Caucasian Business Week #58 by Caucasian Business Week

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BUSINESS WEEK June 16, 2014 #58

June 16, 2014, Issue 58

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BE INFORMED, DO BUSINESS

Barosso: Association and Free Trade Agreements with EU will Grow GDP by 4% and Exports by 12% Pg. 2

GEORGIA AEROFLOT RETURNS ON GEORGIAN MARKET

FOODPANDA’S UPDATED MOBILE APPLICATION MAKES FOOD ORDERING EASIER AND FASTER

nline ordering is becoming more and more demanding on the fast food market. The German brand foodpanda has recently entered the Georgian market to meet Pg. 5 this demand.

NBG President Discusses Clients Problems with Bankers

TBC BANK ON LONDON STOCK EXCHANGE

CIS

Pg. 5 Pg. 5

EU SANCTIONS ON RUSSIA COULD PUSH GAS PRICES UP 50% WORLD BANK

ussia and the EU would both suffer if sanctions escalate, energy markets the most, according to a World Bank report. Pg. 10

AZERBAIJAN FITCH AFFIRMS AZERENERJI’S RATING AS STABLE

nternational Rating Agency Fitch Ratings has affirmed Azerbaijan’s 100 percent stateowned national energy operator’s long-term issuer default rating (IDR) at ‘BBB-’ with a stable outlook and its short-term foreign currency IDR at ‘F3’. Pg. 11

GPI OUTRUN ALDAGI

UK CREATED ALL-TIME RECORD 345,000 JOBS IN FEBRUARY-APRIL

Pg. 4

Pg. 2

Papashvili to Construct 100-Suite Hilton in Abastumani Pg. 4

WORLD NEWS

rowth in UK employment reached an all-time high with 345,000 more people in work from February to April, compared to the previous quarter. Pg. 13

David Narmania: Unemployment in Main Challenge in Tbilisi

CAUCASIAN BUSINESS WEEK – MEDIA PARTNER FOR THE GEORGIAN FAN CLUB OF TURIN JUVENTUS AND ITALIAN NATIONAL FOOTBALL TEAM FANS

PASHABank Georgia introduces a New Chairman of Board of Directors Pg. 5

MAIN EVENTS caucasian business week

June 16, 2014 #58

BAROSSO: ASSOCIATION AND FREE TRADE AGREEMENTS WITH EU WILL GROW GDP BY 4% AND EXPORTS BY 12%

ssociation and Free Trade Agreements with EU will increase GDP of Georgia by 4%, export - by 12%, - president of European Commission José Manuel Barroso stated on Friday, on the Georgian-European Investment Conference in Tbilisi. President of European Commission declared that the agreements, along with many other economic benefits, will enable Georgian companies to open businesses in EU and employ citizens of Georgia there. Georgian private companies will be able to participate in the state procurements on the terri-

EUROPEAN COMMISSION PRESIDENT VISITS GEORGIA

uropean Commission President, José Manuel Barroso, arrived in Georgia on Thursday after visiting Moldova, to reiterate support as Tbilisi, along with Chisinau, will sign the Association Agreement with the EU on June 27. Speaking at a news conference after meeting Georgian President Giorgi Margvelashvili, Barroso said that the EU is ready to engage in discussions with Russia if the latter has concerns and wants to “clarify” some of the aspects of the Association Agreement, which also includes deep and comprehensive free trade treaty. Barroso also stressed: “We have to be firm in the respect of sovereign right of any country to decide its own future.” “The European Union is imposing nothing on Georgia. Georgia has made a choice and we are here to support the choice of Georgia.” “We do not see these agreements as exclusive. Georgia can of course establish other agreements with other countries,” the European Commission President said. “We do not oppose Georgia’s relations with other countries. We are finalizing free trade agreements with many countries in the world that also have free trade agreements with other countries. We do not see trade as confrontation; we see trade as cooperation.” “I want to reiterate our willingness to pursue talks with Russia to discuss the concrete implementation of these agreements in case there are some concerns on the Russian side. Of course we have to respect the agreements what was already decided by the governments of these countries, but if there are some concerns, some technical issues that our Russian partners want to clarify, we are ready for it.” The Russian Foreign Ministry said on May 22 that it is Georgia’s sovereign right to sign the Association Agreement with the EU, but it should also understand possible consequences, and pointed out in this context to the fact that Russia has recently become Georgia’s third largest trading partner after Moscow lifted embargo on import of Georgian wines and other products. Speaking at a joint news conference with the European Commission President, Georgian President Giorgi Margvelashvili said that signing of the Association Agreement will mark “the launch of new important stage in the history of our country.” “We are pursuing policy directed towards the membership of the European Union,” Margvelashvili said, adding that “not only the governing team, but the entire Georgian society is united over this issue.” Barroso repeated what he said last month after meeting Georgian PM Irakli Garibashvili in Brussels, that Russian President Vladimir Putin told him and President of the European Council Herman Van Rompuy in January in Brussels that Russia “was not intending to have any kind of negative action on Georgia, when Georgia signs the [Association] Agreement with the EU.” “I hope that President Putin will stand by his own word,” Barroso said.

‘AVOID EXCESSIVE POLARIZATION’ The European Commission President said that Georgia “belongs to the European family of nations” and the best way for Georgia to achieve approximation with the EU is to continue reforms. He said that Georgia has been a “frontrunner” in EU’s Eastern Partnership “thanks to the commitment of the successive governments.” “It has already undertaken many important reforms in recent years; more will be needed.” “It is the key that Georgia remains on the path of political pluralism, media freedom and independent judiciary,” Barroso added. On upcoming local elections on June 15, the European Commission President said: “I hope that these elections are going to take place in accordance with all the international standards.” “It is important there are no doubts about freedom and fairness of the elections, so I expect this to happen,” Barroso said. He said that he will have a chance to further discuss the upcoming elections when he meets PM Irakli Garibashvili, who is also a leader of the ruling GD coalition, and representatives of UNM opposition party on June 13. Barroso also said that it’s important to avoid “excessive polarization”, which can be detrimental to the “good image that Georgia has in terms of being frontrunner in the Eastern Partnership.” Responding a question on the upcoming elections, President Margvelashvili said: “Georgia has to win in these elections; that’s very important.” “Success that we are achieving with the EU and… our country’s future strategy largely depends on a democratic process, which has started in Georgia and which I am sure has only positive outlook,” President Margvelashvili said. “I want to stress that the 2013 presidential election was assessed by our partners as election of European standards and I am sure that we will have positive assessments of the local elections as well. Political forces will win, but first and foremost the country will win. If there is any political force, which may try to have some kind of wrongdoing in these elections, I want to call on them to treat very carefully image that the entire society has created for Georgia. Georgia is a democracy where political forces have free and competitive environment and we should take care of this image. I am sure we will strengthen this image with these upcoming elections,” Margvelashvili said. The Georgian President awarded the European Commission President Barroso with the Order of the Golden Fleece “for firm support to Georgia’s national interests on the international arena and for contribution to development of the EU-Georgia relations.” On June 13 Barroso will address EU’s investment conference in Tbilisi; the conference, which was also held in Chisinau, aims at discussing business opportunities in Georgia in the context of country’s economic integration with the EU through deep and comprehensive free trade area.

BUSINESS WEEK caucasian

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tory of EU, which is a market with huge opportunities. Products export to the 28 EU countries will be able from Georgia, which was impossible before that. “On June 24 we sign agreements with Georgia, Moldova and Ukraine and it’s good for Georgia, as it allows synergy of the countries in the region”, - Barroso stated. He also emphasized that Association Agreement with EU does not mean an exclusive relationship and does not prohibit Georgia to improve relations with other countries, among them with Russia.

