Caucasus Business Week #151

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June 27, 2016 #151

June 27, 2016, Issue 151 - www.cbw.ge

Tourism The True Cost of a Holidays in Georgia.

Will Your Budget Stretch Enough?

Pg. 7

World Turkey’s touristic resorts almost empty as crisis deepens in sector Pg. 13

Energy sector Georgian Energy Sector Development Perspectives without Khudoni HPP Pg. 8 Why Mobile Tariffs are on Rise?

The cellular communications market of Georgia has always demonstrated principles incompatible with the free competition standards. There were times, when for 20 years all three companies had set the same service tariff of 28.8 Tetri per minute. In 2010 the Georgian National Communications Commission (GNCC) explored the market and discovered that cellular communication companies used to spend only 15 Tetri on one-minute call to external networks, while intranet call prices were no more than 5 Tetri.

As a result of the market examination, the GNCC introduced upper margin retail tariff in the amount of 25 Tetri and announced gradual reduction in interconnection tariff, while this tariff makes much contribution to the retail tariff formation. Six years ago the interconnection tariff was 14 Tetri, while the tariff declined to 3.5 Tetri for all operators as of January 1, 2015.

Pg. 4

Universal Healthcare Program Effectiveness Relies on Subsidization of Drugs Component The research work conducted by Curatio international foundation also examines the medication attainability issue – Prices and Physical Attainability of Medications.

According to the report, Georgiamade medications are expensive by 30% compared to imported analogues. Moreover, at pharmacies the level of extra charges of original brands with prescription is twice higher compared to the level of extra charges of medications without prescriptions.

It should be also noted that despite the national currency appreciation, prices of medication have not declined. On the contrary, in some cases they have even increased. So far pharmaceutical companies have named GEL instability and high-level imports as a reason for growth in prices. It is interesting what factors precondition a growth in medication prices amid the GEL exchange rate appreciation?

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2 GOVERNMENT

NEWSROOM US officials applaud PM Kvirikashvili’s election appeal High officials from the United States (US) are welcoming Georgia’s PM Giorgi Kvirikashvili’s election appeal, where he highlighted the importance of hosting a free and transparent Parliamentary Election.

New botanical garden planned at occupation line near de facto Abkhazia The Government of Georgia is creating a vast botanical garden in a village that lies along the ABL separating Georgia’s occupied Abkhazia region from the rest of Georgia.

ECONOMY

Development Sector Makes Major Contribution to Georgian Economy In the first quarter of 2016, as compared to the first quarter of 2015, the Georgian economy increased by 2.6%. The major growth was recorded in the mining industry (29%) and development sector (25.7%).

Mountain Resorts Generate $50 million in the Georgian Economy The government wants to sharply increase revenues from private sector, as well as mauntain resorts. The memorandum, signed between “Maintain Resort Development Company” and company “Red-Co”.

BANKING

Bank Sector’s Net Profits Grow by 37% The Georgian bank sector’s net profits made up 254.5 million GEL as of June 1, up 37% year on year. The May net profits amounted to 74 million GEL, up 5% compared to the same period of 2015.

ADB to Issue Bonds of 64 million GEL ADB will announce about placement of bonds of 64 million after EBRD’ s emission of 107 million GEL. Galt & Taggart actively works on the process, which has successfully made public issuance of 107 million by EBRD on June 17.

BUSINESS

Jackets Manufacturer Factory will be Opened in Georgia In Georgia it is planned to launch the factory of jackets by using Chinese Investments. Specifically, the fabric will produce puffer coats. The head of the Partnership Fund, David Saganelidze stated this information.

New Bill Stops Applying Freezing Orders to Whole Property of Companies The business sector promotion amendments will be added to the Civil Procedural Code. According to the bill, freezing orders will not be applied to the whole property of companies.

COMPANY

Georgia Gains Another Lion at Cannes International Festival of Creativity Social Media Marketing and Application Development Company, Leavingstone won another Bronze at Cannes Lions International Festival of Creativity.

United Agro Project: All Georgia’s agricultural programs under one umbrella

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he Government has launched a new initiative allowing farmers from all over Georgia to easily learn about the existing and new agricultural services offered by the state and how to better benefit from these agricultural programs.

Today Prime Minister Giorgi Kvirikashvili presented the United Agro Project – a broader approach to the agricultural sector that united all of the existing agricultural programs of the country.

Kvirikashvili said having all of the current and future agricultural programs united under one umbrella would make it easier for farmers to identify what programs they could best benefit from.

He said the United Agro Project would also let the state to better communicate information about the available agricultural support with farmers.

The Georgian leader believed this new initiative would make the work

of the Government “more efficient”.

“We have decided from today, to gather all the ongoing projects under the United Agro Project to make our work more efficient and let people get more benefits from the state agricultural programs,” Kvirikashvili said, adding this would greatly contribute to the “positive changes” the Government planned in agriculture.

The PM said he was aware that many problems still needed to be addressed in the villages but promised the Government would fix these issues “step by step”.

“We have enough resources to strengthen the villages, develop our agriculture and ensure our products meet international standards and we will definitely achieve this,” Kvirikashvili said.

“High quality production from Georgia will find its place in European and other international markets. Georgian villages will become economically strong and our people [will be] proud,” he added.

Kvirikashvili said the Georgian Dream Government had “proven with actions” that agriculture was among the country’s top priorities.

As of today there are six ongoing agricultural programs gathered under the United Agro Project. These are: - Preferential Agro Credit; - Enterprise Co-financing; - Agro Insurance; - Plant the Future; - Assist Smallholder Farmers to Conduct Spring Works; - Georgian Tea. Here are some statistics showing what has been done within these agricultural programs in recent years: - Establishment of 150 new enterprises was financed; - Enlargement of 700 enterprises was financed; - More than 700,000 farmers received annual financial support for agricultural works since 2013; - More than 200,000 hectares of land was cultivated annually since 2013.

EU’s Mogherini: “We find the work Georgia has done remarkable”

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eorgia and the European Union (EU) have signed an important agreement which will see the two sides tighten their security cooperation.

Georgia’s Foreign Minister Mikheil Janelidze and the EU’s High Representative for Foreign Affairs and Security Policy, Vice-President of the European Commission Federica Mogherini signed the Agreement on Security Procedures for Exchanging and Protecting Classified Information in Brussels.

Following the signing ceremony Mogherini praised Georgia and stressd the country deserved visa liberalisation.

“I want to say what I said on visa liberalisation on Monday after the foreign affairs council. I think I was as clear as I could be on behalf of all the 28 Member States,” she said.

“We find the work Georgia has done in this field remarkable and now the decision is up to the Coun-

BUSINESS WEEK caucasus

The Editorial Board Follows Press Freedom Principles Publisher: LLC Caucasian Business Week - CBW Address: Aleksidze Street 12 Director: Levan Beglarishvili WWW.CBW.GE

June 27, 2016 #151

Mobile phone: +995 591 013936 Email: caucasianbusiness@gmail.com

cil, from the Commission’s side, the recommendation is clear, all benchmarks are fulfilled. So we are looking forward to that to come into action.”

Mogherini underlined the “remarkable partnership” with the President, Prime Minister and the Foreign Minister of Georgia. The Vice-President also touched upon the forthcoming parliamentary elections in October and expressed her hope that the relations between the EU and Georgia would be as good as they were before the elections.

The Georgian Foreign Minister said in a statement that the agreement signed yesterday would bring Georgia closer to the EU informational security standards and it would also increase the efficiency of the country’s participation in the EU peacekeeping missions.

Following the signing ceremony, a bilateral meeting was held where Janelidze and Mogherini discussed various aspects of Georgia’s co-operation with the EU.

www.cbw.ge <<

Giga Chkheidze: Family Physicians Medical Education Support is an Important and Necessary

<<

Georgia to Begin Antihail Rockets Production

<<

TBC Bank Named the Best Bank in Georgia 2016 by Global Finance Magazine

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Liberty Bank Ends February in High Profits

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Georgian Wine Bottle Ranina Ranked First at Top 10 Packaging Projects

Editor: Nutsa Galumashvili. Mobile phone: 595 380382 Reporters: Nino Kuparashvili, Lazare Gvimradze; Shiva Parizad.

