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November 12, 2018 - www.cbw.ge
#260
WEEK
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The 2019 State Budget: Salaries and Social Allowances to Grow The 2019 Budget to See Historical High – 13 billion GEL Government of Georgia has submitted a revised variant of the 2019 state budget bill to the parliament.
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Interview with Public Relations Specialist Teona Chavelashvili of Administration of the State Attorney-Governor in the Kakheti Region Teona Chavelashvili: "No technologies can change human relationships based on healthy cooperation and trust".
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Electricity Sector of Caucasus Energy independence for every country is one of the most important challenges for economic, political and security reasons and countries from Caucasus region (Azerbaijan, Armenia and Georgia) are not the exception.
Why Government Fails to Stabilize GEL Exchange Rate
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Foreign Citizens Wishing to Obtain Residence Permits in Georgia will Have to Provide Due Contribution Procedures for grating residence permits in Georgia to foreign citizens will be tightened. The parliament will discuss legal amendments by second hearing, under which foreign citizens will be requested to provide real estate and investments of more value, Tbilisi Mayor Kakha Kaladze said.
IMF: Turkish LIRA Depreciation will Devaluate Georgian GEL The current economic situation in Turkey will make influence on the Region, especially on the countries, with which Turkey has direct trade relations. In this respect International Monetary Fund (IMF) outlines Georgia and Azerbaijan, the last IMF review reads regarding the Central Asia and Caucasus countries.
Prices for Fruit and Grapes Dropped by 9.9% Georgia takes 12th Place by Cost of Living among 117 Countries Among the 117 countries, Georgia is in the 12th place by cost of living. Georgia has 30.14 points in the Numbeo’s portal ranking and it takes place between Algeria and Bangladesh.
In September 2018, prices for fruit and grapes dropped by 9.9% compared to September 2017. According to Geostat data, prices declined mostly for plums (-35%), Kiwi (-32%), apples (-24%), pears (-17%), lemon (-16%), and grapes (-14%).
Italy PM Backs TAP Pipeline – Italy to Get Natural Gas via Georgia Government to Spend 271 million GEL on Anaklia Seaport Approach Way and Railroad Section Government of Georgia plans to spend 271 million GEL on constructing Anaklia Seaport approach way and railroad section. Under the plan, submitted to the parliament, the state budget will allocate 20 million GEL in 2019, 75 million GEL in 2020, 75 million GEL in 2021 and 90 million GEL in 2022.
Keda Municipality joins EU’s Mayors for Economic Growth Initiative Georgia’s Keda municipality has become the latest municipality to join the EU-supported ‘Mayors for Economic Growth’ (M4EG) initiative.
George Kobulia: Georgian Companies Expressed Unprecedented Interest towards Shanghai International Import Minister of Economy and Sustainable Development George Kobulia, who is in the People’s Republic of China within the frames of the Georgian Government Delegation visit to China to participate in the International Import Forum and Exhibition of China, evaluated the results of the visit.
Prime Minister of Italy Giuseppe Conte gave his final consent to the Trans Adriatic Pipeline (TAP) project. After the project implementation Italy will receive Caspian natural gas through Georgia, Turkey, Greece and Albania.
IMF Warns against Low Competition in Georgia’s Banking and Health Sectors The International Monetary Fund (IMF) recommends that the Government’s role in economy should gradually decrease to neutralize economic development obstacles.
Visitors Inflow from Some Countries Grew by 1000% for Sports Events In January-October 2018, a total of 7 507 517 international visitors arrived in Georgia. According to National Tourism Administration, tourist inflows particularly increased from several countries.
