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July 13, 2015 #1

July 13, 2015, Issue 1

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BE INFORMED, DO BUSINESS IN AJARA

GEORGIA

Georgia’s Incoming Tourism Grows Pg. 7

Top 10 Reasons To Visit Ajara

Archil Khabadze Congrats Ajara Business Week

TURKEY

Pg. 2

Turkish-American university to open soon: Business association Pg. 4 RUSSIA

Russian Tycoon Bids $200 mn for Control of Swedish CTC Media

Pg. 10

Pg. 5

UKRAINE

Ukrainian Inflation Slows Further in June as Hryvnia Stabilizes Pg. 6 AZERBAIJAN

Azerbaijan introduces new car insurance tracking system Pg. 7 ARMENIA

Armenia’s Regulators Fine Russian-Owned Electric Utility Company Pg. 8 WORLD

The 10 most affordable cities in the world Pg. 9

How to Join Produce in Georgia Program

xpo Georgia exhibition center has hosted a presentation of an annual report of the Produce in Georgia project. A total of 90 industrial projects, 5 000 employees are the results of the project. The cabinet of ministers is content with the achievements and plans to further enlarge the program. The Produce in Georgia government program was inaugurated on June 1, 2014 to stimulate, develop and promote the competitive domestic production. The government offers financial, infrastructural and advisory assistance to interested entrepreneurs. In a year after the program inauguration, the Government has introduced a report of performance to the society. According to the statistics of the Ministry of Economy and Sustainable Development, 90 new industrial projects of 252 million GEL were inaugurated. Under the program, commercial banks have issued about 122 million GEL to the private sector. Pg. 6

Black Sea Pearl Project to Draw 30 billion USD Investments to Ajara Region

garian, Czech companies have met with the Ajara Supreme Council Chairman. After the meeting the businessmen expressed their content with the position of the Ajara Government and the Supreme Council concerning this ambitious project. Avtandil Beridze, the Supreme Council chairman, pledged full support to the group of international investors that plans to invest over 30 billion USD in the Ajara Region. Pg. 5

Government Officials Rule out Further Deprecation of GEL Exchange Rate

fallen in relation to USD. Therefore, we cannot artificially create a stronger currency. The current rate reflects Georgia’s trade balance”, Kvirikashvili noted and then answered the question about whether the government implied similar indicator while making the GEL Exchange rate stabilization forecasts. The Finance Minister has made more optimistic forecast concerning the GEL exchange rate. The government’s economy team has not implied the current realities when talking about the GEL exchange rate stabilization. “The exchange rate stabilized along with a growth in exports and tourists inflows”, Khaduri said. Pg. 5

One Visitor Spends 225 USD in Georgia on Average

in Georgia and neutralize foreign negative factors. “In the first quarter of 2015 a total of 986 366 international visitors arrived in Georgia, down 2% compared to the same period of 2014. This was a logical tendency, because the regional crisis has hit almost all neighboring countries, while 91% of the 1Q15 visitors have come from the very neighboring countries. Pg. 7

Irakli Garibashvili: Ajara Region to Draw One billion USD Investments Pg. 7

Zurab Kukuladze: Ajara Business Week to Establish Friendly Relations with Ajara Business Sector

Pg. 3

Kakha Maghradze: Ajara Business Week to Consolidate Many Local “Players” and Create BusinessEconomic Information Space

Pg. 3

Georgia’s Incoming Tourism Grows

he summer season has brought a growth in tourists’ inflows. The National Tourism Administration of Georgia says in mid June 2015 a total of 496 758 international visitors arrived in Georgia, up 9.3% year on year. The number of tourists who have spent in Georgia 24 hours and more, constituted 197 500 ones, up 3.4% compared to June 2014. A major part of the visits was carried out from the neighboring countries (86%). A special growth in tourists’ inflows was registered from Russia (+47%), Armenia is second (+33%) and Azerbaijan is third (+15%). From other countries we should mention: Kazakhstan (+40%), Belarus (+56%), Israel (+26%) and United Arab Emirates (UAE), from where a record growth in foreign visitors’ inflows was registered. The year of 2015 started with a little pessimistic report and the first months recorded a decline in tourists’ inflows, but the first half has registered a little upturn anyway. Pg. 6

2 MAIN EVENTS GEORGIA-US DEEPEN TIES TO AVOID TAX EVASION

TOP STORY

Congrats to ‘Ajara Business Week’

eorgia and the United States (US) are deepening their bilateral relationship to improve international tax compliance and ensure all citizens pay their appropriate taxes when living abroad. Today Georgia signed an Inter-Governmental Agreement (IGA) with the US on tax compliance and mutual understanding, which encompasses implementation of the Foreign Account Tax Compliance Act, commonly known as FATCA. Following the signature Georgia must report information regarding US account holders in Georgia to the US Internal Revenue Service (IRS) in order to eliminate cases of tax evasion. The agreement will establish a framework to assist Georgian financial institutions in reporting certain financial account information required by the US’ FATCA. “Georgia joined those 80 countries who have already signed this agreement with US. Georgian banks were waiting for the day when Georgia would sign the document. This document enables Georgian banks to operate on US market through the US bank’s effort,” said Georgia’s Finance Minister Nodar Khaduri. The agreement was signed by Georgia’s Finance Minister Nodar Khaduri and US Ambassador to Georgia Richard Norland.

TBILISI TO HOST FIRST ASIAN INFRASTRUCTURE INVESTMENT BANK MEETING

op officials from 57 countries will visit Georgia’s capital next month for the first round of negotiations of the China-led Asian Infrastructure Investment Bank (AIIB). The AIIB is newly created bank that is expected to be established by the end of this year for the purpose of providing loans for infrastructure projects in developing countries in Asia. The first ministerial, which will be held in Tbilisi on August 24-25, will see founder banks introduce the candidates they wish to nominate for the AIIB presidential role. Georgia joined the AIIB as a founding country last month when the country’s Finance Minister signed a special document cementing Georgia’s place as one of 57 AIIB founding nations. By joining AIIB Georgia will be able to attract preferential financial resources for implementing infrastructural projects. The capital of the bank will be $500 billion USD. Georgia was the 45th country to join the AIIB. A further seven countries have the chance to sign the Bank’s foundation agreement before the end of 2015. Meanwhile at today’s Government meeting Finance Minister Nodar Khaduri told Government members that the Bank was ready to support infrastructural development in Georgia, specifically to help implement the Silk Road project.

ELECTRICITY TARIFF TO BE REVISED DUE TO THE DEVALUATION OF THE NATIONAL CURRENCY

he devaluation of the national currency will be reflected in the tariff for electricity generated by thermal power plants - Irina Milorava, the head of the Georgian National Energy Regulatory Commission (GNERC), states. As for the general consumer electricity tariff, it is impossible to make any predictions in this direction. “The Commission received a request to review the tariff for thermal power plants, which is scheduled to be discussed in the near future. The basis for the request was the depreciation of the national currency, since imported natural gas account for nearly 99% of the total costs intend for production of energy by thermal power plants. Naturally, this means that the devaluation of the lari will necessarily be reflected in the tariff for thermal power plants. With regard to consumer tariff, the request for its revision was submitted by the electric power distribution company “Energo -Pro” in April. We should consider this request within 150 days. By the end of the month, we may take a decision on this issue but now it is impossible to predict what it will be.

July 13, 2015 #1

ajara business week

ARCHIL KHABADZE Chairman of Ajara AR Government

t is not easy to venture and found another newspaper among the multitude of media. It needs a great courage to find a niche among the already successful outlets and great accomplishment is success of this idea. Publishing new periodical edition focused on business and economic issues indicates development of Ajara region. This means that the local media market is ready, the economy is growing and interest towards traditional media is still high. Georgia was ranked first in the region to media freedom, thus I am glad that Ajara Business Week professionals wish to produce high-quality reports on Ajara business and economy, inform tourists and investors about the events taking place in the region. Since Ajara is a destination where something new happens daily, where constantly flows investments; where tourism, education, agriculture, health care are developed for

the social welfare of the people. We are proud that Ajara is exquisite with its geopolitical location, all means of transportation, beautiful nature and diverse culture. With flexible environment for doing business Ajara has a great potential to become a key point in the Black Sea region. Just recently a new Station ‘Batumi Central’ was opened in Batumi, with railway and bus stations. There is a comfortable and well-spaced facility. Any traveler will be able to get a quality service, enjoy shopping and have a rest while waiting for the relevant transport. With the help of the newspaper, the passengers on the way to Batumi, tourists accommodated in our hotels, customers having dinner at our restaurants will be even more convinced of Ajarian tourism’s unique capabilities and the region’s development prospects. So, Congrats!

Privatization Proceeds in Ajara Exceed 8 million GEL in 1H15

he Ajara government has fulfilled the privatization plan in excess in the first half of 2015. The Ajara Ministry of Finances and Economy says the 1H15 privatization proceeds marked 8.182 million GEL. According to the statistics, the revenues from the privatization process in 1H15 rose by 4.791 mil-

lion GEL compared to the same period of 2014 (3.391 million GEL in 1H14). Expected revenues from the privation process by the end of 2015 totals 6.345 million GEL, including, revenues from nonfinancial assets – 5 025 million GEL, other sources - 1.319 million GEL ( sales of capital). The 2015 privatization plan makes up 10 million GEL.