GOVERNMENT CHANGES MIND ON RUSSIAN GAS IMPORTS

eorgian government abandoned the intention to look for alternative sources of gas supply. Deputy Minister of Energy Marika Valishvili states commersant. ge that the government has already stopped searching for alternatives to the Azerbaijani gas and in the near future renewal of this process is not planned. Recall that in May last year the Energy Minister Kakha Kaladze said that the country should diversity its energy partners, noting that there was still a need for more suppliers – including Russia. “Our government will do everything so that in the future there will be two, three, four suppliers... There will be more competition in the market and it will be interesting in terms of pricing,” - said Kaladze. In addition, Kaladze said that Georgia would not refuse the Azerbaijani gas. “Azerbaijan was and remains our strategic partner. We are happy to receive gas from Azerbaijan at a very good price. As for the other suppliers,

it can be not only Russia, but also Kazakhstan, “- said Kaladze. According to him, Azerbaijan’s state oil company “SOCAR” is one of the largest on the Georgian market. In Kaladze’s words, the company makes the largest investments in the energy and social sectors of the country. “Commersant” was told at SOCAR office in Baku a year ago that the search for alternative sources of gas was the sovereign right of Georgia and Azerbaijan would carefully treat any decision taken by the Georgian government, and would continue to supply gas at the current price. Through long-term contract with Azerbaijan, Georgia gets cheaper gas. In general, the country receives gas from 4 sources - 250 million cubic meters at transit cost of 55 USD per 1 000 cubic meters, 500 million also at a reduced price of 64 USD, 150 million cubic meters at a price of 110 USD that is Georgia’s transit fee for Moscow to use the country’s North-South Pipeline to ship natural gas to Armenia, another 500 million from Azerbaijan for 189 USD and 400 million - for 240 USD.

INSURANCE MARKET CHANGES: GPI HOLDING EMERGES AS MARKET LEADER

hanges have occurred in the insurance market of Georgia - after participation of private companies in public insurance programs was limited, a long time leader “ALDAGI- BCI” has given primacy to “GPI-Holding” in the index of premiums raised without government programs. This is the first case of loss of position on the part of “ALDAGI” over the past 17 years. According to the Insurance Supervision Service, in terms of attracting premiums “GPI-Holding” was ranked the first – 24. 7 million GEL, followed by “ALDAGI - BCI” - 23, 5 million, “Irao “- 7, 1 million,” Ardi Group”- 7 million,” PSPinsurance “- 5, 2 million GEL. As for performance including government programs, “ALDAGI -BCI” is still the leader with 26. 1 million GEL, followed by “GPI-Holding” - 25, 9 million, “Irao “- 7, 8 million, and” Ardi Group “- 7 million GEL. In the first quarter of 2013 “ALDAGI -BCI” led by the volume of premiums raised without government programs , in particular, - 25.5 million GEL, followed by “ GPI-Holding” – 18.5 million, “Cartu” – 8.4 million, “Ardi Group” – 5.8 million GEL. It is known that a volume of premiums attracted without participation in government programs is a real indicator of the business opportunities of a company. The data published by the Insurance

Supervision Service indicates that “GPI-Holding” and “Ardi” have improved their indicators while a volume of premiums of the insurance market leader “ALDAGI- BCI” has decreased. According to President at the Georgian Insurance Institute George Gigolashvili, changes in the market are not extensive and are quite natural in the face of rising competition - in this situation changes among the market leaders are quite normal. “No company has guaranteed leadership. Most difficult - is to get into the top three or four leaders, and within these three or four changes may occur regularly. Especially when among leaders are the companies who do not depend only on government programs and work in various sectors of insurance. Thus, the sources of their income are more diversified, “- the expert notes.

The weekly is distributed to top companies, banks, embassies, state sector, Tbilisi and Batumi hotels, Tbilisi, Batumi and Kutaisi Airports, as well as in the town of Marneuli. The newspaper will also penetrate Azerbaijan in the near future

PUBLICITY June 16, 2014 #58

caucasian business week

APARTMENT

Every Wednesday At 21:00 On GDS TV Full of humor

Anchors – Kotiko Toloraia, Levan Gogoreliani will offier refined humor, provide good mood and invite interesting guests for the program audience. The program consists of three parts: the first block offers humor and apolitical monologue with funny video clips, pictures and so on. The second and third blocks are dedicated to famous public figures that will be invited as guests. The show will start Wednesdays at 21 o’clock and it will cover all interesting issues excluding politics to guarantee good mood for the audience.

Guests: Nanuka Gogichaishvili, Nini Badurashvili, Misha Mshvildadze and Special guest “Rubilnik”

INTERVIEW caucasian business week

“GEORGIAN DREAM”: UNEMPLOYMENT IN MAIN CHALLENGE IN TBILISI An interview with Georgian Dream ruling coalition’s candidate for Tbilisi mayoral post David Narmania

- In your opinion, what problems are the most urgent for Tbilisi residents? - First of all - unemployment and social problems. The City Hall has a little leverage to fight against unemployment, but we intend to increase funding for programs and projects that create jobs in the city - it’s about the programs financed from the city budget. A center to promote and develop small and medium business will also be created, the so-called business incubators, where aspiring entrepreneurs can get the necessary consultations. We will have target programs to support specific business sectors - construction, tourism, etc. Municipalretraining programs will be also launched. There will be also a variety of social programs, such as the ability to purchase drugs under the public insurance programs, pay utility costs for citizens living below the poverty line, the benefits for journey in public transport. In general, in the next 4 years over 800 million GEL will be spent for these purposes. Emergency buildings are a big problem for Tbilisi.... This problem should be divided into 2 parts. First - damaged buildings in the historic part of

the city, the second - emergency houses in other districts of Tbilisi. The traditional look is required to retain in the historical part. The City Hall must put in order communication, infrastructure, facade, and then offer investors to invest in the old historical buildings in order to add the area. As for the other districts, there is no need to maintain the historical appearance, respectively, an approach is completely different. - This is a large scale problem, and its solution takes many years. In your opinion, what largescale changes can be carried out over the 4-year term? - If we are able to demolish 30 houses in residential areas and build in their place something new and repair 50 buildings in the center of Tbilisi, it will be very good. Moreover, a lot of attention is paid to environment in my program - in particular, about one million trees are planned to be planted in Tbilisi as well as to declare the Mtkvari River a recreational area andclean it. - Your program of million trees has become an occasion for ridicule from your opponents. What is thisprogram based on? - We held consultations with environmentalists, analyzed data, and only then made the decision. There are a lot of areas that require landscaping in the capital and around it. There is nothing unreal. - Congested roads is another problem in Tbilisi. What do you plan to do in this regard? - It is impossible to completely solve the problem of traffic jams, but we have a plan how to reduce them. First of all I mean infrastructure projects. We have developed 10 projects, which will help relieve the streets – it is planned to expand roads, construct flyovers, etc. Movement of large vehicles will be limited to the maximum, such as trucks for garbage collection. All this will make it possible to relieve the situation on the roads.

AEROFLOT RETURNS ON GEORGIAN MARKET

eroflot got permission from the Russian aviation authorities for flights to Tbilisi. They submitted charter flights schedule to Civil Aviation Agency of Georgia in February, although due to absence of permission of the Russian air regulator, they withdrew back the application. The air company wanted daily charter flights to Tbilisi. The agency informs that license has not been issued yet, as the air company has not applied till now. Aeroflot operated to the 2006 embargo. Then

they resumed flights for the short term in 2008, before the war. Gazeta.ru reports that Rosaviation gave permission for flight to Georgia to Aeroflot after they got responsive nota from Ministry of Foreign Affairs of Georgia about the restoration of regular flights. Currently 2 Russian air companies - Siberia and Ural Airways operate on Georgian market. Ural provides Kutaisi-Moscow flights, Siberia - Tbilisi-Moscow flights. Georgian Airways (Airzena) also gas flights to the same directions.

COCA-COLA BOTTLERS GEORGIA GOES TO KAZAKHSTAN

oca Cola Bottlers Georgia started export of Coca-Cola to Kazakhstan. As founder of the company Temur Chkonia stated in the program Business Contact, they won tender in Kazakhstan and already started supply of the products. “It’s a very large project, we should export 30 million bottles of Coca cola. Overall turnover of the project is $22 million, which is quite a large sum for 4 months”, - Temur Chkonia stated. He also mentioned that Georgian Railway provides the product shipment. “I talked to George Kvirikashvili that there is such a large project, we created a great export potential and only railway should receive 4,5 million GEL from the shipment. Today Kazakhs called us and they are shocked, as Georgian Railway could deliver out carriages in 4-5 days.