The Editorial Board Follows Press Freedom Principles Publisher: LLC Caucasian Business Week - CBW Director: Levan Beglarishvili WWW.CBW.GE Address: Aleksidze Street 1 Sales: Mob: +995 591 01 39 36 Email: caucasianbusiness@gmail.com Editor: Nutsa Galumashvili. Mobile phone: 595 380382 Copy Editor: Ellie Rambo Reporters: Nina Gomarteli; Mariam Kopaliani; Merab Janiashvili, Economic columnist: Andria Gvidiani; Technical Assistant: Giorgi Kheladze;
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Why Government Fails to Stabilize GEL Exchange Rate
GEL exchange rate remains the most challenging issue in Georgian society. Both ordinary citizens and experts have been actively discussing this topic. Over the past period the GEL depreciation has beaten the historical maximum. The national currency devaluation has made negative effect on both economy and social condition of our population. As a result of the GEL exchange rate devaluation, both physical and legal bodies bear losses, who had taken debts in USD. Prices are rising on consumer products, fuel and tobacco, on almost all products. Purchasing capacity of the national currency is falling. Consumers have to pay more GEL to buy products, compared to previous years. Strengthening USD and unforeseeable economic environment have brought problems to business sector. The real estate market was also damaged. The Caucasus Business Week (CBW) has inquired reasons behind such catastrophic downturn in the GEL exchange rate and the outcomes we should expect. Financier Temur Basilia talks about GEL exchange rate depreciation reasons. Unemployed budget funds make negative impact on the exchange rate volatility. According to Basilia, expenses determined by the budget law have not been thoroughly spent. Therefore, this collapse of GEL exchange rate has less relation with either social policy or elections. The GEL exchange rate would fall in case of excessive spending of budget funds. However, the Government has not spent such funds. Moreover, even the budget law determined expenses were not fully used, Basilia said. “Not excessive, but even the law-determined funds were not spent”, Basilia said. As reported, a key part of unemployed budget funds is recorded for Ministry of Infrastructure. In response to the question, why the Government fails to spend money and accelerate infrastructural projects, Basilia noted that this is other problem. Anyway, the question is whether the country and its institutions are ready to use such an amount of money. Basilia has named money-monetary policy of the National Bank of Georgia (NBG) as the second crucial reason behind the GEL exchange rate devaluation. Nothing has changed in this direction over the past years, he said. “Regretfully, the NBG communication with our society cannot withstand criticism. NBG avoids communication with media and society, but if they do, we hear only incompetent and irresponsible explanations. I do not know what are reasons.… even in the beginner’s textbook of economy we read that a growth in money mass in turnover is one of the key reasons for the exchange rate volatility. The NBG top managers
are trying to persuade us in different things. I do not know real reasons. We may suppose that in this way they try to cheat our society to hide corruption schemes regarding the so-called refinancing loans. The matter is that hundreds of millions of GEL from NBG are mainly issued to two commercial banks for many years. This is a key reason what causes GEL exchange rate volatility”, Basilia noted. In response to the question whether it is a right decision to extract USD from turnover for replenishing foreign currency reserves, as this move creates USD deficit on the market, Basilia explained: instead of extracting GEL mass from turnover, NBG grows GEL volume and provokes GEL depreciation. “If GEL falls below 2.80 point, the price of 1 USD may total even 3 GEL in long-term perspective”, Nika Shengelia, analyst for FENIX 1970 company, doctor of economics noted regarding GEL exchange rate depreciation over the past period. The fact the state budget has fixed the GEL exchange rate at 2.70 point signifies that in the near future the exchange rate will be balanced on 2.80 point. “In 2019 Government announced plans for growing pensions. About 898 000 citizens receive state allowances in the country, including 730 000 pensioners. The government has pledged to increase allowances 5 times and Government needs to mobilize about 25 million GEL additionally to this end. Therefore, nobody knows how the state budget is manipulated. Seemingly, the ruling party plans to replenish the deficit through GEL exchange rate manipulations”, Shengelia noted. Despite elections, the GEL exchange rate fell to 2.80 point and now the Authorities artificially curb the rate. If the exchange rate falls below 2.80 point, there is theoretical chance that 1 USD total 3 GEL. However, there are no grounds for