David Sergeenko: Implementation of Primary Healthcare Reform is Underway

inistry of Health, Labor, and Social Affairs plans to reform the Primary Health Care in the near future. David Sergeenko made this statement on Friday. A statement in this regard was made, at the National Center for Disease Control and Public Health, that hosted a conference on C Hepatitis Elimination Program. According to Sergeenko, together with Universal Healthcare and Hepatitis C elimination programs, the ministry plans to focus on improving Primary Health Care. “Our first step was to develop the Universal Healthcare and C Hepatitis Elimination programs and for now we have launched both of them successfully. At this stage, I can tell you that one of the main goals is to improve the primary healthcare,” Sergeenko said. “We have been actively getting consultations with the international consulting group “Global Alliance,” he added. The main focus of Georgian healthcare is creat-

ing a primary healthcare package. It happened that during the last years or rather decades there was not paid enough attention to the primary healthcare and the whole focus was concentrated on the hospital sector. It is clear that such attitude consists several risks, as primary healthcare is not fullfilling its part, which in ideal situation is to manage 80% of medical needs and only 20% should be given to the stationary treatment. Unfortunately our reality is that the patients are applying to the hospitals and they are themselves choosing the specialists and the institute of home doctor, and in general of primary healthcare is almost skipped out. I as a minister frankly to say don’t see the primary healthcare as a system yet in Georgia. Our main goal is to create it and to improve it. The major entrance of the healthcare is thr primary heathcare. The powerful pyramid should be based on it. Unfortunately this is not our case. Recent primary healthcare has diffusional structure, it is difficult to distinguish any system elements and the doctors are avoiding to discuss

the case because its delicatness. But we should state thet for example the income of the primary doctors is far from adequate. It is obvious that all professions are special, but the doctors’ is unique. I’ll not count why. The doctors should not be left on the battlefield with their economic problems alone. In this case it will be impossible to talk about the quality of medical care”.

New Railway Station Opens in Batumi

eople travelling to Georgia’s seaside city Batumi can now be transported directly into the heart of Batumi thanks to the opening of a new railway station in the city centre. A new train station employing hundreds of locals officially opened yesterday in the Black Sea coastal city. Until now rail passengers were unable to directly reach the heart of the coastal city as the last stop on the train line ended in Makhinjauri, five kilometres north of Batumi. Georgia’s Prime Minister Irakli Garibashvili praised the opening of the new railway station. “This is a very important investment for Batumi. Partnership Fund and Georgian Railway contrib-

BUSINESS WEEK

AJARA The Editorial Board Follows Press Freedom Principles Publisher: LLC Caucasian Business Week - CBW Director: Levan Beglarishvili Address: Aleksidze Street #12 Editor-in-chief: Zura Kukuladze. Tel: 599 00 82 12 Mobile phone: +995 591 013936 WWW.ABW.GE Email: ajarabusiness@gmail.com

uted significantly in implementing this project. Batumi’s potential is growing and we all should support the city to use its potential,” said Georgia’s Prime Minister Irakli Garibashvili. A Georgian Railways representative said the new train station was another major infrastructure project implemented by the Government and Georgian Railways that aimed to increase tourism potential and fit the interests of Batumi residents. The new railway station opened in Batumi Central, a four-storey business centre that also housed corporate offices and other service centres. The railway station occupied an area of 750 m2 and included passenger waiting halls. About 300 people are employed at the railway station.

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

July 13, 2015 #1

AJARA BUSINESS WEEK

ajara business week

Ajara Business Week to Establish Friendly Relations with Ajara Business Sector Zurab Kukuladze, an editor-in-chief for the Ajara Business Week

he Ajara Business Week (ABW) is a fully new-style platform in the Georgian media space with a focus on the business environment of one specific region of Ajara. With multiyear experience in the business media, our team fully realizes the business potential the Autonomous Republic of Ajara holds in the current situation. This team will act as a certain mediator between the Authorities, the business sector and the society in terms of unbiased and qualified coverage. We believe our undertaking will increase the attractiveness of the Region’s business environment. We will provide qualified analysis on Ajara’s business potential to the interested audience. The newspaper will actively cover achievements, challenges and potential of the local business. We plan to tightly cooperate with local and central governments to deliver valuable information on governmental initiatives and reforms to the interested audience and provide additional opportunity to local major and smaller businesses and investors to better realize and perceive the region’s huge potential. We fully realize the responsibility the Ajara business sector needs a mighty media lobby that will deliver real and qualified information on the region’s opportunities to the Authorities, the society and major and smaller potential investors, who are interested in putting financial resources in the Region. We will cover all important business initiatives and achievements. We will also make

focus on the problems before the business sector. We believe the outlining and actualizing of problems is the first step for their resolution. We will also succeed in cooperation with medium and small-sized business sectors that have less leverages for outlining their advantages and challenges. We believe Ajara is one of the attractive regions in terms of investment environment in not only Georgia, but the whole Black Sea Region. We plan to deliver highly-qualified information on the local opportunities to foreign investors and interested society. We realistically appraise the Ajara’s tourism potential and we plan to introduce the local environment to the Georgian and foreign citizens, who may make investments in Ajara. We will provide zealous job to thoroughly show up Ajara’s entirely diverse environment with not only sea resort, but culture, traditional and medical centers that will be as attractive for tourists as the sea resorts. In brief, we plan to become guides for not only arrived visitors, but all potential guests to the Ajara Region. We will provide active cooperation with the development sector that is one of the quickly growing fields in the Region. We believe this field includes huge potential and our involvement in the field promotion is one of our main objectives. We will also highlight the potential of Ajara’s transportation and logistics center to provide maximal contribution to developing the field and the transportation potential in not only Ajara, but also the whole country. Promotion of micro, small and medium

business sectors is one of the main objectives of the Ajara Business Week. Initiatives of both central and local Authorities are significant in this respect and our participation in implementing these initiatives will be one of the priority directions of our edition. In this respect we will provide potential beneficiaries with qualified analysis on about the local opportunities that still remain unemployed. In one word, our team will have friendly relations with the Region’s business sector and lobby the local initiatives and highlight the Region’s opportunities. I hope the local business and the society will accept our friendship and fruitfully cooperate with our team. The Ajara Business Week is a joint project of two partner business editions: the Englishlanguage Caucasus Business Week and the Georgian-language Banks&Finances. The Banks&Finances appeared in the Georgian media space in 1995. Currently, the edition’s weekly circulation is 3 500. The main objective of the newspaper is to introduce the Georgian business and economy opportunities and high-level analysis of problems to the interested audience. The Banks&Finances has been successfully cooperating with all major and comparatively smaller business structures in Georgia, as well as with state organizations, civil sector and experts with respective qualifications. The Banks&Finances’ platform runs in online space on the website www.bfm.ge. The Caucasus Business Week is an Englishlanguage edition with a focus on coverage of major and medium business initiatives.

The Ajara Business Week will be published in not only a newspaper format, but the website www.abw.ge will also launch operation in the near future that will publish Ajara’s business news and analysis in everyday regime. The online space will provide our team with more opportunity to attain the above-mentioned goals.

Ajara Business Week to Consolidate Many Local “Players” and Create Business-Economic Information Space The Ajara Business Week (ABW) is the first English-language business-economic news edition with a main focus on business-economic news coverage in the Autonomous Republic of Ajara, Georgia. KAKHA MAGHRADZE, a senior partner for the PR & Marketing Communications Company GEPRA, talks about the importance of this media platform in the region, its beneficial role for acting businesses and potential investors in making orientation in the current realities and other interesting issues.

- Mr. Kakha, how would you appraise a media platform with a focus on the Ajara Region’s business potential has appeared in the Georgian business news media segment? How interesting it will be and what will this edition give to the local business? - The Ajara Region, in general, is a very active zone. After Tbilisi, it is a very active region in Georgia. From the standpoint of my profession, I would say the Ajara Region will be saturated with a lot of business and economic news. Consequently, I believe this edition will create a context in

terms of business-economic news coverage for the interested audience and this will be very relevant and efficient way. In addition, the English-language format of the edition is also very significant, because a major part of businesses in Batumi and Ajara is represented by foreign investors. Therefore, this language will consolidate the local “players” and create business news information space. - Do you think the Ajara Business Week will act as a mediator between the government and the business sector? - All information resources covering economic fields, including business, investments, tourism, is very relevant and interesting to all interested parties in Ajara. Business companies and their managers are on the one side, the audience with a focus on all these aspects is on another side, including public offices, the local government, judicial system, civil sector that carries out monitoring of this process in the name of the society and is interested in this information. This newspaper may also raise the interest of regional and central media agencies, because it will perform specific mission. - What is the role of media agencies for the business sector development and what spe-

cific goals should the Ajara Business Week achieve? - I think this will certainly work, because undeveloped business media sector is one of the factors that hamper the business sector’s quick development, because many simple issues may be resolved in a simple way when we have required information. Even one news article may lead you to the decision of making investments of several millions of USD in this or that business. Today in Tbilisi, at the central level, Georgian businessmen have accumulated certain capital that may be directed to regions. Ajara is an interesting region for many other factors, but these interesting sides are mainly confined with Batumi. If the Ajara Business Week ensures a valuable coverage of the region’s business and economic activities, this will enable interested investors to take specific decisions in the whole Ajara Region. The number of residents in a specific municipality, the social situation there, main products of consumption, and the level of development of the bank sector – our media sector lacks for information about all these aspects. I believe the coverage of these and all other related issues will be very interesting for not only Georgia-based businessmen.

- According to certain considerations, online media development overwhelms the print media. Do you agree with this consideration and how would you appraise the perspectives of the Ajara Business Week? - A newspaper will always maintain its own niche, especially ones with specific professional direction. Newspapers do not spread mass information. This function is performed by televisions and the internet, while newspapers maintain the niche of information analytics. Unlike the internet media, the newspaper audience is accustomed to the issuance frequency and the newspaper reading becomes a habit and custom. A newspaper establishes other culture, in reality. Therefore, in case of newspapers, businesseconomic editions with their own niche on the media market are very interesting, while the editions without specific accents are losing their importance. - And finally, what would you suggest the Ajara Business Week publishers? What they should make focus on? - This newspaper should highlight useful economic information for any audience. It should be useful as an information resource database to spread interesting and relevant news and analytical materials.

AGRICULTURE

4 TURKEY TURKEY’S ONLINE RETAIL MARKET TO DOUBLE BY 2020

urkey’s online retail market is expected to double to 14 billion Turkish Liras ($5.2 billion) by 2020 from 7 billion liras ($2.6 billion) in 2015, according to a report from the Boston Consulting Group and Boomerang Commerce titled “Multichannel Pricing Strategy.” “There is fierce competition in the retail sector in Turkey,” said BurakTansan, partner and managing director of BCG Turkey. “The conditions of competition have also changed. The rules of the game have been rewritten with the development of the digital world.” Turkey’s Internet economy is expected to reach 2.6 percent of GDP by 2017. An increasing number of consumers go online, check prices from both online and bricks-and-mortar stores, and then choose where to buy, the report said, adding that this put great pressure on retailers both online and offline for pricing.

