Caucasus Business Week #178 by Caucasian Business Week

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January 30, 2017 #178

January 30, 2017, Issue 178 - www.cbw.ge

Interview Georgia is on par with European Countries in terms of telecommunication Pg. 7

Bank Report on JSC Terabank Performance in 2016 Pg. 7

PR In Georgia, PR is often used to put out “fires”, which is a false assumption Pg. 8

Estonian Model Challenges Impact on Small and Medium Business Sectors

Larization in Georgian Economy Starting January 17, 2017 the socalled loans Larization program started. Physical bodies, who took mortgage loans in foreign currency before January 1, 2015, are able to convert them into GEL denominated loans. At the same time, advance payment commission fee will be abolished on this category of loans. Total portfolio of these loans is about 400 million USD. Subsidization concerns principal sum of bank loans or its part (no more than 40 000 USD) and its remaining value must not exceed the amount as of January 1, 2015. The Larization program participants will receive state budget subsidization in the amount of 20 Tetri for conversion exchange rate. Currently, the exchange rate is 2.69, while state budget subsidy will reduce the rate to 2.49. State budget allocations on the mentioned subsidy will be 65 million GEL. According to Ministry of Finance, all commercial banks are ready to provide due services to all clients under the mentioned program. Pg. 4

Whether Oil Companies Raised Fuel Prices before Upturn in Excise Tax

Pg. 9

At the end of 2016 Georgian Starting January 1, 2017 excise tax has increased on automobiles and fuel. «Excise tax will increase on imported vehicles and I would like to note that excise tax will be several times lower compared to rates in neighboring countries. Excise tax will also increase on oil products», Prime Minister Giorgi Kvirikashvili said. According to Minister of Finance Dimitri Kumsishvili, excise tax of a ton of petrol increased to 50 GEL from 250 GEL. Excise tax on one ton of diesel rose to 400 GEL from 150 GEL and excise tax on 1000 cubic meters of natural gas grew to 200 GEL from 80 GEL. The Caucasus Business Week (CBW) has explored current situation on the market and eﬀects of excise tax growth. Companies have misused excise tax growth fact and raised fuel prices before excise taxes went up. Pg. 5

2 GOVERNMENT

NEWSROOM Revenue Service Prepares Manual for New Regulations of Proﬁts Tax Ministry of Finance has developed a very good format that ensures dialogue over important issues for business. It is important that such communication is continued on such relevant issue as profits tax reformation.

Partnership Fund Expands Partner Research Strategy The focus should be made on agriculture, construction sector, tourism, hotel construction and processing industry, energy and those sectors which are already attracting for the banks will be represented with a less amount.

ECONOMY

A Norwegian Energy Company is Investing Eight Billion in Georgia In partnership with Enka, a listed, Turkish industrial company, Clean Energy are to build a power plant with a projected annual production of 1.5 – 1.6 terawatt hours, and 436 megawatts of installed capacity.

A New Program to Launch for Vineyard Agriculture Co-operatives According to government information, cooperative members of program participants will have a chance to get benefit from not only grapes but also realization of wine.

BANKING

National Bank Raises Monetary Policy Rate by 25 Base Point to 6.75% The decision is based on macroeconomic forecasts, under which in 2017 inflation will be mainly above the target indicator. However, in 2018 inflation will decline and will be maintained below the target indicator.

Number of Microﬁnance Institutions in Georgia Increased to 80 Following the adoption of new regulations by the Government in respect of online loan companies, some of them have been transformed into microfinance institutions.

BUSINESS

Nuts Worth $ 179 Mln Exported from Georgia in 2016 Copper and concentrates worth $ 312 million top the list of the most exported products. Ferro-alloys are on the 3rd place with $ 169 million among export products.

First Georgian Tablets to Cost 50% less and Match Georgian Educational Programs Tablets will also match the programs of schools and universities so that it will help pupils and students in the study process.

COMPANY

January 30, 2017 #178

Rustavi Azot Goes to EU Investment Ownership EU Investments holds a 100% stake in Rustavi Azot, the company managers told Business Contract. EU Investment was registered in autumn 2016.

Georgian Growth Above Target Will Aid Ailing Lari

eorgian Finance Minister Dimitri Kumsishvili said economic growth may exceed 5 percent this year thanks to tax cuts and planned infrastructure spending, helping to ease pressure on the nation’s currency. There are “realistic” prospects of beating the government’s 2017 target of 4 percent growth and meeting the World Bank’s forecast of 5.2 percent, Kumsishvili said in an interview in the capital, Tbilisi, on Monday. An additional 600 million lari (about $224 million) in infrastructure spending, a free-trade deal with China and the removal of taxes on reinvested company profits will all help boost the economy, he said. Strengthening the economy “is the answer for the lari rate, this is the main task” for the government, said Kumsishvili, 42, who was appointed in November after the ruling Georgian Dream party won parliamentary elections. The currency has declined 21 percent since June, the worst performer among former Soviet republics, and is trading at about 2.69 per dollar after sinking to a record-low 2.82 on December 21. Georgia is fighting to overcome the economic impact of Russia’s longest recession in two decades

and the weakening of the Turkish lira amid political turmoil following July’s failed coup attempt. Russia and Turkey are the Caucasus nation’s neighbors and top two trading partners. Georgian Prime Minister Giorgi Kvirikashvili said in an interview in May that he expects a decade of growth averaging 7 percent to 8 percent a year to 2026 as improvements are completed to major transport links to Turkey, Russia, Azerbaijan and Armenia. The economy expanded by 2.3 percent in the third quarter, according to the state statistical service, Geostat, which lowered Georgia’s 2016 growth rate to 2.7 percent from 3 percent. The World Bank forecast this month that Georgia’s gross domestic product will increase by 5.3 percent in 2018 and 5 percent in 2019. China Trade Increased excise levies on tobacco, cars and oil products as well as taxes on gambling will cover budget revenue lost by ending taxation of profit that companies reinvest in their businesses from Jan. 1, Kumsishvili said. The government will continue working to narrow the budget deficit from 4 percent last year, while shifting the balance of spending

away from current needs toward infrastructure investment, he said. The free-trade agreement that takes eﬀect in June will create opportunities to export more food products to China, which now buys 5 million bottles of Georgian wine annually, Kumsishvili said. Georgia is considering a visa-free regime for Chinese tourist groups to boost visitor numbers, he said. A program begun by the government and the central bank this month to allow borrowers to convert dollar-denominated loans into lari will make Georgia “less dependent on foreign currency” within three to five years, the minister said. “It’s a sign of a strong and developed country to respect the local currency,” he said. Central bank Governor Koba Gvenetadze said in an interview soon after he took oﬃce last March that clashes between the government and his predecessor over the lari’s exchange rate had dented public trust in the regulator. Ministers repeatedly criticized the bank for not spending reserves to support the currency as it declined 21 percent in 2015, a policy that Gvenetadze defended. Bloomberg

Georgia makes progress in latest Corruption Perceptions Index

eorgia’s ranking in the Corruption Perceptions Index (CPI) improved by four spots in 2016, with the country now ranked in 44th place out of 176 countries. Global anti-corruption organisation Transparency International (TI) released its annual Corruption Perceptions Index today. In the report Georgia topped many Eastern European nations, Central Asian states and even several European Union member nations. The report studied diﬀerent countries’ perceived corruption levels in the public sector. Georgia gained an overall score of 57 out of 100 - which is the highest

BUSINESS WEEK caucasus

The Editorial Board Follows Press Freedom Principles Publisher: LLC Caucasian Business Week - CBW Address: Aleksidze Street 3 Director: Levan Beglarishvili; Mob: +995 591 013936 Sales: Mob: +995 558 36 61 07 WWW.CBW.GE Email: caucasianbusiness@gmail.com

indicator since 2012. Georgia’s CPI score in 2015, 2014 and 2012 was 52, while in 2013 it was 49. TI said no country got even close to a perfect score in the CPI this year. Over two-thirds of the 176 countries and territories in this year’s index fall below the midpoint (50) of the scale of 0 (highly corrupt) to 100 (uncorrupt). “In too many countries, people are deprived of their most basic needs and go to bed hungry every night because of corruption, while the powerful and corrupt enjoy lavish lifestyles with impunity”, said Chair of Transparency International Jose Ugaz.