Such a good communication we have with the state, which helps us in the quick supply of our products. They are shocked, because shipment from Astana to Aktau takes more than we could do from Georgia to Kazakhstan. Considering this, Kazakhstan may increase the demand”, Chkonia stated. Temur Chkonia said that the company actively works for the export of their products - cold tea in the jars and Shvefs and considers that export amount will be great. “We have good relations with Coca-Cola and only agree on the production of the products, which is not only local, but also on the export markets”, - the businessman says and mentions that the company also exports carbon dioxide in the balloons to Azerbaijan. He says that in 2014 his business group will make investment of 13 million EURO, among them will invest 6,5 million EURO in Kastel.

June 16, 2014 #58

PAPASHVILI TO CONSTRUCT 100SUITE HILTON IN ABASTUMANI

ormer shareholder of the Bank Republic Lasha Papashvli plans construction of Hotel Hilton in Abastumani. According to government’s order, the businessman’s obligations have been postponed for the construction of the hotel. According to the new terms, he should start exploitation of the hotel till August 19, 2018. The place, where the hotel will be located, was directly sold to Papashvii in 2009. The hotel should have at least 100 rooms and as Lasha Papashvili stated to GBC, minimal investment will equals to 7 million GEL. Besides, according to government’s order, the businessman should invest at least 626 530 GEL out of the total sum this year. Lasha Papashvili should provide receipt construction permission for the hotel complex till the end of 2014. He should start the construction in 2015.

Besides, imposed/possible fine was abolished to the businessman provided that he will fulfill the new obligations according to indicated schedule.

BANKER: CLIENTS OFTEN CONCEAL UNDECLARED DEBTS AND FAIL TO SERVE NEW LOANS

irector general o VTB agrees to NBG president, that more communication is necessary with the consumers, although doe not share opinion that the bank misleads the client. Archil Kontselidze states that the new loan offer to cover all other loans aims to smooth burden the client, as restructuring obligation is distributed for the longer term. Archil Kontselidze considers that the problem lies only in the communication. Frequently, a client has undeclared debt and hides it from the bank. Due to it they can’t pay loan. The banker considers that relation between consumer and bank should be more open. The management takes care on it and will try to devote more time to working with client, until the information about al products is clear for the consumer.

NBG president George Kadagidze met with bankers on Thursday. He focused on so called credit traps and relations with bankers. Kadagidze called the consumer to more caution.

84-SUITE INTERCONTINENTAL TO OPEN IN BORJOMI IN 2015

ne of the largest hotel networks of the world - InterContinental Hotels Group (IHG) will open a hotel Crowne Plaza Borjomi in Borjomi in 2015, which will be the first international brand hotel in Borjomi. As a portal ПРО-ОТЕЛЬ reports, T&T Consulting will provide the hotel management, according to the franchise agreement made with Park Hotel LLC. The hotel will be located in the Borjomi center, on Baratashvili Street, near railway station and central park. It will host both tourists and business organization. The hotel will have 84 rooms, spa center, fitness

studio, 6 rooms for negotiation, 2 restaurants and a cocktail bar. The hotel will be opened in 2015. It will be located in one of the existing buildings. Currently full reconstruction of the building is going. “We are glad and proud to become operator of the first international hotel operator, which will open hotel in Borjomi. Georgia is a priority market for is. Soon we will open second hotel in this country. Opening of two other hotels is planned. We will be glad to work with Park Hotel LLC and we will develop with our brands in Georgia”, - IHG vice president in Russia, CIS countries and Georgia Aaron Libinson stated.

FLOATING HOTELS AND TENT CITY “KAZANTIP” IN ANAKLIA

rganizers of the electronic music festival Kazantip , which was traditionally held in the Crimea, published on its website that Kazantip 2014 will be held in a small Black Sea resort town of Anaklia on 20- 30 August. All the information for those who will decide to attend the festival is posted on the site. It is assumed that the event will be held on the beach, where mini cottages will be located and accommodation will cost $ 15 per day. Those who want will be able to book rooms in hotels in Anaklia. Negotiations are also underway on the organization of a floating hotel meant for 5 000 seats . A stadium with a fenced yard and a beautiful green lawn , a luggage storage , showers, toilets and food outlets are located on the territory of KaZantip tent city. Guests will be able to put tents previously registered on kazantipa.net site. Cost of accommodation of a tent is 2-5 USD per day. Administration of the festival also explains the reasons for its transfer: “The reasons for holding the event in the Crimea

do not depend on the organizers – these are changes of the political system and legal framework, making impossible the existence of the project, at least this year,” –website says. Director of the Georgian National Tourism Administration George Sigua was the first who announced that the festival would be held in Georgia. Later the festival organizer Nikita Marshunok told the Russian TV company “Dozhd” about this. According to him, he liked this town and decided to hold a festival similar to that which takes place in the Crimea. “It will be a new era of traditional festival, and it will be innovative and adapted to Georgian traditions. At the first stage we expect approximately 50 000 people at the festival, and I hope that over the years their number will grow. Millions of investment will be carried out in this town that will contribute to local business. We are negotiating with Director of the National Tourism Administration of Georgia George Sigua. We were offered two cities - Anaklia and Batumi. We chose Anaklia and it will be the symbol of the festival,”- Marshunok notes.

BANKING June 16, 2014 #58

caucasian business week

PASHABANK GEORGIA INTRODUCES A NEW CHAIRMAN OF BOARD OF DIRECTORS

ASHA Bank in Georgia, a full-service corporate bank, has announced that Shahin Mammadov has been appointed the new Chairman of the Board of Directors of PASHABank Georgia.

Mr. Mammadov was previously working as Member of the Executive Board of PASHABank and CFO. Mr.Mammadov was preceded by Anar Ismayilov, who will continue to work at PASHABank in a new position. Mr.Mammadov holds Bachelor’s and Master’s degrees from Azerbaijan State Economic University, faculty of Accounting and Auditing. He has a Ph.D. in Economics and is a member of the Association of Chartered Certified Accountants, (ACCA). From 2003 to 2009 Mammadov held various positions in the banking sector and big four advisory firms. He started his career at PASHABank in 2009 at the position of Director of the Department of Financial Management. In 2011 he was appointed as board member and CFO of PASHABank.

NBG PRESIDENT DISCUSSES CLIENTS PROBLEMS WITH BANKERS

BG president discussed consumer problems on the meeting with bankers. George Kadagidze focused on so called credit traps. He called to maximal caution to the consumers, especially during getting or installment, credit card and other loan products. “Retail lending considerably increased in the consumer sector. If we add micro-finance organizations, pawnshops, instant installments and representatives of other non-formal sectors, we get the following picture: in the certain part of the population debt service burden is quite high and in the case of further increase it contains threat”, - Kadagidze stated. He mentioned that in the low-income country there is high probability of financial problem in terms of debt service.

“It’s problematic and unethical policy, when the consumer is offered a new loan to cover the old one. Temporary resolution of the problem is not the solution. Respectively, each case similar of this will have adequate reaction. Meanwhile I want to ask consumers and wand them to read the agreement and be very cautions using credit products (credit car, overdraft, installment). It’s the most expensive product in Georgia and in the world”, - president of NBG stated. To prevent this, on one hand, the client should realize the risks and on the other hand, the banks should adequately evaluate and take a responsible approach to such clients. “Respectively, we work on 2 directions: 1) maximal adjustment of the banks’ credit policy to the client needs. 2) Enhancement of awareness and maximal transparency of the product. The consumer should understand all threats”, - Kadagidze stated.

