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BUSINESS WEEK August 31, 2015 #8
August 31, 2015, Issue 8
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Mirza Svanidze: Our Motto Is Maximal Comfort to Clients Pg. 3
Giorgi Lomtatidze: Legislation Ensures Business-Friendly Environment in Georgia Pg. 3 Sulkhan Evgenidze: General Rehabilitation Works Underway in Kobuleti Pg. 10
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Batumi’s Bestselling Soft Drinks The Ajara Business Week (ABW) and Market Intelligence Caucasus, a market research company, continue a join project for conducting weekly research works in Batumi in order to determine five top-selling brands in the specific product categories on the local consumer market. Market Intelligence Caucasus, a subsidiary of the market research global network of TNS, applies
modern and international-standard methodologies. Within this project, we have explored the soft drinks retail market and questioned 500 respondents in the 18 to 65 age category. The ratio of female respondents marked 57%. At the same time, 42% of the respondents were of 18-34 years old and 58% were of 35 to 65 years old. 56% of the respondents were employees. Before we introduce the report, several
Government and Experts Rule out New Wave of National Currency Depreciation The Georgian Government has appraised the GEL rate devaluation as a result of panic conduct. Outcomes of the outer economic shocks have been balanced and, according to the mid August indicators, a decline in imports has fully reimbursed a contraction in exports and foreign currency inflows, Georgian Economy Minister Giorgi Kvirikashvili told the government meeting. As a result of imports contraction, Georgia has preserved 332 million USD foreign currency. The privatization proceeds exceeded 110 million GEL, while the FDI indicators should be still specified. “Based on various factors, including USD balance on accounts of state enterprises that will appear on the market stage by stage and the recent
days’ currency turnover jointly calculated with the national ban, we have all grounds to suppose yesterday’s developments on the currency market was a result of only panic conduct”, Giorgi Kvirikashvili said. The market players that will participate in speculative transactions will finally bear losses, he added. The Economy Minister urged Georgian citizens to show patience, because nothing special is happening on the market. “Currently macroeconomic parameters are healthy and we believe coordinated operation will improve the situation”, Giorgi Kvirikashvili noted. Nodar Chichinadze, a president for the association of young financiers and businessmen (AYFB), says assertions that the GEL depreciation will continue should be appraised as a crime before the society. Pg. 5
interesting facts should be also submitted. Namely, 83% of the respondents enjoy soft drinks at home, 25% in the street, 15% at cafes, 13% at offices, 10% at fiends’ home, 7% at bars, 7% at restaurants, 3% everywhere. Naturally, each respondent could name several places, where they enjoy soft drinks. We introduce this report with interesting results in several directions.
Georgia Notes Record Number of Visitors From Russia
Georgia is becoming more and more popular among Russian tourists”, – BBC Russia reports. As the article points out, due to Russian ruble devaluation and economic problems, outgoing tours are declining, But as for Georgia we have positive conditions. Based on official statistics journalist Nina Akhmeteli has reported that the number of Russian tourists in Georgia has broken records this year and has reached nearly half a million, which is 12 percent higher than last year. Pg. 10
Oil Prices on Global Market Plunge, Profits Margin of Georgian Oil Importers Rises The global stock exchanges are sharply declining in Asia, Near East, Europe and Russia. At the same time, oil prices are falling worldwide. The global tendencies have not much affected the Georgian fuel prices. Supposedly, we should not expect such an affect at all, because Georgian im-
porters follow an iron argument for many years. Fuel importers assert they have purchased fuel reserves at high prices in advance and therefore fuel prices cannot be cheapened considerably, while the contraction in oil prices have influenced fuel prices in almost all countries. Pg. 5
Turkish BoraJet Airline Enters Georgia’s Air Market
Pg. 4
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MAIN EVENTS
2 NEWS NATO SECRETARY GENERAL OPENS JOINT TRAINING AND EVALUATION CENTRE IN GEORGIA
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he Training Centre is part of the Substantial NATO-Georgia Package, agreed at the NATO Wales Summit last year to help Georgia in its aspirations to NATO membership. Agenda.ge,27 Aug 2015 - 17:10, Tbilisi,Georgia The Substantial NATO-Georgia Package that was offered to the country last year is beginning to deliver tangible results, as NATO Secretary General Jens Stoltenberg inaugurated the new Training Centre during his first visit to Tbilisi today. The Secretary General opened the NATO-Georgia Joint Training and Evaluation Centre at the Krtsanisi Military Facility, where Georgian troops will train alongside NATO allies and partners.
NATIONAL BANK OF GEORGIA BELIEVES LARI WILL STABILISE
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e do not expect further fluctuation of the Lari,” says the Vice President of the National Bank of Georgia (NBG). Bank official Archil Mestvirishvili confirmed the prediction of Government officials, who earlier today claimed the Lari exchange rate would stabilise. “The current geopolitical challenges in the region of course affect Georgia as well. Although the external shock effect on the Lari exchange rate is now over,” he said.
GEORGIAN RAILWAY LOWERS TARIFFS BY 20%
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tarting July 1st of this year, tariffs on domestic and export transits reduced by 20%, says Georgian Railway’s management. The change applied to both domestic transit and exports of all kinds of dry goods, as well as container shipping. This marketing decision in the rail transport sector will reflect on company’s future sales growth, significantly contributing to increasing Georgian products’ competitiveness and local production volumes. This in turn will positively reflect on the country’s economic growth prospects.
Ali and Nino to Be Relocated due to Coastal Erosion
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ne part of the famous statues of Ali and Nino, iconic to Georgia’s Black Sea coastal town Batumi, has been damaged during dismantling as experts attempted to relocate the intertwining statues to a new location. The Ali and Nino statues are one of the main attractions of the Batumi Boulevard but were forced to be relocated due to coastal erosion under the monument’s foundations. As experts from Arnabi 21 relocation company attempted to move the structure yesterday, the Nino statue fell. Company representatives and local authorities stressed the damage was “insignificant” and would be fixed in the coming days before being erected at a new location 50 metres from its previous home. Plans stated the structure will be fully operational in its new location by September 5. Head of the Batumi Boulevard Administration Giorgi Zirakishvili said it was necessary to move the statue because of coastal erosion that was compromising the monument’s foundations. He said a tender was announced on July 5 to relocate the statue and 234,975 GEL from the local municipality budget had been allocated to the project. If any damage [was] caused during dismantling, the tender-winning company Arnabi 21 would be responsible for material expenses,” said Zirakishvili, adding the creator of the monument had
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GEORGIA GIFTS ANCIENT WINEMAKING QVEVRI TO UNITED NATIONS
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piece of Georgian culture and tradition is going on show at the United Nations Geneva office to mark the organisation’s 70th anniversary. In 2013, Georgia’s unique traditional method of fermenting wine in qvevri was registered on the Intangible Cultural Heritage list of United Nations educational, scientific and cultural organisation (UNESCO). In recognition of being named on the list, Georgia will send a qvevri as an official present to the UN. A qvevri is a large clay Amphora-like vessel that’s traditionally buried in the ground up to its neck, in which wine is fermented and stored in regions of Georgia but especially in Kakheti, east Georgia. Qvevri wine-making is an ancient Georgian tradition that has been passed down the generations that even today remains widespread around Georgia.
earlier given her approval to relocate the statues, according to Georgian legislation. Arnabi 21 representative Mamuka Zhgenti said the Nino portion of the monument sustained slight damage during the dismantling process. He said the Nino figurine was being lifted by crane and lowered when it fell onto a concrete wall, causing damage to the figurine’s wings. The damage was minor and would be fixed in several hours, he stressed. Meanwhile the country’s main opposition party United National Movement (UNM) accused the current Government of committing “barbarian acts” and “fighting against modernity” by moving the iconic statue. UNM claimed the monument had been purposely crashed and destroyed. Conversely, statue creator Tamar Kvesitadze spoke to Rustavi 2 TV and said she had not been informed about relocation of the statue and she had no information about the tender. However today, Batumi Boulevard Administration released the consent document signed by Kvesitadze on March 27, 2015. In the letter Kvesitadze responded to the Batumi Boulevard Administration and agreed safety measures should take place and consented to move the statue slight further away from the shore. The monument was erected in Batumi in 2011. The concept of the statue was based on the novel Ali and Nino by Kurban Said, an author with a pseudonym whose real identity is disputed.