Designer illustrator: Ilia Chrelashvili. Technical Assistant: Giorgi Kheladze

Source: www.commersant.ge, www.bpi.ge, www.gbc.ge, www.agenda.ge, www.civil.ge

June 27, 2016 #151

PUBLICITY

GEORGIAN RAILWAY URGES YOU TO CROSS THE RAILWAY TRACK IN ONLY SPECIALLY ALLOTED ZONES AND TAKE CARE OF YOUR LIFE! Crossing the railway track in the unpermitted places violates article 106 of the Georgian Code of Administrative Offences and this lawbreaking results in due sanctions.

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ECONO-MIX June 27, 2016 #151

Georgia’s Oil Products Market is Very Competitive

VASSIL KHORAVA

Wissol company director general

Why Mobile Tariffs are on Rise?

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Georgia’s oil products market is very competitive”, Wissol company director general Vassil Khorava told the Business Contact. Over the past months oil prices are rising at global oil exchanges and therefore, oil products prices were revised in Georgia too.

The Competition Agency has not passed a decision on the case of Wissol company. Anyway, previous positions of the Competition Agency are unacceptable for Wissol and therefore, those decisions were appealed, Vassil Khorava noted.

Because of sharp competition on the market, prices by various companies are almost identical. Companies in Georgia operate with low margins of profit, Mr. Khorava said.

As reported, the court has approved the decision passed by the Competition Agency on forfeiting SOCAR, but the company plans to appeal against the decision to higher instance courts.

Over the past 3 years the interconnection tariff has declined from 8 Tetri to 3.5 Tetri, while individual call tariffs have increased by 240%, from 10 Tetri to 24 Tetri MARIAM KOPALIANI

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Stadler Company Statement on Bi-Level Trains for Georgian Railway Stadler KISS trains purchased by Georgian Railway corresponds to the T dimensions and it has been examined through both in drafts and by practical measurements. It should be noted that prior to conclusion of the purchase agreement, technical appropriateness were examined and confirmed by Deutsche Bahn AG – DB international experts, who have issued a corresponding positive conclusion.

Swiss Company Stadler has released a special statement regarding misinformations and rumors that were spread in Georgian media and social networks about compatibility of KISS trains with the Georgian railroad infrastructure. The statement reads: “Operational compatibility of our product, in the given case of KISS model, to 1520mm rails is determined by ГОСТ 9238-83 standards. The mentioned ГОСТ determines maximally available dimensions for trains and minimum available dimensions for approaching to such structures as tunnels, bridges and platforms. Three main dimensions are applicable to moving trains (T, 1-T, BM) and the T standard is the most capacitive. Analogical classifications exists for getting closer to artificial structures to prevent moving trains from contacting structures, including tunnels on the Georgian Railroad and other artificial structures.

Stadler KISS trains bought by Georgian Railway correspond to the T standard in both drafts and by practical measurements. It should be noted that technical compatibility requirements were examined and confirmed by experts and Deutsche Bahn AG – DB international before the agreement conclusion and they have issued a positive conclusion.

The existing infrastructure enables to arrange the second stage for passenger accommodation, because the old single-level trains do not fully use the whole height of the capacity, while bi-level Stadler Kiss cannot fully fill the T standard dimensions.

KISS Bi-level electric train for the Georgian Railroad infrastructure has been engineered by Swiss specialists, who have already constructed many other trains for Switzerland, Germany, Austria and Luxembourg, i.e. European customers”.

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Six years ago the interconnection tariff was 14 Tetri, while the tariff declined to 3.5 Tetri for all operators as of January 1, 2015.

”

he cellular communications market of Georgia has always demonstrated principles incompatible with the free competition standards. There were times, when for 20 years all three companies had set the same service tariff of 28.8 Tetri per minute.

In 2010 the Georgian National Communications Commission (GNCC) explored the market and discovered that cellular communication companies used to spend only 15 Tetri on one-minute call to external networks, while intranet call prices were no more than 5 Tetri.

As a result of the market examination, the GNCC introduced upper margin retail tariff in the amount of 25 Tetri and announced gradual reduction in interconnection tariff, while this tariff makes much contribution to the retail tariff formation.

Six years ago the interconnection tariff was 14 Tetri, while the tariff declined to 3.5 Tetri for all operators as of January 1, 2015.

It is logical that this change was to lower retail tariffs and boost the market competition, but it turned out Magti company had different plans.

Starting April 27, 2016, the standard tariff price for Magticom subscribers became 24 Tetri for any cellular and landline operators. Starting late April, 2016 Magticom subscribers will talk for 24 Tetri a minute, instead of previous 10 Tetri, for both intranet calls with Bani and Magti subscribers and any other mobile and landline operators of Georgia.

Magticom has carried out opposite policy against the interconnection tariff reduction and increased tariffs on its several services. Starting March 17, 2016 Magticom company increased the tariff for sending SMS notifications abroad to 24 Tetri.

It should be noted that Magticom has not confined with only this tariff. At the end of February Magticom subscribers received notification that the tariffs for making calls to G-Mobile network had also increased.

In January 2016 Magticom revised SMS notification service conditions and the balance checking service tariffs. Namely, SMS service tariff rose to 6 Tetri in late January, while dialing 444 for checking the existing balance increased to 2 Tetri.

Regardless of technological development and cellular service tariffs reduction tendencies worldwide, in Georgia cellular service tariffs are rising. At the same time, MP Zurab Tkemaladze, head of the parliament’s sector economy and economic policy committee , has developed a bill calling to free cellular communication service operators from the excise tax starting January 1, 2018. The Parliament will discuss the bill in rush.

According to the bill, the 8% rate for excise tax for mobile communication services will be maintained up to January 1, 2017, while the rate will decline to 3% up to January 1, 2018.

In 2011 the Government was referring to low tax burden on the cellular communications sector as one of the main reasons for introducing a new tax.

“Georgia’s averaged tax burden is 25-26%, while tax burden of cellular communications sector is 10-15%. We believe it will be expedient to redistribute the pressure to such fields that have lower burden and recorded one of the major profitability indicators”, the then Finance Minister Kakha Baindurashvili said.

Main components that determine conversation in the mobile network are as follows: start and end of call, interconnection, excise and VAT taxes. While excise tax removal will cut expenditures of cellular operators.

Consequently, it will be possible to revise tariffs, however, cellular communication operators are not obliged to do this. The GNCC members assert that it is the companies discretion to decide whether to reduce or not to reduce the tariffs and the GNCC cannot interfere in this process.

Why do the Authorities reduce tax burden for the companies that have set high profit margins and why is this burden lower compared to other sectors?!

Even more so, it is clear that the sector’s competition is low and

these changes are less expected to cheapen cellular communication services. It should be also noted the 2017 budget will receive 24 million GEL profits through this amendment.

The Association of Young Financiers and Businessmen (AYFB) calls on the GNCC to examine grounds because of which Magticom has increased tariffs. The AYFB also urges Magticom to introduce clear, substantiated position what factors have preconditioned that tariffs have surged to maximal margin available. It is important that the GNCC should be based on the consumer interests and try to stimulate reduction of tariffs on the market, not growth.

It should be also noted that in 2010 the GNCC started examining the market’s oligopolies based on the AYFB monitoring reports.

The AYFB says that it is necessary that the GNCC repeatedly examine the cell communications market and decline the existing maximal margin tariff.

