildings will occupy only one third of the whole space, while unique flora and special gardens will cover the remaining space. “The company owns 355 hectare land plot near the Lisi lake. The first phase that is called Lisi Veranda covers 5 hectares. The first phase calls for constructing 120 apartments. The construction works have been almost completed. The construction of only 19 apartments is continued and the process will end in 2 to 3 months. We are trying to make the green zone as large as possible. For example, buildings occupy only 25% of the whole space, while the remaining space is the green territory. All trees on the Lisi Veranda territory have been specially imported from Italy. There are trees of various species that are not grown in Georgia. As to the buildings, they are energy-efficient. Venetian bricks are used for facades, as well as Dutch wood that are quite resis-

tant and withstand various temperature fluctuations. At the same time, windows and doors are made of Shuco company products that is one of the leading brands in the production of windows and doors”, Nodar Adeishvili, a director general for Lisi Development company noted. Lisi Veranda has got special climate conditions with thermal waters and exciting views to Tbilisi. All these factors were included in the project during the planning works – compactness and buildings of nor more than 4 floors. There is also a new hippodrome in the complex. Lisi Veranda is a product of Lisi Development that is the first development company in Georgia implementing such a large-scale project. The company aims to create a modern residential complex with refined architecture and to establish an entirely new, ecological and health lifestyle. Three types of residential complexes will be constructed in Lisi Veranda: 1. 4-floor complex with many apartments. 2. Townhouses – new-style, individual residential house with its own garden. 3. Villa with individual project and own garden. The first stage of the project includes 4000 square meter space, a swimming pool and a fitness center. The residential complex will be served by security service and concierge for 24 ours. At this stage, the company has completed the construction of over 120 apartments, 16 townhouses and 2 villas. The company continues construction of 10 duplex and 8 studio buildings. The next stage of the project will start in May 2014 and it calls for carrying out construction works on 48 000 square meters and building 260 apartments by investing 60 million USD. “We offer three types of products. The first one implies 4-floor residential complex. The minimum price of an apartment per square meter ranges from 1180 USD to 1300 USD. The price depends on location, views, floors and other individual characteristics. Another project includes Townhouses and the price per square meter is 1350 USD. Townhouse represents a 2-floor independent house with its own small land plot of about 300 square meters. The third product includes villas and the price per square meter is 1590 USD. The minimum space is 350 square meters. Villas cover 800 square meters and this space is included in the price”, Lisi Development commercial director Zurab Charbadze noted.

TBC COMPLETED Q1 WITH 21 MILLION GEL PROFIT

BC Bank completed Q1 with 21 million GEL profit (Q1 2013 - 22,3 million). Profit in March equals to 4,4 million GEL (03/13 - 8 million). By April 1, credit portfolio of the bank is 2,637 billion GEL (Q1 2013 - 2,249 billion), deposits - 2,643 billion GEL (Q1 2013 2,273 billion GEL). Overall obligations are 3,5 billion GEL (Q1 2013 - 2,877 billion GEL). Annual growth of the loans is 17,3%, depos-

its - 16,3%. Bank’s actives equal to 4,074 GEL, market share - 23,2% (Q1 2013 - 3, 4 billion, 24,4%). The bank operates for over 20 year. Major stockholders are TBC HOLDING, EBRD, IFC, DEG, FMO. Stock capital of the bank is 592 million GEL (2012 -543,9 million, 2011 - 505,5 million GEL), capital - 589,3 million GEL (Q1 2013 - 567,5 million).

NEW STOCKHOLDER OF INVEST BANK CHANGED SUPERVISION BOARD AND MANAGEMENT

n the general meeting of shareholders held on Wednesday, decision was made that Besik Jikurauli, Nino Demetradze and Merab Chikhradze will represent 3-person supervision board. Jikurauli is a chainman of the board and he is a new staff, as well as Nino Demetradze. Merab Chikhradze was a member of previous supervision board and he represents Trenfor Holding LTD (the company registered on the Virgin Islands of Great Britain), which owns 30% of the stocks. On the general meeting of stockholders, Lasha

Khoperia was appointed as director general of the bank, George Gzirishvili - on the position of director. Lasha Nodia is a representative of the owner of 1 998 400 stocks (70%) of the bank - Alexander Kurtanidze. Recently Kurtanidze replaced Alexidze and Gabrielashvili. Till April 1, during 5 months, temporary administration of the National Bank managed the bank. The reason for entrance of the supervisor was failure to meet requirement of the supervised capital.

CIS caucasian business week

April 28, 2014 #51

PUTIN PROPOSES SETTING UP GAMBLING ZONE IN CRIMEA

R SANCTIONS ‘NOT EFFECTIVE’ IN MODERN WORLD - PUTIN

anctions against Russia will backfire and actually benefit the economy, President Vladimir Putin has said. His comments follow US President Obama’s threat that the White House has prepared a third round of sanctions. “Over-reliance can lead to a loss of sovereignty,” Putin said at a media forum in St. Petersburg on Thursday. Western-led sanctions have several advantages for Russia, the President said. The threat of real economic sanctions is already helping boost domestic businesses, bringing more offshore funds back to Russia, and giving policymakers the push they need to establish a domestic payment system. Similar to what Prime Minister Medvedev said last week, sanctions will only make Russia stronger. De-offshorization has long been a priority of the Kremlin, and Western-led sanctions only help this cause. Russians with Western-held assets worry their funds could be frozen at any moment, which gives incentives to keep money domestically and pay taxes into the Russian budget, and not an offshore tax haven. An estimated $111 billion of Russian money, or 20 percent of the country’s exports, is “lost” offshore, Policymakers are also encouraging businesses to list their companies in Russia, and not abroad, to shield themselves from sanctions. The first wave of US sanctions prompted a mixup with Visa and Mastercard, which led to unlawful blocked payment freezes at three Russian banks in March. Services shortly resumed, but President Putin thinks the disruption will lead to losses for the two giant credit card companies. According to Putin, this was a “very big mistake”. Putin said he believes the Visa and MasterCard