This year’s least corrupt countries were Denmark (90), New Zealand (90) and Finland (89), while countries with the worst results included Somalia (10), South Sudan (11) and North Korea (12). The CPI has been published by TI annually since 1995 and is based on expert opinions on public sector corruption. Since 2012, the Index has been compiled with a new methodology, making it possible to compare results from different years. The CPI is a composite index and is produced based on studies conducted by a number of authoritative organisations.

Editor: Nutsa Galumashvili. Mobile phone: 595 380382 Reporters: Medea Samkharadze; Mariam Kopaliani; Merab Janiashvili Designer illustrator: Ilia Chrelashvili. Technical Assistant: Giorgi Kheladze

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

January 30, 2017 #178

PUBLICITY

ECONO-MIX

Larization in Georgian Economy

Koba Gvenetadze President of the National Bank of Georgia

Second Phase of Stripping Commercial Banks of Noncore Assets Underway

he central bank announced the second phase of stripping commercial banks of non-core assets - President of the National Bank of Georgia (NBG) Koba Gvenetadze states. According to him, work on expanding the range of action is underway and decision will be submitted in the near future. However, he does not specify whether the new measures are agreed with the banking sector. In his words, the National Bank experts intend to look into this matter together with the business whithout specifying whether it will be the banking sector or companies engaged in other business - construction, medicine, insurance, tourism, etc., where large banks have subsidiaries. As reported, in October 2014 the National Bank of Georgia decided to prohibit commercial banks to own non-core assets. It was a response to the numerous complaints from businesses, primarily construction, about the fact that the banks own companies and consider the other players in the real estate market as competitors not giving them loans. Businessmen and experts believe that banks’ active involvement in the various sectors of the economy leads to restrictions in funding for projects, as banks are not interested in a rival company’s strengthening. The issue of ownership of non-core assets by Georgian commercial banks still remains a serious problem in the country. The National Bank of Georgia (NBG) oﬃcially banned commercial banks to non-core companies, but the law is observed formally- in reality nothing has changed in this regard. Developers say that banks still control non-core assets, and virtually nothing has changed that is why the Georgian economy is not growing.

Merab Janiashvili Economic Analyst

The Larization program participants will receive state budget subsidization in the amount of 20 Tetri for conversion exchange rate. Currently, the exchange rate is 2.69, while state budget subsidy will reduce the rate to 2.49. State budget allocations on the mentioned subsidy will be 65 mln GEL

tarting January 17, 2017 the so-called loans Larization program started. Physical bodies, who took mortgage loans in foreign currency before January 1, 2015, are able to convert them into GEL denominated loans. At the same time, advance payment commission fee will be abolished on this category of loans. Total portfolio of these loans is about 400 million USD. Subsidization concerns principal sum of bank loans or its part (no more than 40 000 USD) and its remaining value must not exceed the amount as of January 1, 2015. The Larization program participants will receive state budget subsidization in the amount of 20 Tetri for conversion exchange rate. Currently, the exchange rate is 2.69, while state budget subsidy will reduce the rate to 2.49. State budget allocations on the mentioned subsidy will be 65 million GEL. According to Ministry of Finance, all commercial banks are ready to provide due services to all clients under the mentioned program. Subsidies will not concern bodies, whose annual revenues exceeded 100 000 GEL in 2016 or total debts of their loans’ principal sum exceeded 100 000 USD as of November 28, 2016. “Objective of the mentioned scheme is to alleviate loan service burden after GEL exchange rate volatility. According to the current estimations, this program concerned mainly loans issued before January 1, 2015. These changes do not concern those, who took loans after serious changes in exchange rates, but this category is able to negotiate the issue with commercial banks and achieve loan Larization”, the NBG oﬃcials noted. The announced program concerns about 33 000 borrowers, who have taken foreign currency denominated mortgage credits before 2015. According to Minister of Finance, total portfolio of loans is about 400 million USD. “Larization program will concern about 400 million USD. This signifies this amount will not be claimed on the market, national bank will carry out direct intervention on commercial banks, cover open current positions. This amount of 400 million USD will not make eﬀect on national currency and will help GEL stabilization process”, Kumsishvili noted. However, it is worth noting that in about a week after the program inauguration only 100 borrowers have converted USD denominated loans into GEL. According to Georgian Banks Association, loans’ average rate in the Larization process made up 10-11%. In the credit conversion process, the bank grows clients’ interest rate on individual basis, based on credit history of borrowers. And this factor explains the low demand for loan Larization. Moreover, in some cases commercial banks raise interest rates on credits and add them to refinancing loan rate and this causes mistrust amid expec-

‘‘

he legislation of National Bank does not regulate such organizations, such as financial company “Georgia”-the head of National Bank, Koba Gvenetadze declared. As Gvenetadze noted in the interview with journalists, the population should pay attention what is written in the contract, not to lose their savings. The legislation of National Bank does not regulate organizations such as financial company “Georgia”, that’s why national bank used to make an announcement from time to time. The population should definitely pay attention how to secure their money. It is important to clarify what is written in the contract, what kind of responsibility they take and who takes the loan. I think focusing on it will be a base not to lose savings which population has”-declared Gvenetadze.

National Bank is Expected to Spend 400 million USD for Loans Larization, while Reserves were not Applied for Curbing National Currency Depreciation

‘‘

Finances Should Be Secured

January 30, 2017 #178

tations that monetary policy may be tightened. «The interest rate will be close to market interest rate, depending on the clients’ solvency, There are various coeﬃcients under which commercial banks appraise level of risks, but, on average, we expect that interest rates will be closer compared to the current rates and this is about 10-15%. this is a floating rate for mortgage loans. If a client wants a fixed rate, this depends on maturity period and interest rates vary due to maturity periods. We foster commercial banks to have adequate resources in both GEL and USD so as interest rate be close to market rates», NBG vice president Archil Mestvirishvili said. The Government-proposed Larization program is a part of dedollarization policy. Starting January 1 new changes were enacted for credit organizations, under which commercial banks will be banned to issue loans of about 100 000 GEL in USD. The amount will increase to 200 000 GEL in 2018. The time will show whether government’s steps for economic Larization are eﬃcient. However, it should be noted that the economy dollarization is determined due to deposits. Consequently, Georgian citizens may convert credits in national currency by support of Authorities and in fears of further depreciation of GEL exchange rate. However, if the society does not acquire confidence in GEL, they will not be able to accumulate finances in national currency. And confidence in GEL depends on exchange rate stability. It should be also noted that Government and National Bank introduced Loans Larization program for alleviating losses after GEL exchange rate depreciation. But we should remember that over the past 2 years our society expected NBG to spend currency reserves and tighten monetary policy to curb GEL exchange rate depreciation. In that period NBG refused to spend international reserves, while under Larization program NBG may have to spend 400 million USD reserves, even more so under exchange rate preliminarily determined with commercial banks. As a result, commercial banks will receive serious benefits. Under Larization program, National Bank will supply foreign currency to commercial banks. This signifies that NBG currency reserves may decrease by 400 million USD. According to NBG indicators, as of December 31, 2016 Georgia’s currency reserves make up 2.56 billion USD, down 12.6% compared to October 2013, when reserves volume recorded highest figures (2.9 billion USD). It is interesting whether GEL exchange rate would have depreciated by 60% if NBG had spent 400 million USD reserves in due time on GEL exchange rate stability. In this case state budget would not have to subsidize clients damaged by the mentioned process nor the whole economy would be damaged after GEL devaluation.

“National Bank regulates commercial banks. Process of stripping commercial banks of noncore assets has been completed and no commercial bank owns companies. We want to regulate and supervise the so-called bank holding companies. This signifies we will supervise over groups above commercial banks. We must have information on processes in these groups.”