«It should be also noted that 6 years ago the companies used to spend 15-16 Tetri on one-minute call and today expenditures will be much lower, because technologies are developed on continuous basis. Tariffs are declining worldwide and they must not rise to the maximal margin in Georgia», the AYFB statement reads.

www.cbw.ge <<

Giga Chkheidze: Family Physicians Medical Education Support is an Important and Necessary

<<

Georgia to Begin Antihail Rockets Production

<<

TBC Bank Named the Best Bank in Georgia 2016 by Global Finance Magazine

<<

Liberty Bank Ends February in High Profits

<<

Georgian Wine Bottle Ranina Ranked First at Top 10 Packaging Projects

June 27, 2016 #151

PUBLICITY

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BANKS

June 27, 2016 #151

I we choose and use a credit card properly, we can actually benefit from the free credit limit

Advices from TBC Bank’s regional director Levan Diasamidze

- What is a credit card and how is it different from a debit plastic card?

- A plastic card is an inseparable part of modern banking system.

It enables us to make payments for products or service in almost any country of the world, and it enables us to encash or convert money.

There are two main types of plastic cards: debit and credit cards.

The major difference between a credit card and a debit card is that, in the case of a credit card, the bank allows a cardholder a simple access a loan through a preapproved credit limit. With a debit card, a cardholder can only use the amount available on his or her account.

- How much is the annual card fee and when is it due?

- Almost all types of cards have annual service fees (except cases when a bank eliminates the fee as part of a special offer).

The annual fee is paid in advance or once a year. The size of the fee depends on the card type (Electron, Classic, Gold, etc.).

Consequently, it is important to obtain a card that best suits a consumers needs; the right decision will help economize on the annual fee.

How to save more when using a credit card It is also important to know that, in addition to an annual service fee, credit card users also pay encashment fee, which differs from bank to bank.

- What is the grace period of credit card and can card holders receive “free” credit?

- There are numerous credit cards on the banking market and they all differ from each other, offering a variety of credit limits, interest rates, grace periods, etc.

In fact, if we choose and use a credit card properly, we can actually benefit from the free credit limit. For example, there is card on the market that offers a one-time, three-month grace period, followed by a 55day permanent grace period.

This implies that we can use the credit amount free of charge for three months making a purchase or seeking a cash advance.

After this period, we can benefit

from the grace period –55 days after using the credit card. If you repay the credit during these 55 days, you will not be charged any interest. After repayment, you can spend the credit again and repay it within 55 days.

- What is a payment date?

- A payment date is set on the day the credit limit was approved.

For example, if your credit limit was approved on the 15th of a month, you will have to pay the

interest and the principal on 15th of every month. To be more precise, if you purchased some item on 10th, you will be charged five days of interest on the amount spent – from the 10th to 15th of a month, if the grace period is over.

- How much do I have to pay each month and how is the minimum payment calculated?

- After the 55- day grace period is over, we have to pay interest on the amount spent, as well as the principal spent. The amount to be paid is calculated according to the number of days the credit was used.

- What advice do you give to customers?

- Plastic cards have become an inseparable parts of our lives, so it is important to understand them and use them effectively.

My advice is to learn all conditions related to the usage of the card in detail before signing up for it, and make a decision on which type of a card to sign up for only after diligent research.

I would advise clients not to to base the decision on the color or prestige of the card, since the most important factor should be whether it suits your needs and how convenient it is.

TBC Bank and Geocell Present new Business Award Project If you are the representative of the small and medium sized business companies, and you have started your business activities before 2016 then you have a great chance to become a wellknown representative of the renowed company in Georgia.

TBC bank and Geocell give this opportunity to any businessman wishes to become popular on the market. Thus, TBC Bank and Geocell will hold a joint project – Business Award 2016. On June 21 TBC Bank director general Vakhtang Butskhrikidze and Geocell director general Pavel Smalinski unveiled the project details at a news conference.

“The main objective of the project is to promote the small and medium business sectors of Georgia and foster their development”, Vakhtang Butskhrikidze said.

According to him, small and medium business sectors create Georgia’s tomorrow. TBC bank has

started the small and medium business promotion not today, but they prioritized this direction many years ago.

“Today we have launched a new project jointly with Geocell and I am sure this project will be successful and all Georgian companies will see what may be done and how it may be done in Georgia”, Butskhrikidze said.

“Over the past years about 12 000 representatives of small and medium business sectors have passed trainings in various directions”, he added.

Business registration has started on June 21, 2016 and as the bank’s vice-president Nika Kurdiani declared, any company is able to register on the web site www.Businessaward.ge. However, there are some requirements the company has to satisfy. It must deal with small and medium sized business, and must have been registered as the business maker before the year of 2016. In addi-

tion, Georgia-based Company’s annual turnover must not exceed 10 million GEL. Seven nominations have been selected in the right way for the project.

Winners will be named in the following nominations: 1. Tourism Business of the Year 2. Agro Business of the Year 3. Georgian Product of the Year 4. Innovative Business of the Year 5. Marketing Campaign of the Year 6. Small Business of the Year 7. Business of the Year In each nomination 3-3 successful business companies will be presented. The award is created by the famous designer Zviad Tsikolia.

Geocell Telecommunications Company pro-

vides general sponsorship of the project. Thus, out of 7 nominations Geocell will award winners in the following nomination – Innovative Business of the Year.

“These innovations are important and we have ambition that we are an innovative company.

Therefore, we believe this project will assist companies to expose their activities and attain success”, Smalinski said.

“It is much honor for us to implement this project jointly with TBC Bank. The bank makes focus on bolstering the growing business in the country. Small and mediums business sectors create the segment that has huge potential and perspectives in terms of generating wealth in the state economy”, - added Psavel Smaniski.

The applicants are able to submit their applications until August 15, 2016. The Award ceremony will be held in November 2016.

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TOURISM

June 27, 2016 #151

NUTSA GALUMASHVILI

Kazbegi – Rooms Kazbegi The Rooms Kazbegi management says that the hotel prices differ due to days of the week. For example, on workdays the price of a two-bed standard suite starts from 189 USD, while over weekends the price makes up 236 USD. Unlike the previous year, we have not revised prices and the existing prices include only breakfast services. As to the demands, all suites have been booked. A major part of visitors are foreign tourists, including from Israel, Russia and other neighboring countries, the hotel management said.

Racha – Sunset Shovi Balneologic-climate health resort in Shovi, the Oni District, the Racha Region, which is located a 380km way from Tbilisi, is very popular among Georgians and foreign tourists. The first European-level hotel Sunset Shovi has been operating since 2013. The 4-star hotel comprises 35 suites and is able to accommodate 130 visitors simultaneously. The hotel administrator Mariam Kevkhishvili noted that in the previous years the hotel was operating at full capacity and the expectations are positive in the current year too.

Sunset Shovi hotel manager Mariam Kevkhishvili emphasizes problems with the road infrastructure in Shovi. There are certain problems in terms of transportation and this factor may slow down tourists’ interest, she noted.

“For example, it takes 6-7 hours to drive from Tbilisi to Shovi and this is very problematic issue for tourists.

Moreover, road infrastructure should be improved from Oni to Shovi and this factor may also hamper tourists to visit our areas”,

The True Cost of a Holidays in Georgia. Will Your Budget Stretch Enough?

Along with commencement of holidaymaking season, the issue of where to spend pleasant vacation period after heavy and tired working year acquires much relevance. How much does it cost to spend holiday in Georgia and which resorts do tourists give preferences to?

The Caucasus Business Week (CBW) has surveyed various hotels all over Georgia to examine how much have Georgian and foreign tourists to spend for their holidays in Georgia.

Kevkhishvli said.

Despite these problematic issues, in previous years the hotel was working at full capacity and we have the same positive expectations in this year too. The tourism season was unveiled on June 13 and at this stage all infrastructure has been loaded and advance bookings have been also made, Kevkhishvili noted.

Basically Georgian tourists show interest in Sunset Shovi, while foreign tourists make up only 20% in total volume. As to prices, start-

ing June prices at Sunset Shovi range from 60 to 270 USD. The mentioned price includes three meals a day and entertainment opportunities, sanatorium services, tennis table and so on, Kevkhishvili said.