Ancient Roman Barracks Unearthed at Gonio Fortress in West Georgia
GEORGIA REDUCES CAR EXPORT TO AZERBAIJAN ome 2,519 cars worth $45.97 million were exported from Georgia to Azerbaijan in January-July 2015 or 5.1 times less than in the same period of 2014, the Georgian National Statistics Service said in its foreign trade report as of January-July 2015. The share of this category of goods in the total volume of Georgia’s export to Azerbaijan hit 30.33 percent during the reporting period. Azerbaijan’s share in the total export of this category of goods from Georgia equaled 41.49 percent. The car export from Georgia to Azerbaijan decreased by 3.64 times in terms of value and 10,337 units in terms of quantity compared to the same period of 2014.
August 31, 2015 #8
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rchaeological excavations are coming to an end at a historical castle in western Georgia that earlier revealed some ancient treasures.
Roman barracks were unearthed in the final stage of excavations at Gonio Fortress, located in Gonio at the southwestern tip of Georgia on the Turkish border. Yesterday Georgia’s Minister of Culture and Monument Protection Mikheil Giorgadze visited the historic reserve and observed the excavation works with chairman of the Adjara Government Archil Khabadze, director of Georgia’s National Agency for Cultural Heritage Preservation Nikoloz Antidze and director of Adjara’s Agency for Cultural Heritage Preservation Miranda Charkviani. The Fortress is undergoing major development to transform the site from a forgotten area into a tourist attraction where people from all over the world can learn about the archaeological discoveries uncovered there, including remains of a bath dating back to the 1st Century AD, water reservoirs and a unique ancient Roman mosaic. During their dig archaeologists were surprised by
two things; firstly the technology, materials and designs used to create the baths were different from the way other Roman baths for soldiers had previously been built. The second thing that interested them was the early age of the baths, as all other Roman structures discovered in Georgia were dated no less than one century later. A Polish team of archaeologists started excavating the castle in 2002. Their geodesic and geophysical work enabled researchers to select an area that would most likely reveal future discoveries. Meanwhile once all activities at the site ended and the facility opened for business, tickets to visit Gonio Fortress will be free for children under the age of six, for youth with disabilities, colleagues of Georgian and foreign museums, soldiers and internally placed persons. The Gonio Fortress became part of the National Agency for Cultural Heritage Preservation of Georgia in 2008.
British Theatre Company Plans to Perform in Batumi
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eputy Minister of Culture, Education and Sport of Ajara Lado Mgaloblishvili together with delegations of Ajara and British Council met with a founder of the British leading Theatre Company ‘Gecko’ Amit Lahav and a producer Rosalind Wynn. The Modern International Theatre Company ‘Gecko’ was founded in 2000. The main characteristic of Gecko’s art is diversity of forms while performing and choreography and pantomimes synthesis. ‘Gecko’ theatre talks to the audience with mime and body language about acute social themes and intense human emotions. ‘Gecko’ presented completely sold out six international proj-
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ects in different countries, which created the excellent reputation for the extraordinary theatre. Nowadays ‘Gecko’ projects are considered to be the one of the most popular products in the field of performing arts. Issues of future cooperation between Gecko and Batumi Musical Centre were discussed in the frames of official meetings. In the frames of ‘Performing Arts Supporting Program’ of the Ministry of Education, Culture and Sport of Ajara, tour of ‘Gecko’ project ‘Institute’ is planned in Batumi by 2016. This will contribute to the diversity of the region’s cultural life, will increase awareness of the tourist season in Batumi and will assist in the development of cultural tourism. The English-language weekly is distributed to over 1000 assets in Ajara, including, major companies, commercial banks, international organizations, state offices, high-class hotels, shopping malls, Batumi airport, Kobuleti, Sarpi. Businessmen and Managers Read ABW.
Source: www.commersant.ge, www.bpi.ge, www.gbc.ge, www.agenda.ge, www.civil.ge
INTERVIEW
August 31, 2015 #8
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“Legislation Ensures Business-Friendly Environment in Georgia” Several new hotels launched operation in Batumi in summer 2015. Special facades beautify them. All visitors are able to spend memorable vacation periods at these assets. Colosseum Marina hotel is the newest one in Batumi. The asset received the first visitors on August 1.
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I hope the tourists inflows will further increase in Georgia, particularly in Batumi.
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- Colosseum Marina hotel opened in Batumi several weeks ago. Who is the investor? How much an investment was made in this project? Do you plan to make additional investments in the same or other sectors? -The project was inaugurated in 2012 and ended in August 2015. The hotel received the first visitors on August 1. In the near future, our new partners plan to construct a casino and invest 4 million USD in the project implementation. -How would you appraise the investment environment in Ajara? Many large-scale projects are being implemented in the region. What are the advantages of the Region’s business environment and what factors should have been improved? -The current legislation ensures business-friendly environment in Georgia. All procedures serve drawing new investments, bureaucratic barriers
Colosseum Marina hotel director Giorgi Lomtatidze talks a about the asset’s potential and the current tourism season. He is content with the summer season and he hopes the tourists inflows will increase.
have been minimized. The government follows business promotion policy and this is of vital importance for the business sector development. -What is your opinion on the current tourism season in Ajara and what are your plans after the season completion? - The tourism season is quite positive. Many foreign tourists have visited our region and city, especially from the Posit-soviet space. This inflow is growing and I hope the tourists inflows will further increase in Georgia, particularly in Batumi. Batumi is a sea resort city and it mostly depends on weather conditions. We hope weather also promotes our plans and activities. -The region’s hotel sector records sharp competition. What are your marketing solutions to establish favorable and successful relations with clients and what are your accents in offseason periods?
-A new hotel brand always tries to launch operation on the market with low prices and be competitive from the very inception. Therefore, the more hotels, the lower prices will be and the competition will also increase. In the offseason period we shift our accents upon private companies and conferences that are held in Batumi. Our city has established itself as Georgia’s conference center. Therefore, many large conferences and events are planned in Batumi. Casinos also intensify the tourists inflows. It is worth noting casino visitors arrive in this sea resort city with much pleasure and this field is very successful. We also plan to construct a casino and our project will be finished in 7-8 months.
tors. Our hotel has got several advantages. It is located near the sea, in about 20-30 meter way. We have arranged architecturally very attractive façade. All suites look to the sea. The hotel has got a high terrace with an outdoor swimming pool and this factor is very attractive for many tourists. A considerable part of tourists do not swim in the sea and they prefer hotel swimming pools. Our hotel ensures all these opportunities and this part of our project has genuinely justified.
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The hotel has got a high terrace with an outdoor swimming pool and this factor is very attractive for many tourists.
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-What is the advantage of the Colosseum Marina hotel for which visitors would prefer your hotel, not other ones? - We offer our products and services to the visi-
“Our Motto is - Maximal Comfort to Clients” -This sector is very attractive, because for the last years many investors have arrived here from all neighboring countries to put investments in this business. Currently, about 10 casinos operate in our region. Leogrand is the newest one. Casino Campione has recently opened and its popularity is increasing. Naturally, the seasonal character of our business makes certain problems, because the season lasts only 3 months and a major part of the casinos work at full capacity in the summer period. The intensity shrinks in offseason periods. Nevertheless, a certain category visits casinos anyway, especially from Turkey many gamers arrive in our region even after the summer season. -The current social-economic situation in Georgia suggests casinos cannot be oriented on only Georgian citizens. Who are your potential clients?
Casino Campione was unveiled several weeks ago in Batumi. Unlike all other assets in the sector, Campione is a boutique-style casino. Batumi-based Campione is a subsidiary of Italian Casino di Campione company that is widely represented on the Apennines Peninsula. The Casino Campione’s marketing manager Mirza Svanidze has updated the ABW on this and other interesting issues.
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In general, our company plans to expand its network and not in only the Ajara Region.
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-Your casino opened in Batumi several weeks ago. Who is the investor? How much investment was made in the project? Do you plan to make additional investments in the same or other sectors? - I would refrain from naming concrete persons, but the asset is owned by Georgians, while the management is carried out by a Turkish partner. As to the investments, negotiations are underway. We have received several proposals from various brand business operators to enter their management, because several hotels have opened in the region with special places for gambling games. Therefore, we are in the regime of reciprocal negotiations. In general, our company plans to expand its network and not in only the Ajara Region. -The gambling business is gaining momentum in the Region. What is the benefit from making business in this sector and what are your expectations in the near future?