Murtaz Kikoria NBG vice president

January 30, 2017 #178

FUEL

Fuel Price

Whether Oil Companies Raised Fuel Prices before Upturn in Excise Tax

MARIAM KOPALIANI

Starting January 1, 2017 excise tax has increased on automobiles and fuel. «Excise tax will increase on imported vehicles and I would like to note that excise tax will be several times lower compared to rates in neighboring countries. Excise tax will also increase on oil products», Prime Minister Giorgi Kvirikashvili said. According to Minister of Finance Dimitri Kumsishvili, excise tax of a ton of petrol increased to 50 GEL from 250 GEL. Excise tax on one ton of diesel rose to 400 GEL from 150 GEL and excise tax on 1000 cubic meters of natural gas grew to 200 GEL from 80 GEL. The Caucasus Business Week (CBW) has explored current situation on the market and eﬀects of excise tax growth. Companies have misused excise tax growth fact and raised fuel prices before excise taxes went up, Paata Bairakhtari, analyst for Association of Young Financiers and Businessmen (AYFB) noted. According to analysts’ estimations, since December 2016 fuel prices have increased by 18.26%, while oil products excise rate increased by 15% starting January 1. As a result, price of one liter of Premium fuel hit even 2.19 GEL. «Currently price of one liter of Premium fuel is about 2.19 GEL and increased excise tax is named as a key factor. However, if we analyze main operating factors, it is evident that companies have increased prices

much more as compared to real eﬀect form excise tax and other fundamental factors. Starting January 1, 2017 price of one liter of fuel has increased by 15%, while since December 16 fuel prices have increased by 18.26%. We should also remember that over the past month global oil prices declined by about 10% and for the past 2 weeks GEL exchange rate strengthened by

a result of December 10 decision by OPEC, under which OPEC member countries reached a new agreement on oil extraction reduction. By that period Georgian oil importer companies raised price of a liter of petrol by 5 Tetri on average (GEL exchange rate was 2.58 in that period). After that, national currency depreciated and companies raised fuel prices by additional 5 Tetri», Bairakhtari said.

Starting January 1, 2017 price of one liter of fuel has increased by 15%, while since December 16 fuel prices have increased by 18.26%. We should also remember that over the past month global oil prices declined by about 10% and for the past 2 weeks GEL exchange rate strengthened by about 8% about 8%», Bairakhtari said. Several fundamental factors have preconditioned upturn in prices over the past 2 months, namely: rise in global oil prices, national currency devaluation and rise in oil products excise tax. «Over the past 2 months, on Georgian market fuel prices were corrected 5 times and, in whole, fuel prices rose by more than 18%. On Georgian market several fundamental factors were named for growth in prices, such as upturn in oil prices on global exchanges, national currency depreciation and excise tax growth on oil products. In December 2016 oil prices slightly increased on global markets and the price of a barrel made up 58 USD, as

According to analysts, oil products importer companies carried out one more preventive step at the end of December 2016, when they increased fuel prices by 5 Tetri, while all key parameters aﬀecting fuel prices remained unchanged. The companies have used expected growth in excise tax for further growth in profits and included excise tax margin in fuel price, Paata Bairakhtari noted. «Today oil companies operate under unjust tariﬀs and the state cannot take counter measures. As a result, our consumers turn out in complicated situation», Bairakhtari said. In similar situations it is important that oil companies feel social responsibility before society and do not

misuse all situations. No oil importer company makes comments on whether oil companies have put higher excise tax in price. It is unclear on what AYFB calculations are based and therefore, they cannot make comments on similar statements. Vano Mtvralashvili, head of Union of Oil Products Importers finds the mentioned accusations ungrounded. It is ungrounded statements as if oil companies have included increased excise tax into fuel price, Vano Mtvralashvili said. Current tariffs reflect international oil prices, GEL exchange rate against USD and amendments to tax legislation, Mtvralashvili said. Current tariffs represent a combination of all the mentioned components, he added. Current market prices are very competitive, Mtvralashvili said. «Operators have set different tariffs, including branded operators. Prices vary in non-branded segment too. In whole, various companies operate under various tariffs and this proves there is sharp competition on the market», Mtvralashvili noted. According to forecasts by Mtvralashvili, in the near future fuel prices are not expected to rise, but there are two components that are not stable over the last period. The question is of international oil prices and GEL exchange rate against USD. If these two components are stable, prices will not grow, but it is difficult to say what happens tomorrow and the day after tomorrow, he added.

INVESTMENTS

January 30, 2017 #178

Foreign Investments in Development Sector Make up about 30-40%

DEVELOPMENT SECTOR Over the past period the scales of construction works have particularly increased in the country, especially in Tbilisi. It should be noted that the Georgian construction market becomes more and more attractive for foreign investors. The Caucasus Business Week (CBW) has inquired how successful the development business is in Georgia and whether this sector is attractive for investors.

As to important factors that inspire foreign investors to put money in this country, Abuladze said that amid global confrontation, Georgia may be characterized in terms of statehood strengthening, development, progress, safety and security, social provision, democracy, public welfare improvement, investments attractiveness and growth in global image and perception.

FOREIGN INVESTMENTS

DAVID BAGHASHVILI

Georgian development market is very attractive, especially in terms of simplicity for taking construction permits, Tornike Abuladze, representative of Developers Association, noted. Estonian partners of ARCI development company have unveiled plans to sell their development business in Ukraine and to move to Georgia. “There is much demand for real estate in Post-Soviet space and that’s why this sector is attractive. On the other hand, Georgia is an exception thanks to its simplified licensing system”, Abuladze said. Foreign investors show growing interest in Georgia’s development market. Currently, ratio of foreign investments in Georgian development sector is 30-40%, Abuladze pointed out. “Before 2007, any person, being a doctor or a designer, could apply to commercial bank for loans and launch a construction project through others’ money. This was an incorrect model. There was a boom of construction projects in that period, but under incorrect model. A major part of developers were Georgians. There is nothing to say about the crisis period. Starting 2014-2015 the market started reviving. Today, Georgian development sector has drawn a great number of foreign investments”, Abuladze noted. The years of 2014-2015 recorded a slowdown in residential buildings category, while quantity of transactions increased in 2016, Irakli Kilauridze, managing partner for Colliers International Georgia, noted. However, results of GEL devaluation will appear at the beginning of 2017. Positive tendencies are recorded on hotels market, Kilauridze pointed out. “Hotels of various international brands are being constructed. Number of tourists is also growing and the demand will be huge in the future”, Kilauridze said. Georgia is a tourism country and a direct market for hotels business. Consequently, this segment is very interesting and attractive for investors, he added. As to development of residential buildings segment, the demand is huge and transactions are recorded for economy class real estate in suburb zones. Over the past years residential buildings segment developments was intensified thanks to improved social-economic conditions of our citizens, aspiration for improving residential conditions, growth in welfare of families, increasing attractiveness of business environment and growth in investment inflows, Doctor of Economics, professor Rati Abuladze from Scientists’ Initiative Group, noted. Professor Rati Abuladze noted that developers operate under various economic mechanisms based on normative standards, market requirements, economic policy and so on. Moreover, attractiveness of development business in the country is conditioned by: • Low market competition (market is not saturated yet); • growth in market potential; • unemployed segments (in regions); • business support policy in the country; • the existing pricing policy (that is more favorable for business sector compared to population) and so on. Apartments construction is the most productive segment of development business because of many factors, rati Abuladze said. 1) state budget and government programs for 2017 represent one of the key priorities of regional devel-

opment, infrastructure arrangement and space arrangement. These factors foster sustainable development of the country, improve living conditions and promote development business. Moreover, it is theoretically recognized that 10% contraction in social expenditures grows number of shelter applications by 0.83% per 1000 families (emc.org.ge). There is a different situation in our country. Over the past years, social expenditures are growing every year, as well as socially-oriented budget amount. “It is also impressive that Georgian Authorities provide residential spaces for internally displaced persons. To this end, residential houses are constructed and moreover, apartments are bought from developers (residential spaces have been already transmitted to more than 24 000 IDPs). In whole, government is interested to build new residential spaces for IDPs through partnership with investors. As a result, investment attractiveness of this field will further increase. It should be also noted that growth in socialeconomic inequality in Georgia and in the world, labor market competition, volatility on political and capital market, global and local threats make influence on space changes and pricing policy. However, these factors cannot diminish importance and revenues of apartments segment in development business”,rati Abuladze said. As to important factors that inspire foreign investors to put money in this country, Abuladze said that amid global confrontation, Georgia may be characterized in terms of statehood strengthening, development, progress, safety and security, social provision, democracy, public welfare improvement, investments attractiveness and growth in global image and perception. It should be also noted that Georgia’s macroeconomic environment is improved year to year (statistically); the whole national revenues show growing tendency (30884.8 million GEL in 20115), average monthly incomes of population (1039.9 million GEL in 2015) and average monthly incomes per households (1022.3 GEL in 2015) also grow, rati Abuladze noted. It is worth noting that last period attractiveness of the development sector has considerably increased and investors are also demonstrating adequate “reaction”. According to Geostat, foreign direct investments in development sector made up 49 847.5 thousand GEL in 2013, 316 588.1 thousand GEL in 2014, 110 678.4 thousand GEL in 2015. The figure made up 106 183.5 thousand GEL in January-September 2016 (total amount 15%). “It is worth noting that along with growing attractiveness of development sector, the sector’s output also grows (5.562.1 million GEL), as well as space of finished facilities, number of construction permits and number of employees (69.970 persons). At the same time, crediting volume issued to development sector by commercial banks also grow year to year (816.071 thousand GEL, 2016)”, Abuladze noted. Quantity of weddings has considerably increased over the past years (coefficient of weddings 7.8 (per 1000 make) and consequently, quantity of those wishing new apartments has also increased. Volume of money transfers to the country annually positively affects the apartment construction sector too (1 032 275 thousand USD in 2016), he said. Global developments have raised serious challenges before national economies and violated balance of investment activities, however, Georgia’s business space remains an attractive target for international business interests thanks to correct political direction, stable and safe environment, protected and stable business interests in the country. Consequently, investors also pay attention to attractiveness of Georgian development sector”, rati Abuladze noted.