TURKISH-AMERICAN UNIVERSITY TO OPEN SOON: BUSINESS ASSOCIATION

he Turkish-American Business Association American Chamber of Commerce (TABA/AmCham) will start to work for the establishment of a Turkish-American university with a focus on IT technologies education in 2016, the new president of the association has said. “After the U.S.-Turkey Strategic Economic and Trade Cooperation Framework initiative was launched by U.S. President Barack Obama and his Turkish counterpart, RecepTayyipErdoğan, in 2009, we have seen many opportunities to build closer ties in trade and social areas between the two countries… Among the projects we have focused on in line with this mission is the establishment of a Turkish-American university which specializes on information technologies education,” said the association’s head, Bora Gürçay, on late July 7.

TURKEY CURRENT-ACCOUNT GAP WIDENS MORE THAN ESTIMATED IN MAY

ajara business week

One year on: What are the benefits of DCFTA for Georgia?

ne year on from Georgia’s EU integration the country is already showing immense progress, particularly in the agriculture sector where growth is evident in a range

of directions. The sum of agricultural exports last year increased to reach 29 percent of Georgia’s total exports and for the first time agriculture products ranked third in Georgia’s export trade list. The volume of agricultural products increased by seven percent last year and brought the country $826 million USD in income. Last year the export volume of nuts exceeded the export volume of wine for the first time, meaning nuts become Georgia’s main agricultural export product, according to data from Georgia’s Agricultural Ministry. The new perspectives of Georgia’s agriculture

TURKEY CAN USE GREECE’S TERRITORY FOR CARGO TRANSPORTATION TO EUROPE

urkey can use Greece’s territory for cargo transportation to Europe, FatihSener, executive director of Turkey’s International Transporters Association told Trend July 8. He said that today Turkish-Bulgarian border is the main route for cargo transportation from Turkey to Europe. Sener added that 750 trucks are sent from Turkey to Bulgaria per day, while a maximum of 200 trucks are sent to Greece which is related to the conditions on the border checkpoint of both countries. “Using Greece’s territory for cargo transportation from Turkey to Europe doesn’t mean that Turkey refuses from using Bulgaria’s borders,” he said. “Turkey is seeking access to Europe as before.” Sener added that Ankara regards Turkish-Greek border (Ispala) as an alternative access to EU. EU has spent 6 billion euros for reconstruction of roads in Greece and it is great chance for cargo transportation to EU, according to the executive director.

sector have heavily influenced the country’s investment climate. This sector of the economy enjoyed direct investments worth $19 million USD in 2014, which was 61 percent more than the previous year, said Georgia’s Agriculture Ministry. Agriculture was also largely funded by the Georgian Government – more than 27,000 farmers and farms utilised cheap agricultural loans worth 772 million GEL during the 2013-2014 years. The Agricultural Projects Management State Agency financed 105 new plants and an additional five were opened with the support of the Economy Ministry’s ‘Produce in Georgia’ program. New manufacturing enterprises in the agricultural sector meant creation of additional value and this can be seen in numbers. Final products, worth 4.1 billion GEL, were created in the country as a direct result of processing initial products in 2014. This number was almost a 10 percent

growth compared with the previous year. The share of agricultural products in the country’s total GDP also rose in 2014 and was now 16.5 percent, latest figures showed. In previous years this figure peaked at 12 percent. Exports to the EU increased by 109 percent in the past two years, compared to a growth rate of 46 percent for CIS countries, noted Geostat, Georgia’s state statistics service. Meanwhile, imports from Europe increased by 23 percent in the past two years, while there was a five percent drop in imports from CIS countries in the same time period. As a result, a negative trade balance reduced by $260 million USD, which meant that less foreign currency went out of Georgia. While the expectation of the Deep and Comprehensive Free Trade Area (DCFTA) was to fulfill the Georgian market with EU products, the opposite happened; 12 months on from when the DCFTA was signed, Georgia’s imports from the EU grew five times less than Georgia’s exports to EU countries. Internally, there were 1.3 million cattle last year in Georgia. This was an increase of six percent year-on-year. The number of pigs (units of pork) reached 210,000, which was an increase of 9.5 percent. A nine percent growth was also seen in poultry numbers, which reached 7.4 million. The number of sheep and goats also increased last year by 1.2 percent and reached 867,000 units. The volume of meat production grew by one percent, reaching 49,000 tones, and milk production was 633 million litres in 2014, which was five percent higher than the previous year. As for egg production, this grew by five percent and reached 522 million in 2014. Georgia signed the Association Agreement (AA) which includes DCFTA, on June 27, 2014.

Israeli Businessmen to Invest in Georgia’s Tourism and Agriculture Sectors

sraeli Investors Interested in Investing in Tourism and Agriculture Israeli investors interested in investing in tourism and agriculture in the region of Adjara. It was said at the meeting of the Extraordinary and Plenipotentiary Ambassador of Israel to Georgia and the Chairman of the Government of Adjara. Archil Khabadze and Yuval Fuchs discussed the relations between the two countries. Ckhabadze informed the guest of the current and completed projects and focused on the areas of Israeli investors’ interest. “I am always glad to visit Batumi.

urkey’s current-account deficit widened more than estimated from a year earlier in May as Turkey’s trade gap grew. The shortfall in the current account, the broadest measure of trade in goods and services, rose to $3.99 billion from $3.65 billion a year earlier, the central bank in Ankara said in a statement posted on its website today. The median estimate in a Bloomberg survey of economists was $3.53 billion. Exports declined 18.3 percent in May from a year earlier to 11.9 billion while imports fell 13.9 percent to $17.3 billion during the same period. The lira was little changed after the figures were published and was trading 0.5 percent higher at 2.6648 per dollar at 10:31 a.m. in Istanbul.

July 13, 2015 #1

I first met Archil Khabadze 2 years ago and I can say that since then a progress is evident in the region’s economy and tourism. Tourism and agriculture are of our big interest, which have a great potential in Adjara. We talked about strengthening economic relations between Georgians and Jews as well as new investments. I think, a lot of Israeli tourists will visit Batumi this year ,”- Yuval Fuchs said after the meeting. In turn, the Israeli Ambassador invited the head of the government of Adjara to Israel.

Genetically Modified Food Without Indication Will Be Annihilated

new law came into force from July 1, 2015, all products that contain genetically modified components must have proper labels informing consumers and allowing them freedom of choice. The new law regulated the type of information that must be written on the label. Specifically, if genetically modified components are 0.9 percent more than the product’s total mass, a label stating “GM” must be clearly identified on the top left corner of the product. Those who break the law will be fined 5,000 GEL. If the wrongdoing repeats the fine will increase to 10,000 GEL. “If food labelling is impossible [the product] must have supporting documents that must contain information about the genetic modification,” stated the law. The Georgian market is free from genetically modified products imported from abroad, says a new report by the National Food Agency. Georgia’s National Food Agency spent the past two years verifying product labels to check whether imported food products were genetically modified and if they were, the products were re-

moved from the Georgian market. “We examined about 50 samples of products that are deemed to be high risk of being genetically modified. Such products are soy, corn, potato starch, rice, sugar and many other products. Our research found those 50 samples were free from genetically modified elements,” Kakha Sokhadze, head of the Food Department at the

National Food Agency, told Agenda.ge. As for locally produced food products, Sokhadze explained the products made in Georgia were not genetically modified. “According to a law that was launched last year it is forbidden to import genetically modified seeds. So it is impossible to produce genetically modified food products in Georgia,” he said.

July 13, 2015 #1

ECONOMY

Black Sea Pearl Project to Draw 30 billion USD Investments to Ajara Region

free industrial zone will be created in the Autonomous Republic of Ajara, Georgia. The Black Sea Pearl project will cover 300 hectare land plot in Gonio. The idea has been proposed by the Georgian-Belarus Business Group that unites investors from various countries as part of the project. To enhance the Ajara government’s confidence, representatives of the Georgian, Hungarian, Czech companies have met with the Ajara Supreme Council Chairman. After the meeting the businessmen expressed their content with the position of the Ajara Government and the Supreme Council concerning this ambitious project. Avtandil Beridze, the Supreme Council chairman, pledged full support to the group of international investors that plans to invest over 30 billion USD in the Ajara Region. The company plans to get registered as a joint stock company in Batumi. At the same time, the stock capital amount is not divulged yet. The au-

thors of the Back Sea Pearl project planned to organize the FIZ on 300 hectares on the former Gonio military range, but we have learnt they also plan to develop agriculture sector in the Guria Region on 500 hectares. “We are conducting active negotiations with the Ajara Government. There were some technical difficulties, because we follow different approaches and action plan when working on the project. We are conducting preparatory works and only after these works we will move to specific agreements. We are sending to and receiving letters from the Ajara government. We realize our plans are very ambitious. We have already achieved required agreements. It should be noted this is a multinational project. Czech, Georgian, Canadian, American and Belgian investors are taking part in the project implementation. We cannot divulge all information, but we continue working and we will introduce a final variant to the society”, JSC ISBD President Pavel Aleqsiuk

noted. The Ajara FIZ will consist of three zones: 1) the first zone will hold business assets on 10 hectares, including a stock exchange, leasing companies and business bodies. 2) The second sector will hold a tourism zone with top class hotels; 3) The third zone will offer a virtual zone with IT laboratories. At this stage, the company has obtained permission for carrying out primary works, including planning works, the river Chorokhi bank strengthening works and geodesic monitoring. The project author Archil Dolidze says the company holds quite impressive stock capital and several financial groups are involved in the project implementation, including Tatra, American Global Energy and investors from Israel and Canada. “We are conducting a very harmonious cooperation with the Supreme council and the Ajara Government, immediately with the Finance Ministry and the Economy Ministry. It is a long-term process to receive a land plot and obtain a due status. We have to carry out a number of works after which we will receive the status. The company holds very impressive stock capital”, Georgian Business Group President Archil Dolidze said. The Ajara Supreme Council chairman Avtandil Beridze says this is a very important project for both Ajara and the whole Georgia. “I believe their project is very interesting and significant for our region and the whole country. We will try to involve the Ajara government in the project promotion process, as the Ajara Government is to take a final decision and sign all agreements. The Ajara government should ensure overall practical support to this group’, Avtandil Beridze noted.