Kakheti – Solomoni 1805 The management of hotel Solomoni 1805 owned by businessman Temur Chkonia also talks about extreme growth in tourist inflows and positive expectations. According to their information, the hotel has

been operating for 6 years on the market and this year is recording the highest inflow of tourists ever (if we do not mention the year of inception). The hotel management says that the inflow has been increased at the expense of Russian tourists mainly.

“The ratio of foreign tourists, especially Russian tourists have doubled, contrary to the previous years”, the hotel management noted. The average price of a two-bed suite is 145 GEL, they noted. The tourism season in Sighnaghi lasts from May to late October.

Kakheti – Kvareli Edemi The hotel is located near the city of Kvareli. The complex is surrounded by oak woodland, vineyards and fruits gardens.

These opportunities enable visitors to stay apart from noisy environment and spend time in pleasant and calm environment. The price of a two-bed standard suite in Kvareli Edemi is 255 GEL on workdays and 275 GEL over weekends.

The hotel management says that in this season the inflow of visitors have considerably increased, including domestic and international visitors.

Hotel Radisson Blu Batumi Prices at Radisson Blu Batumi hotel change on everyday basis. Today the price of a two-bed standard suite makes up 187 USD (along with breakfast), excluding VAT. Currently, the hotel has been fully loaded and foreign visitors constitute a major part in total number of visitors, from both neighboring countries and Europe, Israel and other countries.

Borjomi – Crown Plaza The management of Crown Plaza hotel is also content with tourist inflow indicators. Every day the hotel hosts Georgian and international visitors, especially Russian and Ukrainian tourists. As to prices, the price of a two-bed standard suite with breakfast starts from 187 USD. Svaneti – Hotel Tetnuldi In summer period besides seasides mountain resorts are also very popular. Over the past years the quantity of visitors have radically increased in Svaneti, including from foreign countries. There are a lot of guesthouses in Svaneti and their prices range from 50 to 170 USD. As to hotel Tetnuldi in the city of Mestia, the price of a two-bed standard suite starts from 130 GEL. Anaklia – hotel Anaklia Levan Chkhikvadze, manager for hotel Anaklia says that the hotel is overloaded in summer period.

In the July to September period the hotel operates at full capacity, contrary to off-season periods.

Predominantly foreign visitors, especially Armenian tourists are interested in the resort, Chkhikvadze said and added that the price of a two-bed standard suite makes up 177 GEL with breakfast, while the price grows to 236 GEL with three meals.

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ENERGY SECTOR

June 27, 2016 #151

Georgian Energy Sector Development Perspectives without Khudoni HPP

The strategic objective of the energy sector development is to ensure free access to power resources and reliability of supply of these resources. Reasonable employment of resources is a main mission of governments in any country. Everybody agrees that full employment of energy potential and construction of generation facilities is an unconditional challenge before the country. At the same time, along with use of resources, the contemporary world intensifies care for environment impact and climate change issues. When mulling over development of generation facilities in Georgia, the major focus is made on Khudoni HPP project implementation. Public opinion has split concerning this project. Both supporters and objectors actively defend their positions regarding the project implementation issues.

ANDRIA GVIDIANI

Against Khudoni HPP! Environmentalist organizations and, naturally, local population show extremely negative attitude towards the Khudoni HPP project implementation.

On the one hand, protests by local residents are absolutely natural and their arguments against the HPP construction also deserve attention, because the project calls for resettlement of local residents and they will have to leave their residential places.

It should be noted it is not an end in itself to abuse and disturb local residents, nor to construct a facility harmful to the local environment. However, each issue and aspect requires adequate attitude and emotions must be curbed in the decisionmaking process.

On the other hand, environmentalists actively refer to harmful environment impact aspects of Khudoni HPP project. They assert that the project will considerably damage the local ecosystem. Naturally, the HPP construction will inspire degradation of local flora and fauna and this is an evident strong argument against the HPP construction.

energy security and energy independence issues questionable. Naturally, Georgia does not have the right to take such risks. Therefore, power facility such as Khudoni HPP is of vital importance for the country’s energy network. At the same time, we should also realize that deficient generation and high degree of energy dependence is a very negative signal for investors and the mentioned factors largely predetermine their behavior. Consequently, the mentioned factors may create ground for decline in investment inflows to Georgia. For example, the Doing Business uses reliable electricity supply factor as one of the main criteria or creating international ratings. Despite Georgia occupies quite normal positions in these ratings (24th position), the country ranks 62nd in terms of reliability of electricity supply. This is an evidently unfavorable record. Naturally, foreign investors carefully examine these ratings.

Forecast Indicators Arguments

by Supporters of Khudoni HPP Project The above-mentioned arguments are very suggestive, but the project supporters also rely on quite serious substantiations. They assert Khudoni HPP construction is a necessary and irreversible project.

It should be noted that power specialists, government officials, economists and in general, people with pragmatic and reasonable mind actively justify the HPP construction project and substantiate the project relevance by appropriate arguments.

Here we submit the factors that justify the facility construction. We know that Khudoni HPP project will make significant influence on transformation and development of the Georgian energy system.

Naturally, any issue embraces its own alternative expenditures and Khudoni HPP project cannot be an exception.

Consequently, valuable analysis shows that alternative expenses of Khudoni HPP project may make

Along with economic development, the demand for energy resources grows at fast paces. Naturally, to satisfy the growing demand, continuous and reliable supply of resources should be ensured.

Therefore, in the process of forecasting and analyzing electricity consumption and supply aspects, it is supposed that Georgia’s annual electricity consumption will increase by about 5%. This is only a forecast figure. If we envision actual growth indicators of the demand, in most cases, the figure exceeds 5%.

Today, Georgia’s total electricity consumption makes up 11.29 billion kilowatt-hours. Consequently, if the annual consumption grows by 5%, in about 10 years, the country will need 17.51 billion kilowatt-hour electricity a year. Naturally, development and enhancement of internal generation sources is the most optimal and justified mechanism to satisfy the increased demands, because reduction of the country dependence on foreign energy resources is one of the decisive issues in terms of energy security.

Khudoni HPP’s installed generation makes up 702 megawatt and the facility will be capable to generate 1.5 billion kilowatt-hours a year. At the same

time, it should be also stressed that Khudoni HPP is a regulatory station and it will generate electricity in winter peak months.

Now we should analyze the outcomes if the country does not build new stations and, especially, Khudoni HPP. The demand for 17.51 billion kilowatt-hour energy may be satisfied from two different sources: electricity imports and steam power plants generation that also relies on imported raw materials. The first variant of electricity imports will be very expensive for the country, because the electricity prices are growing on constant basis and reach peak figures in the winter period. Moreover, another important problem is related to growth in energy dependence on the neighboring country and this factor creates very big burden for Georgia’s energy and political security. As to the second variant for maximal loading of steam power plants, naturally, the country will face huge problems again. On the one hand, electricity generated by steam power plants are very expensive and energy independence and safety aspects become more problematic. All this mixture makes negative affect on the country development.

Technical Necessity of Khudoni HPP Besides the above-mentioned factors, technical aspects of Khudoni HPP should be discussed separately. After the independence announcement, Georgia-based energy facilities and the existing infrastructure went out of order and ruined for many years.

Consequently, automatic regulators

of the existing hydro power plants are outdated or are out of order. And a major part of steam power plants are amortized.

Therefore, besides rehabilitation of the existing stations, it is necessary to build stations equipped with modern management systems that will be easily integrated into the network. Moreover, the Georgian Energy system suffers from a sharp deficit of reserve power provision systems. Therefore, when working independently from other systems, frequency regulations turn complicated. Moreover, when turning off powerful aggregate, the system automatic switches turns off the consumer.