-The number of domestic gamers has diminished along with opening new casinos in the Region, because the existing gamers have preferred new casinos. Consequently, each casino has lost a certain quantity of Georgian gamers. As noted, Turkish clients are considered potential gamers. We plan to take new activities in terms of promotion campaign. Turkey has also adopted legislative amendments under which AD campaigns will not be restricted. This signifies the inflow of Turkish gamers will further increase. - The region records sharp competition in the casino sector. What are your marketing approaches to keep successful relations with clients? - First of all, we follow the Italian classification. Our casino preserves the synthesis and conditions that Italian analogues provide. Naturally, we are oriented on improving the service level, because there are certain shortcomings in this respect in Georgia, including in the gambling business. Our motto is: “Maximal Comfort to
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We want to create a harmonious environment for our clients to draw new ones.
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Clients”. We want to create a harmonious environment for our clients to draw new ones. Our casino is not a big one. It is a boutique-format casino, but it is capable of meeting the existing challenges in the gambling business starting from gambling machines ending with Lai systems and programs. -What are the advantages of casino Campione compared to other casinos in the Region? -First of all, we have developed flexible offers. We call it Junket Package. We are oriented on our clients’ interests. Casino Campione also represents an entertaining complex with integrated Veranda Di Campione, where every day live concerts are held. These are casino nights. No other casino in Batumi has introduced the same project. Our casino also offers restaurant services, where gamers are able to taste Georgian and European dishes.
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BUSINESS ajara business week
ADB Extends $20 Million To Protect Vulnerable Batumi Coastline
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he Asian Development Bank (ADB) has approved a $20 million loan to stem coastal erosion around the popular Black Sea tourist destination of Batumi. Batumi, the capital of the Autonomous Republic of Adjara, with a population of more than 150,000, is one of the fastest developing cities along the Black Sea coast and plays a significant role in the country’s economy and tourism sector. This coastal area attracts visitors from throughout Georgia and neighboring countries. “This investment will help halt coastal erosion at one of the country’s most popular summer seaside
resort areas,” said Anand Chiplunkar, Director of the Urban Development and Water Division of ADB’s Central and West Asia Department. This loan, the fourth under a $300 million Sustainable Urban Transport Investment Program, a multitranche financing facility approved by ADB in 2010, is earmarked for coastal protection works along the 5 kilometer Batumi coastline where erosion threatens beachfront, roadways, bicycle lanes and buildings. “The project will support tourism and benefit urban residents and the local economy,” said Bertrand Goalou, Urban Development Specialist in ADB’s Central and West Asia Department. “This investment, financed from ADB’s commercial resources, complements ADB’s substantial support to Georgia for water supply and sanitation, road and energy infrastructure,” ADB’s Georgia-based Country Director, Kathie Julian says . ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth and regional integration. Established in 1966, it is owned by 67 members – 48 from the region. ADB has supported Georgia since 2007. As of 2014, ADB assistance to Georgia totaled more than $1.6 billion, including approved loans and technical assistance grants.
Turkish BoraJet Airline Enters Georgia’s Air Market Another Turkish Airline to Fly Between Istambul and Batumi
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ore planes will be flying between Georgian and Turkish skies when another Turkish airline enters the Georgian market. From September 4 Istanbul-based airline Bora Jet Airlines will operate flights from Turkey’s capital Istanbul to Georgia’s seaside resort town Batumi. Borajet Airlines, is the single and the first example of “Regional Airlines” in Turkey similar to other elite airlines in the many countries of the world. Borajet Airlines constantly expands its new fleet with new aircrafts formed of advance technology EMBRAER E-190 type jet aircrafts safely used by 65 airlines company in 45 countries from America to Europe with the highest level of comfort and safety.
With the summer aviation season now in full swing, Georgia is offering more flights into and out of the country. Local airline Georgian Airways has added two more directions to its existing routes until the end of the 2015 summer season. Georgian Airways started performing flights to Rostov, Russia twice per week from August 14. The other new route, between Georgia’s capital Tbilisi and Iraq’s capital Baghdad, also launched in August. The first flight took place on August 8 and operated once per week Flights between Georgia and Tehran, the capital of Iran, have recently resumed. From August 7 Iranian airline ATA Airlines performed the first Tbilisi-Tehran flight this summer season. This service will operate twice per week for the remainder of summer aviation season.
Company “Livo” Comes to Russia and Estonia
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atural juices company “Livo” plans to export its products to Russia and Estonia. According to the company’s Director Goga Samushia, talks with the parties have been completed and export of products will start in the near future. Four types of “Livo” products will be presented in the two countries’ market both in a trading network and HoReCa segment. The company’s management explains that negotiations are ongoing with regard to the products export to the EU market. The products are going through the certification process. The company
hopes that by the end of September, “Livo” will enter the Czech and Polish markets. “ Citro’’ factory was opened in Adjara within the “Millennium’’ program. The enterprise is the only modern citrus processing plant in Georgia that produces 9 varieties of juice under LIVO name. Products appeared in the local market last year. Apart from Georgia, Livo juices are sold on the Russian market, the company is negotiating with several countries regarding export of its products. Livo lemon juice awarded with a gold medal at the international exhibition World Food Ukraine held in Kiev on October 28.
August 31, 2015 #8
Georgia Increases Agricultural Exports to EU and US
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he amount of Georgian agricultural products exported to the European Union (EU) and the United States (US) is increasing, says the country’s Ministry of Agriculture. Georgia’s leading exports - wine and spirits, hazelnuts and mineral waters – are being enjoyed by more people in the EU and the US – two of the world’s largest consumer markets – adding value back into Georgia’s economy. The country’s Ministry of Agriculture published data stating exports of Georgian agricultural products to the US increased by 21 percent in January-July 2015 compared to the same period of 2014. Similarly, this year’s figures were 43 percent higher than the same period of 2013 and
96 percent higher than in 2012. The most popular exported products to the US were fruit and vegetable juices, mineral waters, natural grape wines and spirits. The value of exports to the US in the first seven months of 2015 amounted to $3.48 million USD. The Ministry data revealed similar results for Georgian exports to the EU. In the first seven months of 2015 Georgian exports amounted to $100.5 million USD, which was 84 percent more than in 2014 and 149 percent higher than the same period of 2013. The top exported products were hazelnuts, mineral waters, natural grape wines and spirits. The Ministry noted 33 percent of all Georgian exports in the first seven months of 2015 went to EU countries.
Kakheti Prepares For this Year’s Harvest
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he grape harvesting season starts in Georgia and the country’s famous wine region Kakheti is completely immersed in the grape picking bustle. Today the Rtveli 2015 Coordination Centre for grape vintage opened in Telavi in the heart of Kakheti under the supervision of the Government. The Centre will operate 24/7 and offer support to wine growers, producers and others in the industry. Meanwhile at today’s Government meeting Prime Minister Irakli Garibashvili announced grapes would be subsidised this year, as it was in the past. The subsidy amount is the same as it was last year - 0.35 GEL per kg of Rkatsiteli and Kakhuri Mtsvane [a type of grapes] and 0.15 GEL per kg Saperavi [a red grape variety]. However this year the farmers will get the grape fee directly from banks. Unlike last year they will not be forced to wait for the wine companies to pay for them,” Garibashvili said. The Prime Minister said the market would regulate the price of grapes “so the sector will be competitive and none of the sides will face any
problems”. The volume of grape harvest to come from the Kakheti region was expected to be slighter lower after crops were badly damaged in a hailstorm on August 20. From today every affected grape grower who owned plants on five hectares of land or more would receive special plant protection fertiliser, worth about 65 GEL. While the total cost of the damage has not been counted, officials said preliminary estimates could reach several million GEL. Looking ahead the Ministry of Agriculture will make several amendments to the agriculture insurance project to help disaster-affected families. The changes foresee increasing insurance premium co-financing to 70 percent instead of 60 percent.