Government Officials Rule out Further Deprecation of GEL Exchange Rate

he GEL exchange rate is expected to remain in the current diapason. Money transfers from Greece have considerably decreased. Specialists are sure this factor cannot devalue the national currency. Georgian Economy Minister Giorgi Kvirikashvili assures the GEL exchange rate has stabilized. This signifies currency rate fluctuations are not as sharp as previously. “Naturally, the exchange rate has stabilized, because the rate has strengthened from 2.38 point to 2.24 point. This is the level at which all other currencies of other trade partner countries have fallen in relation to USD. Therefore, we cannot artificially create a stronger currency. The current rate reflects Georgia’s trade balance”, Kvirikashvili noted and then answered the question about whether the government implied similar indicator while making the GEL Exchange rate stabilization forecasts. The Finance Minister has made more optimistic forecast concerning the GEL exchange rate. The

government’s economy team has not implied the current realities when talking about the GEL exchange rate stabilization, Nodar Khaduri said. “The exchange rate stabilized along with a growth in exports and tourists inflows”, Khaduri said. Nevertheless, the Georgian national currency is facing a new challenge that is related to current developments in Greece. This country ranks second in money transfers to Georgia. Annual currency inflows from Greece to Georgia marked about 220 million USD, while the last months have recorded a manifest downturn by 15 million USD. This downturn is expected to deepen further. Giorgi Kadagidze, a president of the National Bank of Georgia (NBG) says the current developments in Greece are especially painful in terms of social issues than in terms of decline in financial streams. “The lack of even 100 million USD in terms of money transfers may not be very important amount in the macroeconomic context, but, unfortunately, this problem contains a deeper social

burden. Many our citizens work there and this signifies thousands of Georgian families depend on remittances from Greece. Therefore, this issue, especially at the initial phase, is more painful in terms of social issues. Indeed, we have been supervising the developments”, Giorgi Kadagidze said and added the economic forecast had foreseen a decline of remittances from Greece. “We hope the pessimistic expectations will not justify in the EuroZone that would definitely affect both Georgia and the whole Region”, Kadagidze said. Economic expert Mikheil Dundua rules out the Greek crisis may affect the GEL exchange rate. He assures we should not expect the exchange rate fluctuations because of the crisis in Greece. “In the first half of 2015 we received 85 million USD from Greece and we expected to receive the same amount in the second half too. In case of the worst scenario, the remittances may halve to 40 million USD and this amount cannot affect the GEL exchange rate stability and the macroeconomic parameters”, Mikheil Dundua said.

Amendments to Revise the 2015 State Budget

he Georgian Parliament is discussing a bill of amendments to the Georgian law on the 2015 state budget. What changes will take place in the budget parameters and distinct pro-

grams? According to distinct packages, the revenues made up 9.9 billion GEL. Amid a decline in economic growth, tax incomes shrank by 200 million GEL, while other sources of revenues will increase, for example, grants and privatization proceeds. In whole, the budget revenues will grow by 25 million GEL. Changes will concern the loans components too. Namely, the government’s limit for taking loans will increase by 15 million GEL. Foreign debts component will increase by about 185 million GEL. Donor-financed projects will shrink. In whole, the foreign debts part will increase by 115 million GEL, while issuance of domestic securi-

ajara business week

ties will shrink by 100 million GEL. Payments part remains unchanged and makes up 9.575 billion GEL, but the current expenditures will grow by 15 million GEL, while capital expenditures will decrease by 55 million GEL. At the same time, the consolidated budget deficit will decrease by 48 million GEL and the state budget deficit will increase by 99 million GEL. As to specific allocations: a major 8% decline is planned in the Agriculture and Energy Ministries, the Interior Ministry budget will be cut by 7%, the Environment Ministry allocations will shrink by 6%, the budget of the Regional Development and Infrastructure Ministry will shrink by about 5.5 million GEL. Namely, expenditures for road infrastructure improvement and road construction-protection will decrease. The Defense Ministry budget will increase by 4%. As to the education direction, the Education Ministry budget will shrink for secondary education,

RUSSIA RUSSIAN TYCOON BIDS $200 MN FOR CONTROL OF SWEDISH CTC MEDIA

he UTV media holding of Russian tycoon Alisher Usmanov has bid $200m for 75% of CTC Media from Sweden’s Modern Times Group (MTG) before a new law limiting foreign ownership of Russian media comes into effect in January 2016. The offer was confirmed in a statement on July 6 by CTC Media. Investors have been rushing to sell stock in the holding comprising several TV channels since it said in June that it had been unsuccessful in its search to find a buyer. CTC Media’s share value plummeted by 28% in the last week of the month and by 57% since January. If the offer is accepted, however, CTC Media is likely to become private and will be delisted, Uralsib analysts said in a note. They expect high volatility in the stock, noting that it is already trading at historic lows amid the stagnating advertising market. “We reiterate our Hold recommendation on the stock,” the analysts said.

SAUDI-RUSSIAN THAW CONTINUES: SAUDIS TO INVEST $10 BILLION IN RUSSIA ECONOMY

audi Arabia’s Public Investment Fund (PIF) plans investing up to $ 10 billion in infrastructure and agricultural projects in Russia in partnership with the Russian Direct Investment Fund (RDIF), Kirill Dmitriyev, told RDIF director. The agreement between the two funds came about as a result of a visit to Russia by the heir to the Saudi Crown Prince Mohammed bin Salman, the Defence Minister of Saudi Arabia, who attended the St Petersburg International Economic Forum in June. The agreement between Saudi PIF and RDIF signals a reloading of economic relations between Russia and Saudi Arabia,told Dmitriyev.

RUSSIA TO SUPPLY 100 SUKHOI PASSENGER JETS TO CHINA

ussia will supply 100 Sukhoi Superjets to China in the next three years, Russian Trade and Industry Minister Denis Manturov said at the Innprom-2015 Defense Exhibition in Yekaterinburg. The first five airplanes will be delivered in 2016. According to Manturov, Russia and China will also jointly manufacture a large passenger airplane and a heavy helicopter.

THE GAS DEAL BETWEEN RUSSIA AND GREECE SUDDENLY LOOKS LESS EXCITING

ack in June, Russia signed a preliminary $2.27 billion agreement on building a pipeline through Greece. The new project is an extension of the socalled Turkish Stream, a gas pipeline designed to bring Russian gas to Europe via Greece, with an annual capacity of 47 billion cubic meters. Russia likes this deal given the strategic geopolitical importance: The Turkish Stream is designed to bypass Ukraine, which allows Russia to maintain its leverage over the EU and to additionally hurt Kiev. Meanwhile, Greece has favorably eyed the project, as it would inject some much-needed cash into the Greek economy come its completion in 2019.

CHINA’S SPACE PROGRAMM MAY BE CARRIED BY RUSSIAN ROCKETS

T research works, access to vocational schools and improvement of quality, summer schools. The freed finances will be directed to general state payments. Namely, the funds will be distributed to budget-financed funds, natural disaster liquidation works and other infrastructural projects. Moreover, the mobilized resources will be directed to serving foreign state liabilities.

he deputy prime minister noted that China is interested “in a number of services and products, which will be very important for the development of the Chinese space program”. The deputy prime minister noted that China is interested “in a number of services and products, which will be very important for the development of the Chinese space program, in particular, for its lunar program.” China’s lunar program is practically impossible withour “certain supplies of equipment from Russia,” Rogozin added.

6 UKRAINE EUROPE’S STRATEGIC INDIFFERENCE OVER UKRAINE AND GREECE

he future of Europe’s security is being played out in Ukraine and Greece. The crises engulfing these two countries are not only economic, stemming from the failures over the years of Athens and Kiev to deal with the fundamental structural weaknesses of their state institutions. The two crises are also about Europe’s inability to recognize that if Greece quit the eurozone and if Europe backed away from giving Ukraine maximum political and financial support, Europe’s security would be at stake.Because Europe has no real security and defense policy and, by implication, no strategy toward Greece and Ukraine, it has depended on NATO—meaning the United States—for its security. The basis of that security is now being challenged because the Europeans have not internalized the threats Greece and Ukraine pose to European security and to the transatlantic relationship.

UKRAINIAN AGRI-FOOD BUSINESSES NEED TO BUILD ENERGY EFFICIENCY STRATEGIES TO MAINTAIN FUTURE COMPETITIVENESS

he Ukrainian agri-food sector needs to reduce its specific energy costs if it aspires to maintain its competitiveness both domestically and internationally. Agriculture is one of the few bright-spots in the Ukrainian economy at the moment. Agricultural commodity exporters trying to expand their global market presence need to continually maintain a focus on improving cost efficiency. Reducing energy costs per tonne is one of the easier variables to focus on initially. At the same time, domestic food companies, faced with rising inflation and energy costs need to enhance their competitiveness by reducing their cost base.

UKRAINIAN INFLATION SLOWS FURTHER IN JUNE AS HRYVNIA STABILIZES

krainian inflation, the fastest in Europe, slowed for a second month in June as the hryvnia stabilized. Consumer prices rose 57.5 percent from a year earlier after surging 58.4 percent in May, the statistics office in Kiev said Monday on its website. That matches the median estimate of three economists in a Bloomberg survey. Prices advanced 0.4 percent from the previous month. Ukraine’s economy is in its second year of contraction as a pro-Russian insurgency in the nation’s east curbs industry and repels investment. Grappling with this year’s second-worst-performing currency against the dollar and predicting 2015 inflation of 48 percent, the central bank kept its benchmark interest rate at 30 percent last month. Having plunged 33 percent in the first quarter, the hryvnia has since rebounded 9.7 percent, data compiled by Bloomberg show. It remains 28 percent lower this year, better only than the Belarusian ruble, and was 1.3 percent weaker Monday in Kiev. Producer prices rose 37.9 percent from a year ago in June compared with a 42 percent increase in the previous month, according to the statistics office. Prices of goods leaving factories and mines advanced 0.6 percent from May.