Naturally, these problems directly affect electricity supply to the population and technical disorder in the network results disrupts subscribers from the network. Therefore, powerful combined steam power plants should be constructed and the existing steam power plants should be rehabilitated to ensure power reserves and improve this deficient situation.

Nontraditional Energy Alternative During discussions around Khudoni HPP and hydro energy power development, in general, environmentalists often stress that the country should develop alternative (nontraditional) power generation sources. Naturally, alternative energy sources are being developed worldwide in intense regime, but alternative energy generation sources embrace several important problematic aspects. First of all, both sun and wind power generation cannot ensure sustainable and stable power supply. Consequently, it is quite risky and dangerous to rely on similar energy sources when we try to achieve sustainability and stability in our power system.

Expensive tariffs create other big challenge in nontraditional energy sources, despite the price of alternative power generators show slowdown trends, their employment remains unprofitable compared to hydro power generation sources. All the mentioned factors make investors show less interest in alternative energy sources.

We should also compare nontraditional energy sources employment tariffs in terms of development of 1 megawatt installed generation. However, similar calculation is inappropriate because different generation facilities have different periods of operation. Regulator hydro power plant can work 8760 hours throughout the year and it embraces about 5000-5500 hour operational resource, while wind station’s operational resource is about 2300 hours and sun station’s operational resources is about 1800-2000 hours (geographical location also matters). Therefore, 2-3 megawatt alternative power sources should be constructed to replace 1-megawatt hydro power generation. This factor is one of the main reasons for showing less interest in nontraditional energy.

Tariffs/Prices During discussions of Khudoni HPP related issues, one of the important issues in memorandum between the state and investor

company, is related to the fixed tariff for guaranteed purchase. Khudoni HPP objectors often refer to this aspect as a main argument against Khudoni HPP project implementation. In reality, the tariff indicated in the memorandum is very expensive compared to other hydro power stations, but this tariff is reducible. In the memorandum, the state has assumed obligation to purchase electricity for 15 years.

Including, for the initial 8 years the state must pay 10.50 Cents for 1 kilowatt-hour power. The tariff declines to 9.50 Cents for the next 3 years.

In the last years the state is obliged to purchase 1 kilowatt-hour electricity at 5.5 Cents. If we examine tariffs in other memorandums, we will see that the averaged weighed tariff is about 6.5-7.5 US Cents. Consequently, there are questions in this respect, naturally, and pretenses around the tariff policy is legitimate. However, every issue has two sides and issues should not be discussed from only one position. The investor injects about 1.2 billion USD investment in the country that is considered to be a risk zone for investors and their capital.

Naturally, investors need strong guarantees that their capital will be safe. Therefore, only mandatory purchase tariff can provide guarantees that are indicted in the memorandum.

Based on the above-mentioned factors, it is important to analyze Khudoni HPP related issues with common sense. Naturally, the power sector development should be considered in long-term perspective. If we take into account Georgia’s balance electricity tariffs, we will see that prices grow every year and even more so in peak months they reach the highest point. There is an only solution.

Georgia should mobilize domestic resources.

Consequently, construction of hydro power plants in Georgia will guarantee stability of tariffs. Therefore, at the first stage, by construction of Khudoni HPP we will acquire very important facility in long-term perspective that in the future will be one of the most important players in the Georgian energy balance (after the memorandum expiry).

Therefore, we can openly say that by construction of Khudoni HPP, we will build safe and stable future for tomorrow.

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STARTUP

June 27, 2016 #151

TREEPEX Changes the Idea of Purchasing CBW is presenting the interview with Bacho Khachidze, one of the founders of the project “TREEPEX”, that will change the idea of purchasing.

The project takes into account the promotion of the Georgian species of trees’ growth and country’s ecological development.

NINO KUPARASHVILI

- Tell us briefly about your business activities. What is “Treepex”?

When was it set up and how long have you been involved in this start-up development?

Treepex is green loyalty program. We establish a green logo brand (trademark) in the global market, which means that if you see a product with Treepex logo affixed to it, another tree will be planted on your behalf.

Each such product will be followed by a unique Treepex QR code. Accordingly, the user scans the code trough Treepex mobile application, and finally the tree is planting on his/her behalf.

Later, the customer receives a picture of the planted seedling via e-mail where the name and geographical location are indicated. As a result, the owner of the tree is able to go and acquaint with it.

We have started working on Treepex in last summer. At first we had a different conception, however, after observation and conducted studies we have received shaped Treepex in the form what it is today.

- What is the main purpose of Treepex? What did you inspire to do this business? Who was the author of this idea?

- The objective is very simple.

We would like to make the planet greener and healthier than it is today by involvement of several companies and individuals in this process.

We were two, my friend and I who have started the project implementation. Lasha Kvantaliani is another co-founder of Treepex. It is more than six years I am working in the field

of “Green”, thus I have gained already certain experience. I am aware of challenges and opportunities in this sector.

In addition, Lasha has 12 years of work experience in terms of new technologies, product development and satart-ups. He was always different from my other friends and it should be noted that he was too hard-working.

One usual day we were sitting in a cafe, drinking coffee and talking. We were thinking about the startup project that would have change the world for better. Consequently, the idea came up.

- What is the public’s interest toward your activities?

- Treepex very quickly became acquainted with Georgian society and have been cooperating with very serious organizations. This is the outcome of well-planned marketing campaign, as well as the fact that we became winners in two pretty serious competitions SeedForum and SeedStarTbilisi which allow us to participate in the Global Forum of the USA and Switzerland to introduce Treepex to global market.

- Which is your target segment?

- Different kinds of companies are interested in Treepex, as social responsibility, as well as in compensation aspect. For example, one of the most wellknown insurance companies offers its customers, to compensate the emissions caused by vehicles. However, in the first year, we are mainly focused on the following aspects: book publishers, the creators of handicrafts and wooden furniture manufacturers.

- Where the planting process of the trees take place? In general, what are the type of trees and who are your company suppliers?

- By now, the works are performed in Ajameti protected area, where the recovery process of Georgian oak and Imeretian oak is underway.

Additionally, we plant Caucasian pine in Borjomi- Bakuriani forestry station, where the burned areas are being restored. We purchased seedlings from local producers.

In Georgia fairly high-quality seedlings are available.

- From your point of view do you consider you have great perspectives in this field in Georgia? How effective and profitable is this type of business in General?

- The startup is innovative and experimental approach to solve the problem and in case you google you will find out that 80-90% of them does not justify hopes due to variety of

reasons. We’ve gone through some steps to get here. Now we absolutely believe in our project, and what we do.

- What are your plans for the future? What is the maximum you would like to achieve in your business?

- Treepex uniquely is a global

startup, we want to introduce our approach to the global market. Very soon we are going to leave the place from here and to continue its development in Silicon Valley. Treepex is a product that will soon consume the entire world.

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BUSINESS

June 27, 2016 #151

Air Taxi to Appear in Georgia From Autumn Adjara Group gets active to logistic direction. According to Oto Berishvili, director of Marketing and Business Development at the company, the Air Taxi will fly in Georgia under the name of Aviator. He declares, that the company has already acquired 8-seat craft from America and the plain is already in Georgia. Air Taxi should fly in Kazbegi, Batumi, Svaneti and other directions, where aerodromes are available. In addition Berishvili declares, that the group works on the development of an aerodrome in Georgia. As for the service costs and investment sums, Beroshvili cannot specify it at this stage, but notes that the company has attracted money for acquisition of the plain from “Bank of Georgia”, however, the group makes the remained investment with its own funds.

WATCHES

EXPORT

Tsikolia Watches Announced New Models

New model P-47 of TSIKOLIA Watches will be released at the market in a month.

Consumers will be able to purchase famous Georgian designer Zviad Tsikolia’s watches in the chain of “ArtTime”, as well as official web-page of TSIKO-

LIA Watches. Cost of the model is not specified yet.

The watch is inspired by Alexander Kartvelishvili’s Georgian legendary fighter model P-47 and diameter of the watch is 47 mm.

