Green Biz 2017

PRIME ADS

Experto Splashes Through The Swimming Pool Industry

See on p. 22

News Making Money

3 July, 2017

http://www.finchannel.com

How can Georgian economy benefit from bitcoin?

Irakli SHALIKASHVILI ISET

F

or the first time in history, the price of Bitcoin broke its highest record (Figure 1) rising above 2,900 USD during the last week of June, 2017. One of the reasons why the market unexpectedly became optimistic about Bitcoin could be the fact that in April, the Japanese government formally accepted1 the cryptocurrency as a mean of exchange, which gave it more validity in Asia’s richest economy. Moreover, there has been significant growth of international money transfer services that use Bitcoin in order to move currency from one country to another. An ad-

ditional interesting turn of events is the broad acceptance of Bitcoin in the U.S. For example, in the educational sector, the University of Ohio is hosting classes about Bitcoin and other cryptocurrencies as a part of its curriculum.

Likewise, some colleges have begun to accept Bitcoin as a means of payment.

The recognition of digital currency has already led to some companies thinking about profitable investment opportunities in Bitcoin, which fuels its journey to the mainstream. But, before going in deeply and analyzing the dynamics of the market, first let’s find out what Bitcoin is and how it works.

Continued on p. 6

PASHA Bank Pays Double Attention to Green CSR Activities in Georgia See on p. 8

Tips for Going Green

Zarapxana to Promote Rich Georgian Jewellery Traditions Abroad

See on p. 9

See on p. 17

The ProCredit Group Environmental Management System See on p. 19

Weekly Market Watch

By Galt & Taggart See on p. 21

CURRENCIES 1 USD 1 EUR 100 RUB 1 TRY

July 1

June 24

2.4036 2.7408 4.0581 0.6831

2.4110 2.6921 4.0425 0.6878

© 2017 The FINANCIAL. INTELLIGENCE BUSINESS PUBLICATION WRITTEN EXPRESSLY FOR OPINION LEADERS AND TOP BUSINESS DECISION-MAKERS