UKRAINE TO PUMP MORE GAS FROM SLOVAKIA FOLLOWING SUSPENSION OF RUSSIAN IMPORTS

kraine will take about 21 percent more gas from Slovakia to boost deliveries to underground storage after the country suspended imports from Russia over a pricing dispute, transport monopoly Ukrtransgaz said on Friday. Ukraine plans to import 16.5 million cubic meters (mcm) of gas on Friday from Slovakia, up from daily imports of 13.6 mcm so far this month, a spokesman for the company said. He said Ukraine pumped 27 mcm of gas per day from July 1-9 and collected 12.2 billion cubic meters of gas in reserves as of July 10. Ukrainian energy officials say Ukrtransgaz must store about 60 mcm of gas per day to ensure it has enough gas to meet demand during the winter and to guarantee the transit of Russian gas to European consumers.

ECONOMIX

July 13, 2015 #1

ajara business week

How to Join Produce in Georgia Program

mance to the society. According to the statistics of the Ministry of Economy and Sustainable Development, 90 new industrial projects of 252 million GEL were inaugurated. Under the program, commercial banks have issued about 122 million GEL to the private sector. Prime Minister Irakli Gharibashvili expressed his optimism concerning the program. “We will be able to replace imported agriculture products in 1-2 years”, the Prime Minister said. The Finance Minister Nodar Khaduri talked about the program details and explained the government covers 10% of the loans interest rates. “We finance about 10% and in reality enterprises serve 1-3% loans”, the Finance Minister said.

Otar Antia, a head of the Entrepreneurship Development Department of the Entrepreneurship Development Agency explains how citizens can join the program. “They should visit a commercial bank for taking a loan for business inauguration or enlarging and re-equipping the existing one. After that our agency will subsidize the annual interest rate for two years. We also promote startups. We provide 50% participation in the loan guarantee”, Otar Antia said. A new component was added to the program, Otar Antia said. The issue is of promoting foreign hotel networks and brands in Georgia. Moreover, movie industry will be also financed. “We will promote shooting movies in Georgia. If a film obtains an international recognition, the state will cover a part of the expenditures”, Antia said. Gia Jandieri, a vice president for the New Economic School – Georgia: “10 years ago we had 60 000 registered enterprises and the number has risen to 400 000 ones. If 5 000 ones grow among 400 000, this is not much success, even more so the issue is of petite enterprises”, Jandieri said. Shota Gulbani, a vice president for the Association of Young Financiers and Businessmen (AYFB) positively appraises the program, but he asserts entrepreneurs face major problems at commercial banks. “If the enterpriser wishing to join the program had problems with commercial banks previously (overdue payments and bad credit history), they cannot use this program and this is a serious obstacle”, Gulbani said. Amid the state support, commercial banks should take higher risks for sake of the entrepreneurship development, Gulbani added.

Natural Resources and Agriculture to Defeat Poverty

eorgian Prime Minister Irakli Gharibashvili has named priority directions for healing the current grave social situation. The agriculture sector and natural resources are to play a main role in this process. Experts agree with this considerations of the Prime Minister: “Two million individuals, that is, every second person is poor in Georgia. Today representatives of the previous Authorities no moral rights to pose questions about why the Authorities have not assisted the citizens for two years. We ask any professor, any more experienced and skilful specialist to name even one sample and precedent, when the country in similar grave situation has overcome the poverty in two years. This is illusion they create to the population to mislead the society again. Nevertheless, we should develop the agriculture sector and strengthen our village. We have started these projects and nothing is impossible”, the Prime Minister noted. Mr. Gharibashvili also considers Georgia’s natural resources as one of the main sources for development. The Ministries have explored each Region’s potential, he added. “We possess huge potential. Considerations as if Georgia is a poor country and it has no natural resources are erroneous. We have developed the program, Strong Region for Strong Georgia. The economy team and profile Ministries have explored each region’s potential and identified that we possess huge unemployed resources. Unfortunately, we have issued many licenses on unique resources that are not employed, because in various periods these people were lobbied by various officials and they appropriated state resources. These resources remain unemployed today. This is a crime. No one has the right to preserve state owned resources for their own pri-

vate interests. We have completed a description of these licenses and we plan to conduct specific negotiations with these people, who have taken these licenses 20 and more years ago. They do not use these resources and the country is losing several millions of USD and this is inadmissible”, the Prime Minister said. Ramaz Gerliani, a chairman of the center of economic policy experts, is working on resolution of the current problem with unemployed natural resources. The poverty may be overcome through involvement of natural resources in the economy, he told the Commersant edition. “Georgia is a rich country of various resources, but it is considered to be a poor country anyway. Our GDP is about 30 billion USD, while unemployed assets of hundreds of billions of USD must be involved in the economy. If we resolve

this problem in line with the market economy and economic freedom principles, in the shortest period we will defeat the poverty. The current situation looks like a family with assets of several millions of USD that receives poverty allowances”, Gerliani said and added a political will is required to valuably employ the resources. Without these measures it is useless to talk about poverty overcoming for the nearest 15 years. Gia Zhorzholiani, a chairman of the parliament’s committee for environment protection and natural resources, proves Georgia does not employ natural resources reasonably and efficiently. “This process was not controlled. The Authorities should develop more purposeful, foreseeable and perspective policy and we are preparing similar legislation. At the same time, we should carry out coordinated policy. Licenses should work more efficiently”, Gia Zhorzholiani said.

TOURISM

July 13, 2015 #1

Ajara Region to Draw One billion USD Investments

djara has significant potential, distinguished resources and the Government will support to the best of its ability all interesting projects implemented in this region – said Irakli Garibashvili. This potential was about to be realised - Garibashvili announced several future projects, of which more than $1 billion USD (about 2.3 billion GEL) will be invested in the Adjara region. These projects are: Rekan Group Georgia will invest $50 million USD in a new hotel; Orbi Group will invest 30 million GEL in a new hotel and apartment complex; and Yalchini will invest $9 million USD on a 100bedroom hotel. The PM’s nationwide tour is part of his promotion of the Governmental program ‘Strong Regions for Strong Georgia’. Meanwhile, in Batumi today PM Garibashvili attended the official opening of the Hilton Batumi Hotel. In his speech he recalled all the hotels

which had opened in Batumi since 2012. These hotels were: Five-star Divan Suites Batumi; Batumi Apart Hotel in which $5 million USD was invested; Five-star Hilton Hotel, in which $137 million USD was invested; and Centro-Medi Hotel, where $2.5 million USD was invested. “This year alone $366 million USD was invested in the Adjara region,” said Garibashvili. “Foreign Direct Investments (FDI) in 2014 increased by 81 percent compared to 2012 and amounted $276 million USD. FDI increased by 42 percent in 2014 compared to 2013 when FDI was $195 million USD. As for the total sum of future investment projects, it exceeds $1 billion USD,” said Garibashvili. As well as developing the country’s hotel industry, Garibashvili recapped the Government’s work across a range of sectors, such as healthcare, roads, education, hydro power and agriculture industries.

Georgia’s Incoming Tourism Grows

growth marked 3.5%. Belarus ranks first (+47%), Kazakhstan is second (+32%), Lithuania is third (+27%), UAE is fourth (+22%), Germany is fifth (+18%), and the USA is sixth (+12%). According to the national tourism administration, the recent natural disaster in Tbilisi has not made a significant effect on the tourists inflows. The office explains this factor by performed advertising campaigns. The country has spent 4.4 million GEL on AD campaigns in 2014. As a result, the country managed to attract 5.5 million tourists. The figure will rise to 7.8 million tourists in 2015. This year Georgia will introduce a national tourism strategy in order to make these activities structured. The national tourism administration of Georgia has been cooperating with international organization Solimar International and the World Bank (WB) for the strategy development. Main part of the strategy will be represented by marketing companies jointly with the infrastructure development project. The main goals of the strategy are as follows: developing the national economy, growth in employment and promotion

of the business sector, upturn in investments inflows and drawing more tourists for the internal sector development. The national tourism strategy is to share the experience of tourists, develop infrastructure, services, upgrade education, develop and improve the existing products. The strategy will also determine AD campaigns strategy. AD Campaigns will be conducted abroad through the internet television and other means in line with peculiarities of the travel basket of the target country. The AD campaigns include three components: identification of the country as a brand on the tourism map, usage of the country advantages and growth in Georgia’s ratio in the tourism market. Today special accent is made on tourism sector because this sector is an only foreign currency source that has not declined compared to other sources. As reported at least 30% contraction was registered in the part of exports, investments and money transfers. In this situation the country hopes the tourists inflows will further grow.