Batumi To Host International Advertising Festival Ad Black Sea
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rom September 24-27 the International Advertising Festival Ad Black Sea will take place in Batumi, Participants from 20 countries will attend the event. This is a new international advertising festival, which aims to inspire all of its participants – advertisers and creative people – with bold, unusual ideas and nontrivial solutions. This is a real competition, but not only. It is a platform of social interaction with colleagues for sharing ideas and planning ahead, the opportunity to meet people not only online, to discuss all the charm and challenges of advertising profession. Batumi is a new meeting point for creators. Festival will be held by the joint effort of Communication Agencies Association and Ukrainian Advertising Coalition. At this stage its main goals are to establish itself on the European festival map, to turn into an annual event and eventually manage a regional forum of the behavior, which of course will have great influence on developing advertising in Georgia. Ad Black Sea is the place of an inspiration, sharing international experience, where new ideas are born. For 4 days, in the frames of the festival, there will be held seminars, workshops, master classes, which is the perfect way to local and sector specialists, businessmen, entrepreneurs develop and deepen their knowledge and experience, get tips and inspiration of world-renowned specialists. Festival participants will be able to meet, listen and meet representatives of the advertising industry in Europe and America, to share with them his vision of the works displayed in different countries, to participate in the competition. The festival brings together creators and other representatives of advertising agencies from the
Black Sea countries – Georgia, Ukraine, Russia, Turkey, Romania, Bulgaria and other “friendly” countries – the Baltic states, Kazakhstan, Moldova, Armenia, Azerbaijan, the other countries of Europe and Asia. Ad Black Sea selects awarded and respected creative leaders to evaluate entries. The contest program consists of 3 categories: Best Video Content & Other Branded Content Best Design, Print & Poster Best Idea The motto of festival is «It’s all about inspiration! Welcome to recharge». We should remember about important role of inspiration in advertising and communications industry. Ad Black Sea will become a Mecca for inspiration and new knowledge for creators. Especially it can be proved by festival location – Batumi. Ancient history and modern architecture, the beautiful Black Sea, amazing sunsets and sunrises, Georgian hospitality and excellent Georgian cuisine – all those things make an ideal place for Batumi creative event. Tit is the best place for creative people to recharge their minds. The festival is included in the creativity and craft rating of Ukraine of the 2015/2016 season where coefficient is 3(k=3).
RESEARCH
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Government and Experts Rule out New Wave of National Currency Depreciation
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he Georgian Government has appraised the GEL rate devaluation as a result of panic conduct. Outcomes of the outer economic shocks have been balanced and, according to the mid August indicators, a decline in imports has fully reimbursed a contraction in exports and foreign currency inflows, Georgian Economy Minister Giorgi Kvirikashvili told the government meeting. As a result of imports contraction, Georgia has preserved 332 million USD foreign currency. The privatization proceeds exceeded 110 million GEL, while the FDI indicators should be still specified.
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ased on various factors, including USD balance on accounts of state enterprises that will appear on the market stage by stage and the recent days’ currency turnover jointly calculated with the national ban, we have all grounds to suppose yesterday’s developments on the currency market was a result of only panic conduct
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Giorgi Kvirikashvili said.
The market players that will participate in speculative transactions will finally bear losses, he added. The Economy Minister urged Georgian citizens to show patience, because nothing special is happening on the market. “Currently macroeconomic parameters are healthy and we believe coordinated operation will improve the situation”, Giorgi Kvirikashvili noted. Nodar Chichinadze, a president for the association of young financiers and businessmen (AYFB), says assertions that the GEL deprecia-
tion will continue should be appraised as a crime before the society. Certain media companies spread the opinion as if the GEL rate devaluation is inevitable and this is a politically motivated decision, Chichinadze added. “There is serious panic in the country. This is a very sensitive issue and any pressure makes negative impact. Indeed, certain influential media companies provide certain pressure to spread the opinion the currency devaluation will not stop and it will go on. I believe dissemination of similar messages, even more so for political goals, is a crime before the society. I do not assert everything is perfect. I understand the situation is heavy, but assertions as if the devaluation will continue should be considered as not only irresponsibility, but also as a crime”, Chichinadze noted. The AYFB President rules out economic factors behind the national currency depreciation.
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supervise the statistics that affect the GEL rate. Today the rate reached almost 2.45 point without any economic preconditions. I cannot prove economic factors have caused the currency devaluation
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Nodar Chichinadze said.
The peak of outer economic shocks that affect the GEL depreciation will be soon removed, economic expert Levan Kalandadze noted. The so-called peak shocks are characterized by short-term periods, he added. “The society knows the GEL rate is formed by a balance of supply and demand, that is, how much the demand for USD grows or falls. The recent developments were mostly preconditioned by the international market realities, namely, by fears of sharp plunge of global oil prices, as well as
by expectations of collapse at stock exchanges. As a result, national currencies in our main trade partner countries of Russia, Ukraine, Turkey and Azerbaijan have dropped. Naturally, the business foresees all these processes and there were certain expectations in this direction and these expectations have changed the rules and culture of the behavior:
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he demand for USD started growing in both the business sector and the society. As a result, the demand for GEL considerably shrank. Nevertheless, the so-called panic shocks are of short-term character and the outer shock factor will soon disappear. Another issue is how we should conduct after removal of outer risk factors
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Levan Kalandadze noted.
After the outer risks are settled, two significant issues should be resolved in short-term and longterm perspectives, Kalandadze added. The NBG vice president Archil Mestvirishvili agrees with this consideration, in practice. Additional fluctuations of the GEL exchange rate are not expected in equal conditions, Mestvirishvili assures. Economic shocks and expectations have already affected the national currency exchange rate, he added. “According to our information, economic shocks and expectations have already affected the national currency and a decline in foreign currency inflows were reflected in the imports dynamics. This signifies in all other equal conditions we do not expect repeated fluctuations of the GEL exchange rate. Naturally, the geopolitical problems in the Region influence Georgia too, however,
the existing and identified shocks were already reflected in the national currency exchange rate. At this stage, one of the main factors for extra pressure is related to negative expectations in autumn, but as noted, in other equal conditions, in autumn the currency conduct on the market will bring opposite result and the GEL rate will strengthen”, Mestvirishvili noted. The NBG keeps communication with the government and all questions concerning the NBG policy and instruments have been removed, he added.
“W
e keep communication with the government and all questions regarding the NBG policy and instruments have been removed. As to the fiscal policy, the budget spending is balanced this year and we do not expect negative impact on the rate in the remaining period of 2015
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Archil Mestvirishvili said.
Oil Prices on Global Market Plunge, Profits Margin of Georgian Oil Importers Rises
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he global stock exchanges are sharply declining in Asia, Near East, Europe and Russia. At the same time, oil prices are falling worldwide. The global tendencies have not much affected the Georgian fuel prices. Supposedly, we should not expect such an affect at all, because Georgian importers follow an iron argument for many years. Fuel importers assert they have purchased fuel reserves at high prices in advance and therefore fuel prices cannot be cheapened considerably, while the contraction in oil prices have
Oil prices on the global market have slipped 22.44%, while the contraction in Georgia does not exceed 2.5%. influenced fuel prices in almost all countries. The association of young financiers and businessmen (AYFB) appraises the current contraction in fuel prices as inadequate amid a significant downturn in oil prices on the international market. The oil prices are declining on the global market and seeing the 7 year’s bottom, AYFB analyst Paata Bairakhtari said. At the last NYMEX trade session the barrel’s price dropped 2.23 USD to 38.06 USD. Similar contraction was last recorded in 2009. Bairakhtari explains several factors have preconditioned a contraction in oil prices on the global
market. Removing sanctions from Iran is one of the similar preconditions. To maintain their stakes on the global oil market, OPEC member countries have to increase the extraction volume, but extraction costs differ in every country and some countries have to sell crude oil at unfavorable tariffs. Currently, Saudi Arabia is considered a major oil extractor country worldwide, Bairakhtari said. As to the Georgian market, amid the global market developments, changes have taken place on the Georgian fuel market too. For the last month oil companies have lowered tariffs by 0.03 to 0.05 GEL. But AYFB says this contraction is questionable amid the global factors. According to the AYFB analysis, for the last month oil prices on the global market have slipped 22.44%, while the contraction in Georgia does not exceed 2.5%. “Oil prices are demonstrating a downturn trend for the last two months. In details, in July oil prices on the global market declined by 23.3% compared to June. Despite similar plunge, no oil importer company has lowered fuel prices in Georgia in July. For example, in the USA the price of a liter of Regular petrol has shrunk to 0.62 USD that is 1.46 GEL under the current exchange rate. Naturally, we should also take into account the recent depreciation of the GEL exchange rate. Despite this fact the fuel prices remain still inadequate,
because the GEL rate depreciated by only 5.08% for the last 2 months, while the oil prices on the global market have shrunk by 45.74% for the last 3 months”, AYFB analyst Paata Bairakhtari noted. Along with a plunge in oil prices, the international oil products prices are also decreasing under the Platt on which fuel prices depend in Georgia. Namely, today international petrol price under the Platt makes up 481.75 USD per ton, while the price of 10PPM diesel is 431 USD per ton.