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4 586,40

Portugal

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30

15,60

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Austria

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13,80

358,80

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2 152,80

4 305,60

Qatar

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10,20

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Austria

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2 152,80

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Qatar

Al-Sharq News

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14,00

420,00

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Bahrain

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Arabic

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12,80

384,00

1 152,00

2 304,00

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Romania

National

Romanian

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22

10,80

237,60

712,80

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Belarus

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Weekly

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Dutch

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Bulgaria

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Arabic

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Canada

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The Daily Observer

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Canada

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2 754,00

Chile

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3 168,00

6 336,00

Spain

China

China Digest

Chinese

Daily

13

9,60

124,80

374,40

748,80

1 497,60

Spain

China

Guangming Daily China Daily Hong Kong

Chinese

Daily

30

10,50

315,00

945,00

1 890,00

3 780,00

English

Daily

26

12,00

312,00

936,00

1 872,00

3 744,00

China Czech Republic Denmark

Dnes

Czech

Daily

26

17,90

465,40

1 396,20

2 792,40

5 584,80

Spain

Diario AS El Pais European Edition La Vanguardia

Daily

30

21,20

636,00

1 908,00

3 816,00

7 632,00

Swaziland

Observer on Saturday English

Weekly

4

16,20

64,80

194,40

388,80

777,60

Swaziland

Sunday Observer

English

Weekly

4

16,20

64,80

194,40

388,80

777,60

Swaziland

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Daily

26

15,50

403,00

1 209,00

2 418,00

4 836,00

Spanish

Berlingske Tidende

Danish

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30

21,30

639,00

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3 834,00

7 668,00

Sweden

Expressen

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30

19,50

585,00

1 755,00

3 510,00

7 020,00

Denmark

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30

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6 372,00

Sweden

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30

23,10

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8 316,00

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Estonian

France

Le Berry

France

Le Figaro

France

Le Journal du Centre

French

France

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French

France

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French

Daily

Germany

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German

Germany

German German

Daily

Germany

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German

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3 888,00

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4

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74,40

223,20

446,40

892,80

French

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30

15,00

450,00

1 350,00

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French

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26

13,80

358,80

1 076,40

2 152,80

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30

14,70

441,00

1 323,00

2 646,00

5 292,00

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30

14,30

429,00

1 287,00

2 574,00

5 148,00

26

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356,20

1 068,60

2 137,20

4 274,40

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26

14,70

382,20

1 146,60

2 293,20

Daily

30

13,10

393,00

1 179,00

2 358,00

26

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1 068,60

2 137,20

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26

13,20

343,20

1 029,60

Daily

26

11,90

309,40

928,20

Switzerland 24 Heures

French

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26

12,90

335,40

1 006,20

2 012,40

4 024,80

Switzerland Blick

German

Daily

26

12,20

317,20

951,60

1 903,20

3 806,40

5 400,00

Switzerland 20 Minuti

Italian

Daily

22

11,90

261,80

785,40

1 570,80

3 141,60

4 305,60

Turkey

Haberturk

Turkish

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30

15,20

456,00

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2 358,00

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30

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2 214,00

4 428,00

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2 358,00

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11,30

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2 034,00

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4 274,40

UK

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30

11,40

342,00

1 026,00

2 052,00

4 104,00

2 059,20

4 118,40

UK

Vatan Al Hayat International Daily Express

English

Daily

26

17,90

465,40

1 396,20

2 792,40

5 584,80

1 856,40

3 712,80

UK

Daily Mail

English

Daily

26

22,10

574,60

1 723,80

3 447,60

6 895,20

Greece

Kathimerini

Greek

Daily

30

13,50

405,00

1 215,00

2 430,00

4 860,00

UK

Daily Mirror

English

Daily

26

18,50

481,00

1 443,00

2 886,00

5 772,00

Hungary

24 Ora

Hungarian

Daily

30

10,50

315,00

945,00