11 color combinations will be presented. The characteristics of the watch are

NEWS

TECHNOLOGY

BGEO Became 100% Stockholder of the Company GGU BGEO Group has purchased 75% of Georrgian Global Utilities. As a result, it became 100% share holder of the company. According to the published information by the company, the transaction value made up 287 million GEL. GGU is the owner of “GWP“.

BGEO Group purchased 25% of the company’s share in 2014 at a price of 47 million GEL.

Georgian Led TV Sets to Compete with Samsung Production A few weeks ago Georgian TV sets appeared on the market.

The factory AG Telekom put the production up for sale on June 1, 2016. According to the head of the factory, Mikheil Ghlonti, since June 1st till today, 150 units of TV sets have been purchased on average. Thus, this is the indicator of what the company’s management predicted at the begining before the production have been launched. The head of the company says that the realization rate will be meaningfully improved in future.

as follows: stainless steel with a diameter of 47 mm, sapphire glass covered with anti-reflector, luminescence and darts board, waterproofing 5 ATM, leather and nylon strap, limited circulation, serial number.

International warranty card of 3 years.

“Inspired by individualism and the will to achieve success”, – Tsikolia’s works are assigned so, however each model is unique.

Limited edition products are manufactured in Switzerland, they are distinguished by packaging and

Invention by Lasha Telia, 15, Draws Interest of Oil and Gas Corporation Lasha Telia 15 year-old student

The invention introduced by Lasha Telia, a 15 year-old student, has draw much intention in the society. Even Georgian Oil and gas Corporation (GOGC) has launched studying this invention.

The issues and subjects in which I am interested are not taught at pubic schools. Therefore, I have entered UG-Limes Academy and passed unique and innovative curricula – Cognize Electronics. This program is to popularize physics, electronics, mathematics, informatics, robotics to raise interest of pupils in these disciplines.

“I and my two friends – Giorgi Jlantiashvili and Beka Abulashvili invented a device Universal Meter that is to protect various facilities”.

Universal Meter fits to be installed on bridges and landslip zones, on historical monuments located at residential places.

GOGC has already showed interest in this invention and plans to install this device on the pipelines to ensure their security. The device is able to give alarming signal in case of breakdowns.

I have participated in the Millennium Innovation competition thanks to UG-Limes Academy. I and my team members have introduced Universal Meters device to this competition. Our project was included in the list of final top ten projects and we received huge experience.

design. Each model is part of an exclusive collection.

They are divided into three subsections: Motor Transport, Aviation and Navy.

It should be noted, that TSIKOLIA watches (in past UNIQ watches) was established by internationally renowned designer Zviad Tsikolia in 2011. Tsikolia Design has been awarded two times by world’s most prestigious design award RED DOT in 2006 for concept “Fashion watch” design and in 2014 for “Uniq P-47” watch packaging design.

Georgian Mineral Water Discovers New Sales Market in South Korea JSC Tskali Margebeli manufactures various sorts of lemonade, cold tea and cold coffee. In the near future, Nabeghlavi mineral water will be sold in South Korea too, JSC Tskali Margebeli exports manager Levan Chikovani told the BusinessPressNews.

The company takes constant efforts to find new sales markets and expand the exiting ones, Levan Chikovani said.

“Our company provides huge job to expand the exports markets.

Nabeghlavi exports grow in EU, USA and Turkey markets. Despite certain problems in the CIS space, our sales are increasing in certain countries of this space anyway. We also plan to penetrate Eastern countries too. We have already established contacts with Korea and sent our products to this country a month ago. We also plan to enter the Japanese and Chinese markets. Therefore, we have real success.

Demand for natural mineral water grows year to year. Besides Nabeghlavi we also produce natural juice Bakhmaro and we try to popularize this drink. We have already sent first consignments of Bakhmaro to the USA”.

The company is also building a new plant that will be unveiled at the end of 2016. The plant will manufacture various sorts of lemonade, cold tea and cold coffee.

HEALTHCARE

June 27, 2016 #151

Effectiveness Relies on Subsidization of Drugs Component Over a half part of Georgian citizens enjoy the universal healthcare state program benefits. Majority of the recent research works show that the physical access to medications still represents a big challenge before our population. The Healthcare Ministry and Global Alliance advisory company have conducted a research work all over the country.

The inquiry called as “What Worries You?!” was conducted in January to March period, 2016. The report has showed that 51.7% of population want medications to be more attainable. It should be also noted that the universal healthcare program does not cover drugs component in case of ambulatory treatment.

11

UNIVERSAL HEALTHCARE PROGRAM

SALOME SHIKHASHVILI Healthcare Platform’s communications specialist

The research work conducted by Curatio international foundation also examines the medication attainability issue – Prices and Physical Attainability of Medications. According to the report, Georgia-made medications are expensive by 30% compared to imported analogues. Moreover, at pharmacies the level of extra charges of original brands with prescription is twice higher compared to the level of extra charges of medications without prescriptions.

It should be also noted that despite the national currency appreciation, prices of medication have not declined. On the contrary, in some cases they have even increased. So far pharmaceutical companies have named GEL instability and high-level imports as a reason for growth in prices. It is interesting what factors precondition a growth in medication prices amid the GEL exchange rate appreciation?

For the purpose of narrowing expenditures from the consumer’s pocket, it is necessary to broaden access to generic medications and introduce drugs component in the universal healthcare program, known as the reimbursement mechanism in the healthcare field.

The Healthcare Platform is a recommendation that should embrace medications with prescription in the reimbursement list.

- Why should the Government subsi-

dize the drugs component?

-We think it is expedient to explain the nature of reimbursement. In due time, the reimbursement mechanism was introduced to alleviate the financial burden arisen in the process of acquisition of medications and for improving a reasonable use of medications.

Reimbursement is an efficient mechanism for providing patients with medications and this mechanism makes spending of the state funds and resources more transparent.

The reimbursement mechanism enables patients to pass treatment by means of medications, including, by innovative medications. In this process the state puts more finances than a patient. As a result, the state spares funds determined for each citizen, because valuably treated patient, as a rule, rarely gets to the inpatient clinic.

- How does this mechanism work?

- The price on medications (especially of innovative medications) varies due to the demand and pharmaceutical companies earn much benefit in this way. In case of reimbursement, the tender participant company assumes the obligation to offer lower and affordable prices to the consumer in case of increased demand for medications.

- What is the state’s benefit?

- Reimbursement grows access to medications, makes state spending on citizens and procedures transparent.

- What is the population’s benefit?

- The state covers the price of medications fully or a major part of the price. At the same time, access grows to such innovative medications that patients cannot afford to buy at their own expenses.

The international experience suggests that the subsidization should make medications affordable and their efficiency should have been examined for many years.

The reimbursement mechanism successfully operates in such European countries as Poland, Czech Republic, Slovakia, Moldova, Turkey and so on. In the developed countries the positive indicator of reimbursement makes up 90% of the medications existing on the market. And no compensations are issued for the remaining 10%. International experts recommend to make subsidized medications high-quality, effective and affordable for population.

Driver’s Medicine Kit Price Rose by 5% in May The Healthcare Platform has published the monitoring report for the month of May for the next segment. In this case, the organization has explored the list and price of medications for a driver’s medicine kit. The monitoring has showed that, unlike previous months, which recorded price contraction tendencies, the price of medications of the driver’s medicine kit has increased by 5% in May. To be precise, the price of bactericidal adhesive tape, Oxolin Ointment, ibuprofen, ammonia solution and Nitroglycerin Pharma. In April the driver’s medicine kit price was 36 GEL, while in May the price rose to 38 GEL. The price surge is unimportant, but change in medicine prices directly affects the consumer pocket. The organization has identified prices of total of 17 medications and accessories, including antiseptics, analgesics, cardiology medications. The monitoring was conducted in 4 leading pharmacies. The exploration has showed that month on moth upturn made up 2 GEL. The Healthcare Platform continues examining and monitoring of the pharmaceutical market tendencies to update Georgian citizens about the governing tendencies in the sector.