similar GEL devaluation, Shengelia noted. The NBG regulations have frustrated the development sector. In practice, the regulator works isolated and opens way to companies affiliated with oligopolist banking system, which operate in various sectors, Shengelia said. The country’s economic indicators are not bad, but the figures and the national currency exchange rate are different aspects. Improper, unbalanced spending of the state budget funds and invaluable economic policy is a key reason for the GEL exchange rate volatility and this process is carried out by incompetent bodies, Shengelia said. “Unqualified staff appointed by nepotism have mainly brought these undesirable results. The results are evident for everybody”, Shengelia said. References and explanations as if current devaluation tendencies in the neighbouring countries have depreciated the GEL exchange rate are absurd and nonsense. Domestic currencies have stabilized in all neighbouring countries since August 2018, contrary to GEL, Shengelia said. Doctor of economics Rati Abuladze said that the currency exchange rate is an important instrument and its profile reflects economic policy of our country. Various factors make influence on it, including: • Political instability and inefficiency. Over the past period, the current environment during the presidential elections has made negative effect on the exchange rate. Regretfully, instead of reaping state dividends, the political spectre has not showed resources for new economic wave, potential for shaping a new political team and new political structure. As a result, public disappointment has made negative effect on the currency market too. • Payment balance (transactions, exports, imports). The country spends much money on imports of products, services and specialists and this is serious factor depreciating the GEL exchange rate. Every year, about 7-8 billion USD leaves the country. Budget spending on service of foreign companies and employing foreign specialists are not registered. All the above-mentioned factors reduce family incomes and make them poorer;
• State debt. Georgia’s state debt forecast margin by the end of 2019 is fixed at 20.1 billion GEL, including state external debt – 15.7 billion GEL and internal debt – 4.4 billion GEL. It should be stressed that amid major state debts, the country has less changes to attract foreign capital. At the same time, amid major foreign debts and high dollarization level, the country becomes vulnerable to unexpected financial results (according to International Monetary Fund). • Trade conditions and competitive capacity. There is a small number of Georgian products, which are attractive and competitive on the market. Exports is a source of capital inflow. (protection of domestic products in Georgia is another problem). Furthermore, amid the current governance conditions, there is less chances for capital collection and populistic approaches prevail in the agenda. It is noteworthy that in the initial bill submitted by the Government (about the 2019 state budget), the exchange rate was determined by 2.63 GEL. In the revised variant, the exchange rate was fixed at 2.70 GEL. At the same time, the focus is made on minimization of expected negative outcomes as a result of the currency exchange rate volatility. Therefore, the mentioned data may be considered as a real portrait of the national currency. It should be noted that the country lacks for not qualified personnel, but the due communication that the management chains and managers should show in relation to qualified staff. Instead of carrying our reforms and changes, the cheaper mechanism for Georgian politics is to spoil new faces and permanently use old staff. However, both country and politics bear losses from similar approaches. And this situation destroys all directions (exchange rate, prices, state territory); The fact is that everything has turned obsolete. Policy, management resources, offices, the workload should be essentially revised. Moreover, the new political resource outlines new and efficient horizons for Georgian or international commonwealth. As noted, Government has submitted the 2019 budget’s revised bill. In the revised variant the GEL/USD exchange rate is fixed at 2.7 point. It is noteworthy that in the initial bill, the exchange rate was 2.63 point, in the 2018 budget – 2.5 point. How the GEL exchange rate has changed against USD in January-October 2010: January 20 —1 USD—2.54 GEL February 20 —1 USD—2.46 GEL March 20—1 USD—2.44 GEL April 20—1 USD—2.43 GEL May 20—1 USD—2.44 GEL June 20—1 USD—2.45 GEL July 20—1 USD—2.45 GEL August 20—1 USD—2.57 GEL September 20—1 USD —2.61 GEL October 20—1 USD—2.7029 GEL By Merab Janiashvili