1 890,00

3 780,00

UK

Daily Record

English

Daily

26

17,40

452,40

1 357,20

2 714,40

5 428,80

India

Hindustan

Hindi

Daily

30

11,00

330,00

990,00

1 980,00

3 960,00

UK

Daily Star

English

Daily

26

17,00

442,00

1 326,00

2 652,00

5 304,00

Iran

Khorasan

Persian

Daily

26

20,30

527,80

1 583,40

3 166,80

6 333,60

UK

Daily Telegraph

English

Daily

22

17,40

382,80

1 148,40

2 296,80

4 593,60

Iran

SMT newspaper

Persian

Daily

26

10,20

265,20

795,60

1 591,20

3 182,40

UK

Financial News

English

Weekly

4

12,60

50,40

151,20

302,40

604,80

Iran

Tejarat Daily

Persian

Daily

26

10,20

265,20

795,60

1 591,20

3 182,40

UK

English

Weekly

4

12,60

50,40

151,20

302,40

604,80

Israel

Israel News Faxx

English

Weekly

4

9,90

39,60

118,80

237,60

475,20

English

Daily

26

17,10

444,60

1 333,80

2 667,60

5 335,20

Israel

Jerusalem Post

English

Daily

26

11,90

309,40

928,20

1 856,40

3 712,80

Italy

Corriere della Sera

Italian

Daily

30

16,80

504,00

1 512,00

3 024,00

6 048,00

UK

First News I [from The Independent] The Guardian

English

Daily

26

20,30

527,80

1 583,40

3 166,80

6 333,60

UK

The Journal

English

Daily

26

17,40

452,40

1 357,20

2 714,40

5 428,80 1 233,60

Italy

Corriere dello Sport

Italian

Daily

30

12,30

369,00

1 107,00

2 214,00

4 428,00

Italy

Italian

Daily

30

15,50

465,00

1 395,00

2 790,00

5 580,00

Italian

Italy

Il Sole 24 Ore La Gazzetta dello Sport La Repubblica

Italian

Italy

Libero

Italian

Italy

Tuttosport

Italian

Japan

Mainichi Shimbun

Japanese

Italy

UK

UK

The Observer

English

Weekly

4

25,70

102,80

308,40

616,80

UK

The People

English

Weekly

4

18,90

75,60

226,80

453,60

907,20

UK

The Sun

English

Daily

30

17,70

531,00

1 593,00

3 186,00

6 372,00

30

13,20

396,00

1 188,00

2 376,00

4 752,00

Daily

30

14,40

432,00

1 296,00

2 592,00

5 184,00

UK

The Times

English

Daily

22

17,90

393,80

1 181,40

2 362,80

4 725,60

Daily

30

14,10

423,00

1 269,00

2 538,00

5 076,00

Den

Ukrainian

Daily

18

11,30

203,40

610,20

1 220,40

2 440,80

Daily

30

12,00

360,00

1 080,00

2 160,00

4 320,00

Daily

30

13,20

396,00

1 188,00

2 376,00

4 752,00

Ukraine United Arab Emirates United Arab Emirates USA

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30

17,70

531,00

1 593,00

3 186,00

6 372,00

Al-Ittihad

Arabic

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30

14,40

432,00

1 296,00

2 592,00

5 184,00

American Banker

English

Daily

22

10,20

224,40

673,20

1 346,40

2 692,80

USA

Financial Times

English

Daily

22

12,50

275,00

825,00

1 650,00

3 300,00

USA

ForbesWeekly

English

Weekly

4

10,40

41,60

124,80

249,60

499,20

USA

Global Times

English

Daily

22

11,90

261,80

785,40

1 570,80

3 141,60

Daily

Japan

Yomiuri Shimbun

Japanese

Daily

30

12,80

384,00

1 152,00

2 304,00

4 608,00

Jordan Korea, Republic Of Korea, Republic Of Kuwait

Al Ghad

Arabic

Daily

30

13,70

411,00

1 233,00

2 466,00

4 932,00

The Korea Times

English

Daily

26

12,20

317,20

951,60

1 903,20

3 806,40

Maeil Business Newspaper

Korean

Al Qabas

Arabic

Daily

30

13,80

414,00

1 242,00

2 484,00

4 968,00

USA

New York Post

English

Daily

30

19,10

573,00

1 719,00

3 438,00

6 876,00

Diena

Latvian

Daily

22

11,10

244,20

732,60

1 465,20

2 930,40

USA

English

Daily

30

14,20

426,00

1 278,00

2 556,00

5 112,00

Netherlands De Telegraaf

Dutch

Daily

30

17,30

519,00

1 557,00

3 114,00

6 228,00

English

Daily

26

12,30

319,80

959,40

1 918,80

3 837,60

Norway

Varden

Norwegian

Daily

26

16,40

426,40

1 279,20

2 558,40

5 116,80

Oman

Al Shabiba

Arabic

Daily

22

13,10

288,20

864,60

1 729,20

3 458,40

English

Daily

22

13,20

290,40

871,20

1 742,40

3 484,80

Oman

Oman Arabic Daily National Herald Tribune Pakistan Observer

Arabic

Daily

30

11,40

342,00

1 026,00

2 052,00

4 104,00

USA

The Day The New York Times International Edition The Wall Street Journal Europe USA Today

English

Daily

22

11,90

261,80

785,40

1 570,80

3 141,60

English

Daily

30

9,60

288,00

864,00

1 728,00

3 456,00

USA

Washington Post

English

Daily

26

17,10

444,60

1 333,80

2 667,60

5 335,20

3 996,00

USA

Washington Times

English

Daily

22

13,20

290,40

871,20

1 742,40

3 484,80

Latvia

Pakistan Pakistan

English

Daily

Daily

26

30

13,70

11,10

356,20

333,00

1 068,60

999,00

2 137,20

1 998,00

4 274,40

USA USA

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green business

The ProCredit Group Environmental Management System Eva BOLQVADZE

A

The FINANCIAL

s a part of the ProCredit group, ProCredit Bank Georgia has been in the banking business for more than 18 years. The bank focuses mainly on providing financial services to small and medium-sized businesses with long-term business plans. ProCredit Bank Georgia was awarded a rating of BB/Stable by Fitch Ratings, which is not only the highest rating in Georgia, but is also one notch above the sovereign rating. It offers its customers innovative, modern, and convenient banking services and strives to be a reliable business partner.

Promoting environmental awareness and protection and helping to mitigate climate change has always been a matter of concern for the ProCredit group. It is a critical part of their business model - not only in connection with business operations, but also in their day-to-day work. All ProCredit banks set high standards regarding the impact of their staff, clients, and counterparts, as well as the general public, on the environment.

“ProCredit Bank Georgia is committed to improve internal and external environmental performance, which naturally fits with our values and mission to support steady economic development. We aim to act in an environmentally friendly manner and take sustainability and responsible resource management into account.