payment systems will lose their market share in Russia -currently 90 percent- over any future payment disruptions. “I’m sure they are already aware of this,” the president said. “I’m not talking about some administrative steps from our side. We do not envision any punishment steps for our dishonest partners. But they are undermining our credibility in them, which means they are absolutely certain to be losing market share,” the president added. Putin is worried that the payment systems will continue to “cave” under US pressure. THIRD ROUND OF SANCTIONS On Wednesday, US President Obama said the US is ready to unleash a third round of sanctions against Russia, as tensions in eastern Ukraine haven’t deescalated, as agreed upon in last week’s Geneva peace plan. New sanctions by the United States and Europe will likely target specific industries- like energy and banking While sanctions against Russia have had some negative effects on the Russian economy, like a ratings cut and loans becoming more expensive, it hasn’t been dramatic, Putin said. “On the whole, probably, [ratings] cause harm, because ratings are reviewed and loans can become more expensive, etc.,” Putin said. So far, two agencies, Standard & Poor’s and Fitch have downgraded Russia’s credit rating over the potential impact of US and EU sanctions. Forecasters have cut their estimates for Russian growth in 2014, with the best case scenario at 2.5 precent, and the worst, 0 percent. The EU is holding off on a third stage of sanctions against Russia over Ukraine, as there is little consensus among member states. The council is considering economic measures, but won’t meet again until May 12 to discuss the matter.

GAZPROM SENDS UKRAINE $11.4BN BILL FOR UNSHIPPED GAS

ussia’s Gazprom, the world’s biggest natural gas producer, has sent a $11.4 billion bill to Ukraine’s Naftogaz. The money is for the two thirds of the gas it failed to use under its 2009 take-or-pay contract. According to the contract Naftogaz had to consume 41.6 billion cubic meters of gas last year, while Ukraine used only 12.9 billion cubic meters, Bloomberg quotes Aliona Osmolovska, a spokeswoman for the Ukrainian company as saying. In the take-or-pay contract Ukraine is obliged to pay for the volume agreed, whether it is used or not. Ukraine is looking to avoid dependence on Russia, accusing President Vladimir Putin of using energy exports as a political tool. About half of Ukrainian gas imports come from Russia and 15 percent of Europe’s annual gas consumption goes through Ukrainian pipelines. This makes the energy issue a central problem as

tensions with Russia escalate. “Russia is clearly whipping up tension before Ukraine’s talks with Europe, understanding that Naftogaz won’t pay,” Bloomberg quotes Bohdan Sokolovskyi, an energy adviser to former Ukrainian President Viktor Yushchenko. “Under the contract, Gazprom truly has the right to demand $11.4 billion. The other issue is the contract was unfair.” In the talks with Europe Ukraine wants to reverse the flow in EU-bound pipelines to supply its domestic needs. Last week Vladimir Putin said that Gazprom will switch to a pre-payment system next month if Ukraine doesn’t settle the accumulated $2.2 billion gas debt. Currently Ukraine needs to pay $485 per a thousand of cubic metres of Russian gas, which compares to $268.5 agreed between Russia and Ukraine in December. Kiev has repeatedly said this price is “unacceptable”, purely “political” and isn’t ready to pay it.

ussian president Vladimir Putin has submitted a draft law to the State Duma to establish a gambling zone in Crimea, the fifth in the Russian Federation. According to the bill adding Crimea as a gambling zone will not require any additional money from the federal budget and Crimea’s new government will be given the say over location and size of the casino zone. At first it was proposed the development of gambling zones should be limited to areas close to 5-star hotels in Sevastopol. Dmitry Kozak, Russia’s Deputy Prime Minister believes the gambling zone should be built in less densely populated areas and segregated from already established resorts, as Vedomosti reports. Kozak stresses while gambling will add to the economy, it will not be a main staple in Crimea’s growth. Kozak has been tasked by the Russian government to turn Crimea into a special economic zone. In 2014, Crimea’s budget deficit is predicted to be tens of billions of rubles, but Russia’s Finance Ministry has promised to help cover infrastructure development. Russia has proposed other help for the newly acquired Black Sea territory, and will invest $7 billion in the next year in transport, telecoms, and other industries. Prime Minister Medvedev said

Crimea will be transformed into a special economic zone, which will help lure big investors with tax incentives. Under current Russia law, casinos are only allowed in four regions of Russia – Krasnodar, Kaliningrad, Altay, and Primorsky Krai, and not allowed in larger Russian cities like Moscow, St. Petersburg, and Sochi. However, finding investors for the projects proved difficult, and only one city has opened casinos, Azov City, a coastal area east of Crimea. The other areas haven’t attracted investors yet. In 2009, Casinos across Russia, mostly in Moscow, were shut down to curb a serious increase in gambling addiction. Prime Minister Dmitry Medvedev expressed interest in turning Sochi into a gaming zone, but the idea never came to fruition, in order to keep the resort town family-friendly.