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The 2019 State Budget: Salaries and Social Allowances to Grow The 2019 Budget to See Historical High – 13 billion GEL Government of Georgia has submitted a revised variant of the 2019 state budget bill to the parliament. Budget indicators have increased compared to the initial variant and 270 million GEL has been added to the final version, Irakli Kovzanadze, head of the parliament’s committee for finance and budget issues noted. “Allocations have risen by about 538 million GEL. In 2019 the Government is expected to spend about 13 billion GEL. This is the most important indicator. Moreover, indicators have increased by 69.500 million GEL for the children assistance package. We have unprecedented figures in the history of independent Georgia”, Kovzanadze told the parliament’s bureau. According to the 2019 revised budget bill, the state budget inflows will increase by 357 million GEL compared to the initial variant, including allocations will increase by 80 million GEL; grants – 102 million GEL, basically, as part of EU budget assistance program; credits – 145 million GEL, including budget assistance – 90 million GEL. The state budget allocations, as compared to the initial variant, have increased by 268 million GEL, which include– 50 GEL package for socially vulnerable children (20 GEL money allowances + 30 GEL food voucher) – 70 GEL; defense ministry equipment – 92 million GEL. For the purpose of enforcing the credit guarantee scheme, the entrepreneurship development program will increase by 10 million GEL to 20 million GEL. The gasification program budget grows by 10 million GEL and in general, 40 million GEL will be spent on gasification works in regions.
Environment protection and agriculture program funding will increase by 34 million GEL, including marmorated stink bug program will be financed by 10 million GEL. At the same time, in 2019 Government will cover a part of electricity costs for families with many children. Subsidization rules will come into force on January 1, 2019. According to the Government resolution, the monthly 20-GEL subsidies will be issued to the parents with 4 adolescents under 18 years old. If a citizen has got more than 4 children, they will receive no more than 10 GEL for each next child for consumed electricity. Families with those citizens, who have obtained the status of a parent with many children, will receive social allowances if the corresponding family has been registered in the united database of socially vulnerable families and their rating point is equal or less than 300 000 conditional unit. The resolution explains that reception of this subsidy will not result in suspension of social assistance and living allowance or revision of social-economic classification of families. As to salaries. In 2019 salaries will increase for a number of state officials. In 2019-2020, a total of 7 526 servicemen will receive increased salaries, Prime Minister Mamuka Bakhtadze noted at the news conference prior to the government meeting. Starting January 2019 salaries of border guards of Interior Ministry frontier police and staff of coastguard vessels will increase by 250 GEL. Moreover, starting January 1, 2019, salaries will increase for other sectors too, including for personnel of special security service, Bakhtadze said. “We would like to remind you that in summer 2018 salaries increased to about 14 000 workers of Interior Ministry. This process will be continued and starting 2019, their salaries
will increase by 250 GEL. About 2 900 border guards of Frontier Police and coastguard vessel staff will received increased salaries. Starting January 1, salaries will increase for other divisions too, including the staff of special security services”, Bakhtadze said. By 2022 averaged salary of teachers will be 1800 GEL, while senior teachers will receive 2000 GEL and more, the Ministry of Education and Culture reports. “In 2019-2021 salaries will increase to school directors, administrative staff and salaries will increase to teachers too. By 2022 averaged salary of teachers will be 1800 GEL, while salaries of senior teachers will amount to and exceed 2000 GEL. In the 2019 state budget bill, corresponding funds have been already allocated”, the information reads. By the Prime Minister’s initiative, assistance program will be launched for adolescents living in poverty. The state budget will allocate 70 million GEL to issue 50 GEL allowances to children in socially vulnerable families. Instead of current 10 GEL assistance, socially vulnerable families with children under 16 years old will receive 50 GEL aid. This initiative will concern about 140 000 children. Under the 2019 budget bill, salaries of a number of state officials will increase, as well as social allowances. According to the Government, these steps were taken in response to the UNICEF report, under which in 2014-2016 poverty level increased in Georgia. Considering that target aids, as a rule, reach specific persons, consequently, increased social expenditures will reduce poverty level, but real figures will be showed in 2019.