FOODPANDA’S UPDATED MOBILE APPLICATION MAKES FOOD ORDERING EASIER AND FASTER

nline ordering is becoming more and more demanding on the fast food market. The German brand foodpanda has recently entered the Georgian market to meet this demand. The international company foodpanda, which is the winner of the European Tech Startup Award 2014, works on a German business model that does not have any alternative in Georgia. foodpanda - as a customers oriented company, using contemporary technological means – like mobile applications – makes the food ordering process easy and fun, resulting in utmost user comfort. Ordering food online and placing orders from your smartphone is already possible via foodpanda’s updated application. Ordering food with the simple procedure from over 50 dining points across Tbilisi, Mtskheta and Rustavi is now possible through an updated application available on iOS, Android, and Window Mobile devices, as well as from the company’s official website -www.foodpanda.ge. The goal for this service is to help customers follow

the modern, active lifestyle - while almost all restaurants have a delivery service, foodpanda combines their menus in the internet space and grants users the ability to select and order food in a fast and easy way! The ordering process is simple and streamlined: after downloading the application to your preferred mobile device and registering an account, you can select your city and district, which will allow the application to display a list of restaurants best catered to your location. You can then select one of these restaurants to see their full menu – which is always being regularly updated to keep in sync with its real-life counterpart – and select your preferred meals, add personal notes, and get an exact calculation of price and time of delivery. It’s important to note that foodpanda.ge retains all prices from its partnered restaurants and doesn’t add any additional fee atop the base price. Payment itself is done in cash once the courier arrives with your order, but online payment system will be implemented in the nearest future.

TBC BANK ON LONDON STOCK EXCHANGE

BC Bank has conducted an Initial Public Offering (IPO) on London Stock Exchange. TBC Bank joined the world’s leadingcompanies listed on London Stock Exchange - one of the largest stocks exchanges in the world. TBC Bank’s Initial Public Offering on the London Stock Exchange was conducted in the form of Global Depositary Receipts. Barclays PLC and UBS were Joint Global Coordinators and Joint Bookrunners, Renaissance Capital was Joint Bookrunner, and Peel Hunt was Co-lead Manager on the IPO. This transaction is of international significance where theprice of shareslisted by TBC Bank exceeded GEL 400 million. TBC Bank IPO is the largest ever off-index international IPO out of Europe, Middle East and Africa (EMEA) region.This is the largest public offering of any Georgian company on a stock exchange.Up to a 100 highly reputable institutional investors from Great Britain, United States of America, Scandinavia and other countries of Europe already purchased TBC Bank’s shares. TBC Bank’s investor base has expanded as a re-

sult of the IPO on the London Stock Exchange and this will help the Bank achieve its long-term development and strategic goals. Moreover, many of the Bank’s shareholders, including institutional shareholders and founders, Mamuka Khazaradze and Badri Japaridze, remain as shareholders of the Bank. Withthe raised funds, TBC Bank plans to actively finance such growing business segments as retail and Small and Medium Enterprises. “Listing of our stock on London Stock Exchange is a recognition that TBC Bank, as a financial institution corresponds to the world’s highest standards.Moreover, the IPO allows us to furtherimprove our business processesand ensure that the Bank’s corporate governance is aligned with international best practices. What is most important, this is an enormous investment, which will support the development of the Georgian economy and increase investor confidence towards companies operating in Georgia - factors that ultimately contribute to the country’s long-term economic development. I would also take this opportunity and thank the entire TBC Bank team for their contribution to the Bank’s success,”- stated TBC Bank CEO Vakhtang Butskhrikidze.

“TBC BANK” REDUCES INTEREST RATE ON LOANS An interview with “TBC Bank” President Mamuka Khazaradze - As it is known, the other day “TBC Bank” shares were floated on the London Stock Exchange. Did you expect so much interest in your bank? - This is a victory not only for “TBC Bank”, but also for the entire banking sector, and the economy of Georgia. Demand has exceeded all expectations, it was one and a half higher than we planned, which once again shows the high professional level of our management as well as investors’ confidence in the country. 100 large investors and international funds from the Scandinavian countries, Europe and the United States interested in “TBC Bank” shares. This is the new reality for the recovery of the Georgian economy. - It also became known that after your shares were floated on the LSE, you are going to allocate about one billion GEL for loans.What changes are to be expected? - We’ll offer a lot of innovations to Georgian financial market that will allow us to increase the portfolio to 1.5 billion GEL. This means that many companies will receive funding, there will be more long-term money, and it certainly will lead to the reduced interest rates on loans. The declining trend in interest rates has been observed for a few years, and we intend to continue. This in turn will help small and medium businesses. In addition, it is very important that investors,

who cooperate with our bank, are potential investors in the Georgian economy. - To float shares on the London Stock Exchange is a great success. Will this fact be reflected on your clients? - The fact that we will be able to allocate about 1 billion GEL for loans means that the number of issued loans will increase, credit terms will be improved, conditions will become more advantageous. This is beneficial to our clients. We went to the capital market and we will not have problems with raising cheap money, and this will stimulate economic development. It is globally very important, not only for our clients.

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BUSINESS 6 LUCA POLARE ON AGHMASHENEBELI AVENUE! caucasian business week

Luca Polare opened a new branch at 125 Aghmashenebeli Avenue on 7 June

uca Polare rings in the summer with an important novelty: on 7 June the company opened its fourth branch at 125 Aghmashenebeli Avenue. In addition to all famous specialties, a new product “Polare yogurt”, is available exclusively at the Aghmashenebeli branch. Like other products, Polare yogurt is made according to an original house recipe. It contains no artificial coloring or flavoring. It is free of preservatives and prepared fresh every day to ensure maximum quality. Polare yogurt is distinguished from its peers by its low calorie content and light taste. Selection of Polare yogurt toppings allows customers to create a unique product according to individual taste. This is the first time in Georgia that an ice cream parlor has given its customers complete freedom of choice. Our motto is “Make it your way!” At the Aghmashenebeli branch opening, Luca Polare unveiled its special bonus cards and gift cards. Soon the cards will be available at every

branch of Luca Polare; bonus cards can be obtained for free with purchase. The cozy atmosphere, elegant terrace and products made and served with love will make Luca Polare on Aghmashenebeli Avenue the place to be in Tbilisi! Luca Polare, a German-Georgian family business, started six years ago with the idea of building something completely new for Georgia - a European-type ice cream parlor that meets international standards of product quality and service. Every day, from early morning (8am) until late at night (2 am,) Luca Polare offers: Up to 26 different flavors of ice cream, Various coffee drinks, Various hot and cold drinks, Cakes, Salads and fresh fruit… and now also Polare yogurt at the Aghmashenebeli branch. Providing top quality products and friendly service focused on customer needs are the main priorities of Luca Polare, as a satisfied customer is the best advertisement.

June 16, 2014 #58

MUNICIPALITY June 16, 2014 #58

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PUBLICITY AND ACCOUNTABILITY ARE OUR MAIN PRINCIPLES

ublicity and accountability to our citizens is one of the main principles of me and my team. Therefore, I believe the Marneuli municipality residents should have information on the ongoing and coming projects of the local self-government. I believe similar activities foster the growth of civil society involvement in the municipality management process. In 2014 the municipality will implement projects financed by the central authorities, local budget and the village support program. Each program was planned in the interest of local population. All ongoing and coming projects are so large-scale and various, I believe I should introduce them to the Marneuli municipality residents in the form of a timetable that comprehensively describes all ongoing and coming infrastructural projects in the municipal city and villages in 2014.

Marneuli Municipality Head MERAB TOPCHISHVILI

HPP caucasian business week

June 16, 2014 #58

GIORGI VOLSKY: “KHUDONI PROJECT IS OF PARAMOUNT IMPORTANCE”

ublic discussions about Khudoni Project do not cease. The government has clear view about the project’s importance for economic development of the country. Officials state that the project implementation is vital for Georgia and the HPP needs to be built with consideration of local population’s interests. Giorgi Volsky, Member of the Parliamentary Majority, expressed his thoughts on this issue: “In my opinion, implementation of Khudoni Project is of paramount importance for the country’s economic development. Georgia’s energy independence and development greatly depend on it and we have to well realize this fact. Better communication is needed with the population. Adoption of anti-discrimination law showed us that a part of the society did not have information on it. Therefore, more explanations are required for the locals and public at large why this project needs to be implemented”.