January 30, 2017 #178

INTERVIEW

BANK

Report on JSC Terabank Performance in 2016

he year of 2016 was a period of significant challenges for Terabank. The bank has coped with all challenges successfully. Small and medium business sectors (SME) represent a main target segment for the Bank. At the end of the year, Terabank’s market ratio rose by 1.2% to 4.4%. Terabank has met the year of 2017 with a 43% growth in SME credit portfolio and a 20% upturn in number of clients. In 2015, after 17-year history of Bank existence, it was decided to revise business strategy and it became necessary to change the bank’s appearance and communication model. Following visual revision of the concept, Terabank team has introduced new service standards, improved products with the aim to provide maximal comfort for clients. «In 2016, based on the bank’s business strategy, a unique product was created for micro and SME clients – Tariff Partner. The product provides special comfort for companies in everyday bank operations. The bank has also introduced a special offer for microbusiness companies – 10% of interest rates paid for a year is returned back in case of borrowing a loan», Akaki Sanikidze, head of product development department, noted.At the end of 2016 Terabank provided support for major startup event with participation beginner and successful entrepreneurs of 16 different industries. At Startup Market Terabank offered special package for entrepreneurs – free service for all bank operations and cards for 6 months. Terabank has introduced several special products on the retail market, including Flex Deposit, which protects clients from unexpected cases. It is a type of term deposit with special flexible conditions. Unlike other term deposits, in case of withdrawal of sum in advance, interest rate is charged due to the amount of the effective time. In 2016 Terabank’s Travel Card was very popular that enables the owner to withdraw money free of charge from any ATM, carry out online payments at trade and service outlets. In 2017 Terabank will continue working on business strategy developed in 2016 and plans to intensify efforts in small and medium business directions and improve products. Comfort of Finance House is also expressed in diversity of distant channels. Mobile Bank application of Terabank simplifies management of own accounts. In the near future a new Internet bank will be launched with flexible and functional interface. E-commerce direction has become very popular in contemporary business and in 2016 Terabank intensified efforts in this direction too. The bank plans to improve the service and transform i into an attractive product for small and medium business sectors. Along with diverse products, Terabank is expanding the network of branches all over Georgia. Currently, Terabank owns 23 branches and service centers in Georgia under My Finance House concept. The figure is expected to rise to 27 service centers in 2017.

Georgia is on par with European Countries in terms of telecommunication Company “Huawei” started operating in Georgia in 2000 and after successful 16 years played significant role in countries’ telecommunication market development. “We are on the same page with most of the European countries, in terms of telecommunication. We already have supported Magticom, which has launched 4.5G network that currently is the most advanced commercial technology in the world. I can say that Huawei Georgia developed together with Georgian Telecom market. In 2000 we started with only 5 employees in a small hotel meeting room, in 2007 we cooperated with Magticom and built the first CDMA network in Georgia. 2013 - we supported Magticom to renew their 2/3G network in west region, at that moment Huawei’s development in Georgia stepped on a fast track. Now in 2016, we have 300 employees and our equipment is serving to more than 75% of the mobile users in Georgia, which is significant achievement” – declared General Director of Huawei, James Liang. - Most of the readers know you as a producer of mobile devices and tablets, but technology development side of the company is one of the most impressive direction. What would you comment on this topic? - “Yes, it is interesting that most of the population knows Huawei , for its mobile phones, because this is what you mostly see is shops or in advertisements. But what you may not know is that we are providing telecommunication services for most of Georgian

“

NOWADAYS GEORGIA IS BECOMING MORE AND MORE IMPORTANT FOR HUAWEI BUSINESS IN CA&C REGION AND THE PIONEER IN TERMS OF ICT DEVELOPMENT IN THE KEY POSITION OF THE SILK ROAD CONNECTED TO CHINA.

population. Huawei started with carrier business in 1987. Within these 29 years, company was concentrating on the telecommunication technology development. Starting from switches to Optical Networks like DWDM/GPON, then 2G /3G /now 4G networks. Let’s say in 2G era we were new comers in the Mobile market, in 3G era we catch up and became a major player, now, in 4G, 4.5G era we are leading in the technology. In terms of Georgian market, if you are a Magticom mobile network user, or you are a Geocell mobile network user and using mobile phone in West region like Batumi or Kutaisi, then backside is Huawei’s equipment and solution which is providing service. We are cooperating with Magticom to build their new IPTV system that is just launched. We will keep trying our best to provide better service with higher quality. - What about Huawei team all over the world? - “We have 176,000 employees all over the world, with 79,000 R&D employees. Besides, we have 16 R&D centers and 36 Joint innovation centers all over the world that will ensure Huawei and our

Customers to keep leading positions in technology”. - Let’s talk about the recent event you had, briefly tell us about “Huawei Information and Communication Technologies Exhibition Tour in Central Asia 2016”, as we know, Tbilisi was one of the first destinations of the event. - “Nowadays Georgia is becoming more and more important for Huawei business in CA&C region and the pioneer in terms of ICT development in the key position of the Silk Road connected to China. The aim of the event was to bring the most advanced technology developed by Huawei to Georgian Market. In the exhibition truck located in Tbilisi, visitors could see the latest services like VoLTE etc…If you are a 4G user, when calling your friend you are facing an unpleasant 8-10 second waiting time. If we deploy VoLTE solution in operators’ Core network, the waiting time will become Less than 2 seconds and you may nearly not feel it, your friend will receive your call immediately after you dial the number. The event was attended by Georgian operators, representatives of Georgian government and business partners”. - Let’s talk about Huawei’s future plans, after 16 successful years on the Georgian market. - “First of all we are staying on the market and will keep supporting our customers to provide better service to their customers, bringing new technologies like VoLTE /5G/ IOT etc.. in order to build a better-connected Georgia and enrich communication and life. Now we are also starting the Enterprise business in Georgia. We provide very good IT equipment like Server/Storage and UPS etc. with higher capability and less energy consumption. We also provide Cloud computing, smart city, and Safe city solution to make people’s life more convenient and safe. In this field, we are ready to share the benefits with all of our end users and partners”.

January 30, 2017 #178

Interview with NODAR KANCHAVELI, director for Silknet PR and Marketing director.

“We know that in Soviet Period marketing and PR directions were less required. Therefore, these ﬁelds have the history of only 25 years in Georgia”

In Georgia, PR is often used to put out “fires”, which is a false assumption - What are you by profession? - It may be surprising, but I am a lawyer by profession. I have graduated from Ivane Javakhishvili Tbilisi State University, later I also finished MA course in the Netherlands, in the field of urban management. - Your first job place. - I started my first job at Tbilisi Municipality, namely, in Old Tbilisi Board. - Current job and position. - Director for Silknet PR and Marketing Department. - Your First Success. - My life has proceeded in a very interesting way. Important novelties happen in may career in every year. Therefore, I believe I have attained much success during this period. This is very important for self-motivation and higher self-confidence. As to my first success, I can remember several projects I have implemented at initial stage of my career that helped me in correct self-evaluation and determining correct plans for the future. There were several similar projects. Naturally, there were opposite outcomes too, when this or that plan was not finished in compliance with initial plans, but similar failures should not make a person desperate. On the contrary, we should make correct analysis of what reasons have preconditioned failure or/and goal and then we should start aspiring for a new objective with new forces. This is certain passion. - Business, project that you take pride in even today. - I have noted in previous question that there are several projects that I take pride in. I believe the projects for rehabilitation/development of one of the regions of Georgia was a special one in which I have participated. We have implemented this project by support of World Bank and I believe we have made very important aﬀairs for our country. - Field where you would never work. - I could not be a doctor. - What factors make a person successful in your field? Besides knowledge, what special features are required. - Marketing and PR fields were widely established in Georgia several years ago and these fields are being developed stage by stage. We know that in Soviet Period marketing and PR directions were less required. Therefore, these fields have the history of only 25 years in Georgia. If we make comparison to other fields, this is a very short period for developing these fields.