RUSSIA SAYS VISA, MASTERCARD SHOULD PAY ‘SECURITY FEES’ FOR POSSIBLE DISRUPTIONS

nternational payment systems such as Visa and Mastercard should start sharing their income with Russia to shield the country against future possible disruption, said Natalya Burykina, head of the financial markets committee of the State Duma. The new payments need to be introduced for foreign systems that process payment data and settlements outside Russia, Burykina said. “There’s an idea to charge these operators of payment systems with a security fee, but not very big,” the Vedomosti business daily reported Burykina as saying. Under the plan, the new charge would be levied at 0.25 percent of one day’s profits per quarter for the payment systems. The idea largely echoed the words of Prime Minister Dmitry Medvedev, who told Russia’s Cabinet on Tuesday that March’s disruptions by Visa and Mastercard violated existing agreements and should be punished. “We need to make an ef-

fort… to bring the correspondent foreign partners to their senses,” Medvedev said. He said the disruption was an additional incentive for Russia to speed up a creation of its own domestic payment system, which has been discussed for many years. The creation of a National Payment System (NPS) for Russia is being worked out by the country’s central bank, with the government hoping to complete work on the project within the next six months

KAZAKHSTAN, MOROCCO EYE TIES

hairman of the Kazakh Senate (upper house of the parliament) Kassym-Jomart Tokayev met with chairman of the House of Councillors of Morocco’s parliament Mohammed Cheikh Biadillah, who paid an official visit to Kazakhstan. A fruitful conversation on a wide range of issues concerning Kazakh-Moroccan relations and relevant international issues was held among speakers in the Senate, the Kazakh Senate reported on April 22. Tokayev expressed confidence that the visit of the distinguished guest will give a new impetus to mutually beneficial cooperation, in which the inter-parliamentary relations play an important role. In this regard, the parties agreed to fully promote the work of the MPs’ groups on cooperation in the two countries’ parliaments. Kazakh Senate Speaker spoke about the beginning of implementing Kazakh President Nursultan Nazarbayev’s strategy “Kazakhstan-2050”. The country’s joining 30 most developed world countries is its aim. He invited Morocco to take part in the Expo-2017 international exhibition in Astana. Tokayev informed Biadillah about the preparation for the fifth congress, scheduled for 2015, and discussed the opportunity of Morocco’s participation at the highest political level. The Moroccan side, in turn, spoke in detail about

the development of modern Morocco, the situation in the Arab world and the African continent. Biadillah stressed Kazakhstan’s significant contribution to establishing cooperation between Asia and Europe, and expressed appreciation for the stability and development in Kazakhstan. “President Nazarbayev and Morocco’s King Muhammad VI attach great importance to internal and regional stability,” he said. “Moreover, the two leaders foster a dialogue among civilizations and religions. Such a dialogue greatly contributes to safety.” Kazakhstan and Morocco have many common interests and opportunities for further development of cooperation, including alternative energy and agriculture, he added.

AZERBAIJAN April 28, 2014 #51

caucasian business week

CHINA SHOWS INTEREST IN AZERBAIJAN, UAE TO HOLD AZERBAIJANI SATELLITE PROJECTS BUSINESS FORUM

hina is planning to take part in Azerbaijan’s upcoming satellite projects. The statement came from the Ambassador of the People’s Republic of China to Azerbaijan, Hong Jiuyin at a meeting with the Azerbaijani Communications and High Technologies Minister Ali Abbasov. “The Chinese companies are showing great interest in Azerbaijan’s satellite projects and will participate in the upcoming tenders for launch of spacecrafts,” he said. Jiuyin praised Azerbaijan’s rapid development of economy and added that he is closely monitoring the country’s achievements in the field of ICT. Referring to the interest of Chinese companies in investing in this sector of Azerbaijan, he said companies, in particular Huawei, ZTE have increased their activities in the central Asian country. It was also noted that China Telecom is one of the

major telecom operators of the project TASIM (Trans-Eurasian Information Super Highway), which is commendable. In turn, Ali Abbasov spoke about ongoing reforms in Azerbaijan, achievements in the ICT sector, as well as large-scale measures aimed at development of high technologies. He also talked about a wide range of opportunities for attracting foreign investments, the creation of a favorable business environment. Abbasov also spoke about the expansion of activities of China’s ICT companies in Azerbaijani market. China is one of the largest players in the satellites market. It is also one of the main designers and manufacturers of satellites with three operating spaceport (Jiuquan, Xichang, Taiyuan) and one still under construction. China is hosting dozens of scientific and production enterprises of space industry. The first Azerbaijani communications satellite Azerspace-1 was launched in February 2013, while the second satellite is scheduled to be launched in 2017. Moreover, Azerbaijani space agency “Azercosmos” plans to launch a lowEarth orbit satellite in 2016. Azerspace is broadcasting over 80 TV and radio channels, covering Eastern Europe, the Caucasus, Central Asia and North Africa. Some 80 percent of the satellite’s resources are available for commercial purposes. The satellite was designed to offer digital broadcasting services, internet access, and data transmission. It also creates multiservice VSAT networks and provides governmental communication services.

he next business forum of Azerbaijan and the United Arab Emirates (UAE) will be held as part of the joint intergovernmental commission on trade, economic, and technical cooperation. The news was announced by Azerbaijani Economy and Industry Minister Shahin Mustafayev at a meeting with Deputy Chairman of Dubai Chamber of Commerce and Industry Hisham Al Shirawi. During the meeting, the sides discussed the current state of relations and prospects for cooperation between the two countries. The minister praised political relations between Azerbaijan and the UAE, and said political relations, legal framework, and fruitful activities of the Intergovernmental Commission have paved the way for developing economic cooperation. “Trade and economic ties between Azerbaijan and the UAE are expanding. Opening the Dubai Chamber of Commerce and Industry in Baku is a strong signal of cooperation between the two countries,” the minister noted. Mustafayev also said there were ample cooperation opportunities for developing infrastructure, trade, agriculture, and investment between both countries. The minister said thanks to the socio-economic policy implemented in Azerbaijan, the country’s international prestige had increased and it had built the image of a reliable partner for itself. Al Shirawi, in turn, said the UAE attaches great importance to cooperation with Azerbaijan. He also spoke about a series of events and exhibitions in Dubai, adding that attending those events