These indicators demonstrate today the price of a ton of petrol is about 1130 GEL, while the retail price is 1.95 GEL. We should recall the retail price per liter was 2 GEL amid the historical maximum of fuel prices, when the price of a ton of petrol was 1070 USD, that is 1800 GEL according to the that period’s exchange rate. According to these indicators, today companies receive much higher profits than amid the historical maximum of fuel prices.
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RESTAURANT ajara business week
August 31, 2015 #8
Ajarian Baklava House
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aklava is made of tender and transparent sheets and nuts. It is an indisputable leader among Ajarian desserts and confectionery. Ajara residents consider Baklava to be their own confectionary culture. However, they recognize the product has penetrated Georgia from Turkey and the Osman Empire influence has established this product in Ajara. In the course of time, several varieties of Baklava of simpler recipes were also spread in the region with appellations of Czech Baklava, Baku Baklava, Armenian Baklava and so on. The Batumi-based Baklava House offers a wide range of delicious confectionary products: Ajarian Baklava, Ajarian Burme, Czech Baklava, Azerbaijani Baklava, Halva, Shu and various cream cakes. Discount tariffs run for devoted clients. You are able to buy a 33% discount voucher at the Baklava House and buy 15 pieces of Baklava at 10 GEL. Baklava is famous for its one of the most difficult preparation rules among desserts. Over 60 tender sheets of dough are stretched over a salver and laid on each other piece by piece jointly with
thinly-milled filberts or nuts. The space between the sheets is saturated by ghee. The baking process is also very important for preparing Baklava. A plenty of syrup is added to the cake after the oven and it is cut in the form of a rhomb. Baklava is ready as soon as the sweet embraces the whole cake. “We prepare the dough without eggs and use a Lenten ghee for fat. The appearance and texture are identical, but it lacks of the special taste that butter adds to the genuine Baklava and it may be considered even a surrogate. This cake is not considered a diet product because of its high caloricity. Crispy confectionary saturated with sugar syrup is a genuine felicity for gourmets. We should also mention other varieties of Baklava that have borrowed only nuts and an abundance of sheets from the traditional variant, but no other dough can compare with thin sheets of phyllo dough”, the Baklava House cookers noted. The Ajarian Baklava House Address: Gorgasali Street 10, Batumi.
Lazona in Batumi
Cultural Milieu! Traditional Cuisine! Social Designation!
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azona, a Laz restaurant and ethnographic zone, has opened in Batumi in order to maintain and develop the Laz culture. The asset takes visitors to the Old Laz environment, and offers old Laz dishes, introduces the Laz culture, customs, sailing and fishing skills and traditions. The restaurant manager Tsiala Katamidze says the restaurant is a social enterprise and all revenues are directed to improving social-economic conditions of traditional anglers in Georgia. -The restaurant has been working under this concept for several days. It is of crucial importance to raise the public interest in popularizing and protecting the individuality of the Laz culture, the ancient Georgian tribe and ethnographic group of the Georgian nation. By visiting Lazona, on the one hand, you will make contribution to maintaining the Lazona culture heritage; on the other hand, you will assist anglers in developing the traditional trade. The restaurant is a social enterprise and the revenues are directed to improving the social-
economic conditions of the traditional anglers in Georgia. The restaurant was developed with the EU support and the association of traditional fishermen of Georgia carries out the asset’s management. The Lazona’s concept was developed through involvement and active consultations with the Sarpi and Kvariati residents. The Flora and Fauna Association actively protects the interests of traditional anglers to improve their financial through protection of the habitation milieu of various fish species (as part of the project of Protection of Interests of Traditional Fishermen in Georgia).
-Do you apply the restaurant revenues for improving the socioeconomic condition of fishermen? -We spend all revenues on the association of fishermen, on their legal assistance and protection of their rights. Initially, there was a fish restaurant here and later the asset was re-branded. In gener-
al, the Laz people are old fishermen and the fishing was a developed trade in Lazona, the country of the Laz People. The Laz People has developed very rich culture and our objective is to popularize this culture. Our clients are able to taste not only Laz dishes, but also receive information on the Laz culture, customs, sailing and fishing traditions. There is a Laz boat here. The ornaments of the restaurant are fully adjusted to the Laz style. The concept of the Laz restaurant was developed by David Chachua. The project’s design was accomplished by Evgeni Zakharov. A fishermen and a fireplace were made by Qemal Turmanidze and the Laz boat was made by Mirian Numanashvili.
- The Laz cuisine is often identified with the Black Sea region’s dishes. The Region’s cuisine is famous for its individuality, but it also contains elements of the Turkish kitchen, in general.
- The Black Sea region’s cuisine, including the Laz one, was not influenced by the hegemony of the Kezhera Pkhali and anchovy. In other words, the Black Sea cuisine includes diverse dishes from various cultures. The Laz cuisine has got three main characteristics: Kezhera Pkhali, Anchovy and Dairy Products. This signifies the Laz Cuisine is not famous for its diversity. There are no complicated mixtures of ingredients to achieve various tastes and flavors. The Kezhera Pkhali is a main dish that is prepared in various ways every season. Anchovy dishes are prepared due to seasons. For example, fresh anchovy is eaten. The Laz believe the genuine taste of fish can be perceived only after the snow penetrates the fish ear. In summer they use salted fish. In old times, anchovy was very cheap and they used to buy the product in huge volumes, clean it up, salt and store in pitchers in ground. The Laz also used to eat horse mackerel, mullet, and flounder. Moreover, when mentioning fish products, we should also name red-fin river trout.
August 31, 2015 #8
RESEARCH ajara business week
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Batumi’s Bestselling Soft Drinks
The Ajara Business Week (ABW) and Market Intelligence Caucasus, a market research company, continue a join project for conducting weekly research works in Batumi in order to determine five top-selling brands in the specific product categories on the local consumer market. Market Intelligence Caucasus, a subsidiary of the market research global network of TNS, applies modern and international-standard methodologies. Within this project, we have explored the soft drinks retail market and questioned 500 respondents in the 18 to 65 age category. The ratio of female respondents marked 57%. At the same time, 42% of the respondents were of 18-34 years old and 58% were of 35 to 65 years old. 56% of the respondents were employees. Before we introduce the report, several interesting facts should be also submitted. Namely, 83% of the respondents enjoy soft drinks at home, 25% in the street, 15% at cafes, 13% at offices, 10% at fiends’ home, 7% at bars, 7% at restaurants, 3% everywhere. Naturally, each respondent could name several places, where they enjoy soft drinks. We introduce this report with interesting results in several directions.
NEW TECHNOLOGIES
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August 31, 2015 #8
ajara business week
International Network “Aesthetic Medical Clinics Group” – Prague, St.Peterburg, Tbilisi
TOP–12!!!
Clinic “MEDI” Presents 12 Technologies For Slimming Down Recognized World Wide!
Excess weight and obesity is a malady of the XXI century. According to statistics, a number of overweight people increased by 26% worldwide in 2014. Lots of people strive for slimming, though visiting fitness centers and strict diets are associated with difficulties, especially when a person works, is busy and his/her time is scheduled. For such people a lot of devices are available in the esthetic medicine, where 30 minutes of spent time is equal to hours spent in the fitness centers.
Top-10 of top-12 of the world slimming methods are presented only in the “MEDI” clinic.
3. BODY-ESTHETIC - is a ultramodern procedure of body correction, a French conception and treatment of the cellulite. It aids in body correction, modeling, cellulite removal, restoring of blood circulation, improvement of metabolism. Vacuum removes superficial subcutaneous fat, ultrasound removes deeper deployed fat and eradicates it from the body by means of lymphatic system. 4.
RF-LIFTING – is a technology based on the radio-frequency wave, which makes a skin lifting, has an anti-cellulite effect, burns fat and smoothes a body surface.
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CAVITATION – is one of the most effective combined methods of fat and cellulite decomposition for today. The procedure improves blood circulation, stimulates connective tissue cells, smoothes a skin surface. Metabolism in the fat layer improves due to skin warming by the radiofrequency waves; lymphatic drainage and skin tonus increases; so called orange skin removes; amount and size of fat cells decrease on the treated zone.
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PRESS THERAPY – is an ap-
paratus method, which is considered to the most effective in reducing lymphostasis and various swellings. It is unique for treatment obesity and cellulite.
the procedure a special cocktail consisting of various preparations is injected into the surface layer of skin. The cocktail contains bio-active substances, herbal extracts and vitamins, that improve a skin structure.