GOGA KHACHIDZE: “KHUDONI IS TO BE BUILT, OTHERWISE THE COUNTRY WILL NOT DEVELOP”

oga Khachidze, the Ex-Minister of Environment Protection and a current Member of the Parliamentary Minority, stated that implementation of Khudoni HPP was necessary for the country’s economic development. “I don’t know the situation under the new government, what negotiations were conducted or if anything changed. As far as I am concerned, Khudoni is not just important but it is vital for the energy development of the country. Unfortunately, at the time when we were in the government the opposition was making statements only based on the party and political interests with respect to this Project. Georgian Dream Coalition was declaring that it would not support construction of big dams. However, upon coming to power, they realized that Khudoni was to be built and it would be essential for the country’s development. I think that people have to make a choice. If we do not want development and don’t need more electricity we don’t have to build it, but if we support development we have to realize this project. It is as simple as that. Although during our ruling the Khudoni Project was not finalized, required documents were not complete, and the project was not developed at the level as it is now, our government was stating that we had to build Khudoni HPP. The more the process is delayed, the harder it will be for the government to implement the Project” – Khachidze stated.

OTAR CHRDILELI: “KHUDONI PROJECT IS PROFITABLE FOR THE COUNTRY” ow important Khudoni Project is

for the economic development of the country and whether or not it should be implemented, is still being questioned in the Georgian politics. The government’s position is clear – Khudoni is needed for the country, however the peoples’ demands are to be met at maximum extant. Otar Chrdileli, a Member of the Parliamentary Majority addressed importance of the Khudoni Project: “Although I am not involved and do not know this project well, I think that it is profitable for the country’s economic development. It is necessary that the government and people reach consensus. Our government will not make decision on its own, without asking people; Khudoni construction is essential for energy independence of the country.”

KHUDONI HPP –EXPORT GROWTH AND LARI STABILITY GUARANTEE

t is a banality but it is obvious that by utilizing hydro resources, the country will have a new sector for export. Utilization of hydro potential is irreplaceable for the country’s energy security. In addition, Khudoni Project does not have an alternative” – noted Lado Gurgenidze, Executive Chairman of the Supervisory Board of JSC Liberty Bank and Georgia’s Ex-Prime Minister. Liana Jervalidze, an Expert in Energy and Transit Issues, emphasizes the role of Khudoni scale projects in reduction of negative trade deficit of the country: “Export-import balance is disrupted and we have to do everything for export promotion. Shall we produce just that volume of apples and pears that we consume and do not export these products? If we do not start today, we won’t have it in the future when the need arises”. Marina Guledani, Director of CFS Investment Bank regards power as an export product and a mechanism for strengthening Georgia’s foreign exchange reserves and maintaining stability of the national currency. “Naturally, the power generated from hydro resources is the most important export potential and

a good means for strengthening foreign exchange reserves and national currency. Some hydro power plants (working on the rise in water flow) in Georgia are being built with the aim to use excessive electricity generated during summer for exporting to Turkey. Such plants do not require dams. Even if part of projected HPPs are constructed, the capacity of transmission line to Turkey will not be sufficient to ensure full export and construction of additional power transmission line will be necessary” – Marina Guledani said. According to official statistics, Georgia managed to export power this year only in May. According to Electricity System Commercial Operator (ESCO), Georgia exported power to Russia, Armenia and Turkey. In particular, 88.41 million kW-hr got exported to Russia, 64.5 million kWhr to Armenia and 8.6 million kW-hr to Turkey. It should be noted that during the first five months of this year, Georgia imported 280.78 million kW-hr and sold 161,6 million kW-hr. Based on GEOSTAT data, in January – April 2014, Georgia’s negative trade balance constituted USD 1.576 billion (46% of external trade turnover).

BANKING & INVESTMENT June 16, 2014 #58

TBC INTRODUCES VISA PAY STICKER

irst time in Georgia and in the South Caucasus, TBC Bank offered clients innovative product - Visa Pay Sticker. The bank stated that Pay Sticker is an exclusive product representing the quickest payment means and TBC aimed to create additional comfort for the consumers. Pay Stickers is add-on of the debit card and the consumer can stick in on any item - cell phone, clock, keychain and so on. The consumer can link Pay Sticker account to the debit card account. The transaction will be made by approaching the sticker to the terminal. After that the amount will be deducted. Transaction up to 45 GEL may be made by sticker, without pin code. The consumer gets double Smartpoints by Pay-Sticker. The innovation can be used in any trade object, which has contactless payment logo, also in the POS terminals of TBC and other banks.

BANK OF GEORGIA LEADS RATING OF FORBES GEORGIA

nalysis of Georgian banking sector was the main topic for the influential business-economic journal. Presentation of 31st issue was held on Tuesday, in the National Bank. The rating was made up according to the main financial data (actives, deposits, obligations, capital). Ernst and Young- Georgia and Forbes Georgia prepared the exclusive materials with cooperation to NBG. June edition of the journal discusses in details main trends of the banking sector and analyses how each bank coped with macroeconomic challenges. President of NBG George Kadagidze, based on the evaluations of influential financial institutes, once again stated that banking sector of Georgia is a total champion in terms of attraction of direct foreign investments and employment and locomotive for the country economy.

BASISBANK COMPLETES JANUARY TO APRIL PERIOD WITH 4.9 MILLION GEL PROFITS

SC Basis Bank completed I reporting month of the Q2 with 2,1 million GEL profit. In January-April profit equaled to 4,9 million GEL. By May 1 deposit portfolio (without banks’ deposits) equaled to 213,4 million GEL (01/05/13 -173 million), loans - 209,5 million GEL (01/05/13 -119 million), overall obligations - 294 million GEL (01/04/13-216 million). Annual growth of the deposits is 23,4%, since the same period last year loan portfolio has increased by 76%, bank’s actives - by 53%, to 414,7 million GEL (01/05/13 - 271,2 million), market share - 2,3%(01/05/13 - 1,9%). Basis Bank operates since 1993. Since 2008 European Bank for Reconstruction and Development (EBRD) is its stockholder (15%). In 2012 the largest chines Hualing Group became owner of Basis Bank shares. Its share is 93%, 5% belongs to the founder of the bank Zurab Tsikhistavi, 1,85% - to EBRD. Overall stock capital of the bank is 121,2 million GEL (01/05/13-55,1 million GEL). Rating agency Fitch Ratings stated on Monday that they confirmed rating to Basis Bank at “B”, with a Stable Outlook.

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BANK OF GEORGIA TO INCREASE CLIENTS FINANCIAL LITERACY

n connection with the statement of the President of the National Bank of Georgia (NBG) about the presence of “traps” for customers in the banking sector, “Bank of Georgia” took the initiative associated with the increasing level of customer awareness regarding finance. According to the Director General of “BG” Irakli Gilauri, it is very important that taking a credit the client should know exactly what to expect and therefore, will be able to plan the budget properly. To this end, the bank and its subsidiary - Financial Academy - intend to

open free courses for those who want to know what banks offer and will be able to properly plan their expenses. “We are interested in the client’s creditworthy and will be able to pay his debts, as we do not need to give out bad loans, and then fight for their return. The bank grants loans, which primarily advantageous for it and the client. Of course, banks are not always 100% right. First of all, it is impossible to lend to anyone, but on the other hand, circumstances are changing. Only about 2% of outstanding loans fall on consumer loans, but it is important that this figure was even smaller. In general, banks have an image problem, but it is primarily due to the fact that the overall situation in the financial market is complicated by moneylenders and small organizations that provide loans very quickly. Our policy aims to ensure that the client was solvent, and therefore, those whom we do not give a credit, should not goto the moneylenders - if the banks refuse to make loans, it means that the client cannot pay - we have the relevant experience and see it at an early stage, and the client -not. Therefore, it is better to abandon the intention to take the credit “- said General Director of the Bank Irakli Gilauri.