would create great opportunities for Azerbaijani businessmen to build new business relations and get access to the Middle East markets. The Dubai Chamber of Commerce and Industry, an entity engaged in developing business environment and protecting the business interests of the UAE, organized a roundtable on the development of retail and franchising in partnership with Azerbaijan Investment Promotion Foundation (AZPROMO) on April 21. Diplomatic relations between Azerbaijan and the UAE were established on September 1992. Azerbaijan and the UAE are cooperating within the framework of the UN, the Islamic Conference Organization, and other influential regional and international organizations. The UAE supports Azerbaijan’s fair position on the Armenia-Azerbaijan Nagorno-Karabakh conflict. More than 20 agreements on cooperation in various economic spheres have been signed with the Emirates. Currently, about 200 companies from the UAE are operating in Azerbaijan, and the country has invested more than $465 million in this Caspian nation in recent years.

AZAL TO USE OLD, NEW TERMINALS FIRST PHASE OF KHAZAR ISLANDS PROJECT TO BE ACCOMPLISHED AT BAKU AIRPORT oth old and new air terminal com- for 750 cars and driveways to it. BY MAY plexes at the Heydar Aliyev Inter- Safarli said both air terminal complexes will be

national Airport will be used for conducting international and domestic flights, AZAL Spokesman Maharram Safarli said on April 24. Azerbaijani President Ilham Aliyev attended the opening ceremony of the terminal complexes of the Heydar Aliyev International Airport on April 23. The terminal complexes have all the necessary conditions to provide the passengers with maximum convenience. There are numerous cafes, restaurants, business halls, interactive kiosks and a children playground. The halls are equipped with over 2,000 chairs, 40 registration desks, 30 escalators and 21 elevators. Outside the terminals’ buildings there are telescopic boarding ramps, which can serve 12 aircraft simultaneously, including the world’s largest passenger aircraft Airbus A380. The new terminal complexes have also a car park

functioning soon and flights abroad and inside Azerbaijan will be conducted from these terminals. “The air terminal complexes are already starting its operations and will serve planes carrying out both domestic and international flights,” Safarli added. Thus, Baku-Ankara and Baku-Moscow flights started at the new air terminals on April 24. Currently, flights to 33 airports of 15 countries are carried out from the Heydar Aliyev International Airport. The regular domestic flights are conducted to the cities of Nakhchivan, Ganja, Gabala, while charter flights go to the cities of Zagatala and Lankaran. A total of 2,857,000 passengers were transported from the Heydar Aliyev International Airport to different destinations and back in 2013.

U.S. INTERESTED IN ENERGY COOPERATION WITH AZERBAIJAN

.S. is going to work closely with Azerbaijan in the field of alternative energy. The news was announced by Julia Nesheiwat, Deputy Assistant Secretary at the U.S. Department of State for Implementation in the Bureau of Energy Resources, during her visit to Azerbaijan, the U.S. Embassy in Azerbaijan reported. “The U.S. is pleased with Azerbaijan’s achievements in the field of alternative energy. Azerbaijan is known for its oil and gas, but the world must learn about it as a country rich in alternative energy sources. We look forward to close cooperation with Azerbaijan in this sphere,” she said. Nesheiwat visited Azerbaijan last week.

During her visit to Baku, she discussed the expansion of cooperation in the field of alternative energy and explored potential areas of cooperation. During the visit, Nesheiwat and U.S. Ambassador to Azerbaijan Richard Morningstar visited the Azerbaijan’s State Agency for Alternative and Renewable Energy. Nesheiwat also acquainted herself with the work of the household waste recycling plant in Balakhany. Azerbaijan, which is turning from oil-based economy to the non-oil sector, is now developing alternative ways of power production. The country has potential to use wind, sun, geothermal, and mixed alternative energy sources. The share of alternative energy sources in the total energy production, including small hydro power plants in the country, is currently two percent. Azerbaijan plans to increase the figure to 20 percent by 2020. The share of solar energy in the total volume of alternative energy in Azerbaijan is estimated to reach 40 percent by 2020, while the share of alternative energy sources in general is planned to increase to 20 percent of the total volume of energy consumption, which presupposes around 7 billion manats ($8.9 billion) investments.

he first phase of the huge Khazar Islands project will be completed in May this year, Azertag state news agency cites Avesta Company. Khazar Islands, which is under construction on an artificial archipelago, will consist of 50 islands of different size with a total area of 3,000 hectares on which 19 residential districts will be built. According to the company, the opening of a number of facilities, including beaches, restaurants, bridges and roads, are scheduled for May 28. Besides, four km boulevard and two parks of 5 hectares for each will be put into operation by the mentioned time. The project will be implemented in three stages. The total investment required in the Khazar Islands project is estimated at $ 100 billion. In general, it is planned to construct 20 km boulevard and 20 bridges. The tallest building on the planet, the 1,050 meter-high Azerbaijan Tower, will be built in the territory of Khazar Islands as part of the second phase of the project. The Tower construction is expected to cost $2 billion.

The completed Khazar city will have more than 150 schools, numerous hospitals, and clusters of parks, shops, and cultural centers. A yet-to-beconstructed airport will provide international access to the area. The islands will be dominated by high-rise buildings and resort-like accommodations, with miles of unspoiled beaches and warm, shallow waters. Special considerations were taken in the design of the island’s structures to withstand up to a 9.0 magnitude quake. Work on the project to date has been funded by the Avesta Group itself. The Company hopes to reach annual profitability margins of 10-15 percent on investments.