Environmental awareness is, in fact, an integral part of ProCredit`s identity, a groupwide initiative designed to improve our internal and external environmental performance in order to reinforce the wider socially responsible positioning of the group.” Ioseb Rostomashvili, Head of the Environmental Management Unit of ProCredit Bank Georgia, told the FINANCIAL. “In our daily work, we contribute to ecological sustainability by implementing a comprehensive three-pillar environmental management system (EMS), which is aimed at improving both the internal and external environmental impact of our activities,” said Rostomashvili.

The EMS is implemented

uniformlynot only by ProCredit Bank Georgia but by all of the banks of the ProCredit group. It enables the effective management of any potentially negative impacts on society and helps to ensure that direct and indirect environmental impacts are minimised.

Commitment to environmental management and offering green financing is a point of differentiation for the acquisition, retention and deepening of relationships with clients. It also connects directly to the overarching topic of operational efficiency and productivity, which is vital for SMEs (esp. producers) in all markets. Environmental management and green finance fit with the ProCredit approach of proactively building long-term client relationships.

“ProCredit Bank Georgia is doing much more than merely designing new types of loans for green purposes - we devote resources to awarenessraising campaigns and regular training sessions for our staff, enabling them to improve the environmental performance of

the companies we work with.

Comprehensive training for our staff is not only provided at bank level, but also at group level at the ProCredit Academy in Germany. By introducing green finance, we have encouraged many of our clients to make sound investments in environmentally friendly projects. Clients receive comprehensive support from us in the form of both financial and human advice,” said Rostomashvili.

ProCredit Bank Georgia offers three categories of green loans consisting of investments in energy efficiency (EE), renewable energy (RE), and other investments that have a beneficial impact on the environment (Gr). The ProCredit group defines an EE investment as one that improves a client’s energy efficiency, for example, the installation of more efficient equipment to achieve significant energy savings. ProCredit Bank Georgia supports for example investments in renewable energy technologies, primarily in solar water heaters;

photovoltaic installations; small hydropower plants and wind power turbines; as well as biogas and biomass applications. Investments that are inherently environmentally friendly and help conserve the quality and availability of natural resources are covered under the Gr category.

“We aim to work with businesses whose activities don’t harm the environment or the health, safety and well-being of their staff and neighbours. Above all, we strive to acquire clients who make positive contributions to the environment. Before issuing loans, the bank closely examines the business by evaluating social and/or economic risks, in order to find out whether these risks pose a potential threat to the environment. Our Business Client Advisors then give clients valuable advice,” said Rostomashvili.

“ProCredit Bank Georgia wants to motivate its clients by setting an example. We promote green business, firstly, through our own actions, such as waste management, ecostandards, electro-mobiles or

hybrids. Our electro-mobile loan with its unprecedented conditions is motivation for others to replace their vehicles with environmentally friendly, ecologically sound cars,” Rostomashvili told the FINANCIAL. To raise customer awareness, ProCredit Bank Georgia started its “Come and See” project. Clients from special lists are invited to share their successful experiences with each other. At B2B meetings clients talk about how our recommendations have helped them to develop their business and achieve their business objectives. The practical and realistic examples given motivate other entrepreneurs.

Our management and staff fully comprehend the concept of responsibility towards the environment. In 2016, ProCredit Bank Georgia successfully completed the ISO 14001:2015 certification process. This once again emphasizes the bank’s high degree of commitment towards the environment. ProCredit is the only bank in Georgia to be the holder of this important certificate.

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How can Georgian economy benefit from bitcoin?

Irakli SHALIKASHVILI ISET

FROM ISET ECONOMIST

ISET-PI.GE/blog

Recent Developments

F

or the first time in history, the price of Bitcoin broke its highest record (Figure 1) rising above 2,900 USD during the last week of June, 2017. One of the reasons why the market unexpectedly became optimistic about Bitcoin could be the fact that in April, the Japanese government formally accepted1 the cryptocurrency as a mean of exchange, which gave it more validity in Asia’s richest economy. Moreover, there has been significant growth of international money transfer services that use Bitcoin in order to move currency from one country to another. An additional interesting turn of events is the broad acceptance of Bitcoin in the U.S. For example, in the educational sector, the University of Ohio is hosting classes about Bitcoin and other cryptocurrencies as a part of its curriculum. Likewise, some colleges have begun to accept Bitcoin as a means of payment. The recognition of digital currency has already led to some companies thinking about profitable investment opportunities in Bitcoin, which fuels its journey to the mainstream. But, before going in deeply and analyzing the dynamics of the market, first let’s find out what Bitcoin is and how it works.