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AQUALEX – the latest method for cellulite removal. A fat decomposing cocktail may be applied on any zone of the body. It is an anti allergy injection method. The preparation decomposes fat and has got an anti-cellulite effect. It has a long-lasting effect on the treated zones, prevents creation of new cellulites, improves blood circulation. This unique method makes skin more flexible and elastic. The procedure is quite painless and requires no anesthesia. It lasts for 30-40 minutes.
10. FRAXEL – is the latest technology of a fractional laser peeling. Skin is treated superficially, without exfoliation. It changes skin quality, makes it smooth and even, flexible and elastic, fades and eliminates pigment spots, removes fine wrinkles, acne and caused by it scars, retards aging. 11. DOT-LASER – is a fractional laser, which makes a skin ablation (skin peeling by
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IMPEDANOMETER – is a device for diagnosis of a skin structure, amount of fat and liquid in it. On its basis a doctor will select proper for you method of slimming technology.
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MESOTHERAPY – is method of treatment of subcutaneous fat tissue. During
1. ZELTIQ – removal and decomposition of fat by freezing. It is a painless alternative to liposuction, that doesn’t require a rehabilitation. By means of a vacuum system fat cells are absorbed and frozen. And above all, the he procedure lasts for an hour (on one zone) and, on average, removes 30% of total fat amount. Upon on a completion of the procedure You may return to a normal rhythm of life. 2.
MANTIS – is a unique innovative ve dosystem, combining two types of energy: endomassage and magnetic field. Mantis has created ed a technology which fights not only a result, but also a reason of the problem. MRG - Magnetic tic Regeneration technology (Magnetic Regenerate) te) is one of the best ways of fighting cellulite. It is effective and safe lipolysis (fat decomposition). )
Clinic “MEDI” 52 Kostava str. Tbilisi Tel: 291 00 00 23 Vazha-Pshavela str. Batumi Tel: (422) 27 77 88
using a laser high energy). The procedure aims at restoration of damaged and aged skin. It is a unique laser technology, which copes with a lot of skin problems in the shortest period of time: changes skin quality rate; makes it smooth and even, flexible and elastic, fades and removes pigment spots, fine wrinkles, acne and skars.
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PLASMOLIFTING – is the latest method of rejuvenation both for face and body. The procedure reduces fine wrinkles, scars, pigment spots. Is recommended for a sunburned dry skin. Eliminates acne active elements, smoothes skin surface. The skin becomes healthy and young. Has no side effects and allergic reactions. As a result of the procedure we get healthy, moisture, elastic and rejuvenated skin.
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WORLD NEWS
August 31, 2015 #8
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ajara business week
Rock Star Economists Whose Ideas Are Changing The World Under The Radar
We're living in the age of the rock star academic. Everyone is trying to make sense of financial crises and the old economics textbooks don't work so well anymore. So it's natural to turn to the people who study this stuff for a living. Thomas Piketty, a French academic, sold 1.5 million copies of his book "Capital in the Twenty-First Centry," while Nobel prize-winning economists like Paul Krugman and Joseph Stiglitz can be found burning up social media, the newspapers, and the conference circuit. But not everyone with influential ideas on economics and finance is as well-known. Here are the academics that are changing the world behind-the-scenes. The list isn't exhaustive. If you think we've missed anyone out then please email in suggestions.
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Alma Mater: Seoul National University Big Idea:
Alma Mater: University of Freiburg Big Idea:
Alma Mater: Yale University Big Idea:
Alma Mater: Duke University Big Idea:
Alma Mater: University of Brussels Big Idea:
Developed countries talk a lot about the free market but really use their power and financial strength to profit at the expense of emerging economies. Chang’s ideas are controversial, centering on the role that international bodies like the IMF and World Bank play in the world economy. In books such as Kicking Away the Ladder and The Myth of Free Trade he argues that the governments of bigger economies help out their own companies, while preaching the benefits of the free market to developing nations.
The rule of law must be suspended for financial markets in a crisis, or the whole system will collapse. Pistor, who won the Max Planck academic research award in 2012, is developing a legal theory of finance to work out how laws affect its shape and composition. She discovered that, in a crisis, the regulations that build markets aren’t worth the paper they’re printed on. Political power is the driving force behind who gets hit in the heat of the moment.
Financial collapses don’t happen at random and aren’t inevitable. They come from complex bargains between politicians and bankers that spiral out of the government’s control. That’s one of the reasons why the US has had 12 major banking crises since 1840, while Canada has had none.
Trusting your risk models will lose you money in a crisis. Risk models will generally tend to have the same outcomes when everything is going well, even if they have different mathematical foundations. This tricks people in to thinking that they work all the time. But when all hell breaks loose, the models will give you wildly different risk assesments, leaving you flying blind. This is bad for banks and hedge funds but even worse for central banks, who have to make policy decisions for everyone else.
CEOs are rewarded for luck rather than performance. Also, employers judge applicants on their name as much as their qualifications. Bertrand is one the reasons why there's been such a shareholder backlash against CEO pay, after proving their huge bonuses are based on luck rather than genius. in a 2003 paper, She and Sendhil Mullainathan also famously replied to help-wanted ads in Chicago and Boston with fake names. Some applicants used names like Emily and Greg, while others used names like Lakisha and Jamal.
Ha-Joon Chang, University Of Cambridge
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Alma Mater: Colum- Alma Mater: Yale bia University University Big Idea: Big Idea:
Alma Mater: Cambridge University Big Idea:
You don't need money to make a stable market for something. Roth, along with Lloyd Shapely, won the Nobel Prize in 2012 for showing that people can make a market based on mutually-beneficial swaps rather than cash to satisfy a specific need. This was particularly useful for easing the shortage of kidney donors in the US. Roth used game theory to pair up donors with patients they didn't know, making it easier for people to swap their organs and find a match.
Alma Mater: Bocconi Univerisity, Milan Big Idea:
Goodhart's Law. Goodhart said that as soon as governments or central banks turn a statistic, such as the stock market, into an implicit policy target, it ceases to become a reliable statistic. This is because players in financial markets change their investment strategies to pre-empt the policy. Goodhart was one of the orignal members of the Bank of England's monetary policy committee in 1997, and a veteran of financial crises in 1970s.
Far from hurting growth, austerity measures can actually help economies recover. In 2009, Alesina and Silvia Ardegna published a paper called Large Changes in Fiscal Policy: Taxes Versus Spending. It was an important part of the debate in the years that followed over whether austerity and reducing debt or boosting government spending were the best strategies for economies recovering, cited by fiscal hawks.
: Kath: Charles : Jon : Mari: Alvin : Richard : Charles : Alerina CaloDanielsanne Roth, Portes, Goodberto Pistor, miris, son, LonBerHarvard London hart, Alesina, Columbia Law Columbia don School of trand, Univer- University Business School London School Harvard School Business Economics sity Of ChiAnd Stanford of Economics University School cago Booth University
Bondholders can often work together to get concessions from a borrower. Portes, now professor of economics at London Business School, laid down the groundwork for collective action clauses, where sovereign bondholders use their bargaining power to impose conditions on a debtor country. The work has been especially important in cases like Greece or Argentina.
“The results show significant discrimination against African-American names,” the authors wrote. “White names receive 50% more callbacks for interviews.”