STOCKHOLDER OF DEVELOPMENT BANK OF GEORGIA MAY BECOME CHINESE BANK WITH THE SAME NAME

hines Development Bank will invest 0,5 billion in Georgia. Details of the 500-million investment project will be known at the end of this month. By that time visit of Chinese is planned in our country, which aims opening of the bank’s representation. Leader of majority David Saganelidze, who had just returned from China, stated in TV Maestro, that the discussion topics include Development Bank of Georgia, shareholders of which may include Chinese Development Bank along with other international financial institutions. However, their contribution will be less than 50% in the state stock society. Sagenelidze recalled several successful examples of such financial institutions, among them KFC and motioned that currently such 500 institutions successfully operate in Europe, Asia and Africa. He informed that it’s not excluded Development Bank of Georgia to be renamed to consortium. Saganelidze stated that banking sector, which had not been involved in the discussion, was skeptic at first, although they approved the initiative, as Georgian bankers assured that the bank will not compete the sector. Saganelidze mentioned that the funds attracted by the bank will be directed to the projects, which will be considered as risky by banks and do not give credits. Besides, these projects will be funded though the commercial banks and the sector will have additional money. GBC listened to the opinions of EBRD and Procredit Bank Georgia on this topic: EBRD director in the South

Caucasus, Moldova and Belorussia Bruno Balvanera: “We have not been asked and it’s not necessary to ask us, but any instrument, which is oriented on the business support, will bring results.” Director general of Pro Credit Bank (Georgia) Asmus Rotne: “We did not participate in the discussion. Government should decide whether they stimulate economy through Development Bank or through commercial banks”. Although they welcome stimulation of the business b the government in any form and expect effect by establishment of Development Bank. Currently registration of the bank has been suspended. Parliament discussions will resume after the elections. New group is working on the improvement of the model, as assigned by Prime Minister. Experts consider that some obstacles should be improved. The project did not include clearly established rights and responsibilities of the bans. For example: it was restricted to attract deposits, although there was not indication that emission of deposit certificates was prohibited, which considers attractions of deposits by securities. Besides, stock type was not determined (common, privileged...). Individuals could owned 49% (privileged shareholder with more rights can have it. Although their access on the budget funds in this form is unaccepted). Development bank, fund or consortium is being established on the basis of Partnership Fund. At first the government initiated to transform it into the sovereign fund, but the last initiative is establishment of Development Bank.

CIS June 16, 2014 #58

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RUSSIA-UKRAINE GAS WAR: EUROPE WONDERS WHAT’S IN STORE speculated. The South Stream gas pipeline, another route bypassing Ukraine set to deliver about 64 billion cubic meters to Europe, could now be in peril over chilled EU-Russia relations. The US and EU are pressuring Gazprom partner countries to block the South Stream project, and on Sunday Bulgaria announced it is suspending work. Later, the Energy Minister said the project is “irreversible” and will go on.On June 13 teh European Commossion is coming to Bulgaria to discuss the issues connected with the marine section of the South Stream. DIARY OF THE DISPUTE Ukraine currently has a 10-year contract with Gazprom, which was signed under the leadership of Yulia Tymoshenko in 2009. A provision of this is “take or pay”, which requires Ukraine to purchase about 40 billion cubic meters of gas per year, whether they use it or not. When Crimea reunited with Russia, the oil rich Black Sea, which has an estimated 2.2 billion

ussia has again extended the deadline before Kiev starts using a prepayment system, but if Ukraine doesn’t pay its gas debt by June 16, Moscow could pinch the energy vein that provides for a third of the total gas needs in Europe. Russia has turned off gas supplies through Ukraine twice, in the winters of 2006 and 2009, after Kiev was late paying. Halting natural gas supplies not only hurt Ukraine, but also squeezed European neighbors, as prices shot up and millions of European homes were left without heat. Both periods lasted about three weeks. Kiev and Moscow are still negotiating on a gas price, which Russian President Vladimir Putin announced on Wednesday could be lowered to $385 per 1,000 cubic meters. Kiev hasn’t formally accepted this offer, insisting it was “biased” and “political”. Europe imports a third of its natural gas from Russia, and nearly half of that is delivered via Ukraine. In 2012, over 84 billion cubic meters of gas traveled from Russia to Europe through Ukraine. Little of Ukraine or Europe will feel any immediate effects, since dependence on Russian gas in

cubic meters of natural gas valued at $1 billion, switched hands to Moscow. Gazprom took over the operations of Chronomornafrogaz (Black Sea Gas), and Ukraine’s Prime Minister Arseniy Yatsenyuk demanded Russia return the “stolen” gas. Up until 1991, Crimea was part of the larger Union of Soviet Socialist Republics, better known as the Soviet Union. Before that, it was part of Russia, until it was gifted to the Ukrainian Soviet Socialist Republic by then-premier Nikita Khrushchev in 1954. During the Soviet Union, Ukraine became a natural hub for transporting gas westward to European and Turkish markets. Now, it has become an unreliable transport state, so Russian state-owned Gazprom is rapidly building pipelines around it to ensure product delivery to European clients, some of which are 100 percent dependent on Russian gas. The North Stream pipeline, which crosses the Baltic Sea, delivers gas to Germany and other north western states, and the to-be-completed South Stream will service southern Europe.

the summer months is lower. In the so-called ‘low season’ Europe can get enough gas through the Nord Stream pipeline or through the pipes across Belarus. But in winter, transit through Ukraine would be vital, Aleksandr Pasechnik, head of analytical department the Fund of National Energy Security, said earlier. Some European countries have large reserves. Latvia, for example, has a year’s worth of gas saved up. However other countries, like Bulgaria, the EU’s poorest member state, have less than two months of gas at its disposal. So if Russia’s gas supplies to Ukraine are cut off for long enough, Europe may face a really cold winter. Europe can also turn elsewhere for gas - Norway and the Netherlands are both gas producing neighbors, or Azerbaijan, the oil rich country south of Russia situated on the Caspian Sea. European LNG terminals have the ability to import nearly 200 billion cubic meters of gas per year, according to Gas Infrastructure Europe, a Brussels-based lobby group. But LNG imports would be really expensive. If tarnsit of Russian gas via Ukraine is dirupted, prices in the UK and other parts of Europe could more than double, many analysts have

EU SANCTIONS ON RUSSIA COULD PUSH GAS PRICES UP 50% - WORLD BANK

ussia and the EU would both suffer if sanctions escalate, energy markets the most, according to a World Bank report. The loss of the European market would cut Russian government revenue by 10 percent of GDP, and European gas prices would jump 50 percent. Most dependent EU countries could see higher gas prices. Coun-

tries from Central and South East Europe like Germany, Italy, Hungary, and Poland are up to 80 percent dependent on Russian gas imports, says the World Bank. Increased tension between Russia and the EU is a key downside risk to regional forecasts. “Should tensions further escalate, more intrusive sanctions, possibly interrupting trade and banking flows, cannot be ruled out,” the World Bank report said. “Given the close economic interdependence between the EU and Russia, the escalation of sanctions would likely impose large economic costs, damaging recoveries in both.” In Russia, oil revenues represent 9 percent of GDP and a quarter of government revenues, and “a loss of EU export markets could reduce government revenues by 10 or more percent of GDP,” according to World Bank analytics. Europe depends on Russia for nearly 30 percent of its natural gas supplies. In case of supply disruption or sanctions, the economic costs could be high. Additional LNG imports to Europe from elsewhere in the world would boost global demand and prices. However even assuming no boost to LNG prices, EU import costs would rise by 50 percent or about 0.15 percent of GDP says the report. The losses would be much

higher for major importers. Russian economic growth in 2014 is expected to be at 0.5 percent. The longer outlook forecast is a bit more optimistic with 1.5 percent in 2015 and 2.2 percent in 2016. Global GDP growth is projected to gradually rise from 2.4 percent in 2013 to 2.8 percent in 2014, 3.4 percent in 2015 and 3.5 percent in 2016. The World Bank has revised down its forecast for economic growth in the developing world this year from 5.3 percent to 4.8 percent. The report shows that 2014 will become the third consecutive year of growth below 5 percent and urges developing nations to make economic reforms in order to boost growth potential. 2015 will come with a gradual GDP growth by only 5.5 percent. “The global economy got off to a bumpy start this year buffeted by poor weather in the United States, financial market turbulence and the conflict in Ukraine,” says the document. Overall the Ukraine situation is estimated to have eroded 1 percentage point of growth among low and middle-income countries in the region. In Central Asia much weaker Russian growth has slowed the economies there because it is a major trading partner, and a source of remittances. Declining metal and mineral prices and domestic capacity constraints have also affected the economy. High-income countries will experience 1.9 percent growth this year compared to 1.3 percent in 2013 and 2.5 percent by 2016, becoming the main impetus for acceleration. High-income economies are projected to inject an additional $6.3 trillion to global demand over the next three years, which is significantly more than the $3.9 trillion increase they contributed during the past three years, and more than the expected contribution from developing countries.