Defining Bitcoin Bitcoin is a cryptocurrency2 that is held and created electronically.

It is not under the control of any

authority and is not printed like other currencies; Bitcoins are produced by individuals, mostly by business representatives who are running computers (for example BITMAIN blocks)3 using software that deals with mathematical problems. Each block costs 1,220 USD, and on average, one block can earn 0.005 Bitcoins per day.

Depending on the current market price, a block can be transformed to a dollar value or any other currency. However, one major question that still has to be answered is how bitcoins are created. As far as mathematical problems go, they are solved during the Bitcoin transaction (Graph 1). The system works as follows: when one per-

son (Giorgi) wants to send BTS4 to another person (Levani), one of the mining blocks that will be the most successful (the first one) will solve the transaction process (mathematical problem) and as a result the miner gets a reward (a specific number of Bitcoins) for the provided service. Technically, Bitcoin is based on the P2P (Peerto-Peer) network, meaning that the network does not have central administrator unit. In order to sell or buy Bitcoins, you have to set up Bitcoin wallet that will give you an address and personal private key.

Transactions between the negotiating (trading) parties is guaranteed by “miners” all over the world who are using mining software to

deal with above-mentioned complex mathematical problems, and the corresponding output is the result of a completed transaction between trading partners. Generally, anyone can access the network and become a miner with just some relevant hardware and an internet connection.

Bitcoin is useful to buy things electronically, as it is like all other currencies that are also traded and exchanged digitally (e.g. Ethereum, Ripple, Litecoin, etc.). Based on price and market share in transactions, Bitcoin is the most successful form of Continued on p. 15

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green business

PASHA Bank

Pays Double Attention to Green CSR Activities in Georgia The FINANCIAL

by MARIAM PAPIDZE

O

ne of the leading banks of Azerbaijan - PASHA Bank - is creating sustainable value for its clients and employees, its shareholders and for society in Georgia, taking responsibility for the company’s effects on environmental and social wellbeing in the country by implementing a number of projects within its Corporate Social Responsibility (CSR) initiative.

PASHA Bank is committed to CSR and supporting Georgia’s development, focusing its efforts on the areas of youth, health, education and the environment.

“In December 2016 the Bank promised to dedicate its CSR activities to environmental projects throughout 2017. We pay considerable attention to CSR and we have already carried out a number of charity and social activities in Georgia. This year we have decided to mostly focus on environmentally-friendly projects and get our clients and partners involved as well,” said Chief Commercial Officer of PASHA Bank, Goga Japaridze.

Meanwhile, PASHA Bank is famous for its constant support and contribution to the growth and development of the business sector in Georgia.

For the third consecutive year PASHA Bank has been the special partner of the most influential and prestigious annual business awards ceremony in Georgia Golden Brand.

Golden Brand has been awarding locally-operating companies for their various achievements since 2006.

“PASHA Bank is the partner of Golden Brand Awards for the third time this year. By doing so, we once again underline our readiness and desire to support the development of local business.

We believe that the Awards serve as additional motivator for the winner companies and prove their success,” Mr. Japaridze said.

Being a Baku-based financial institution, PASHA Bank has been providing corporate and investment banking services to large and medium-sized enterprises in Georgia since 2013. The slogan of the Bank is ‘New heights. Together.’ And as Mr. Japaridze said, supporting customers and achieving success together with them is the main goal of the Bank.

“Over the last three years, PASHA Bank’s credit portfolio has increased from zero to GEL 110 million, while total assets exceeded GEL 250 million. Since 2015, the Bank has become profitable. By providing high quality corporate and investment banking services and financing large projects in Georgia, Azerbaijan and Turkey, we contribute to the development of the regional economy,” Mr. Japaridze said.

GOGA JAPARIDZE, Chief Commercial Officer at PASHA Bank Georgia

Q. PASHA Bank has been actively involved in CSR campaigns over the recent past. What are the specific projects the Bank is involved in?

A. I think nowadays it is very important to raise awareness of ecological problems and do the best to solve them.

This year we made a special New Year gift for our partners and planted 2017 Georgian Pine Trees

near central Georgia’s resort town Borjomi, where 260 hectares of forest got burnt down in August 2008.