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Teona Chavelashvili: "No Technologies can Change Human Relationships based on Healthy Cooperation and Trust" Interview with Public Relations Specialist Teona Chavelashvili of Administration of the State Attorney-Governor in the Kakheti Region. Why did you decide to enter this field and what opportunities does it give in terms of career growth? Public relations first of all gives the possibility of continuous and multilateral communication with a large number of people -representatives of different professions, ages, social groups, and religions. Every day you meet many interesting people, learn and master something new, work with successful people whose experience enhances your knowledge. When you are a PR specialist, and even more, have an interesting job, you have witnessed many important events and accomplices. Long story short, PR specialty is probably one of the most interesting profession. Accumulated knowledge and experience, in turn, makes it easier to move forward in career.
necessary to determine risk, evaluate, and most importantly, quick reaction to them in any career. What would you wish you would’ve known before starting out PR? I would mind more about psychology of the masses. Today, we do not notice the shortage of resources in this field, you can find many innovations daily and use it for professional growth. Describe your typical work week. I will not go into details, even though there are plenty of fine-tiny details during working day and work week. PR staff will agree that beyond what we’ve officially planned, meaning the part of our work that is publicly visible, there are so many other issues popping up daily, that sometimes takes all of your energy or day.
What is it necessary to hold successful communication with public?
How would you go about finding relevant contacts and sources?
Human relations is number one for me, at the same time the trust factor is crucial. It has a great importance the quality of the product that we are giving to the public.
Working, information meetings. When you have the opportunity to communicate with the community members directly, it expands your acquaintances. I love the challenges, novelties, and finding ways to solve the issues. The field of public relations was once a novelty and challenging for me. I mentioned above that human relationships mean a lot for me, and therefore, in this field, I have tried to develop healthy relationships and communication with people, and I think that the approach justifies, the more positive than negative.
What tips would you offer someone just starting out in PR? The activity in this field brings many good experiences, which will benefit people at different stages of their lives in the future. For example, assessment of the risks that are necessary in the process of planning any activity. it is
How would you prioritize and start your work day? It starts with checking emails and looking through notes on my little, red notebook. Tons of new details can be added to the list of tasks throughout of the day. What are the skills successful PR Manager needs? Sociable, detail oriented, nice to people, oriented to establish healthy relationships, quick responsiveness. What is the best PR practice that technologies can not replace? I will repeat, that no technologies can change human relationships based on healthy cooperation and trust. What are some of the growing trends in the public relations industry? Social channels have changed a lot. Social media made it faster and more flexible to receive, deliver, share and disseminate information.
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Business News Tbilisi to Host International Business Economic Forum BGC and Major Awarding Ceremony of Companies
Leadership Forum. Forum will be held on November 25-30, 2018, Tbilisi, Georgia and February 2019, Stockholm, Sweden.
On December 18 Biltmore hotel will host International Business Economic Forum. The event is organized by Business Media Contact and co-organized by AREA Group.
Young European Ambassadors to Visit Young Farmers’ Centres in Tetritskaro Municipality On 12-16 November, Young European Ambassadors (YEAs) from Georgia will visit Young Farmers’ Centres (YFCs) in the country’s Tetritskaro municipality to raise awareness about the EU, the Young European Neighbours Network and the YEAs initiative. Georgia Advances to the 6th Position in Doing Business Rating
amounted to 162 mil. USD, that is 20% higher than the data of the previous year.
Georgia has progressed to the 6th position in the World Bank (WB) rating of Doing Business, according to the new report by the World Bank Group.
SRPC on the Global Petrochemical Map Pirosmani’s Work from Stefan Zweig’s Private Collection Put up for Sotheby’s Auction
Exxon Mobil, VA Tech Wabag, and Schneider Electrics declared interest towards this complex.