“

If PR and marketing cohabit in company strategy, if it analyzes factors, results and feels the pulse, then business is also developed dynamically and companies do not have to expect ﬁre hazards either.

As to what factors lead a person to success in this field: 1. Initiativity is a very important component. We should not be afraid of new ideas and their implementation; 2. We should have good understanding of consumer needs and then we should correctly plan how to show up our products and services. This signifies we should always think as a consumer, not as a producer or seller. 3. You should be self-organized, because this is a field, where you have to take into account many details to be successful and organizational skills are required to cope with so many details. To put simply, all components of classical management are represented in this business. - Is it possible today in Georgia to learn PR at professional level, or international knowledge and experience are required? - Today Georgia provides various opportunities to learn PR profession. We have qualified lecturers, trainers, who are practitioner specialists with due experience to transmit all details and skills to listeners and students. The main thing is that we should know instruments of modern PR communications and international technologies and it is possible to receive required knowledge and practical recommendations in Georgia too that will help you in successful fulfillment of PR manager’s functions. - Is PR field perceived and understood in Georgia in its classical nature? -In Georgia PR is mostly used for neutralizing fire hazards. This is an erroneous attitude. If PR and marketing cohabit in company strategy, if it analyzes factors, results and feels the pulse, then business is also developed dynamically and companies do not have to expect fire hazards either. - How easily do you settle crisis situations and take decisions? Do similar factors damage working process? - We always have to cope with emergency situations when leading a big organization and a big structural unit in this organization. A manager studies these cases and in the course of time acquires due experience and takes required decisions in similar situations. I believe this is one of the strongest aspects of me. -Interesting episode from your life that has changed your lifestyle. -I would remember the episode, when at one of Tbilisi cafes I and my friends set plans for continua-

tion of my studies abroad. Later this decision turned out decisive for valuable advancement of my career. I believe this episode has changed my life. - Where would you try efforts if not this profession? - If not PR and marketing fields, I would work in public sector anyway, where I have spent many years. However, I always had aspirations for banking sector marketing and PR directions. We know that not only business sector applies these directions. - What are your strong personal features? - I would name several ones. The main thing is to apply them in everyday life: 1. I always try to listen to everybody, especially inferior staff, because they express the frankest positions. 2. I always try to be self-organized; 3. I try to be friendly, not sever at office. -What does the employer company give you? What makes it interesting for you? -Silknet company has been operating on telecommunications market since 2010 and it is leader in supply of telecommunications services. We hold major market ratios in internet and television segments. The company employs about 1500 persons. It is very interesting for work in such a big company. Telecommunications sector is being developed at quick paces and we do not have time to relax. Even more so, our company has the name of a leader and stable business. All of us wants to establish cuttingedge technologies in Georgia. This is our certain responsibility before our subscribers. Therefore, we permanently seek, analyze and make advancements. It is also very important to organize a valuable team. I communicate with partner organizations, many interesting people in everyday regime. Themes and initiatives that I have been implementing jointly with my team finally creates my career and biography. To put simply, working for Silknet brings many good friends and good experience. - What makes major discomfort in working process? - My attitude to project, business. If I think I am making an incorrect project, I cannot perform the job at valuable level. - Where do you see yourself after 20 years? -I have never thought about this. But now I guessed that after 20 years I would like to live with my family members and friends in everyday life with interesting business and more results.

January 30, 2017 #178

ECONOMY

ESTONIAN MODEL CHALLENGES – IMPACT ON SMALL AND MEDIUM BUSINESS SECTORS

KETEVAN MELKADZE - ISET MA Student

owever, it is interesting to analyze gaps in this model and what obstacles may arise after its enforcement, how prepared Georgian business sector has met the new regulations. In autumn 2015, under grant of USAID project of Governing for Growth (G4G), Association of Young Economists carried out assessment of impact of introduction of Estonian Model regulations in Georgia (RIA). Under the document, the authors have appraised potential economic effects after enforcement of Estonian Model. The analysis shows one-time effect that will arise in 1.5 year after the model introduction. Under the assessment, the reform will bring positive effect on investments. Stock capital will increase by 3.23%. This signifies economic agents will implement more investments, real GDP will increase by about 1.44%, total private consumption will increase by about 0.85%. Besides positive influence on macroeconomic indicators, the model is also expected to bring about 3% budget deficit expansion, as well as legislative and other risks. Estonia carried out profits tax reformation in 2000. The report proves that the reform has considerably improved macroeconomic parameters of the country and condition of companies. It is worth noting that reform impact scales vary in case of Georgia and Estonia. Reforms impact was higher in Estonia. This difference may be explained by tax burden that existed in Estonia before 2000 and its alleviation has given huge opportunities to Estonian companies for profits reinvestments. Moreover, higher effects of reform were mainly preconditioned by considerable contraction in bureaucratic expenditures, while in Georgia taxation system is more liberal today compared to Estonia in 2000. This signifies that we have better starting positions for reformation process. Consequently, we will receive less effect compared to Estonia. According to the model developed in the regulation impact assessment report, scales of compensation actions were calculated and this signifies that the mentioned deficit may be replenished by raising the incomes tax by 1% or growing the consumption tax by 1.25% (taxes on purchase of goods and services that is paid by a consumer. For example, such VAT, excise). According to their recommendations, in the process of moving to a new balance position the Government should not increase administrative costs during several years. Economist Irakli Kipiani told Eugeorgia.info that Estonian Model enforcement will definitely make positive impact on small and medium business sectors, because similar companies used to make reinvestments and put finances in the company development, before enforcement of this model. “These companies will not change their conduct and they will put this sum in reinvestments. They will save 15% in addition. Therefore, I believe this model will bring positive effect for small and medium business companies. As to reforms, they were implemented very badly, I think”, Irakli Kipiani noted. Kipiani refers to the regulation impact assessment document prepared by Association of Young Economists, under which the Government was to implement a number of reforms jointly with Estonian Model so as to reap positive results of the model. Under the research, reforms have mighty effect on investments growth, while other aspects, such as institutional instability expressed in dissolution of stability of formal institutions because of various political changes, may shadow positive effect of reforms. As a warning, the document mentions that if the Government adds amendments to Tax Code, budget expenditures should not increase for several years. “Under one of the recommendations, Government was to maximally cut bureaucratic costs, much more than expected after Estonian Model enactment. However, Government has raised excise tax, did not reduce bureaucracy expenditures considerably and therefore, Estonian Model is not giving expected results today. Under the research, private sector was to accumulate about 500-600 million GEL thanks to these reforms. Today in the 2017 budget approved by third hearing, the business sector can save only 300 million

GEL. This signifies Estonian Model suffers from double “inflation” because of other incorrect reforms”, Irakli Kipiani said. Estonian Model genuinely brings positive effects, especially for small and medium business sectors. However, financial managers of many companies have analyzed the model details and some of them made the model expediency questionable, Shota Komladze, manager of taxationcustoms direction of Georgian Business Association, said. “Under the new model, loans and relations with offshore companies are taxed jointly. Companies’ loans and relations with offshore compnies become more expensive in advance and business sector does not like this, but this taxation eradicates money laundering risks”, Shota Komladze noted. Another important issue is how prepared small and medium business sectors have met the model and whether Government had tight communication with business sector representatives prior to implementation of legislative amendments. Government genuinely have problems with communication with business sector, Irakli Kipiani noted: “Before excise tax introduction, Government had not negotiated the issue with any vehicle importer company. Government just told them that starting January 1 they would not continue their business activities in previous regime. I suppose Government does not know how to communicate with the business. Any reform should meet business sector interests”, Irakli Kipiani noted. Vakhtang Shengelia, a representative of BLH (Business &Legal Hub) consulting company talks about challenges related to the new model introduction. He explains problems related to model implementation: “Small-budget companies have to take higher costs for hiring professional accountants. Therefore, I think small companies will face certain difficulties. However, in midterm and longterm perspectives I think the new model will make positive effect on small and medium business companies”, Vakhtang Shengelia said. The model has not received a valuable form yet and the Government continues working in this direction, Shota Komladze said. “Naturally, we expect changes. We have introduced several ones. The one thing is that those, who paid profits tax in ordinary regime in 2016, if they share profits, including profits of 2016, to 2017, 2018 and the following years , they will have to pay tax on taxed profits in the part of dividends. Government agrees on this issue and shows readiness to

make amendments to the legislation, but no ideal model has been represented yet. This is not a simple job to improve this gap”, Shota Komladze said. Georgian Business Association has already submitted a package of amendments to Government to prevent taxation in the process of purchase of securities in turnover of foreign exchanges, because in this case companies have to pay 15% higher taxes for trade on exchanges. Government has taxed purchase of securities in free turnover by 15% and in this way restricted companies to sell and buy shares in their own companies, as well as money laundering in this way. Shota Komladze asserts that these amendments should not concern purchase of securities in free turnover, because trade process on exchanges proceeds in transparent regime and money laundering risks have also disappeared. When estimating influence of Estonian Model on foreign investments inflow, Shota Komladze noted that losing profits