AZERBAIJAN June 16, 2014 #58

caucasian business week

FITCH AFFIRMS AZERENERJI’S RATING AS STABLE

I ADB INVESTING HEAVILY IN AZERBAIJAN

sian Development Bank (ADB) has invested $1.7 billion in various projects in Azerbaijan by giving Baku 20 loans and signing a grant agreement with the country

since 1999. The news was announced by Azerbaijan’s Finance Minister Samir Sharifov at a meeting held on June 9 marking the 15th anniversary of country’s accession to the ADB attended by VicePresident of the Bank Wencai Zhang. “Some $1.334 billion have been invested as of early this year under loan agreements with the bank,” Sharifov said, adding that the volume of used funds stood at about $570 million. “Following the restoration of Azerbaijan’s independence, the effective integration of the country into the global economic system was chosen as a strategic goal of economic policy, and this goal certainly would not have been achieved without cooperation with international financial institutions,” the minister noted. Minister Sharifov said currently Azerbaijan ranks 26th in the world and 18th in the region in terms of possession of shares in ADB. “ADB has actively participated in implementing infrastructural projects in Azerbaijan. These projects touched such areas as transportation, water supply and so on. ADB projects cover both public and private sectors, and a representative office of the bank has been operating in Baku since 2004,” Sharifov added. He also noted that Azerbaijan intends to continue strengthening cooperation with ADB to achieve the sustainable economic development goals. The current cooperation and the prospects for future cooperation between Azerbaijan and the ADB also were discussed during the meeting. The event emphasized the successful development of cooperation and the importance of joint implementation of water, transportation, and oth-

er infrastructural projects. Zhang visited Ganja city and Goychay region during his visit to Azerbaijan to review the process of implementation of ADB projects. “Progress and development are observed in these regions of the country, as well as in Baku,” Zhang said. The issue of holding a meeting of ADB Board of Governors in Baku in 2015 was also discussed during the meeting. Sharifov said the preparatory work for the meeting is being conducted at a high level and in accordance with the scheduled program. Zhang, in turn, expressed confidence in Baku holding the meeting, adding that Azerbaijan will once again prove itself as a reliable partner of ADB. Azerbaijani Transport Minister Ziya Mammadov met a delegation headed by Wencai Zhang afterwards. Addressing the meeting, Mammadov stressed that transport is one of the priorities of the Azerbaijani economy. He also spoke of the construction of Baku International Sea Trade Port, the state program for the railway development, as well as large regional projects and the expansion of international cooperation, adding that BakuTbilisi-Kars railway project is under completion. Zhang, in turn, stressed that there is great potential to expand cooperation between ADB and Azerbaijan. The sides also discussed other related issues and came to an agreement on enhancing cooperation in all areas of the road transport complex. Established in 1966, ADB has 67 member countries. The bank’s headquarters is located in Manila, the capital of the Philippines. ADB’s leading shareholders are Japan and the U.S (31.2 percent of the total share capital), India and China (12.8 percent), Australia, South Korea and Canada (16 percent) and so on. Azerbaijan’s share in the bank’s capital is 0.5 percent.

AZERBAIJAN’S PRODUCTS MAKE WAY FOR EUROPEAN MARKET

zerbaijan’s products will be labeled with the CE mark (Conformite Europeenne) from September. Director of Azerbaijani Standardization and Certification Institute, Sabig Abdullayev, announced about this on June 9. Abdullayev said this procedure is among the activities of the German TUV company, which is one of the famous commercial leaders in the area of products inspection. “Labeling Azerbaijani products in accordance with European directives and standards allows free exporting of Azerbaijani goods with CE mark to the European markets without additional requirements,” he said. Abdullayev added the TUV will cooperate with various Azerbaijani companies and government authorities, in particular with the institute tasked with labeling domestic products with the CE mark. “In Azerbaijan, TUV will also supervise construction processes as an independent third party, regulatory inspection and certification,” he said. CE mark is a special sign put on the products, thus certifying that the products comply with the main requirements of the directives of the EU. The sign indicates that the product is not harmful or dangerous to the health of consumers. It also shows that the products are environmentally friendly. It is the only sign of compliance with European standards and directives. The trade turnover between Azerbaijan and EU countries amounted to roughly $4.3billion mil-

lion in January-April 2014. Economy expert Vugar Bayramov believes that matching Azerbaijani production with the European standards will open wide opportunities to Azerbaijani businessmen. A great deal of production in Azerbaijan are not corresponding to the European quality and thus cannot enter the broad European market, he said. “Today, the European Union is one of the biggest supporters of Azerbaijan’s trade,” Bayramov said. “Sixty percent of the trade turnover in Azerbaijan falls to the EU. Currently, Azerbaijan mostly imports oil and oil production to Europe, while import is consisting of the non-oil production.” “New quality standards will create a possibility to export more non-oil production to Europe,” he said. Bayramov believes the agricultural sector will also benefit from the European standards and will increase at least by 10 percent. Economist Oqtay Haqverdiyev also said this is a positive sign, as using the CE mark will force the producers in Azerbaijan to create goods matching with European standards. Azerbaijan is currently developing its non-oil sector and serious achievements were secured in this sphere. The average annual growth rate in the non-oil sector over the past 10 years reached almost 11 percent. Moreover, the average pace of annual real growth in GDP in the non-oil sector is expected to be more than 7 percent by 2020.

nternational Rating Agency Fitch Ratings has affirmed Azerbaijan’s 100 percent state-owned national energy operator’s long-term issuer default rating (IDR) at ‘BBB-’ with a stable outlook and its shortterm foreign currency IDR at ‘F3’. Fitch said it continues to align Azerenerji Joint Stock Company’s ratings with those of Azerbaijan (BBB-/Stable), the sole shareholder, to reflect strong legal, operational and strategic ties between the company and the state, as per the agency’s Parent and Subsidiary Rating Linkage methodology. In particular, the rating alignment reflects state guarantees for the majority of Azerenerji’s outstanding debt, the company’s strategic importance to the Azerbaijani economy and strong operational links, including tariff and capex approval by the government, and track record of direct state support. Fitch assesses legal ties between Azerenerji and the state as strong given that the state continues to provide guarantees for a substantial part of Azerenerji’s outstanding debt. “Fitch assumes this ratio will remain fairly stable over 2014-2017 and we do not expect any significant changes in the legal links with the state in the foreseeable future, as there are no plans at present to privatize Azerenerji,” the agency said. “The strength of strategic ties is underpinned by Azerenerji’s virtual monopoly in Azerbaijan’s electricity generation market and transmission segment as well as a 55 percent market share in the country’s electricity distribution. This demonstrates the company’s importance to Azerbaijan’s economy, despite a fairly low contribution to the country’s GDP.” In addition to state-guaranteed debt, Azerenerji received interest-free loans from the Finance Ministry that accounted for another 6 percent of total outstanding debt excluding accrued interest at end-2013. “The state also continued to provide equity injections of 818 million manats over 2009-2013 to partially fund its investment program,” Fitch said.

During five months of 2014, the government provided 15.7 million manats and the company expects to receive 22 million manats by end-2014 and another four billion manats over 2015 to 2017, covering around 97 percent of the investment needs for the respective periods. Fitch expects Azerenerji to continue generating solid cash flow from operations of around 200 million manats on average over 2014-2017. However, free cash flow is likely to remain negative over the same period due to significant capital investment plans, Fitch noted. “A large part of the investment program is discretionary, depending on the level of available funding from the government. Azerenerji’s committed capex totaled 0.8 billion manats at end-2013. Additionally, we do not expect Azerenerji to pay dividends in the medium term,” Fitch said. Azerenerji’s funds from operations (FFO) adjusted net leverage decreased slightly to 5.76x at end-2013 from 5.84x at end-2012, but remained high compared with its peers. Fitch expects net leverage to remain high, averaging above 6x over 2014-2017, mainly due to gas tariff hikes from December 2013 while electricity tariffs remained unchanged. Given the already high leverage, Fitch would expect Azerenerji to receive state guarantees for any new (currently unplanned) debt in addition to equity injections for specific investment projects. Azerenerji is the main producer of electricity in Azerbaijan, having on its balance sheet more than 200 substations, with a capacity of 500, 330, 220 and 110 kilovolt amperes, and eight water power plants and 13 thermal power plants.