On November 27 the Sotheby’s Auction in London will expose Niko Pirosmani’s work Woman with Tambourine for auction. Presumable price of the work is 650-900 thousand USD. The Georgian artist’s work has been represented in the Russian section.
Bitfury Completes 80 USD Million Private Placement Fragments of Satkhi church’s Pillars Rehabilitated by Co-Financing RMG Handed to National Museum National Agency of Cultural Heritage Preservation of Georgia handed fragments of Satkhi Church’s pillars to Georgian National. Tbilisi Transformational Leadership Forum to be held on November 25-30 41 companies participate in Georgia’s Responsible Business Awards Meliora This year the Center for Strategic Research and Development of Georgia (CSRDG) launched the annual CSR excellence contest – Georgia’s Responsible Business Awards Meliora. Georgian Wine Export Has Grown by 12% and the Exported Wine Price by 20% According to LEPL National Wine Agency, in January-October 2018, up to 68,3mil. bottles (0,75l) of wine have been exported to 53 countries worldwide, that is 12% higher than the similar data of 2017. Exported wine income
Call for young professionals aged 24-35 from Ukraine, Moldova, Azerbaijan, Belarus, Georgia, Armenia, Sweden, Estonia, Lithuania and Poland to participate in Tbilisi Transnational
Expanded Support from Major Corporate and Financial Institutions Confirm Continued Strength of Top Blockchain Company.
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Electricity Sector of Caucasus Short Sector Overview Energy independence for every country is one of the most important challenges for economic, political and security reasons and countries from Caucasus region (Azerbaijan, Armenia and Georgia) are not the exception. According to Geostat, Armstat and stat.gov.az, average demand on electricity in these countries is constantly growing, but electricity consumption and production are seasonal.
The main sources of electricity generation are different through countries. For Armenia it is nuclear energy, for Azerbaijan thermal energy and for Georgia hydro power plants. However, the seasonality of water flow in rivers affects energy production in Georgia: In summer, when electricity consumption is low, river level is high and in winter when there is maximum consumption of electricity, the water level is significantly lower. Consequently, the minimum hydropower generation period in the country matches with the maximum consumption period of electricity and vice versa. As a result, there is a demand, which must be fulfilled with import. Georgia mainly imports from Azerbaijan, Russia and Armenia.
Electricity market in Caucasus can be provisionally divided into retail and wholesale markets. Participants of wholesale market are electricity producers, direct customers, importers, exporters and distribution licensees, also service providers, transmission system operators, market operators, transmission and distribution licensees. Main service providers on retail market are electricity distribution licensees. Currently around 151 (Armenia - 40, Azerbaijan – 34, Georgia -77) main electricity producers are registered at wholesale market in these 3 countries. Total generation capacity of Georgia has constituted around 3,868.76 MW, 3,213.2 MW in Armenia and 7,417 MW in Azerbaijan (2017 data). Electricity System Commercial Operator (ESCO) of Georgia buys and sells balance electricity and organizes trade with guaranteed capacity for the purpose of meeting (balancing) demand of qualified enterprises. Georgian State Electro System (GSE) is a 100% state-owned joint stock
company providing transmission and exclusive dispatch services to about 50 eligible companies in Georgia. Based on the transmission and dispatch tariffs established by the independent regulator (GNERC-Georgian National Energy and Water Regulatory Commission) GSE carries out technical control over the entire power system to ensure the availability of the system for uninterrupted and reliable power supply; and transfers, without the right of purchase or sale, the electricity imported or generated in Georgia to distribution companies, direct customers or the power systems of neighboring countries. There are two main companies that carry out the distribution of electric energy in Georgia - ENERGO-PRO Georgia and Telasi. ENERGO-PRO Georgia is a daughter company of ENERGO-PRO A.S. and a member of ENERGO-PRO Group, which unites electricity generation and distribution utilities in Czech Republic, Bulgaria, Georgia and Turkey. At present they manage and maintain 15 medium and small size hydro power plants with total capacity of 469,25 MW and Gardabani gas turbine power