“

UNDER THE NEW MODEL, LOANS AND RELATIONS WITH OFFSHORE COMPANIES ARE TAXED JOINTLY. COMPANIES’ LOANS AND RELATIONS WITH OFFSHORE COMPNIES BECOME MORE EXPENSIVE IN ADVANCE AND BUSINESS SECTOR DOES NOT LIKE THIS, BUT THIS TAXATION ERADICATES MONEY LAUNDERING RISKS

“

The year of 2017 started with significant changes for business sector. Namely, Estonian Model of profits tax reformation came into force. The model introduction process generated various estimations from the side of businessmen, politicians, economists. Everybody agrees that the Estonian Model will genuinely bring positive eﬀect onto business, especially, on small and medium business sectors.

of 100% deduction of amortized fixed assets will bring restrictions to the investors who plan to become profitable companies in short-term period. However, for investors oriented on long-term objectives, this model will genuinely bring stimulating effect. As to difficulties related to the law enactment, adaptation period will run definitely. It is also difficult to say whether new model will be simpler for small and medium business sectors in terms of administrative aspects. “We even applied to Ministry of Finance not to use strict measures in relation to business bodies in the first months, because many companies cannot even fully realize the law formulations. They should pass a transient period for several months and easier get adapted to new realities. I do not think administrative aspects will go better, because they used to fill out declarations every year and now they have to do the same every month. It should be also noted that small companies have simpler operations”, Shota Komladze said.

Finally, Estonian Model introduction is a step forward for economic stimulation. Everybody agrees that the model is especially attractive for small and medium business sectors. However, it should be also noted that eﬀect of Estonian Model greatly depends on various factors in Georgia. According to economists and businessmen, the model will bring important positive eﬀects in midterm and long-term periods, while before, Government should not considerably expand administrative expenditures and it should curb budget deficit in this way. Any legislative amendments should meet business sector’s interests. Another important aspect is the existing gaps in Estonian model and readiness of business sector. Small and medium business bodies may easier fill out declarations, but moving to essentially new model will make them take additional costs and a certain adaptation period is required so as financial managers grasp the new system details.

BUSINESS

January 30, 2017 #178

Bidzina Ivanishvili Sold Three Artworks for 112 million USD Georgian billionaire Bidzina Ivanishvili has sold three artworks from his own collection for 112 million USD, the Russian Forbes reports. According to the edition, Ivanishvili sold the last work at Christie’s auction in 2016 for 66 million USD. Initially, the work was estimated at 40 million USD. The mentioned work had sold for 27 million USD in 2006. At the same time, the Russian Forbes unveils that in 2016 Ivanishvili had put out 4 masterpieces for auction. According to the edition, Ivanishvili’s property is estimated at 4.8 billion USD.

TECHNOLOGY

FURNITURE

Liquidink-Mixture of Old and New Style Wooden Armchairs material to produce furniture. After some time, we will try to oﬀer more diverse products to customers. Tell us about yourself, what kind of experience do you have in this field? I am an architect. I graduated from Art Academy in 2015. During 4 years, I learned a lot about the connection between subjects and nature. I am going to study more about product design because it is my field of interest. My 6 months architect experience in D Mark Company helped me to succeed. Liza Timchenko is an interior designer. After she graduated from Art Academy, she got her first experience in the rooms company and in Object

Liquidink is a new Georgian brand, which was founded a month ago and produces wooden armchairs. The business was an initiative of two friends, Pito Seturidze and Liza Timchenko. Pito who is architect and Lisa, who is an interior designer are not planning to expand the production.Pito will talk

about how they started their business and what they are oﬀering. Tell us about your start up, what is Liquidink? I and Lisa know for many years that we should have planned our profession and future business together. We started to work on wooden armchairs and wood is quite interesting

NEWS

HAND-MADE

Edvex- Startup Which Oﬀers Paying to Locate Ads on Automobiles

GT Hand-Made Bags Made in Georgia: Stylish and Convenient

“Edvex” is an innovative platform which connects drivers and brands with each other. Any driver can locate Ads on their automobiles and earn extra income. Edvex mobile application will monitor how many kilometers the driver will pass and calculate the salary according to this data. As for brands, they will be able to work online and follow cars with ads, get detailed information about kilometers they passed and calculate ,supposedly, how many people saw the Ads.

Up to 300 Georgian Wine Marani With the initiative of Georgian Wine Association, for the first time in Georgia, tourist map has been created, which is equipped with QR code navigation which helps tourist to easily find interesting direction and visit diﬀerent Marani, restaurant or hotel. There are up to 300 destinations included in the guide book. According to Tata Jaiani, almost all Marani, restaurant and guest house are entitled with QR. With the special application, tourist is able to switch to Google map and visit the direction he would like to check.

The founder of handmade natural leather bags GT, Giga Tavdgiridze has been producing his product since 2015. He graduated from Technical University but his current profession is very diﬀerent from the academic one. Tavdgiridze started design work lately, but he already took part in Tbilisi and Adjara Fashion Week. Tell us how did you come up with an idea to start GT business and when did you start it? I used to work in one of Ads Company for 15 years, but I left the job because of my personal reasons. After that I made my first leather purse for my family. I bought the material myself and my family liked it a lot. I started making purses in 2015. I don’t get individual orders because i make the purses and sell product. Which target group do you have for your purses? – My purses are for both men and women. GT purse concept is vintage. It is made exclusively. I have done combination of wood and leather, as well as leather and other materials. I have already made 9 collections and I am working on my 10th collection now. At one of the exhibitions, out of 12 purses, two of them have been sold. I always work on making my products more comfortable. What do you think, what should government do to support business development? If the government supports my business, it will be nice. For example, I would make leather bags for pupils and soldiers.

later. Currently, she is a private interior designer. How is your product diﬀerent and how makes your product unique? It is hard to talk about it because we are still in the process of searching, observing materials, trying to learn more. It is getting more interesting. We have more ideas and we both like the mixture of old and new style. We don’t think we have competitors because we have our own ideas and others have theirs. What are your future plans and expectations? First of all, we want our brand to become famous and demanding not only in Georgia but abroad. At the same time, I want to study abroad to do something more in this industry.

Georgian App Augep Recognizes Unknown Named Dishes Can you remember your last visit at Chinese restaurant ? – There are so many different dishes with difficult and unknown names, or when you’ve been at French restaurant also with different unknown named dishes. So Georgia founded app, Augep helps you to choose meal at the restaurant for more than 30 minutes. It’s really difficult to choose the right dish when you don’t know what it looks like and exactly what are the ingredients it’s made of, you have to ask waiter many questions about menu and dishes, and in case if you travel in foreign country and don’t know local language it becomes harder to talk with waiter.Sometimes also it’s really dangerous for your healthy, because some people have allergies on some ingredients of the food. Augep is the first augmented reality menu, It helps to make reasonable decision in case if you don’t know or never tested some of the dishes at the restaurant.

January 30, 2017 #178

ADVERTISING MARKET

An important part of trials were shaped as a precedent in the practice of Supreme Court of Georgia, in both directions: contractual and tax disputes.