Since then we have been implementing various CSR projects, but I would single out in particular the hackathon ‘Smart City’, which was hosted by Caucasus University and where student teams competed in the generation of innovative solutions to make our capital city a better place in regard to parking, ecolo-

gy, queues and other related issues.

The teams were evaluated by the following criteria: whether the innovation is applicable in real life; and its originality.

The winner in the contest Green Project was granted a prize from PASHA Bank.

We consider it important to involve the young generation in ecological issues and to hear their initiatives on how to care about the environment in a better and more effective way.

Q. This year again PASHA Bank congratulated its partners and clients on Easter in a special way. Can you tell us about the initiative?

A. Yes, every year we try to congratulate our partners and clients on Easter in a very special way that is different every year.

This year on behalf of our associates the Bank planted 1,000 Georgian Oak (Quercus Iberica) and Imeretian Oak (Quercus Imeretina) trees, the latter of which is in the Red List of threatened species of plants. The seedlings were planted in the Imereti region and fully covered one of the areas in the Ajameti Managed Reserve where rehabilitation processes are carried out. Together with Treepex and PASHA Bank the representatives of the Agency of Protected Areas of Georgia and local schoolchildren also joined the planting process.

Q. What activities can you name as an example of supporting business activities in Georgia in 2016?

A. Our core business implies financing large and medium-sized enterprises for their further development. Therefore most of our work is actually aimed at supporting business activities in Georgia.

In parallel with this, we frequently finance various business-related conferences and trainings. In this way we support the development of professionals working in the business sector, which is most certainly a significant prerequisite for economic development.

Besides partnering the Golden Brand Awards Ceremony we also supported the Telecommunication Meeting in Georgia; the marketing

event Spotlight; the 13th Bond Congress Baltic States and Caucasus, events organized by the American Chamber of Commerce in Georgia, HR Hub, International Business Forum and others.

We will continue supporting conferences and forums this year as well.

Q. Tell us about ‘Business Café’. What is its contribution to developing Georgian business?

A. Business Cafe is a project initiated by one of the leading consulting and recruitment companies in Georgia - Insource, and has been supported by PASHA Bank since 2015.

Business Café meetings are attended by the top managers of large and medium-sized enterprises on a regular basis. Each meeting offers a convenient platform for sharing knowledge and experiences as well as discussing the recent trends in various industries and the economy as a whole.

Interesting discussion topics and an interactive event format attract participants and contribute to the rising popularity of the project. As of 2017 two new sponsors have joined the initiative - ACT and Orient Logic.

The speakers of the meetings are selected considering their experience. For example, this May the ninth meeting of Business Café was held in Tbilisi where Mr. Sascha Ternes, Managing Partner at TERNES Real Estate Fund LLC and former CEO of ProCredit Bank, spoke about organisational culture, business ethics and corporate management.

Q. Why does PASHA Bank consider it so important to support business?

A. We are oriented on developing ourselves as well as caring about the success of our customers. We try to be very attentive while cooperating with them. The interest of our customers is the cornerstone of our corporate strategy. That is why we aim to support the development of our customers.

In fact, supporting business activities is our primary function. We help the companies to develop and expand.

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publicity

Tips for Going Green The Benefits of an Environmentally Friendly Business

money on electricity, paper and other resources - money that you can reinvest in your business.

Get everyone involved

R

unning an environmentally friendly business helps you reduce your impact on the environment and preserves natural resources. Your business can help the environment in many ways. For example, you can: use products that reduce your reliance on natural resources (e.g. rainwater tanks, solar hot water systems) use products that are made from recycled material (e.g. office supplies made from recycled plastic, furniture made from recycled rubber) look at all your business activities to see if you can do anything differently (e.g. reducing air travel by holding conference calls instead of interstate meetings).

Making your business environmentally friendly not only benefits the environment but can also save you money.

Recycling reduces your costs Avoiding, reducing, reusing and recycling can lower your costs. For example, a few simple changes to how you deal with paper can involve your staff in environmentally friendly processes while saving you money:

Set up regular discussions with employees so they can suggest ideas to help your business help the environment. This boosts morale and generates goodwill as every person in your business can contribute to your environmental goals.