plant with total capacity 110 MW. ENERGO-PRO Georgia’s service area covers 70% of Georgian land plot with total number of customers exceeding 1 million. Telasi is one of the major network companies of Georgia, carrying out distribution and sale of electric power in Tbilisi. Currently, the INTER RAO Group owns 75% of the shares of Telasi and 25% of the shares are under the government’s ownership. The Company’s activities include: purchase and sale of electric power; operation and maintenance of power grids; services for electric power transit; administration of integrated and coordinated system of power supply, water supply and wastes management in Tbilisi. The Company’s total number of customers is 524,500. Distribution in Armenia is controlled by Electric Networks of Armenia (ENA), High Voltage Electrical Networks (HVEN CJSC), and Electro Power System Operator. There are over 36,000 km of distribution lines across the country. CJSC Electric Networks of Armenia was founded in May of 2002 as merger of four state regional companies (Yerevan Electric Networks, North Electric Networks, South Electric Networks and Central Electric Networks) and is mainly engaged in regulated distribution and sales of electric energy. High Voltage Electric Networks CJSC performs the function of electric power transmission while Electric Networks of Armenia CJSC implements electric power distribution. In addition, Operator of Electric Power System CJSC performs the operative technological and economic regulation of the electric power system, functions of the electric power system (production, import, export, transit), as well as ensures the parallel work with the regional electric power system of the Republic of Armenia. The Asian Development Bank (ADB) and Government of Azerbaijan have signed a Memorandum of Understanding in 2015 for a $1 billion investment programme to rehabilitate and expand the country’s power distribution network as the country experienced electricity
losses in transmission and distribution. As a result, a single operator of electricity distribution network, Azerishig JSC has been established, which has obtained the electricity distribution powers in all districts of the country. The opportunities in Caucasus countries are different. Azerbaijan government has adopted the increased use of renewable energy sources as a priority area for the country. They are planning the installation of stations designed for renewable energy sources, with a projected total capacity of around 420 Megawatts, guided by its Strategic Road Map 2020 for the development of utilities (electricity and thermal energy, water and gas supply). There are numerous investment opportunities in the sector in Armenia too as the country has significant potential for electricity production from renewable energy sources such as hydropower, wind, solar, geothermal, and biogas. Government tries to support new projects and upgrade old ones. For example, Metsamor nuclear power plant is aging and will need to be replaced soon. It is receiving lots of financing for modernizing its systems and safety features. Plans for building a new nuclear power plant are been discussed too. Georgia has more than 20,000 rivers and almost 300 of them provide excellent opportunity for hydropower generation. Only 25% of economically feasible Hydro potential is being exploited today. Georgia could produce additional 25 Tw electricity annually with hydro resources alone. There are over 60 potential HPP projects identified by the Ministry of Energy, the list is public and can be seen on the website. All new hydro power plants are totally deregulated, license for export are not required and have priority access to new transmission line to Turkey. Investor is free to choose the market and negotiate the price. HPPs with installed capacity of 13MW or less don't require generation license and HPPs that have installed capacity of 2 MW or less don't need environmental impact permit either. They can sell generated electricity to direct consumers without third party. All three mentioned countries have problems with old machinery and Soviet technology. Companies providing modern solutions are always welcome as governments try to upgrade the production process or to implement cost effective modern methods. Wind potential of the Caucasus countries is also significant. Ganja-Dashkesan zone in the west and the Sharur-Julfa area in Azerbaijan, Bazum Mountain, Jajur Pass, Gegham Mountains, Sevan Pass and Sisian and Goris in Armenia, Kutaisi, Mta-Sabueti, Gori, Kaspi, Paravani in Georgia are the best locations for such kind of business. By Giga Goliadze