Reliable Partner Proved in Time – 10 Years of Success of GLCC Law Company

oday GLCC law company marks its 10th anniversary of successful operation on the market. From very inception, the company is oriented on development. The 10-year success of GLCC company was preconditioned by joint eﬀorts and contribution of founders, employees, a team of professional lawyers, clients and partner companies. Professionalism and team spirit, honesty in business and devotion to clients – these are key values of the company lawyers. More than 300 clients with successful legal disputes of more than 20 million USD, legal support for projects of more than 1 billion USD this is an incomplete list of the company achievements for 10 years. An important part of trials were shaped as a precedent in the practice of Supreme Court of Georgia, in both directions: contractual and tax disputes. The list of GLCC clients comprises leading financial institutions, multimillionaire investment funds, major agriculture manufacturers, healthcare organizations, communication companies, development companies, real estate companies, international nongovernmental organizations and physical bodies. It is important that GLCC partners are participating in legislative process on such topics as insolvency, entrepreneurship, arbitration, licensing and permitting, maritime, election and other key

directions. Today, GLCC law company marks its 10th anniversary and, based on the above-mentioned, we declare: GLCC is a reliable partner proved in time. Founded in 2007 GLCC law company oﬀers result-oriented and dynamical legal services for successful business development. GLCC is leader in development, construction and real estate businesses. During professional practices, the company has provided legal services for more than 35% of

real estate and developments business companies in Georgia. GLCC lawyers participate in negotiations and prepare contracts for such major transactions as 150 million USD investments for building Olympic Village, legal evaluation and sales of Basisbank, one of the major financial institution in Georgia, multi-million USD loan agreements with international financial institutions (OPIC and EBRD), merger in development business, healthcare and tourism businesses, various licenses in communications sector, permits for natural resources and so on.

AF – Best Advisor in Advertising Field DAVID BAGHASHVILI

AF advertising company was founded in 2013. Initially, the company took eﬀorts in outdoor advertisement segment, while currently the company provides indoor and outdoor advertising services. Big letters, lightboxes, indoor and outdoor interior, printing, typography and all kinds of advertising services. The company owns its own enterprise and everything is made on the spot. The company provides high-quality services and attains top results. The company has performed many major projects and it cooperates with many leading brand organizations. All these factors guarantees top quality services. Main motto of the company is: “Your Business is Special, Their Attitude is Individual”. Based on customer’s requirements, creating top-level products is one of the key priorities of the company. Interview with MARIAM AREVADZE, head of marketing department of AF advertising company. - What is advertisement? How do we perceive it and what is its purpose, in general? -To put simply, advertisement is one of the forms of delivering products to the society – all entrepreneurs are interested in delivering their own products to consumers. This is a very complicated process, because consumers, as a rule, consider all novelties critically. Only 10-25% out of 1000 consumers may be interested in a certain product, but in this case the mentioned figure may vary due to type of products. American publicist Vens Pakardi has formulated the essence of an advertisement in this way: “Advertisement is Art to Take Aim at Head and Strike at Wallet”. Opinion of Franklin Roosevelt is also very interesting: “If I could start my life anew, I would devote my life to advertisement”. Advertisement is a purposeful informational impact on consumers. This is a paid form of communication. First of all, it is an instrument to assist consumers to have their own opinion, views and make choice based on the mentioned factors. Today, advertisement is considered to be the most important component of marketing. It is a market competition instrument. In contemporary

society advertisements are considered as Sales Stimulator. Objective of the advertisement is to popularize product or idea and promote their sales. It promotes upturn in sales, provides consumers with information about parameters, prices, rules of use and places of distribution of products. -What sort of advertisements are practiced in contemporary world? - Advertising business was developed in the process of struggle for markets and in seeking maximum profits. As a result, today advertising projects are implemented due to plan – it fosters shaping requirements of young people. It is worth noting that advertisement stresses high quality of this or that product, makes accents on its unique character and signs, draws consumer attention and oﬀer in advance, before purchase deals. Therefore, repeated advertising mechanism is frequently used to make eﬀect on consumers. -How are advertisement activities carried out? -As a rule, special firms and agencies, divisions of enterprises and trade companies, publishing departments of major companies and other advertising divisions implement advertising activities. It is worth noting that advertising mechanisms were growing, broadening and becoming more valuable along with development of technologies. Advertising agencies are independent enterprises that enjoy rights of legal entities. Main scope of their activities is: developing advertisement concept, management of advertisement distribution process. They make focus on full services for clients, the so-called planning of advertisement, preparing an advertisement and conducting a complex of distribution works. The advertising agency determines projects and submits a list of costs to the customer and these factors create a ground of signing a due contract agreement. -When was AF advertising company founded and what was the purpose of its foundation? -AF company was founded in 2013 as a materials importer company. Later, we decided to transform the company into an advertising enterprise to provide full advertising services. Since we are importers of materials to Georgia, we operate with minimum prices on the market. Our printing machines represent one of the priority directions and we do not

need to act as a mediator company. Today we own 3 printing plotters (Epson dx 7); Orgmin machines. CNC router that is widely used for advertising activities, as well as digital equipment for printing works and we offer full advertising services to our consumers. -What directions does the company make focus on? -We provide a full package of advertising services and we offer any advertising products to our clients: -Indoor and outdoor advertising services - Big letters; - Lightboxes; -Printing services: banners, stickers; -CNC router services; -Printing services; -LED screens -What innovations do you have in the company now? -Several months ago we finished rebranding process, changed logo, added a new product. We started assembling LED screens at our enterprises and they are widely used in advertising field today. -What is objective of the company and, as an ordinary consumer, why would you recommend AF services to us? -The company is staffed with young hardworking people with the scope on everyday professional development and advancement. In our company each employee knows the price of time and has a correct view of time management. Therefore, if you plan to carry out advertising activities, but have no idea of what sort of advertising products to supply to the market and how to make your advertising activities efficient, in this case we offer services of our company and we are ready to serve your needs every time.

AF – Your Best Advisor In Advertising LLC AF Aghmashenebeli Avenue 164, Tbilisi TEL: 2961661;568313211 MAIL: AFMARKETİNG2013@ GMAIL.COM WWW,AFLTD.GE FB:WWW.FACEBOOK.COM/LTDAF

PUBLICITY

January 30, 2017 #178

WORLD NEWS

January 30, 2017 #178

Quotes

“ We make a “With all those markets available for free trade, US factories would have looked much more attractive to, say, European or Korean auto manufacturers”

living by what we get, but we make a life by what we give.

”

Winston Churchill

Who to lose most from Trans-Pacific Partnership collapse?

Gazprom considers joining TAP to export its gas to Europe

Russia’s Gazprom company is discussing the possibility of using Poseidon and Trans Adriatic Pipeline (TAP) to export gas to Europe, the company’s deputy CEO Alexander Medvedev said. He made the remarks during the European Gas Conference in Vienna Jan.24, Reuters reported. TAP is a part of the Southern Gas Corridor which is one of the priority energy projects for the EU. TAP project envisages transportation of gas from the Stage 2 of development of Azerbaijan’s Shah Deniz gas and condensate field to the EU countries. The pipeline will be connected to the Trans-Anatolian Pipeline (TANAP) on the Turkish-Greek border, run through Greece, Albania and the Adriatic Sea, before coming ashore in Italy’s south. Poseidon is the project for construction of oﬀshore part of ITGI gas pipeline which will run through the bottom of the Ionian Sea and connect the gas transport systems of Greece and Italy.

he US will regret foregoing the Trans-Pacific Partnership (TPP), Russell A. Green, Will Clayton Fellow in International Economics at Rice University’s Baker Institute (Houston) told Trend. The Trans-Pacific Partnership was a proposed free trade agreement linking the United States and 11 other Pacific Rim economies. The agreement would lower tariﬀs and other trade barriers among Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam. The finalized proposal was signed on February 4, 2016 in Auckland, New Zealand, concluding seven years of negotiations. The US President Donald Trump earlier signed an executive order withdrawing the US from the proposed TPP trade deal. But the agreement had not yet received Senate approval, so the executive order was more of a formality. “The direct impact on imports, exports, GDP and employment were likely to be small in any case. Most estimates put it at 0.5 percent of GDP after 15 years. That’s almost a rounding error,” said Green. But it could have had major impacts

on investment flows, encouraging US firms to open operations abroad and attracting foreign firms to the US, the expert believes. “With all those markets available for free trade, US factories would have looked much more attractive to, say, European or Korean auto manufacturers. TPP entailed significant soft power benefits for US stature in Asia,” he added. Green believes that Vietnam probably loses the most from the collapse of the TPP. “It was prepared to make significant concessions to meet US standards on labor, environment, governance and investor protection that would have made it much easier for Western companies to set up export operations,” said the expert. “Domestic firms, too, would have found much better access to major markets.” TPP does not make sense without the US for Japan, said Green, adding that they made significant concessions opening domestic industries to foreign competition, specifically in the hopes of gaining better access to the US market. “Without that, the deal is politically untenable for Japan. Without the US and Japan, TPP loses its value,” he added.