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PUBLICITY

June 27, 2016 #151

WORLD NEWS

June 27, 2016 #151

13

Quotes

“ The number of Russian tourists visiting Antalya has dropped by 96 percent amid the ongoing diplomatic crisis between Turkey and Russia

If we left the European Union, it would be a one-way ticket, not a return. So we will have time for a proper, reasoned debate. At the end of that debate you, the British people, will decide.

”

The result sets the U.K. up for years of bitter divorce talks with the first salvos likely to be fired at an EU leaders’ summit next week.

David Cameron

Turkey’s touristic resorts almost empty as crisis deepens in sector

Armenia’s first smartphone goes on sale

A

The first smartphone made in Armenia, called the ArmPhone, went on sale this week. Various Armphone models were unveiled during a kick-off celebration on Monday held as part of a marketing campaign called “It’s Time for Armenian [products].”

Produced by the Technology and Science Dynamics Inc./Armtab Technoligies, an Armenian and American joint venture, the ArmPhone, according to the company founder Vahan Shakaryan, compares to other smartphones being developed today in the open market.

“It is important to note that our product is high quality and we stand behind and take responsibility for the quality of our product,” said Shakaryan, as quoted by media. “We produce [our product] in Armenia, we are with our consumers and take full responsibility for every step, from production to customer service.”

s Turkey’s tourism sector faces one of its worst ever years due to diplomatic problems with Russia and rising security concerns, all popular touristic resorts are almost empty, hitting not only hotels but also restaurants and shops.

The number of foreign visitors to Turkey decreased by 16.5 percent to 5.82 million in the first four months of this year compared to the same period of 2015, according to official data. The number of foreign arrivals visiting Turkey slumped by 28 percent in the month of April to 1.75 million compared to the same month of 2015, marking the steepest decline since May 1999.

In many touristic resorts and towns in the Mediterranean, which were once very popular among European and Russian tourists, the crisis is clear simply from looking at the almost empty streets, the lines of available taxis, and the empty local stores. Airports are also almost deserted, and flights to the major airports of Turkey’s Mediterranean region are full of empty seats, unlike in typical touristic seasons.

An employee from a car rental company near Antalya’s Alanya resort said their business is very calm this year compared to previous summers.

“Our revenue has almost halved this year. This month is almost like a winter month,” said Cumali Bora, the owner a handmade soap shop.

‘Worst in years’ A restauranteur in Alanya said they had been in business for 16 years but had never seen such a bad season as this year.

“We are currently seeing the worst days ever since our opening. We expected foreign arrivals from countries other than Russia, but nobody came up,” said Cengiz Topal in front of his restaurant.

The number of Russian tourists visiting Antalya has dropped by 96 percent amid the ongoing diplomatic crisis between Turkey and Russia. The number of German tourists fell by 30 percent in the first five months of the year compared to the same period of 2015, according to official data.

One hotelier in Alanya said he had to cut the number of his staff members from 360 last year to 220 this year. Even this figure is high as the occupancy rate in the hotel has fallen from 85 percent to 25 percent.

“And this is when our hotel is in one of the best positions in the town now. So think about others,” he said.

Another hotelier in Antalya’s Kemer district said he had opted to not open one of his five star hotels this year due to the huge drop in reservations.

“We have even been unable to ensure high occupancy rates in just one of our hotels that is open,” he added.

Azerbaijan’s SOCAR drilling new well at Oil Rocks offshore field

A

zerbaijan’s state oil company SOCAR will produce about 3,650 tons of oil annually through commissioning of a new well being drilled at the Oil Rocks offshore field in the Caspian Sea. The well’s projected depth is 1,700 meters and its daily debit is expected to reach 10 tons of oil, said a SOCAR message issued June 22. SOCAR is currently implementing a program to stabilize and increase oil output. The company produced 3.16 million tons of oil at the country’s onshore and offshore fields in January-May 2016, as compared to 3.46 million tons in the same period of 2015.

Azerbaijan’s state oil company SOCAR will additionally produce 3.65 million cubic meters of gas and 32,850 tons

of oil per year as it has put into operation a new well in the Caspian Sea, said SOCAR in a message.

The well was put into operation at the Gunashli offshore field in the Azerbaijani sector of the Caspian Sea after being overhauled.

The Gunashli field plays an important role in Azerbaijan’s oil and gas industry. The field’s shallow part is developed by SOCAR on its own, while its deep-water part is developed jointly with foreign partners. Currently, SOCAR is implementing a program for stabilizing and increasing the oil production.

The company produced 3.16 million tons of oil at offshore and onshore fields in January-May 2016 as compared to 3.46 million tons in January-May 2015.

Ruble Drops Most Since May as Crude Oil Tumbles on Brexit Vote The ruble weakened the most in almost two months as Britain’s vote to quit the European Union triggered a flight from riskier assets and pummeled the price of crude oil.

The currency of the world’s biggest energy exporter weakened 2.8 percent in to 65.695 per dollar as of 10:29 a.m. in Moscow, the sharpest intraday slump since May 4. Stocks and government debt fell the most since January when crude hit its lowest level in more than a decade. Brent plummeted as much as 6.6 percent on Friday, weakening with most commodities. The ruble joined a rout in developing-nation currencies after Britain voted to end its more than four-decade membership of the European Union. Crude and natural-gas sales account for about 60 percent of Russia’s exports, and Friday’s slump pared the ruble’s recovery from a record low at the start of the year.

UK Votes for Brexit, Cameron Resigns After Historic Rupture With EU

T

he U.K. voted to quit the European Union after more than four decades in a stunning rejection of the continent’s postwar political and economic order, prompting Prime Minister David Cameron to resign and sending shock waves around global markets.

WHY BRITAIN VOTED TO LEAVE THE EU The pound plunged to the lowest since 1985, European stocks followed Asian equities in tumbling and U.S. Treasuries surged in one of the most dramatic 24 hours in modern British history. The final tally, announced just after 7 a.m.

London time, showed voters had backed “Leave” by 52 percent to 48 percent. The government’s pro-EU campaign was defeated by more than 1 million ballots.

“The British people have made a very clear decision to take a different path, and as such I think the country requires fresh leadership,” Cameron said in an emotional statement to reporters outside his Downing Street residence in London on Friday.

He said he’ll stay on for the next three months with a new Conservative leader to be installed

by October.

The result sets the U.K. up for years of bitter divorce talks with the first salvos likely to be fired at an EU leaders’ summit next week. The U.K. must now count the economic and financial cost of an exit that Cameron warned would spark a recession. JPMorgan Chase & Co. and HSBC Holdings Plc have said a so-called Brexit would lead them to move thousands of jobs out of London.

The outcome is a victory for Boris Johnson, the former mayor of London who broke with former schoolmate Cameron to help lead the “Out” campaign and sets him up for a potential tilt at the premiership. Still, the vote widens fissures in the U.K. by raising the prospect of another push for Scottish independence and leaves London as one of few pro-EU centers. Johnson was greeted by jeers and boos when he briefly emerged from his north London home.