FOREIGN TRADE SURPLUS EXCEEDS $1 BILLION IN Q1

zerbaijan’s State Customs Committee (SCC) announced a 16.54 percent reduction in foreign trade in January-March 2014, compared to the same period of 2013. Some 116 countries were Azerbaijan’s foreign trade partners throughout this period, while Azerbaijan’s total turnover stood at $7.14 billion. In foreign trade operations there has been a positive balance of about $1.02 billion. Some 3,036 individuals and legal entities were involved in the country’s foreign economic activity throughout this period some 2,220 of them being legal entities and 816 individuals. The export operations conducted in the first quarter totalled $5.38 billion, or 15.26 percent less than the figures for the same period of 2013. The public sector’s share in exports totalled $5.1 billion (94.8 percent), while private sector’s share was $268.17 million (4.99 percent). The share of individuals in the exports stood at $11.37 million (0.21 percent).

Imports totalled $1.76 billion in January-March, or 20.23 percent less than the figures in the same period of 2013. The public sector’s share in import operations amounted to $389.77 million (22.1 percent), while private sector’s share was $1.31 billion (74.2 percent) and individuals’ share in import operations totalled $63.33 million (3.7 percent). Some 1,093 kinds of goods were exported from Azerbaijan in January-March, while 4,372 kinds of goods were imported to the country.

PUBLICITY caucasian business week

April 28, 2014 #51

WORLD NEWS April 28, 2014 #51

caucasian business week

THIS BRILLIANT PYRAMID OUTLINES THE 6 STEPS TO FINANCIAL SUCCESS

ou’ve probably heard of Maslow’s hierarchy of needs. It’s the ranking of primary human needs for psychological wellbeing as described by American psychologist Abraham Harold Maslow, and is usually illustrated not unlike the old-school food pyramid:

The financial blogger known only as Mister Squirrel recently shared his own version of Maslow’s hierarchy: the path to financial success. Here’s what it looks like:

make real progress. 3. Learning. This is where you set aside an emergency fund to keep you in the green should something go wrong, and start learning about the possibilities for your money. Which accounts should you use? Should you invest, and how? If you have a question, now is the time to find an answer. Luckily, you have the entire internet at your fingertips. 4. Investing. Time to make use of those answers. Squirrel points out that this stage doesn’t have hard borders — it will continue on through the pyramid’s last stages. 5. Optimizing. Now that you have your answers and have gotten your money in order, it’s time to start tweaking your plan to perfection: Plan for taxes, get a will, create a system to check on your money. 6. Freeing. “When you get to this stage,” Squirrel writes, “you should be ‘there.’” Now that you’re financially independent and perhaps have even retired early, you have predictable expenses easily covered by passive income streams. The theory isn’t perfect — and Squirrel is the first to say that you should do your research before making any financial decisions — but it is a helpful template for thinking about your path to financial success. 10 HABITS OF PEOPLE WHO ARE GOOD WITH MONEY

Squirrel, who “dreams of a non-corporate life,” calls his theory the Hierarchy of FIRE (Financially Independent and Retired Early). The idea is that once you’re operating in the highest tier with your money, you’re set up to be a financial success — and that applies whether or not you’re aiming for early retirement. While you can get a more in-depth explanation on his website, here’s how the tiers break down, from most essential to least: 1. Surviving. Before anything else, we have to get our minds right when it comes to money. As Squirrel puts it, “If you think that the government will look after you, money will take care of itself, or you’ll win the lottery, then you’re not thinking about money correctly.” In this stage, you’ll also start living below your means, and spending less than your monthly income. 2. De-debting. While everyone’s debt situation is different, ridding yourself of “bad debt,” (the kind that costs you money without giving you any clear value in return, like credit card debt), needs to be checked off your list before you can

A couple of weeks ago, a reporter from Kiplinger interviewed me about financial habits. “Do you think there are specific habits that make certain people more successful with money than others?” she asked. I generally don’t like to make generalizations, so at first I hedged my answers. But the more I talked with the reporter, the more I realized that I do see differences in the way people handle money. I thought about the people I know who are always broke, including my brother. These folks seem to share some common qualities. And the people I know who have managed to build wealth? They share some similarities too. (Note: The outcome of the Kiplinger interview was this slideshow (yes, I hate slideshows too) about the reasons people remain broke.) None of these differences are absolute, of course, but from looking at my own friends, and from reading the stories Get Rich Slowly readers have sent me over the years — especially stories about how people have moved from debt to wealth — I do think there are some patterns, including: • Successful people surround themselves with positive people. They limit their exposure to negativity and naysayers, preferring to spend time with folks who have can-do attitudes. They don’t have time to listen to the reasons something can’t be done; they’d rather find ways to make it happen.

• Successful people aren’t flummoxed by failure. They know that mistakes are inevitable and should be treated as stepping stones to success rather than signs of weakness or reasons to stop trying. (As a side note, I’ve become increasingly convinced that the best thing we can do for our children is not to praise achievement, but to praise effort. The former breeds fear of failure.) • Successful people manage their time effectively. They recognize that minutes and seconds are a precious non-renewable resource. So, they set priorities and pursue them with passion. My successful friends seem to watch less television (and play fewer videogames) than my unsuccessful friends, for instance. There’s nothing inherently wrong with TV and Flappy Bird, but they suck up time that could be spent exercising or reading or taking a class. • Successful people ignore the opinions of others. They don’t feel compelled to “keep up with the Joneses.” They limit their exposure to mass media not only because it allows them to be more productive, but also because it reduces the influence of advertising and the pressure of cultural norms. When investing, they don’t follow the herd. The wealthy people I know all drive older cars (many of them bought used!), dress modestly, and avoid conspicuous consumption. But the people I know who are most often broke? They’re on top of trends and fashion. • Successful people have direction. They act with purpose. They know why they’re working hard and saving money. They have a mission, even if it’s as simple as putting their kids through college, and their daily actions are aligned with their long-term goals. None of the folks I know who struggle with money have a clear idea of what they want to do with their lives. • Successful people focus on big wins. Yes, they develop smart habits and pay attention to the small stuff. But they also understand that if they’re diligent with their dollars, then the pennies will take care of themselves. The average