Everything You Need To Know About Ukraine’s $18 bln Debt Agreement Ukraine reached a bond-restructuring agreement with about half of its private-sector creditors on Thursday after five months of negotiations. Below are the details of the terms of the agreement and what happens next. Which bonds are included? The deal covers $18 billion of Ukraine’s foreign debt, including 11 government Eurobonds and three state-guaranteed Eurobonds issued by the Ukrainian Infrastructure Fund. Not included is about $4.6 billion of quasi-sovereign bonds, $2.8 billion of which has already been restructured. What are the terms? The principal value of the securities will be written down by 20 percent, or $3.6 billion. The existing bonds will be rolled into nine new securities, each paying the same 7.75 percent interest. Bondholders will receive a share in each of the new bonds, which will be repaid in nine equal installments from 2019 to 2027. The coupon reflects an increase from the current blended average of 7.2 percent, according to Ukraine. The exchange will be made on a bond-by-bond basis, Finance Minister Natalie Jaresko said in a interview late Wednesday, meaning holders of current 2015 notes will receive new securities that mature in 2019 and holders of the 2023 bond
will receive new notes maturing in 2027. How do GDP warrants work? The deal also includes a so-called GDP growth warrant that will kick in from 2021 through 2040. The main conditions for triggering the instrument are that nominal gross domestic product must exceed $125.4 billion, compared with a projected $84.3 billion in 2015. Real GDP growth, meanwhile, must be 3 percent or higher for the warrant to be activated, according to the following parameters: a) 15 percent of the value of the GDP growth between 3 percent and 4 percent b) 40 percent of the value of the GDP growth above 4 percent Between 2021 and 2025, total payments are capped at 1 percent of GDP What happens next? Ukraine’s Finance Ministry is planning to start the bondholder approval process no later than Sept. 15, after pushing legislation through parliament. On most bonds, creditors then need to be
given at least 21 days notice to review the terms before meetings can be called for a vote. To pass the deal, 75 percent of bondholders must vote in favor at a meeting in which two thirds of creditors are represented. Quorum falls to one third at a second meeting if it isn’t reached first time around. Ukraine hopes to complete the entire voting process by the end of October, which means that a $500 million principal payment due on Sept. 23 and a 600 million euro ($678 million) payment due on Oct. 13 will be temporarily suspended. What if some bondholders don’t accept the new terms? The Franklin Templeton bondholder group holds a majority of more than 75 percent in some of the debt, according to Jaresko, which means they will be able to push through the new terms on those. In most of the bonds, the committee holds less than 75 percent, meaning that other creditors can obstruct an agreement. Ukraine won’t be able to give better terms to holdouts, Jaresko said.
“Anyone can choose to decline,” she said. “Then they have to choose to deal with whatever the consequences are and whatever the legal implications are of being a holdout.” Some bondholders, including Yerlan Syzdykov, who helps oversee $254 billion, including Ukrainian Eurobonds, at Pioneer Investments, have already said they will back a deal. Russia, which holds a third of the debt being restructured, said it won’t take part. What are Ukraine’s options with the $3 billion owed to Russia? Ukraine can either pay the bond in full, convince Russia to accept a restructuring or default. Each option has some downsides, including the potential of Ukraine losing IMF funding.
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REGION
ajara business week
August 31, 2015 #8
General Rehabilitation Works Underway in Kobuleti and we have spent over 1 million GEL from the budget. The Kobuleti seaside arrangement works are still in active phase. 114 New decorative benches and 70 rubbish bins were installed along the beach. The municipal budget has spent 116 600 GEL on purchasing these inventories. We have also repaired damaged plates and curbs in order to arrange the beach. A temporary construction was installed on the dam that was damaged by the natural disaster. The full rehabilitation of the dam will start in September. At this stage, we are paving the motorway with plates on Chavchavadze Street. Sidewalks will be arranged under the project, curbs will be rehabilitated and sewage systems will be arranged. Guramishvili street was also accommodated. We provide huge job and despite the criticism from our opponents, the fact is Kobuleti is being beautified and developed.
In his interview with the Ajara Business Week (ABW) SULKHAN EVGENIDZE, the Kobuleti municipality head, talks about the large-scale projects the new government has implemented in Ajara and all other ongoing works - The first phase of the Kobuleti Museum rehabilitation works is over. A new exposition hall has been arranged for the ethnography department. Viagor company has carried out the reconstruction works. The budget spending has amounted to 39 774 GEL. The works lasted three months. The second phase of the rehabilitation works will start in the near future. - A mini stadium rehabilitation works are in active phase to improve the sports infrastructure in Kobuleti. - The infrastructural rehabilitation project calls for restoring 13 mini stadiums and repairing damaged sections, painting and renewing the inventory. LLC Cheda 2012 is conducting the rehabilitation works. The budget contribution makes up 115 498 GEL. Under the project, a new mini stadium will be also constructed. - The natural gas network construction issue was always relevant. Local residents have expressed protests several times. Have you resolved this problem? - The gas pipeline construction works are underway. The project calls for arranging gas supply to 80 local families. LLC Ajara Natural Gas is
implementing the works valued at 37 000 GEL. The second phase of the gasification works calls for arranging a trunk gas pipeline in the village of Kvirike in 2015. The gas pipeline construction works are being also carried out in Buknari, Sachino and Chakvi. Sewage system arrangement works are also underway in the settlement of Gelauri. The project calls for arranging a central sewage system and the internal network. The budget spending makes up 1 296 699 GEL. The project will be finished in autumn 2015. - Your opponents assert the rehabilitation works on Rustaveli Street have created discomfort and difficulties to tourists during the tourism season. - At this stage, the sidewalks rehabilitation works have ended on Rustaveli Street. Decorative plates were laid starting the Freedom Street turn up to the Railway Station, curbs and sewage channels were also arranged. Special places were organized for bus stops and rubbish bins. Georgian Stone company has performed the works valued at 450 145 GEL. Along with the sidewalks rehabilitation works, road holes were asphalted on Rustaveli Street as part of a long-term project
Georgia Notes Record Number of Visitors From Russia
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eorgia is becoming more and more popular among Russian tourists”, – BBC Russia reports. As the article points out, due to Russian ruble devaluation and economic problems, outgoing tours are declining, But as for Georgia we have positive conditions.
Based on official statistics journalist Nina Akhmeteli has reported that the number of Russian tourists in Georgia has broken records this year and has reached nearly half a million, which is 12 percent higher than last year. “They are such a nice people. I feel like home, when i arrive here”- Maria Tokarova says.
According to the National Administration of Tourism Goestat, Russia ranks fourth in the number of visitors to Georgia. However, today despite the problems in relations between Moscow and Tbilisi remain, Georgia in the Russian socio-political media is hardly mentioned, while social networks are full of positive impressions of Russians who have visited the country, the author of the article noted. When tourists come, they see that local people, when they find out that you are from Russia great you with a bright smile and talk very kindly to you. In other words the fear is still there but it’s shattered from the very first days of staying in Georgia,” the Head of travel company My Georgia Egor Pavlov told to BBC Russian. “Relations between the countries are bad and it’s no secret. But maybe it is even better when you get more than you were expecting. Meanwhile, Georgia’s seaside resort areas are enjoying growing visitor numbers thanks to an increase in international flights. In July 2015 alone the number of tourists to the western Adjara region increased by 5.8 percent
year-on-year (y/y), announced the Government of Georgia. This was also evident in the first seven months of the year where the region experienced 4.3 percent growth y/y. The number of visitors to Adjara region from various countries increased this summer. In particular, tourist numbers were higher from these nations: Kazakhstan – 11 percent; Bulgaria – 6.8 percent; Lithuania – 5.5 percent; Israel – 4.6 percent; Poland – 3.7 percent; Ukraine – 3.5 percent; Turkey – 3.2 percent; Azerbaijan – 1.5 percent and Armenia – 0.8 percent. As Head of Georgia’s Tourism Administration Giorgi Chogovadze said to BBC Russian, “tourists are also attracted by wine tourism in Kakheti, the Black Sea coast and the mountain resorts of Georgia.”