One Visitor Spends 225 USD in Georgia on Average

he Association of Young Financiers and Businessmen (AYFB) has held a briefing on the topic: Active Phase of the Tourism Season will Stabilize the Economy. AYFB analyst Paata Bairakhtari noted the association analyzes the current developments in the tourism sector. The analysis has showed an active phase of the tourism season will stabilize the economic situation in Georgia and neutralize foreign negative factors. “In the first quarter of 2015 a total of 986 366 international visitors arrived in Georgia, down 2% compared to the same period of 2014. This was a logical tendency, because the regional crisis has hit almost all neighboring countries, while 91% of the 1Q15 visitors have come from the very neighboring countries. At the same time, the first half o 2015 has recorded an entirely different reality. Namely, the number of visitors in January to June period increased by 3.5% compared to the first half of 2014. It is worth noting the visa policy restriction has also made a certain influence on tourists inflows and on a disposition in the rating of top countries. For example, Iran ranked sixth in the rating, but now the country has moved to the 10th position, while China and Iraq have left the list of 15 top countries. They were replaced by Lithuania and Belarus. The last period has recorded a considerable growth in visitors’ inflow from Germany. In 1Q15 the number of visitors increased by 64%. An upturn is also reported from Belarus, Kazakhstan and the United Kingdom with 39%, 29% and 14% respectively. As to the EU countries, their ratio in total quantity is under 3%. According to the 1Q15 report, the rating of the 15 top countries is as follows:

ajara business week

AZERBAIJAN AZERBAIJAN INTRODUCES NEW CAR INSURANCE TRACKING SYSTEM

n the next two to three months, a new system will be in place allowing State Traffic Police to able to easily check the car insurance policies using radar technology. Special equipment to be installed on the roads will transmit the necessary information about each car that passes, including its state registration number to the Compulsory Insurers Bureau ISB, said NamigKhalilov, head of the State Insurance Supervision Service. The ISB, established by mandate from the law “On compulsory types of insurance” in 2011, will detect the driver’s car insurance policy based on data it has received. The ISB information system integrates with the vehicles and identity cards database at the Interior Ministry to resolve any technical issues concerning the new trafficking system. The ISB, which oversees 15 companies, 11 of which have the right to sell compulsory motor liability insurance policies, will allow the switch to the electronic system of the insurance policy in accordance with the integration.

AZERBAIJANI OIL PRICES RISE

he price of AZERI LT CIF Augusta stood at $58.23 per barrel on July 8 or $0.94 per barrel more compared to the price on July 7. Azeri Light oil is produced from the AzeriChirag-Gunashli offshore fields. It is directly delivered to the Turkish port of Ceyhan via the Baku-Tbilisi-Ceyhan main export oil pipeline, and to the Georgian port of Supsa via the BakuSupsa pipeline. AZERI LT FOB Ceyhan oil price was $57.25 per barrel or $0.99 per barrel more than the previous price. Azerbaijan also exports URALS oil from the Novorossiysk port, which is delivered via the Baku-Novorossiysk pipeline. The price of URALS (EX-NOVO) was $54.73 per barrel on July 8 or $0.93 per barrel more than the previous price. The price of Brent Dated, produced from the North Sea, was $55.71 per barrel on July 8, or $0.98 per barrel more than the previous price.

AZERBAIJANI BANKS INCREASE RESERVES

he expanded monetary base in Azerbaijan totaled 7.984 billion manat as of June 1, 2015, the report of the Central Bank of Azerbaijan as of January-May said. In annual terms, the monetary base in Azerbaijan decreased by 29.76 percent in 2014. For comparison, as of April 2014, this figure was 113.5 billion manat or by 1.44 percent. As of June 1, 2015, the monetary base in manat amounted to 7.597 billion manat versus 11.272 billion manat as of June 1, 2014. In the mentioned period, the volume of money in circulation amounted to 7.129 billion manat, while this figure was 10.750 billion manat as of June 1, 2014. The ratio of the mass of cash in circulation to the monetary base was 89.3 percent as of January 1, 2015, decreasing by 5.3 percent compared to the same figure as of June 1, 2014. The bank reserves amounted to 849.2 million manat during this period or by 41.56 percent more than in the same period of 2014 (599.9 million manat).

AZERBAIJANI STATE OIL FUND REVEALS VOLUME OF REVENUES FROM LARGEST GAS PROJECT

T AZERBAIJAN - 283 504 VISITORS TURKEY – 261 756 VISITORS ARMENIA – 228 305 VISITORS RUSSIA – 123 109 VISITORS UKRAINE – 23 608 VISITORS GERMANY – 6 101 VISITORS KAZAKHSTAN – 4 953 VISITORS THE USA – 4 731 VISITORS POLAND – 3 188 VISITORS IRAN – 3 108 VISITORS THE UNITED KINGDOM – 2 778 VISITORS BELARUS – 2 662 VISITORS

GREECE – 2 526 VISITORS ISRAEL – 2 617 VISITORS LITHUANIA – 2 294 VISITORS. One visitor spends 225 USD in Georgia on average, Bairakhtari added. “As to the foreign currency inflows from the tourism sector, in the first quarter one visitor has spent 225 USD on average, totally 241.300 million USD. The tourists inflows considerably grow after the first quarters. Therefore, in the summer season amid the 2015 Youth Olympic Games we expect the increased number of tourists will spend much more foreign currency and this factor will make positive effect on the national currency stability”, Bairakhtari said.

he State Oil Fund of Azerbaijan (SOFAZ) received $2.31 billion from the implementation of the project for development of Shah Deniz gas and condensate field in the Azerbaijani sector of the Caspian Sea from 2007 to July 1, 2015, SOFAZ told Trend July 9. SOFAZ said it has received $190 million within the Shah Deniz project in H1 of 2015, including $31.8 million in June. The contract for development of the Shah Deniz offshore field was signed on June 4, 1996. The field’s reserve is estimated at 1.2 trillion cubic meters of gas. The shareholders are: BP, operator (28.8 percent), AzSD (10 percent), SGC Upstream (6.7 percent), Petronas (15.5 percent), Lukoil (10 percent), NICO (10 percent) and TPAO (19 percent). The State Oil Fund was created in 1999 and its assets were equal to $271 million that time. The assets of SOFAZ dropped by 5.86 percent and exceeded $37.104 billion as of Apr.1, 2015, compared to about $34.931 billion in early 2015.

8 ARMENIA SERZH SARGSYAN MAKES SPEECH IN UFA, HIGHLIGHTS IMPORTANCE OF ARMENIA-IRAN RAILWAY CONSTRUCTION

s a friendly neighbor of Iran, Armenia sincerely wants talks on Iran’s nuclear program to be crowned with success, Armenian President Serzh Sargsyan said yesterday, on July 9, in Ufa during summits of BRICS, the Eurasian Economic Union (EEU), and the Shanghai Cooperation Organization (SCO). According to the press service of Armenian president, Serzh Sargsyan delivered a speech in which he addressed the project aimed at unifying the Eurasian integration and the Silk Road Economic Belt initiative, which he said can interact harmoniously and ensure a new level of implementing large infrastructure and transport projects. “In case of Armenia, the construction of Armenia-Iran railway may become such a project that could provide access of EEU countries to the Indian Ocean through the Persian Gulf. A feasibility study was already carried out, and the project is open to state-private partnership. We hope that companies of the countries present here will show interest,” the Armenian president said.

ARMENIA’S REGULATORS FINE RUSSIAN-OWNED ELECTRIC UTILITY COMPANY

ust days after facing mass protests against an electricity price hike, Armenia’s troubled power distribution network was fined 60 million drams ($126,000) on Wednesday for what state regulators called a violation of consumer rights. The Public Services Regulatory Commission (PSRC) penalized the Electricity Networks of Armenia (ENA) utility for demanding earlier this year advance payments from residents of newly built houses and apartment blocks needing access to electricity. The ENA’s embattled chief executive, Yevgeny Bibin, ordered such payments in March in addition to regular connection fees collected from new consumers. The Russian-owned company promised to deduct corresponding sums from their electricity bills for the next few years. Many of those home owners seeking power supplies rejected the ENA’s extra charges, leading the PSRC to investigate the matter.

ARMENIAN EMBASSY IN BRUSSELS HOSTS EVENT TO BOOST BUSINESS LINKS BETWEEN ARMENIA AND BELGIUM An event aimed at boosting business links between Armenia and Belgium was held yesterday, July 8, in the Armenian embassy in Brussels, Armenian Foreign Ministry said. A number of memorandums of understanding were signed at the event. The memorandums were signed by Armenia Development Fund on the one hand, and Wallonia Export and Investment Agency, the Walloon Union of Enterprises, and the Chamber of Commerce of Brussels on the other. Armenian Ambassador to Belgium Tatul Margaryan said the strengthening and deepening of cooperation between Armenian and Belgian agencies and unions specializing in trade and investment attraction will enhance the efficiency of bilateral cooperation in those spheres and promote contacts of business circles.

ARMENIA GUILTY OF OCCUPATION OF AZERBAIJANI LANDS

he European Court of Human Rights (ECHR) finally issued a ruling on the lawsuit of IDPs from Azerbaijan’s Lachin district “Chiragov and Others v. Armenia” where it places blame on Armenia for occupation of Azerbaijani lands, said the article by Raoul Lowery Contreras published in The Hill newspaper. The author said that ECHR’s ruling may exercise heavy influence over potential settlement of the Armenian-Azerbaijani Nagorno-Karabakh conflict. According to the ECHR’s ruling of June 16, Armenia is responsible for the aggression against Azerbaijan and the occupation of almost 20 percent of the country’s territory, Contreras wrote. The conflict between the two South Caucasus countries began in 1988 when Armenia made territorial claims against Azerbaijan. As a result of the ensuing war, in 1992 Armenian armed forces occupied 20 percent of Azerbaijan, including the Nagorno-Karabakh region and seven surrounding districts.