person economizes on the small things but isn’t willing to make sacrifices when it comes to housing, transportation, or income. And the folks who are broke all of the time? Well, they fritter away their pennies and their dollars. • Successful people do what’s difficult. They don’t procrastinate. My friends with money work longer, harder, and smarter than my friends who have less. They practice deferred gratification, sacrificing small comforts today in order to obtain greater rewards tomorrow. • Successful people make their own luck. They practice awareness so that they can recognize opportunities when they come along. Moreover, they act boldly, seizing these opportunities where others might hesitate to act. • Successful people believe they’re responsible for their future. They have an internal locus of control. That is, they understand that although it might not be their fault they’re in a given situation, it is their responsibility to change it, to respond productively — and proactively. • Successful people grow and change over time. They adapt. They evolve. They’re not afraid to entertain different points of view. Most importantly, they’re not afraid to change their minds. They seek knowledge and experience, and they allow the things they learn to mold them. Most people (including me) follow a few of these rules but not others. The most successful people I know do all of the things on this list; the least successful people do none of them. (Note: For a similar, but different, discussion, check out this controversial three-year-old article on the differences between the rich and the poor.) I guess the bottom line is my friends who are successful with money (and life) take what they do seriously. They treat their personal life as if it were a business. They act as both CEO and CFO, and they do their best to “grow the business” over time. Your personal wealth is your real business; everything else just supports it.

THERE’S A SHOCKING CONNECTION BETWEEN EATING MORE CHOCOLATE AND WINNING THE NOBEL PRIZE

he above chart showing the relationship between a country’s chocolate consumption and Nobel Prize victories is making the rounds on Twitter, perhaps because it’s Easter. One would assume, when seeing the chart, that it’s one of those jokey correlation charts that you might find on Reddit or something, like the chart comparing homicide to the use of Windows Explorer.

But apparently the chocolate chart isn’t a joke. The chocolate chart actually comes from a New England Journal Of Medicine paper published in 2012 called: Chocolate Consumption, Cognitive Function, and Nobel Laureates. The paper isn’t a joke. It was written by Franz H. Messerli, MD. A full ungated version of it can be read here.

Messerli writes: Since chocolate consumption could hypothetically improve cognitive function not only in individuals but also in whole populations, I wondered whether there would be a correlation between a country’s level of chocolate consumption and its population’s cognitive function. To my knowledge, no data on overall national cognitive function are publicly available. Conceivably, however, the total number of Nobel laureates per capita could serve as a surrogate end point reflecting the proportion with superior cognitive function and thereby give us some measure of the overall cognitive function of a given country. The principal finding of this study is a surprisingly powerful correlation between chocolate intake per capita and the number of Nobel laureates in various countries. Of course, a correlation between X and Y does not prove causation but indicates that either X influences Y, Y influences X, or X and Y are influenced by a common underlying mechanism. However, since chocolate consumption has been documented to improve cognitive function, it seems most likely that in a dose-dependent way, chocolate intake provides the abundant fertile ground needed for the sprouting of Nobel laureates. Obviously, these findings are hypothesis-generating only and will have to be tested in a prospective, randomized trial.

PUBLICITY caucasian business week

April 28, 2014 #51

TBILISI GUIDE April 28, 2014 #51

Embassy United States of America Embassy 11 Balanchivadze St., Dighomi Dstr., Tbilisi Tel: 27-70-00, 53-23-34 E-mail: tbilisivisa@state.gov; askconsultbilisi@state.gov United Kingdom of Great Britain and Northern Ireland Embassy 51 Krtsanisi Str., Tbilisi, Tel: 227-47-47 E-mail: british.embassy.tbilisi@fco.gov.uk Republic of France Embassy 49, Krtsanisi Str. Tbilisi, Tel: 272 14 90 E-mail: ambafrance@access.sanet.ge Web-site: www.ambafrance-ge.org Federal Republic of Germany Embassy 20 Telavi St. Tbilisi Tel: 44 73 00, Fax: 44 73 64 Italian RepublicEmbassy 3a Chitadze St, Tbilisi, Tel: 299-64-18, 292-14-62, 292-18-54 E-mail: embassy.tbilisi@esteri.it Republic of Estonia Embassy 4 Likhauri St., Tbilisi, Tel: 236-51-40 E-mail: tbilisisaatkond@mfa.ee Republic of Lithuania Embassy 25 Tengiz Abuladze St, Tbilisi Tel: 291-29-33 E-mail: amb.ge@urm.lt Republic of Latvia Embassy 16 Akhmeta Str., Avlabari, 0144 Tbilisi. E-mail: embassy.georgia@mfa.gov.lv Greece Republic Embassy 37. Tabidze St. Tbilisi Tel: 91 49 70, 91 49 71, 91 49 72 Czech RepublicEmbassy 37 Chavchavadze St. Tbilisi Tel: 291-67-40/41/42 E-mail: czechembassy@gol.ge Web-sait: www.mzv.cz Japan Embassy 7 Krtsanisi St. Tbilisi Tel: 75 21 11, Fax: 75 21 20 Kingdom of Sweden Embassy 15 Kipshidze St. Tbilisi Tel: +995 32 2 55 03 20 , Fax: +995 32 2 22 48 90 Kingdom of the Netherlands Embassy 20 Telavi St. Tbilisi Tel: 27 62 00, Fax: 27 62 32 People’s Republic of China Embassy 52 Barnov St. Tbilisi Tel: 225-22-86, 225-21-75, 225-26-70 E-mail: zhangling@access.sanet.ge Republic of Bulgaria Embassy 15 Gorgasali Exit, 0105 Tbilisi, Georgia Tel: +995 32 291 01 94; +995 32 291 01 95 Fax: +99 532 291 02 70 Republic of Hungary Embassy 83 Lvovi Street, Tbilisi Tel: 39 90 08; E-mail: hunembtbs@gmail.com State of Israel Embassy 61 Agmashenebeli Ave. Tbilisi Tel: 95 17 09, 94 27 05 Embassy of Swiss Confederation’s Russian Federation Interests Section Embassy 51 Chavchavadze Av., Tbilisi Tel: 291-26-45, 291-24-06, 225-28-03 E-mail: RussianEmbassy@Caucasus.net Ukraine Embassy 75, Oniashvili St., Tbilisi Tel: 231-11-61, 231-12-02, 231-14-54 E-mail: ukraina_pu@wanex.net; emb_ge@mfa.gov.ua Consular Agency: 71, Melikishvili St., Batumi Tel: (8-88-222) 3-16-00/ 3-14-78 Republic of Turkey Embassy 35 Chavchavadze Av., Tbilisi Tel: 225-20-72/73/74/76 E-mail: turkemb.tbilisi@mfa.gov.tr Address: 8, M. Abashidze str. Batumi, Georgia tel: (8-88-222) 7 47 90 Republic of Azerbaijan Embassy Kipshidze II-bl . N1., Tbilisi Tel: 225-26-39, 225-35-26/27/28 E-mail: tbilisi@mission.mfa.gov.az Address: Dumbadze str. 14, Batumi Tel: 222-7-67-00 Fax: 222-7-34-43 Republic of Armenia Embassy 4 Tetelashvili St. Tbilisi Tel: 95-94-43, 95-17-23, 95-44-08 E-mail: armemb@caucasus.net Web: www.armenianembassy.ge Consulate General, Batumi Address: Batumi, Gogebashvili str. 32, Apt. 16