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PUBLICITY

June 27, 2016 #151

June 27, 2016 #151

Embassy United States of America Embassy 11 Balanchivadze St., Dighomi Dstr., Tbilisi Tel: 27-70-00, 53-23-34 E-mail: tbilisivisa@state.gov; askconsultbilisi@state.gov United Kingdom of Great Britain and Northern Ireland Embassy 51 Krtsanisi Str., Tbilisi, Tel: 227-47-47 E-mail: british.embassy.tbilisi@fco.gov.uk Republic of France Embassy 49, Krtsanisi Str. Tbilisi, Tel: 272 14 90 E-mail: ambafrance@access.sanet.ge Web-site: www.ambafrance-ge.org Federal Republic of Germany Embassy 20 Telavi St. Tbilisi Tel: 44 73 00, Fax: 44 73 64 Italian RepublicEmbassy 3a Chitadze St, Tbilisi, Tel: 299-64-18, 292-14-62, 292-18-54 E-mail: embassy.tbilisi@esteri.it Republic of Estonia Embassy 4 Likhauri St., Tbilisi, Tel: 236-51-40 E-mail: tbilisisaatkond@mfa.ee Republic of Lithuania Embassy 25 Tengiz Abuladze St, Tbilisi Tel: 291-29-33 E-mail: amb.ge@urm.lt Republic of Latvia Embassy 16 Akhmeta Str., Avlabari, 0144 Tbilisi.

E-mail: embassy.georgia@mfa.gov.lv Greece Republic Embassy 37. Tabidze St. Tbilisi Tel: 91 49 70, 91 49 71, 91 49 72 Czech RepublicEmbassy 37 Chavchavadze St. Tbilisi ;Tel: 291-67-40/41/42 E-mail: czechembassy@gol.ge Web-sait: www.mzv.cz Japan Embassy 7 Krtsanisi St. Tbilisi Tel: +995 32 2 75 21 11, Fax: +995 32 2 75 21 20 Kingdom of Sweden Embassy 15 Kipshidze St. Tbilisi Tel: +995 32 2 55 03 20 , Fax: +995 32 2 22 48 90 Kingdom of the Netherlands Embassy 20 Telavi St. Tbilisi Tel: 27 62 00, Fax: 27 62 32 People’s Republic of China Embassy 52 Barnov St. Tbilisi Tel: 225-22-86, 225-21-75, 225-26-70 E-mail: zhangling@access.sanet.ge Republic of Bulgaria Embassy 15 Gorgasali Exit, 0105 Tbilisi, Georgia Tel: +995 32 291 01 94; +995 32 291 01 95 Fax: +99 532 291 02 70 Republic of Hungary Embassy 83 Lvovi Street, Tbilisi Tel: 39 90 08; E-mail: hunembtbs@gmail.com State of Israel Embassy 61 Agmashenebeli Ave. Tbilisi Tel: 95 17 09, 94 27 05 Embassy of Swiss Confederation’s Russian Federation Interests Section Embassy 51 Chavchavadze Av., Tbilisi Tel: 291-26-45, 291-24-06, 225-28-03 E-mail: RussianEmbassy@Caucasus.net Ukraine Embassy 75, Oniashvili St., Tbilisi Tel: 231-11-61, 231-12-02, 231-14-54 E-mail: ukraina_pu@wanex.net; emb_ge@mfa.gov.ua Consular Agency: 71, Melikishvili St., Batumi Tel: (8-88-222) 3-16-00/ 3-14-78 Republic of Turkey Embassy 35 Chavchavadze Ave., Tbilisi Tel: 225-20-72/73/74/76 embassy.tbilisi@mfa.gov.tr Consulate General in Batumi 9 Ninoshvili Street, Batumi Tel: 422 25 58 00 consulate.batumi@mfa.gov.tr Republic of Azerbaijan Embassy Kipshidze II-bl . N1., Tbilisi Tel: 225-26-39, 225-35-26/27/28 E-mail: tbilisi@mission.mfa.gov.az Address: Dumbadze str. 14, Batumi Tel: 222-7-67-00; Fax: 222-7-34-43 Republic of Armenia Embassy 4 Tetelashvili St. Tbilisi Tel: 95-94-43, 95-17-23, 95-44-08 E-mail: armemb@caucasus.net Web: www.armenianembassy.ge Consulate General, Batumi Address: Batumi, Gogebashvili str. 32, Apt. 16 Kingdom of Spain Embassy Rustaveli Ave. 24, I floor, Tbilisi Tel: 230-54-64 E-mail: emb.tiflis@maec.esRomania Embassy

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

Freedom Square 0114 Tbilisi, Georgia Tel: +995 32 225 06 19 E-mail: adbgrm@adb.org; Web-site: www.adb.org World Bank Office Address : 5a Chavchavadze Av., lane-I, Tbilisi, Georgia ; Tel: 291-30-96, 291-26-89/59 Web-site: www.worldbank.org.ge Regional Office of European Bank for Reconstruction and Development Address: 6 Marjanishvili St. Tbilisi Tel: 244 74 00, 292 05 13, 292 05 14 Web-site: www.ebrd.com Representation of the Council of Europe in Georgia Address : 26 Br. Kakabadze, Tbilisi Tel: 995 32 291 38 70/71/72/73 Fax: 995 32 291 38 74 Web-site: www.coe.ge Embassy of the Slovak Republic Address: Chancery: 85 Irakli Abashidze St. Tbilisi, 0162 Georgia Consular Office: 38 Nino Chkheidze St. Tbilisi, 0102 Georgia Phone: 2 222 4437, 2 296 1913 e-mail: emb.tbilisi@mzv.sk

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

Restaurants CORNER HOUSE Tbilisi, I. Chavchavadze ave. 10, Tel: 0322 47 00 49; Email: contact@cornerhouse.ge RESTAURANT BARAKONI Restaurant with healthy food.

Georgian-European Cuisine Agmashenebeli Alley 13th Phone: 555 77 33 77 www.barakoni.com CHARDIN 12 Tbilisi , 12 Chardin St. , Tel: 92 32 38 CAFE 78 Best of the East and the West Lado Asatiani 33, SOLOLAKI 032 2305785; 574736290 BREAD HOUSE Tbilisi , 7 Gorgasali St. , Tel: 30 30 30 BUFETTI - ITALIAN RESTAURANT Tbilisi , 31 I. Abashidze St. , Tel: 22 49 61 DZVELI SAKHLI Tbilisi , 3 Right embankment , Tel: 92 34 97, 36 53 65, Fax: 98 27 81 IN THE SHADOW OF METEKHI Tbilisi , 29a Tsamebuli Ave. , Tel: 77 93 83, Fax: 77 93 83 SAKURA - JAPANESE RESTAURANT Tbilisi , 29 I. Abashidze St. , Tel: 29 31 08, Fax: 29 31 08 SIANGAN - CHINESE RESTAURANT Tbilisi , 41 Peking St , Tel: 37 96 88 VERA STEAK HOUSE Tbilisi , 37a Kostava St , Tel: 98 37 67 BELLE DE JOUR 29 I. Abashidze str, Tbilisi; Tel: (+995 32) 230 30 30 VONG 31 I. Abashidze str, Tbilisi Tel: (+995 32) 230 30 30 BRASSERIE L’EXPRESS 14 Chardin str, Tbilisi Tel: (+995 32) 230 30 30 TWO SIDE PARTY CLUB 7 Bambis Rigi, Tbilisi Tel: (+995 32) 230 30 30

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

Galleries ART GALLERY LINE Tbilisi. 44 Leselidze St. BAIA GALLERY Tbilisi. 10 Chardin St. Tel: 75 45 10 GALLERY Tbilisi. 12 Erekle II St. Tel: 93 12 89

Real Estate International Real Estate Company (IREC) Tbilisi. 9 P. Aslanidi St. Tel: +995 32 238 058 Mob: 599 95 76 71 Email: Info@irec.ge www.irec.ge

GSS Car rental offers a convenient service for those who are interested in renting car in Georgia. Rental fleet mainly consist of Japanese made SUV’s, the company has various models of cars including sedans and minivans which are in good technical condition.

Contact information: Email: info@gsservices.ge.

Address: Shalva Dadiani 10

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

LIMELIGHTTRAVELINFOCENTER Address: 13 Sioni Street, 0105, Tbilisi (at the end of Shardeni Street) Phone: +995 322 999 123 E-mail: info@limelight.ge Web-page: www.limelight.ge Facebook page: www.facebook.com/limelight.ge

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

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

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PUBLICITY

June 27, 2016 #151