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EAWSC Georgia – Wine Homeland, international contest of wines and strong drinks, opened in Tbilisi on November 7. The contest is being held for the first time in Georgia. Objective of this contest is to emphasize the high potential of Georgian wines, ensure high-quality standards of Georgian wines and promote Georgian winemakers on international markets. “Objective of this contest is to emphasize the qualitative potential of wines from Eurasia Countries, especially, from Georgia and promote them on international markets”, Murman Kuridze, president of the Association of Oenologists noted. Jean-Marie Aurand, president of International Organization of Vine and Wine (OIV),
parliament member David Songhulashvili, David Tkemaladze, deputy head of National Wine Agency and Murman Kuridze, president of the Association of Georgian
Oenologists have attended the contest inauguration ceremony. “Georgia is a country with unique winemaking history of many centuries and unique varieties
of grapes and similar contests popularize Georgian wines on the international market”, OIV President Jean-Marie Aurand noted. More than 200 wine varieties of 78 companies were introduced from 12 countries (Georgia, Armenia, Azerbaijan, Hungary, Italy, Romania, Moldova, Slovakia, Russia, Czech Republic, Ukraine, Belarus) to the contest. The wine varieties will be appraised by Georgian and international experts. The contest winner wines and strong drinks were named at Chateau Zegaani in Kakheti on November 9. The popular American magazine Wine Spectator will publish articles about the named best wines.
World News
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Azerbaijan’s Second Wine House Opens in China Azerbaijan’s second Wine House in China opened in Shanghai this week, Azerbaijan’s Economy Ministry said in a message Nov. 8.
Business Armenia Supported Exports of almost 6 Billion AMD during January-September 2018 The national body for promotion of exports, investments and tourism, has supported exports of over 5 billion 910 million AMD during the months from January to September 2018, which exceeds the 5.7 billion AMD figure of the last year, Business Armenia executive director Armen Avak Avakian said during a press conference on October 18, reports Armenpress.
Switzerland Offers Support for Vocational Education and Training in Georgia Over six million US dollars from the Swiss government will be spent in Georgia over the next four years to promote vocational education and training in agriculture and offer Georgian farmers modern educational opportunities and services. This new initiative was agreed on November 6 between the Georgian Ministry of Education, Science, Culture and Sport, the Ministry of Environmental Protection and Agriculture, the United Nations Development Programme (UNDP) and the Swiss Agency for Development and Cooperation (SDC).
US Treasury Department Announces New Sanctions for Russian Activities in Crimea The Treasury Department announced new sanctions on Russian and Ukrainian entities and several individuals, all connected to Russia's continuing occupation of Crimea, which the United States considers to be illegal.
UniCredit profits Miss due to Writedown on Turkish Unit UniCredit’s third-quarter net profit slumped after Italy’s largest bank by assets took a €846m writedown on its Turkish operations and increased its provisioning ahead of an imminent US deal on Iran sanctions.
Prague Named as Best City in the World to Spend Cryptocurrencies Prague has been named as the best city in the world to spend cryptocurrencies, with 154 venues – including bars, restaurants, hotels, cinemas and attractions – now accepting Bitcoin as method of payment, as well as 12 ATMs dispensing real cash from virtual money accounts.
World Equities Fall after Fed Keeps Rates on Hold, Dollar up World equity markets declined on Thursday, snapping a seven-session winning streak, with U.S. stocks on the defensive and the dollar strengthening after the Federal Reserve kept interest rates unchanged.
Tesla Names Robyn Denholm as Chair to Replace Elon Musk Baku-Tbilisi-Kars Railway Project Expanding to Azerbaijan’s Nakhchivan The construction of the railway line between Turkey’s Kars city and Azerbaijan’s Nakhchivan Autonomous Republic has been launched, Turkish ambassador to Azerbaijan Erkan Ozoral told Trend on Nov. 6.
Tesla has named an Australian executive as its new chairman after Elon Musk was forced to give up the role. Robyn Denholm, the finance chief of Australian telecoms firm Telstra, takes over from the electric car maker's founder, who remains chief executive.
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