caucasian business week Kingdom of Spain Embassy Rustaveli Ave. 24, I floor, Tbilisi Tel: 230-54-64 E-mail: emb.tiflis@maec.es Romania Embassy 7 Kushitashvili St., Tbilisi Tel: 38-53-10; 25-00-98/97 E-mail: ambasada@caucasus.net Republic of Poland Embassy 19 Brothers Zubalashvili St., Tbilisi Tel: 292-03-98 Email:tbilisi.amb.sekretariat@msz.gov.pl Web-site: www.tbilisi.polemb.net Republic of Iraq Embassy Kobuleti str. 16, Tbilisi Tel: 291 35 96; 229 07 93 E-mail: iraqiageoemb@yahoo.com Federative Republic of Brazil Embassy Chanturia street 6/2, Tbilisi Tel.: +995-32-293-2419 Fax.: +995-32-293-2416 Islamic Republic of Iran Embassy 80, I.Chavchavadze St. Tbilisi, Tel: 291-36-56, 291-36-58, 291-36-59, 291-36-60; Fax: 291-36-28 E-mail: iranemb@geo.net.ge United Nations Office Address: 9 Eristavi St. Tbilisi Tel: 225-11-26/28, 225-11-29/31 Fax: 225-02-71/72 E-mail: registry.geo@undp.org Web-site: www.undp.org International Monetary Fund Office Address : 4 Freedom Sq., GMT Plaza, Tbilisi Tel: 292-04-32/33/34 E-mail: kdanelia@imf.org Web-site: www.imf.ge Asian Development Bank Georgian Resident Mission Address: 1, G. Tabidze Street

Freedom Square 0114 Tbilisi, Georgia Tel: +995 32 225 06 19 E-mail: adbgrm@adb.org; Web-site: www.adb.org World Bank Office Address : 5a Chavchavadze Av., lane-I, Tbilisi, Georgia Tel: 291-30-96, 291-26-89/59 Web-site: www.worldbank.org.ge Regional Office of European Bank for Reconstruction and Development Address: 6 Marjanishvili St. Tbilisi Tel: 244 74 00, 292 05 13, 292 05 14 Web-site: www.ebrd.com Representation of the Council of Europe in Georgia Address : 26 Br. Kakabadze, Tbilisi Tel: 995 32 291 38 70/71/72/73 Fax: 995 32 291 38 74 Web-site: www.coe.ge

Hotels in Georgia TBILISI MARRIOTT Tbilisi , 13 Rustaveli Ave. Tel: 77 92 00, www.marriott.com COURTYARD MARRIOTT Tbilisi , 4 Freedom Sq. Tel: 77 91 00 www.marriott.com RADISSON BLU HOTEL, TBILISI Rose Revolution Square 1 0108, Tbilisi Tel: +995 32 402200 radissonblu.com/hotel-tbilisi RADISSON BLU HOTEL, BATUMI Ninoshvili Str. 1, 6000 Bat’umi, Georgia Tel: 8 422255555 http://radissonblu.com/hotel-batumi SHERATON METECHI PALACE Tbilisi , 20 Telavi St. Tel: 77 20 20, www.starwoodhotels.com SHERATON BATUMI 28 Rustaveli Street • Batumi Tel: (995)(422) 229000 www.sheratonbatumi.com HOLIDAY INN TBILISI Business hotel Addr: 1, 26 May Square Tel: +995 32 230 00 99 E-mail: info@hi-tbilisi.com Website: http://www.hi-tbilisi.com BETSY’S HOTEL With Marvellous Tbilisi Views Addr: 32/34 Makashvili St. Tbilisi Tel: +995 32 293 14 04; +995 32 292 39 96 Fax: +995 32 99 93 11 E-mail: info@betsyshotel.com Website: http://www.betsyshotel.com