August 31, 2015 #8
EVENTS
ajara business week
DIPLOMATIC MISSIONS IN BATUMI: • Azerbaijan - 14 Dumbadze street; t.: 0 422 27 67 00 • Estonia - 60 Gorgasali street; t.: 0 422 27 09 10 • Turkey - 9 Ninoshvili street; t.: 0 422 25 58 00 • Iran - 83 Parnavaz Mepe street; t.: 0 422 22 86 01, 0 422 22 86 02 • Armenia - 32 Gogebashvili street; t.: 0 422 21 63 02
I, Culture Orchestra and Liza Batiashvili – Classical Music Evening in the Batumi State Musical Center
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eat Batumi 2015 continues, and this time on August 25-30 in Batumi the project will pay host to Classical Music Days. I, CULTURE Orchestra, which unites musicians from various countries, visited the coastal city. Additionally, violinist of world orchestra and a Georgian soloist, Liza Batiashvili, had a classical music evening in Batumi State Musical Center. The orchestra, which was conducted by the Ukrainian Kiril Karabits, played in full force and the concert was attended by Georgia’s Minister of Culture and Monument Protection, Mikheil Giorgadze, as well as Poland ambassador to Georgia Andrzej Cieszkowski. Classical music lovers had a pleasant evening, and the I, CULTURE Orchestra presented various works of famous composers. The group was visiting Berlin, Germany and Kiev, Ukraine a few days earlier in frames of their tour, which sees them heading towards Spain next. “It was an important evening, and it’s joyful to know that an orchestra of this level was visiting Georgia. I think that fans of classical music have been gifted with a pleasant evening. Apart from this, it’s an interesting tour, we were at Kiev, we played on the Maidan, where 25 thousand listeners visited, and in a few days we’re travelling to Spain,” noted Liza Batiashvili. “I’ CULTURE Orchestra is a joint project of Poland and eastern partnership countries, including Georgia. I’m glad that we were at Batumi today, and hope that this united initiative will deepen our relations,” stated Poland’s ambassador to Georgia, Andrzej Cieszkowski. “It was an unforgettable evening, I had a very pleasant experience. I, CULTURE Orchestra is more than just an orchestra, it is an idea, a project that is unique by its nature,” noted the minister. Throughout its existence for four years, the I, CULTURE Orchestra has conducted 29 concerts in 22 cities, where the most prestigious halls and
celebrated festivals paid host to them in Great Britain, Germany, Belgium, Spain, France, Sweden, Iceland, Denmark, Litva, Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine. Their annual tour will include Poland, Germany, Spain, Ukraine and Georgia this year. “I, CULTURE Orchestra impresses with its sublime, well-measured and bright music,” – comment the listeners. The I, CULTURE Orchestra is comprised of talented young musicians from Poland and countries of Eastern Europe, including Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine. The group was created with Adam Mitskevichi State Institute’s initiative in 2011, and from the start served the goal to deepen the relations between the European Union and the Eastern Partnership countries. Their mission is to use their music as a means to support the dialogue between the Eastern Europe and southern Caucasus countries. With unified rehearsals and concert tours, the musicians learn to build societies by relying and trusting one another. The candidates for the I, CULTURE Orchestra are chosen from thousands of applicants, who go through hearings annually. The success for the orchestra is based on values of solidarity, integration and friendship. As an educational project, the orchestra enables young talented individuals to improve their technique under the guide of the world’s leading soloists, conductors and instrumentalists. Up to 500 young people have taken part in the I, CULTURE Orchestra project so far. The 60 days of Heat Batumi will, overall, cover over 200 events hosting 259 foreign artists from over 20 countries. With up to 2000 participants overall, Heat Batumi will be split into 11 thematic weeks, with each and every one of them having a unique topic and artistic accent. Heat Batumi is suitable for people of all ages and allows visitors to plan their vacation based on what they wish to see most. There’s fun going down all day-round.
AJARA TOURIST INFORMATION CENTRES: • Batumi boulevard information centre - 2, Ninoshvili str.; m.: 577 90 90 91; t.: 0 422 29 44 12; w.h.: 09:00-22:00 (Everyday) • Batumi cable-way information centre Gogebashvili street; m.: 577 90 90 93; t.: 0 422 29 44 10; w.h.: 24/7 • Batumi airport information centre - 220, Airport highway; t.: 0 422 29 44 14; w.h.: according to flights schedule • Sarpi information centre - Sarpi Customs; mob: 577 90 90 72; w.h.: 09:00-21:00 (Everyday) • Kobuleti information centre - 642 Aghmashenebeli street; tel: 0 422 29 44 13; w.h.: 09:00-20:00 (Everyday) • Keda information centre - Aghmashenebeli street; w.h.: 09:00-19:00 (In summer) • Shuakhevi information centre - 22 Rustaveli street; w.h.: 09:00-19:00 (In summer) • Khulo information centre 29 M. Abashidze street; w.h.: 09:00-19:00 (In summer) SIGHTSEEING AND CULTURE BATUMI CIRCUS - 13 Services: Parking, Toilet The staff speaks: Georgian, English, Russian Prices; Discounts are available CONTACT • Mob.: 599 68 02 23 PUPPET AND YOUTH STATE THEATRE - 13 Working hours: 10:00-17:00 Services: Parking, Toilet The staff speaks: Georgian, English, Russian Prices; Ticket: 2 Gel Discounts are available CONTACT • Tel.: 0 422 27 62 34 • Mob.: 599 40 45 38 • E-Mail: info@puppet-show.org • CINEMA APOLLO - 13 • Working hours: 12:00-00:00 • Services: Credit cards accepted, Free Wi-Fi, Exhibitions, Cafe, Toilet • The staff speaks: Georgian, English, Russian • Prices • Ticket: 6-10 Gel • Tel.: 0 422 22 72 27 BATUMI BOTANICAL GARDEN - 13 Working hours: 09:30-18:00 Services: Credit cards accepted, Free Wi-Fi, Exhibitions, Guide service, Cafe, Information board, Parking, Toilet The staff speaks: Georgian, English, Russian, German Prices Ticket: 8 Gel Guide service: 30 Gel Discounts are available • Tel.: 0 422 29 49 29 • Mob.: 577 10 16 07 • E-Mail: info@bbg.ge AJARA KHARITON AKHVLEDIANI STATE MUSEUM - 13 Working hours: 10:00-17:00 Services: Free Wi-Fi, Exhibitions, Guide service, Information board, Parking, Toilet The staff speaks: Georgian, Russian Prices Ticket: 2 Gel Guide service: 5 Gel Discounts are available • Tel.: 0 422 27 11 75 AJARA STATE ART MUSEUM - 13 Working hours: 10:00-18:00
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Services: Exhibitions, Guide service, Information board The staff speaks: Georgian, English, Russian Prices Ticket: 2 Gel Guide service: Free Discounts are available • Tel.: 0 422 27 38 94 BATUMI ARCHEOLOGICAL MUSEUM Working hours: 10:00-18:00 Services: Exhibitions, Guide service, Information board The staff speaks: Georgian, Russian Prices Discounts are available • Tel.: 0 422 27 65 64 • Mob.: 599 15 41 50 THE NOBEL BROTHERS BATUMI TECHNOLOGICAL MUSEUM Working hours: 10:00-18:00 Services: Exhibitions, Guide service, Information board, Parking The staff speaks: Georgian, Russian Prices Ticket: 3 Gel Guide service: 5 Gel Discounts are available • Mob.: 599 43 03 68 DANCING FOUNTAINS Working hours: 20:00-00:00 Services: Parking • PricesTel.: 0 422 27 88 08 • E-Mail: info@boulevard.ge Ticket: Free BATUMI ILIA CHAVCHAVADZE STATE DRAMA THEATRE Working hours: CLOSED until late June / early July 2015 Services: Parking for around 15 cars. Accessible for disabled people with 10 wheelchair spaces. Toilets (but not accessible). No theatre bar or restaurant but plenty of bars and restaurants nearby. The staff speaks: Georgian, Russian, English, Turkish • Tel.: 0 422 27 06 14 • Mob.: 555 36 63 99 • E-Mail: info@batumitheatre.ge BATUMI SUMMER THEATRE Batumi Summer Theatre is located in a central part of Batumi Boulevard and is designed for concerts and other entertainment events. An architecturallyunique wooden building is adorned with wooden ornaments and features a ceiling painted in imitation of the sky. The Summer Theatre has a long history. It was renovated in 2013 and has operated since then. • Tel.: 0 422 29 45 24 Adress: Batumi boulevard BATUMI ART CENTER Working hours: 10:30-22:00 Services: Exhibitions, Parking, Toilet, Café, Concerts, Performances, Opera, Traditional Georgian Folk Song and Dance, Orchestra Performances The staff speaks: Georgian, English, Russian, Turkish, French Tel.: 0 422 27 62 40 • Mob.: 555 37 75 99 • E-Mail: info@muscenter.ge ZOO Working hours: 11:00-19:00 (Except for Monday) Services: Parking, Toilet The staff speaks: Georgian, English, Russian el.: 0 422 22 17 30 • E-Mail: office@parkbatumi.ge CONTEMPORARY ART SPACE Working hours: 11:00-19:00 (Except Monday) The staff speaks: Georgian, English, Russian • E-Mail: batumiartspace@gmail.com Working hours: 11:00-20:00 The staff speaks: Georgian, English, Russian Prices:Free entrance • Tel.: 0 422 27 97 00 RUSUDAN PETVIASHVILI ART CAFE-GALLERY Working hours: 11:00-24:00 The staff speaks: Georgian, English, Russian • Mob.: 599 74 52 23
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PUBLICITY ajara business week
August 31, 2015 #8
• 247 guest rooms and suites • Nephele Sky Bar on 20th top floor with open terrace and best views • Pelion Restaurant, Lobby Café and Bar Tandila • Eforea spa, fitness room, indoor swimming pool and open sun terrace • 7 meeting rooms and ballroom • Complimetary Internet access throughout the hotel • Smoking rooms available • 181 car parking spaces