ECONOMY ajara business week

July 13, 2015 #1

Georgia Embraces Visa PayWave Technology

eorgia is the leading nation among more than a dozen countries in the Commonwealth of Independent States (CIS) and South-East Europe (SSE) region to embrace a contactless payment service where users can pay for a product in a matter of seconds. Interest in the Visa payWave service has grown immensely in Georgia over the past six years since it was first introduced and today, Georgia was the leader of 17 countries in the CIS and SEE region, where Visa cards were issued, said a Visa spokesperson. Nowadays more Georgian customers pay by Visa payWave than in 2009 when the company first entered Georgia. Visa payWave is a contactless payment solution based on EMV chip technology where users hold their card up to a special terminal and money is automatically deducted from their account. With Visa payWave card consumers can pay almost instantaneously in one “wave” at any merchant equipped with Visa payWave contactless POS-terminal. A Visa payWave card doesn’t need to be swiped or dipped into the payment terminal, and customers do not have to sign or enter a PIN for transactions up to 45 GEL. Georgia was the first country in the CEMEA region (Central Europe, Middle East and Africa) where we piloted Visa payWave contactless technology in 2009. From 2013 we have seen a growing interest in Visa contactless payments in the region and in Georgia in particular, both on issuing and acquiring,” Visa Emerging Products and Innovations Director Andrei Shcherbina specifically told Agenda.ge. Visa statistics showed in September 2014, Visa payWave experienced a whopping 2,746 percent year-on-year growth compared to the number of transactions conducted in September 2013. In September last year there were 148,615 Visa payWave transactions in Georgia, which valued $1,845,748 USD. In this month the number of Visa payWave transactions made up 11 percent of all Visa transactions. The average value of a Visa payWave transaction was $12.42 USD – the maximum amount able to be spent using the payWave technology is 45 GEL. Shcherbina elaborated on the results of the Visa payWave scheme in an interview with The FINANCIAL newspaper, where he said: “Georgians appear to be very progressive in terms of adopting payment technologies and banking technologies in general. It can be compared to only a very limited number of countries worldwide. Therefore, we expect for Georgia to soon become one of the leaders in cashless payment systems in the CIS&SEE region.” The most popular areas where Georgians used their Visa payWave cards in September 2014 were in grocery stores and supermarkets, where 421,480 transactions were carried out and totalled $2,690,086. The next popular place was petrol stations, where 119,505 transactions worth $2,056,751 took place. Other popular places where Visa payWave cards were used: • MISCELLANEOUS FOOD STORES (175,823 TRANSACTIONS TOTALLING $1,960,959); • DRUG STORES AND PHARMACIES (107,213 TRANSACTIONS TOTALLING $1,000,889);

• RESTAURANTS (44,489 TRANSACTIONS TOTALLING $521,684); • CLOTHING STORES (31,800 TRANSACTIONS TOTALLING $864,169); • BARS/TAVERNS/LOUNGES/CLUBS (28,390 TRANSACTIONS TOTALLING $278,525); • COSMETIC STORES (14,355 TRANSACTIONS TOTALLING $264,568); • AUTOMOTIVE PARTS STORES (4,190 TRANSACTIONS TOTALLING

$247,947); AND • ELECTRONIC STORES (3,641TRANSACTIONS TOTALLING $480,851). The Visa statistics also revealed Polish visitors were more likely to use their Visa payWave cards to purchase items in Georgia than other international guests. Polish travellers conducted 1,941 Visa payWave transactions worth $28,426 in September 2014, followed by the travellers from the Russian Federation (984 transactions totalling $38,226), Ukraine (830 transactions worth $14,405), Turkey (660 transactions worth $9,064), the United Kingdom (610 transactions valued at $6,776), Canada (458 transactions worth $6,524), Spain (358 transactions totaling $9,891), Germany (312 transactions worth $12,001), Slovakia (144 transactions valued at $52,975) and Cyprus (136 transactions worth $12,624.14). In Georgia TBC Bank and Liberty Bank and the only two banks that issue Visa payWave cards, while banks that acquired the technology are TBC Bank, Liberty Bank, Bank of Georgia, Bank Republic and VTB Bank. Among the first businesses in Georgia to adopt the Visa payWave service were MacDonald’s, Carrefour, GoodWill, and petrol chains like Gulf and Wissol. www.agenda.ge

Visa payWay statistics of December 2014 shows supermarkets were the most popular places where people in Georgia used their Visa payWay cards

BUSINESS

July 13, 2015 #1

Buy Apartments at “MetroCity” Residences With Internal Credit

.S.C. “Metro Atlas Georgia” Investment Management Company was founded in 2012 and has invested mega project “MetroCity” in Batumi. ”Metro Atlas Georgia” is under the ownership of the brand “Metro Holding”, which has its share on Istanbul Stock Exchange, in Turkey and leads over 35 000 employees in more than 70 companies worldwide. “Two residential complexes include 464 apartments. Those who cover the down payment of 10% of the apartment price, remaining amount will be paid over the next 36 months with 3 % interest per year and who cover 25% remaining amount will be paid over the next 60 months with 5% interest per year. In this way we try to increase the activity of the residence” – said Irma Kamadadze, the head of sales group at MetroCity. STARTING PRICE FROM 1425$ With the ideal size of the apartments, numerous value-added services and impeccable location, “MetroCity” residences offers an exclusive lifestyle, with parking, green area, outdoor swimming pool and playground for children. ”MetroCity” is unique with its special maintenance services. According to Mrs. Irma Kamadadze the owners

of residences will receive added services such as Telephone, Messages and wake-up call services, Visitors Monitoring, Common Area and Visitors control, 24/7 Safety and Security, Shopping Assistance, Concierge, 24/7 Technical Service Assistance, Housekeeping and cleaning service. The project implementation has begun in February 2015 and will be successfully completed in April 2017. Residences from 38 m2 to 300 m2 are available. “Our residences are unique because only we have specially designed outdoor pool for the residences that is absolutely free of charge” – said Kamadadze. Near the residences MetroCity project includes two five star hotels, private school and private swimming pools, panoramic terrace restaurants, casinos, spa, shopping center including 100 brand stores, sport club, a la carte restaurants, cinema, bowling center, playing park for children, closed gold sand beach and the biggest conference hall in Transcaucasia for 1500 person. ”Metrocity” is in 2 km. distance from Batumi International Airport and from the city center in 500 m. The complex with its location is harmoniously mixed with mountains and sea views. Here is everything where the friends and family gather.

What Would Food Pairs be Like if They Were Actual Couples - Foodpanda

veryone likes coupling. Mornings go with coffee, cinema with popcorn, and football with beer. We mix and match, but ultimately some couples just work better together. This applies to many cases, the first being love relationships and a close second, foods. Still, there are pairings and pairings: Some are unpredictable, some eccentric, some odd, some explosive and some just perfect. Foodpanda (www.foodpanda. ge) loves pairing foods and analyzed their relationship as if they were actual couples. 1. THE SOCIALLY SILENT COUPLE: SPAGHETTI & MEATBALLS The socially silent couple is actually only silent about one topic – their relationship. These two are social media-active across multiple platforms, posting selfies, having brunch with friends on Instagram, etc. But this couple has no social media posts about each other. If you didn’t know they are in a relationship you might as well think they are single. My guess is either they’re both trying to play it cool (while being horrified by the idea of commitment), or they just want to keep their options open. 2. THE PDA (PUBLIC DISPLAY OF AFFECTION) COUPLE: BURGER & FRIES Ugh. Whether these two are fighting or are just going to the supermarket, they can’t stop talking about each other. These oversharers’ posts are the most recurrent you see when scrolling through your news feed. They spend more time kissing than talking. They’re the type who will go to a party and will spend the whole time just the two of them, making out or just being ridiculously happy. 3. THE COUPLE WHERE ONE IS WAY MORE INTO IT: PANCAKES & MAPLE SYRUP It’s instantly obvious when you come across one of these couples. It’s a combination of the above two categories – one part oversharer, one part socially silent. She’s totally head over heels in love with him,

ajara business week

becoming all syrupy and gooey, while he’s not all that bothered, really. He just sits there, without really putting any effort in this relationship. She’s totally in love daydreaming about their wedding day, meanwhile he’s on Tinder, keen on meeting different people and clearly not ready for a commitment. 4. THE AWKWARD COUPLE: PEANUT BUTTER & JELLY They are quite clearly not good for each other, and it’s a pretty unhealthy relationship, but somehow they just can’t keep away. No matter how many times you tell them that it’s not a clever idea to be with each other, they ignore all advice and invest on in a dysfunctional union, and acting all Romeo & Juliet about the situation. 5. THE ALWAYS-ARGUING COUPLE: CHOCOLATE & ORANGE It’s the couple you have long given up in trying to separate or reunite. They might even make you pick sides. These two love each other, but in such strange ways. Both are strong, opinionated and autonomous and don’t like to be told what to do. None of them surrenders or admits defeat easily. They act completely different when they are apart and hang out with dissimilar groups of people, and yet, when they are in truce they are such an invigorating duo. 6. THE SECRET AFFAIR COUPLE: CHOCOLATE & SALT Giveaway details: Paranoid glances around the

room, secretive hand touching, giggling, and looking intensely in the eyes. This pairing can’t go unnoticed as they bring out each other’s flavors. They think people don’t know they love each other, but everybody knows really. 7. THE EFFORTLESSLY COOL COUPLE: CHEESE & WINE They look like best friends, fight like brother and sister and dance like a duet. The most astounding characteristic is the balance between independence and interdependence. They have clear boundaries; they are separate people with separate interests, and when they come together their qualities are amplified. 8. THE POWER COUPLE: STRAWBERRIES & CREAM She’s the most beautiful girl, he’s the most hansom boy. They are proficient in multiple sports, they have super white teeth and they wear matching clothes. Oh, and they are usually blond and slightly posh. 9. THE COUPLE THAT NEVER GOES OUT. EVER. : COOKIES & MILK They are so wrapped up with each other that you forget if you’ve seen either of them the last month. They always go for the stay-in option to cuddle on the couch, watching romantic comedies. 10. THE JEALOUS COUPLE: FISH & CHIPS They are so paranoid about the other cheating; they check each other’s phones and stalk the Facebook profiles. The are always asking about their ex, still worrying they are not over them. You always feel their mistrustfulness and competitiveness when you are around them. 11. THE UNEXPECTED COUPLE: MELON & PROSCIUTTO You have no idea how these two work so well together, but they definitely do. They are diametrically opposed. She likes to read, he doesn’t even have a magazine at his place. He’s sporty, she can’t even be bothered to take the dog out for a chilled walk. She’s fiery and passionate, he’s calm and comforting. He’s really, really tall, she’s tiny.