Restaurants CHARDIN 12 Tbilisi , 12 Chardin St. , Tel: 92 32 38 CHINA TOWN Tbilisi , 44 Leselidze St. (ent. from Chardin St.) Tel: 43 93 08, 43 93 80, Fax: 43 93 08 BREAD HOUSE Tbilisi , 7 Gorgasali St. , Tel: 30 30 30 BUFETTI - ITALIAN RESTAURANT Tbilisi , 31 I. Abashidze St. , Tel: 22 49 61 DZVELI SAKHLI Tbilisi , 3 Right embankment , Tel: 92 34 97, 36 53 65, Fax: 98 27 81 IN THE SHADOW OF METEKHI Tbilisi , 29a Tsamebuli Ave. , Tel: 77 93 83, Fax: 77 93 83 PICASSO Tbilisi , 4 Miminoshvili St. , Tel: 98 90 86 SAKURA - JAPANESE RESTAURANT Tbilisi , 29 I. Abashidze St. , Tel: 29 31 08, Fax: 29 31 08 SIANGAN - CHINESE RESTAURANT Tbilisi , 41 Peking St , Tel: 37 96 88 VERA STEAK HOUSE Tbilisi , 37a Kostava St , Tel: 98 37 67 BELLE DE JOUR 29 I. Abashidze str, Tbilisi Tel: (+995 32) 230 30 30 VONG 31 I. Abashidze str, Tbilisi Tel: (+995 32) 230 30 30 BRASSERIE L’EXPRESS 14 Chardin str, Tbilisi Tel: (+995 32) 230 30 30 TWO SIDE PARTY CLUB 7 Bambis Rigi, Tbilisi Tel: (+995 32) 230 30 30 LOFT 11. I. Mosashvili str, Tbilisi Tel: (+995 32) 230 30 30 RESTAURANT NERO 21 Abano Street, Tbilisi Tel: (+995 32) 292 10 15

SH. RUSTAVELI STATE THEATRE Tbilisi. 17 Rustaveli Ave. Tel: 93 65 83, Fax: 99 63 73 TBILISI STATE MARIONETTE THEATRE Tbilisi. 26 Shavteli St. Tel: 98 65 89, Fax: 98 65 89 THEATRE OF PANTOMIME Tbilisi. 37 Rustaveli Ave. Tel: 99 63 14, (77) 41 41 50 Z. PALIASHVILI TBILISI STATE THEATRE OF OPERA AND BALLET Tbilisi. 25 Rustaveli Ave. Tel: 98 32 49, Fax: 98 32 50

Galleries ART GALLERY LINE Tbilisi. 44 Leselidze St. BAIA GALLERY Tbilisi. 10 Chardin St. Tel: 75 45 10 GALLERY Tbilisi. 12 Erekle II St. Tel: 93 12 89 GEORGIAN NATIONAL MUSEUM - PICTURE GALLERY Tbilisi. 11 Rustaveli Ave. Tel: 98 48 14 KARVASLA’S EXHIBITION HALL Tbilisi. 8 Sioni St. Tel: 92 32 27, KOPALA Tbilisi. 7 Zubalashvilebi St. Tel: 99 99 02, Fax: 99 99 02 MODERN ART GALLERY Tbilisi. 3 Rustaveli Ave. Tel: 98 21 33, Fax: 98 21 33 M GALLERY Tbilisi. 11 Taktakishvili St. Tel: 25 23 34 ORNAMENT - ENAMEL GALLERY Tbilisi. 7 Erekle II St. Tel: 93 64 12, Fax: 98 90 13

Akhvledianis Khevi N13, Tbilisi, GE. +995322958377; +995599265432

Cinemas AKHMETELI Tbilisi. “Akhmeteli” Subway Station Tel: 58 66 69 AMIRANI Tbilisi. 36 Kostava St. Tel: 99 99 55, RUSTAVELI Tbilisi. 5 Rustaveli Ave. Tel: 92 03 57, 92 02 85, SAKARTVELO Tbilisi. 2/9 Guramishvili Ave. Tel: 8 322308080,

Theatres A. GRIBOEDOV RUSSIAN STATE DRAMA THEATRE Tbilisi. 2 Rustaveli Ave. Tel: 93 58 11, Fax: 93 31 15 INDEPENDENT THEATRE Tbilisi. 2 Rustaveli Ave. Tel: 98 58 21, Fax: 93 31 15 K. MARJANISHVILI STATE ACADEMIC THEATRE Tbilisi. 8 Marjanishvili St. Tel: 95 35 82, Fax: 95 40 01 M. TUMANISHVILI CINEMA ACTORS THEATRE Tbilisi. 164 Agmashenebeli Ave. Tel: 35 31 52, 34 28 99, Fax: 35 01 94 METEKHI – THEATRE OF GEORGIAN NATIONAL BALLET Tbilisi. 69 Balanchivadze St. Tel: (99) 20 22 10 MUSIC AND DRAMATIC STATE THEATRE Tbilisi. 182 Agmashenebeli Ave. Tel: 34 80 90, Fax: 34 80 90 NABADI - GEORGIAN FOLKLORE THEATRE Tbilisi. 19 Rustaveli Ave. Tel: 98 99 91 S. AKHMETELI STATE DRAMATIC THEATRE Tbilisi. 8 I. Vekua St. Tel: 62 59 73

THE BEST GEORGIAN HONEY OF CHESTNUTS,ACACIA AND LIME FLOWERS FROM THE VERY HART OF ADJARA MATCHAKHELA GORGE IN THE NETWORK OF GOODWILL, NIKORA AND SMART

PUBLICITY caucasian business week

April 28, 2014 #51