Turkish state appoints trustees to Aydınlı Group, baklava chain Faruk Güllüoğlu

he Saving Deposit Insurance Fund (TMSF) has appointed a panel of trustees to the Aydınlı Group textile company and the dessert chain Faruk Güllüoğlu after their chairmen were arrested in September 2016 over alleged links to the Gülenist network. A total of 27 businessmen, including Aydınlı Group Chairman Ömer Faruk Kavurmacı and Faruk Güllü, one of the three brothers who run separate Güllüoğlu baklava chains, were arrested on charges of being members of the network that is widely believed to have orchestrated Turkey’s July 2016 coup attempt. Another 52 suspects, including Nejat Güllü, another brother who runs a Güllüoğlu baklava chain, were released on probation in the same probe.

The Aydınlı Group is the owner of the brand rights of Pierre Cardin, Cacharel, and U.S. Polo in Turkey, as well as a number of other countries. Its 2015 endorsement valued 2.7 billion Turkish Liras. The seizure of the companies by the TMSF comes after the Turkish government’s state of emergence decree law issued in November 2016. “All authorities of the trustee panels, which were appointed to companies due to their junctions or links with terror organizations, will end as of today. The emergency decree herein will be published without any need for a judge’s or court decision,” the emergency decree stated. Some 527 companies have been transferred to the TMSF since the July 2016 coup attempt, according to Deputy Prime Minister Nurettin Canikli.

Russia’s 2014 annexation of Crimea from Ukraine caused huge rises in chicken prices When Ukraine first accused Russia of invading Crimea just under three years ago, few were thinking of the eﬀect on chicken prices. Mironovskiy Hleboproduct, which rears one in three chickens consumed in Ukraine, said prices rose 10 percent in 2016. That follows a 39 percent surge in 2015, as the weakening hryvnia fuelled demand. Twelvemonth sales jumped 7 percent on the previous year, Kiev-based MHP said, driven mainly by exports.

The currency’s depreciation, initially triggered by the RussiaUkraine conflict in 2014, accelerated after the central bank scrapped its indicative exchange rate in a bid to secure an expansion to its International Monetary Fund bailout. However, Ukraine’s poultry-price rally is in contrast with international markets. Export prices for chicken meat denominated in dollars decreased by 16 per cent in 2016, “in line with global commodity trends,” MHP said. A closely watched quarterly poultry report by Rabobank in September had predicted an increase in global prices on reduced supply.

Philip Morris is even pursuing a “reduced risk” label in the U.S., which, with the help of the FDA, will give it a major competitive advantage over the competition.

Will “Heat-Not-Burn” E-Cigs Kill Oﬀ Vaping?

ith a more cigarette-like experience, the next generation of electronic cigarettes could make vaping obsolete. The future of cigarettes may be “smoke free,” as Philip Morris International (NYSE:PM) says, but it is a new platform of electronic cigarettes using heat-not-burn technology that may also kill off vaping as we know it. Not your father’s e-cig Traditional e-cigs and personal vaping systems (PVS) heat a nicotine-infused liquid to create a vapor that is inhaled. Whether it’s a glowing point of light or a massive cloud of vapor being released that can make a user look as if he’s starring in a Cheech & Chong movie, the devices have been critiqued as falling short of being fully satisfying. Users have complained of a chemical aftertaste from the heated e-liquid, while those nearby to someone vaping are annoyed by the billowing clouds in which they’re enveloped. However, the new heat-not-burn technology promises to resolve both problems. By using real tobacco to deliver the flavor and nicotine hit users crave, these next-generation devices give a more cigarette-like experience to the user while emitting a vapor more confined to one’s personal space. And because they are more like combustible cigarettes than either traditional e-cigs or PVS, they may have the advantage of weaning more people off of smoking, which would be a societal gain in terms of cost and health (there are nicotinefree e-liquids available, too). Philip Morris is even pursuing a “reduced risk” label in the U.S., which, with the help of the FDA, will give it a major competitive advantage over the competition. Yet with many of the global tobacco companies also pursuing heat-not-burn (HNB) alternatives, it’s worthwhile to look at the different products they will offer. Philip Morris (iQOS) For a company that produces some 850 billion combustible cigarettes annually, Philip Morris’ call for a “smoke free” future is a big deal. But since HNB products will use real tobacco, it (and the other manufacturers) aren’t really straying too far from home. The iQOS is actually a two-part device, a tobacco-filled miniature cigarette and a heating unit. The cigarette, marketed with Altria (NYSE:MO) as Marlboro HeatSticks, is inserted into a device that looks something like a PVS, which is itself inserted into the iQOS heating device. The e-cig is heated to 350 degrees Celsius (662 degrees Fahrenheit), which differs from combustible cigarettes that burn tobacco at 800 degrees Celsius, or almost 1,500 degrees Fahrenheit. The whole device is then removed and “smoked” just as you would a combustible cigarette, and when it’s finished, the HeatStick is discarded. British American Tobacco (iFuse glo) Next to the iQOS, British American Tobacco‘s (NYSEMKT:BTI) iFuse glo is arguably the next biggest HNB device that will be coming to market. Like the iQOS, a tobacco-filled cigarette, which it will market as NeoStiks under the Kent brand, is similarly inserted into a PVS-like device that is then inserted into the iFuse heating element. BAT bills itself as the first international tobacco company a vapor product in the U.K., the Vype e-cig, and it followed that with an early iFuse HNB product that heated an e-liquid, but passed the resulting vapor through tobacco to give it real tobacco flavor. The glo is the next

stage of development in e-cig technology, and it gives smokers a range of alternatives. Reynolds American (Eclipse, Revo, Core) Reynolds American (NYSE:RAI), which just agreed to be acquired by British American for $50 billion, was one of the pioneers in HNB technology with its Eclipse back in the early 1990s. It relaunched the product in 2014 as Revo, but it once again failed to gain much traction with consumers. Although it’s apparently still available in very limited quantities, Reynolds has been working on a new product called Core, which BAT was supposedly very interested in. It’s said that the delay in Reynolds agreeing to BAT’s takeover offer was related to the Core technology. Core, which is similar to Revo, recently completed the first phase of test marketing in Japan. Japan Tobacco (Ploom Tech) Despite Japan’s tobacco market falling dramatically over the years, heat-not-burn technology is more successful there than just about anywhere else. It is the first market manufacturers enter when launching their products. When Philip Morris introduced the iQOS there in early 2016, it quickly shot to the top, which had Japan Tobacco (NASDAQOTH:JAPAF) quickly following with its Ploom Tech HNB device. Its own products have been so successful that it has at times had to suspend taking orders for it because it couldn’t keep up. Ploom markets the cigarettes under its popular “Mevius” brand. AX Labs (PAX) PAX Labs used to be Ploom Tech until Japan Tobacco bought the name and technology in 2015. Pax subsequently bought back its partner’s minority stake to focus on the PAX looseleaf vaporizing product. Unlike the other HNB technology, users of PAX fill the PAX device with loose-leaf tobacco and place it on a heating unit that plugs into your computer’s USB port. When the unit is hot enough, users attach a mouthpiece to it to draw in the vapor. There are three different devices — the Pax 1, 2, and 3 — that are all similar in function, plus the PAX Era, which is filled with oil. It may be one of the first purpose-built marijuana e-cigs, and it’s available in the U.S., but only in California and Colorado. Up in smoke Every tobacco company understands the combustible cigarette market is dying, which is why they’re broadening their horizons into electronic cigarettes and vaping products. The heat-not-burn technology, though, promises to vastly expand the manufacturers’ lifecycle as the use of real tobacco allows them to continue profiting from their primary cash crop. It might also serve to effectively snuff out any remaining vaping competition. Trump’s potential $1.6 trillion investment We aren’t politicos here at The Motley Fool. But we know a great investing opportunity when we see one. Our analysts spotted what could be a $1.6 trillion opportunity lurking in Donald Trump’s infrastructure plans. And given this team’s superb track record (more than tripling the market over the past decade*), you don’t want to miss what they found. They’ve picked 11 stocks poised to profit from Trump’s first 100 days as president. History has shown that getting in early on a good idea can often pay big bucks – so don’t miss out on this moment.

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January 30, 2017 #178

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

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

January 30, 2017 #178