WORLD GREECE HAS A PLAN

n 8 july, Greece submitted its latest round of bailout proposal to its European creditors, ahead of a midnight deadline. The Financial Times noted that this plan is part of a request for a new 3-year bailout. Headlines from Bloomberg on Thursday evening characterized this plan as similar to the European Commission’s plan presented on June 26. This plan prompted Greek prime minister Alexis Tsipras to call a surprise referendum on the issue. Greece voted firmly against this plan. Greece’s proposal on Thursday includes debt restructuring, a 35 billion euro growth package, a proposed primary budget surplus equal to 1% of GDP in 2015, followed by surpluses of 2%, 3%, and 3.5% from 2016-2018. This plan also has the same value-added-tax reform effective as of July 1, which targets a net revenue gain of 1% of GDP. This plan also proposes an increase on corporate taxes to a rate of 28% from 26%

CHINESE STOCKS ARE SOARING FOR THE SECOND DAY IN A ROW

he heavy government intervention to support Chinese share prices is paying off, for now. For a second consecutive session stocks are soaring. In early trade the benchmark Shanghai Composite index added 6.4%, taking its two-day increase to 11.7% which, if sustained, will mark the largest rally seen on the index since September 22, 2008. Large-cap stocks are outperforming with the SSE 50 index of the 50 largest firms listed in Shanghai, putting on 6.6%. The moves seen in Shanghai are being replicated in other parts of the country. The Shenzhen Composite has added 4% with the tech-heavy ChiNext index up by a similar amount. Unsurprisingly, the CSI 300 and 500 indices, comprising the 300 and 500 largest listed firms in Shanghai and Shenzhen, have put on 6.5% and 5% respectively.

THE 10 MOST AFFORDABLE CITIES IN THE WORLD

f all the cities in the world, your dollar will go the furthest in Mumbai, India. It’s currently the cheapest city to live in, according to the Economist’s World Cost of Living Index. The index, which is calculated every other year, compares countries based on the cost of things like food, drink, clothing, rent, transportation, and utility bills. It’s designed to help companies figure out how much to compensate employees who are working overseas.

10. RIYADH, SAUDI ARABIA 9. JEDDAH, SAUDI ARABIA 8. PANAMA CITY, PANAMA 7. BUCHAREST, ROMANIA 5. KATHMANDU, NEPAL 4. DAMASCUS, SYRIA 3. NEW DELHI, INDIA 2. KARACHI, PAKISTAN 1. MUMBAI, INDIA IMF CUTS WORLD GROWTH OUTLOOK

he IMF cut its forecast for global growth this year, citing a weaker first quarter in the U.S. and warning that financial-market turbulence from China to Greece clouds the outlook. The world economy will grow 3.3 percent in 2015, less than the 3.5 percent pace projected in April and slower than the 3.4 percent expansion last year, the International Monetary Fund said in revisions to its World Economic Outlook released Thursday in Washington. The fund left its forecast for growth next year unchanged at 3.8 percent. While the IMF left its 2015 projections for China and the euro area unchanged from April, it singled out both economies as areas sources of potential risk. Chinese stocks have tumbled in recent weeks and Greece is struggling to reach a deal with European creditors to stay in the euro area.

TRAVEL TO AJARA ajara business week

July 13, 2015 #1

Top 10 Reasons To Visit Ajara

soviet times, Batumi was developed into a popular seaport and tourist destination. To this day, Batumi is still distinguished by a variety of buildings of different architectural styles.

1. GEORGIAN HOSPITALITY AND GOODWILL Exceptional hospitality and the goodwill of the Georgian people make every trip to Georgia very special. According to an ancient Georgian proverb, God sends visitors to Georgia. As such, Georgian culture has developed a strong culture of hospitality. As a guest in Georgia, you will not only experience unparalleled hospitality, but you will also be astounded by the genuine kindness of the Georgian people.

2. THE CULTURE OF GEORGIAN SUPRA AND TRADITION OF TAMADA The Georgian supra (a traditional feast) has no equivalent around the world. The culture of toasting does exist in many cultures; however, the Georgian “tamada” or toastmaster has no parallel. The role of the tamada is to lead the supra. The tamada is considered to be the most honorable member of a traditional Georgian supra. The ideal tamada is well educated, has extensive knowledge of Georgia’s history and culture, is eloquent, is sociable, has a good sense of humor and has musical ability. The tamada should be able to lead a series of toasts on a variety of topics. He should also be able to entertain guests with poems, songs and interesting stories. The Georgian supra is a fundamental element of Georgian identity, which is why the tradition has been preserved to this very day. In total, there are approximately 300 different toasts, some of which are obligatory for each supra, regardless of its duration.

3. AJARIAN CUISINE AND WINE A traditional Georgian feast is a superb display of the diversity of Georgian cuisine, cooking techniques, table-setting traditions and other accompanying rituals. Ajarian cuisine is an inseparable aspect of Georgian cuisine; however the cultural influence of Asian cuisine can be clearly seen in a variety of Ajarian dishes. In mountainous Ajara, dairy products are common ingredients in many dishes. Boatshaped Ajarian khachapuri is one of the most famous Ajarian dishes. Sweets also play an important role in Ajarian cuisine. Viticulture is an essential component of Georgian and Ajarian culture that has been cultivated for hundreds of years. In total, there are around 50 different grape species that are still used in wine production to this very day.

4. LONG SEA SEASON, UNIQUE AIR AND UNFORGETTABLE LANDSCAPES Batumi is an attractive destination not only during the summer season but also in spring and autumn. Visitors can sunbathe or swim as early as the beginning of May. The sea becomes even more pleasant during September and October, given Batumi’s long Indian summers. Winters are warm and summers are hot in Batumi. In addition to the seaside, visitors can also trek to the amazing mountainous regions of Ajara. Just a few hours away from the seaside, one can enjoy the spectacular views from the mountains of Ajara at an elevation of 2000-2500 m above sea level. In Ajara, tourists thoroughly enjoy the unique combination of the region’s mountains and sea, as well as its beautiful landscapes and calming environment.

5. HISTORICAL AND MODERN ARCHITECTURE Batumi is one of the oldest cities in Georgia founded as before the Common Era. The initial settlement, Batus, is mentioned in sources from the 4th century BCE. The city’s unique history has contributed to the city’s vast architectural diversity. In the 19th century, during the “Porto Franco” period, European architects completed a number of interesting architectural projects. Later during the soviet and post-

6. UNFORGETTABLE DOLPHIN SHOW Batumi’s visitors frequently see dolphins swimming in the Black Sea. Therefore, the dolphin is one of the symbols of Batumi. That is also why there are several sculptures of dolphins interspersed throughout the city. Established in 1974, the Batumi Dolphinarium is one of the calling cards of Batumi and is highly popular among tourists and locals. The dolphin shows are offered in three languages, making the show appealing to visitors from all over the world. Come and swim with the dolphins of Batumi at the Batumi Dolphinarium!

7. ONE OF THE LONGEST SEASIDE BOULEVARDS IN THE WORLD The construction of Batumi Boulevard was started in 1881 by a Prussian gardener and landscape architect and later completed by a French architect. The boulevard is distinguished by its beauty and diversity. It is also regularly developed and beautified by the addition of fountains, modern sculptures and other tourist attractions. Nowadays, the boulevard is 8 km long and is distinguished by its broad walking and bicycle paths, evergreen plants, its unique combination of magnolias and palms, fountains, bungalows, café-lounges and children’s attractions.

8. ONE OF THE RICHEST IN THE WORLD BOTANICAL GARDEN If you love nature and a cozy environment, amazing views of the sea and the scent of plants and flowers, Batumi Botanical Garden is the ideal place for you. The botanical garden has no comparison - its plants come from completely different climatic and landscape zones and grow together in harmony. For example, the garden has Canary Palms growing side by side with Japanese Sakuras. In total, the garden features a thousand species of astonishingly beautiful and unique flowers.

9. VARIETY OF TYPES OF TOURISM AND DIVERSITY OF NATURE The combination of seaside resorts and mountainous areas makes Ajara an ideal tourist destination. The resorts located at 1500-2000 m above sea level have excellent conditions for visitors all four seasons of the year. They are also ideal for romantic weekend getaways with your significant other. The coniferous forests in Ajara’s mountainsides contribute to the healthy ionization of the air, which has healing properties. In addition, the protected areas in Ajara and the region’s other natural treasures offer unforgettable experiences for eco tourism enthusiasts.

10. GEORGIAN CULTURE AND UNIQUE FOLKLORE Georgia, is one of the oldest Christian countries in the world, which has had a significant influence on Georgian culture. Gonio, one of the oldest settlements in Georgia, is located in Ajara. It was inhabited in the 8th-7th century BCE. Gonio Fortress, which was built by the Romans, has mythic ties to the legend of Jason and the Argonauts . Ajara is famous for its stone-arch bridges and different religious monuments. The monasteries, Gelati and Bagrati recognized by UNESCO as World Heritage Sites are located just a few hours’ drive from Batumi. Tbilisi, Mtskheta and other parts of Georgia are also very rich in unique and diverse cultural monuments. Moreover, non-material culture, such as Georgian polyphony and dances, are important parts of Georgian culture. Ajarian songs and dances occupy a special place in Georgian folklore. gobatumi.com

July 13, 2015 #1

HEAT BATUMI ajara business week

Heat Batumi Begins!

eat Batumi 2015” is a special Batumi summer season project which covers a two-month period schedule of various festivals and entertainment events in a non-stop fashion. From July 6th to September 15th, each week Batumi will pay host to various kinds of events, which will be communicated under an umbrella brand of “Heat Batumi”. The Batumi City Hall and City Council are the executors of the project, along with the Ministry of Culture and Monument Protection of Georgia, “The Investment Fund for Culture Development”, National Administration for Tourism and the Ajara Tourism Department. “Heat Batumi” is a government project that has the goal of promoting Ajara’s tourism potential on one hand and the entire country as a whole to inner and outer target audiences on the other.

The project opened on July 6th with its week-long Georgian folk art celebration, hosting various ensembles and vocal and dancing groups on Batumi’s open stage and the Batumi Summer Theater. The traditional-oriented week will be followed by contemporary singers and artists like Sopho Khalvashi and the Black Sea Band starting July 13th, along with interesting projects like the opening of “Street Piano.” The 60 days of Heat Batumi will 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.

PUBLICITY ajara business week

July 13, 2015 #1

• 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