AZERBAIJANI BANKS UP FINANCING ECONOMY

zerbaijani banks increased lending to the economy by 24.8 percent in January-April 2014 compared to the same period of 2013. The Central Bank of Azerbaijan (CBA) reported that the banks issued loans totaling 16.245.4 billion manat including 11.759.8 billion manat (72.4 percent) in national currency and 4.485.6 billion manat (27.6 percent) in freely convertible currency for the reporting period. The figure was equal to 13.019.5 billion manat (9.107 billion manat in national currency and 3.912.5 billion manat in freely convertible currency) in January-April 2013. Of the total portfolio, loans worth 895.6 million manat (5.5 percent) were overdue compared to 754.7 million manat as of January-April 2013. Statistics of overdue loans does not include similar loans of the non-banking credit institution Aqrarkredit. Overdue loans increased by 18.7 percent per year. Short term loans amounted to 3.572 billion manat including overdue loans worth 408 million manat compared to 3.139.8 billion manat including overdue loans worth 375.1 million manat as of January-April 2013. The volume of short term loans in the economy increased by 13.8 percent per year. As of January-April 2014, the volume of long term loans amounted to 12.673.4 billion manat including 487.7 million manat in overdue loans compared to 9.879.6 billion manat including 379.6 million manat of overdue loans as of January-April 2013. The long term loans increased by 28.3 percent per year. The credit portfolio of the only state bank in the country, the International Bank of Azerbaijan, hit 5.534.4 billion manat with a specific weight of 34.1 percent, while private banks issued loans worth 10.241.2 billion manat with a specific weight of 63 percent. The remaining 2.9 percent

fell to the share of non-bank credit organizations. They issued 469.8 million manat, according to the CBA. Most of all loans are granted to households in Azerbaijan. As of January-April 2014, households received 40.7 percent or 6.610.9 billion manat, according to the CBA. The trade and service sector (14.3 percent or 2.322.4 billion manat) ranks second, the construction and real estate sector (13.1 percent or 2.127 billion manat) ranks third. The industrial and production sector received 11.7 percent of the total lending amount of the Azerbaijani real sector, which hits 1.908 billion manat in nominal terms. It should be stressed that this sector obtained a great volume of lending in connection with the announcement of 2014 as the Year of Industry. For comparison, as of 2013, the industrial sector received only 9.8 percent of the total volume of loans in the country’s economy. Some 3.6 percent (586.3 million manat) fall to the transport and communication, 4.6 percent (750.5 million manat) - agriculture and processing, 1.6 percent (259 million manat) - energy, chemistry, and natural resources, 10.4 percent or 1.689.5 billion manat loans - on the other spheres. Some 44 banks operate in Azerbaijan.

PUBLICITY caucasian business week

June 16, 2014 #58

WORLD NEWS June 16, 2014 #58

caucasian business week

UK CREATED ALL-TIME RECORD 345,000 JOBS IN FEBRUARY-APRIL

FACEBOOK CLAIMS TO BECOME ‘BIGGEST STADIUM IN THE WORLD’ FOR WORLD CUP

acebook wants to become the biggest media source for the football World Cup in Brazil. The biggest social network says it’ll outperform Twitter, because its 500 million users interested in football is twice the size of Twitter’s monthly user base. 2014 will become the first World Cup followed on people’s smartphones, as the Financial Times quotes Will Platt-Higgins, the director of global accounts at Facebook “For the first time in 2014, we, all of us, are carrying around a mobile stadium in our pockets, where you will be watching, learning scores, team sheets, changes, injuries, substitutes – all of it – and sharing it,” he said. “That is a hugely compelling thing for a marketer.” Twitter has been seen to dominate live events after record-breaking post with almost 3.5 million re-tweets at this year’s Oscars. However, the Facebook analysis is based on user activity, their likes and links shared shows that around half-a-billion of them are interested in football. This is double the number of the aver-

age monthly users on Twitter, giving Facebook a real chance to become the “biggest stadium in the world,” as Platt-Higgins describes it. The world’s biggest social network doesn’t see any barriers to it substituting for TV as a main source for football fans. “This 500 million – it is very, very difficult to find, or reach it in TV,” Mr Platt-Higgins said. Moreover he said it would be much easier to implement an advertising campaign right into the social service, embedding the adverts through a match as the scores come in. For example, Visa aims to use Facebook to reach football fans based on users’ preferences and offer them coupons with their partners. “You can tell by looking at the social graph, if someone is also interested in music, shopping, fashion . . . which results in better target messaging to you as an individual,” Kevin Burke, chief marketing officer for Visa, an official sponsor of the tournament, said. The payment system is strongly oriented to digital media, allocating an average 30 percent of its marketing budget to it, while the global average is 23 percent.

RISKY UK MORTGAGE LOANS REACH FIVE-YEAR HIGH

he number of risky UK mortgage loans has jumped to a five-year high. The share of fresh loans valued at 3.5 times more than a person’s total income jumped almost 100 percent in the first quarter of 2014, according to Bank of England (BoE). “The proportion of new mortgage lendings combined of a Loan-to-value over 90 percent and loan-to-income multiple of over 3.5 for single income borrowers or 2.75 for joint income borrowers increased by 1.1 percentage points to 2.6 percent, the highest since Q4 2008,” The BoE said in a statement. The newly released figures come after IMF managing director Christine Lagarde urged the implementation of “targeted and timely” measures to clamp down on high loan-to-income ratio mortgages, The Telegraph reported. The BoE’s Financial Policy Committee is expected to issue its Financial Stability Report at the end of June, which will include the new lending rules. The government has created the Help to Buy scheme in an effort to make it possible to buy a new-build or existing home priced up to 600,000 pounds (US$1 million) with as little as a five per-

cent deposit. However, lending to first-time buyers still fell by 0.5 percentage points from the peak in the last three months of 2013, to 20.1 percent in this year’s Q1. The majority of borrowers are continuing to fix their mortgage rate in anticipation of an interest rate rise. The proportion of gross advances at fixed rates increased for the sixth consecutive quarter, to 81 percent. This was an annual increase of 10.3 percentage points – the highest growth since 2007. Meanwhile, the overall average interest rate fell by one basis point to 3.24 percent, showing the lowest rate since 2007. The decrease was due to a decline in average variable rates by six basis points, to 2.93 percent, and an increase in average fixed rates by two basis points to 3.32 percent from the other side. “Borrowers are protecting themselves where they can with more than 80 percent of new mortgages taken on a fixed basis. Even though the average fixed rate edged two basis points higher, while variable rates fell on average by six basis points, the growing threat of an interest rate rise means the allure of the fixed rate is strong,” Jonathan Harris, director of mortgage broker Anderson Harris said.

rowth in UK employment reached an all-time high with 345,000 more people in work from February to April, compared to the previous quarter. It’s the strongest increase since 1971, when records began, data from Office for National Statistics (ONS) shows. The total number of working people reached 30.54 million, as the unemployment rate fell to a 5 year low of 6.6 percent, with puts a total of 2.16 million out of work, the report says. Meanwhile the single-month figures show the April’s jobless rate was even lower - to 6.4 percent, the youth unemployment, which covers people aged from 16 to 24, accounted for 853,000. Prime Minister David Cameron tweeted that the government had reached a “major milestone” in its long term economic plan. The quarterly rate of earnings growth, including bonuses, slowed to 0.7 percent from 1.9 percent the previous month. That happened partly due to a delay in bonus payments, the ONS said. Excluding bonuses, pay rose by 0.9 percent.

The Bank of England is holding the interest rate at a record-low of 0.5 percent until the employment situation gets better. “Policy makers will no doubt want to be sure that pay growth is picking up substantially before making the first move in tightening policy,” Bloomberg quotes Chris Williamson, the chief economist at Markit in London. “But today’s data will add to expectations the first rate hike will take place this year rather than next.”

PUBLICITY caucasian business week

June 16, 2014 #58

TBILISI GUIDE June 16, 2014 #58

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: +995 32 2 75 21 11, Fax: +995 32 2 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

June 16, 2014 #58