Tell your customers how your business is environmentally friendly so they can make an informed decision to choose you over your competitors.

Contact your suppliers and ask them to help you. Do they offer a discount if you order in bulk and reduce the frequency of deliveries? Can you return their packing materials for them to re-use in exchange for a discount on goods?

avoid using materials unnecessarily reduce your paper needs by asking staff to print double-sided reuse by encouraging staff to use scrap paper for message-taking instead of purchasing message pads recycle by shredding excess paper - you could recycle this commercially or invite staff to take it home for their compost or mulch heaps.

Good practice can attract new customers

Promoting your environmentally friendly methods can set your business apart from your competitors and attract new customers who want to buy products and services from an environmentally friendly business.

Improves sustainability Reducing the environmental impact of your business will improve the sustainability of your business.

If you are less dependent on natural

resources than your competitors and have ways to deal with rising costs due to climate change, your business will have a greater chance of longterm success.

Make green purchasing decisions

Make your business environmentally friendly

Almost everything your business buys uses energy and resources, and creates waste. Sustainable purchasing is a great way to reduce your impact on the environment. Ask your suppliers if their products are made from recycled materials. Research which suppliers have the least impact on the environment.

Making your business environmentally friendly should save you

Continued on p. 10

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green business

Teenagers and higher-income households most likely to struggle with technology addiction

A

third of people (34 percent) in an online survey of 17 countries firmly agree that they “find it difficult to take a break from technology (my mobile device, computer, TV, etc.), even when I know I should”.

Societe Generale Sells Its Stake in TBC Bank

The FINANCIAL The findings from global research experts, GfK, show that, internationally, gender makes next to no difference in people’s struggle to turn off their devices or ‘unplug’ from technology, with nearly equal percentages of both men and women agreeing they find it difficult.

However, the different age groups and income groups show distinct differences in susceptibility to being ‘always on’.

Younger age groups struggle most with technology addiction Teenagers (15-19 year olds) are the most likely to struggle with technology addiction, with just under half (44 percent) firmly saying they find it difficult to take a tech break, even when they know they should.

This dips to 41 percent for those in their twenties and to 38 percent for those in their thirties. It then falls significantly for the older age groups – standing at 29 percent of those in their forties, 23 percent for those in their fifties and 15 percent for those aged 60 and over.

Critically, the 50-59 and 60+ age groups are the tipping point, where there are higher percentages who firmly indicate they have no problem turning off their technology, than percentages saying they struggle to take a break.

High income households show biggest gap between those finding it easy or difficult to take tech breaks For people living in high-income households (across all 17 countries), 39 percent find it difficult to take a break from technology, even when they know they should, while 11 percent find it easy – a gap of 28 percentage points. This contrasts to those in low-income households, where 30 percent find it difficult,

while 20 percent find it easy – a gap of only 10 percentage points.

China and the Americas have highest percentages who find taking a technology break difficult.

Germans lead in finding it easy At country level, China (43 percent) has the highest percentage

of online population who strongly agree that they find it difficult to break from technology. This is closely followed by the Latin American countries surveyed (Brazil 42 percent, Argentina 40 percent, Mexico 38 percent), with the USA coming fifth (31 percent).

On the other side, Germany has the highest percentage (35 percent) of online population who strongly disagree that taking a break from tech is difficult. This is followed by the Netherlands (30 percent), Belgium (28 percent) and Canada and Russia (both 27 percent).

GfK’s findings clearly show where the key markets lie at a number of levels – from brands offering the latest devices targeting happily ‘alwayson’ consumers, to brands offering ‘quality time’ services that resonate with people who like to break from technology.

The FINANCIAL -- Societe Generale has sold on June 28 its entire 5.3% equity stake in TBC Bank Group PLC. On 28th June, Societe Generale sold approximately 2.8 million ordinary shares in TBC Bank Group via an accelerated bookbuild offering to a number of institutional investors at a price of GBP 15.25 per share.

Societe Generale initially acquired this minority stake in October 2016 as part of the sale of its Georgian subsidiary Bank Republic to TBC Bank Group PLC. The settlement and delivery of the shares shall take place on 30th June 2017.

After the completion of the transaction, Societe Generale will cease to be a shareholder in TBC Bank Group PLC, according to Societe Generale.

This operation would have a very limited positive impact on the Group’s financial ratios, group said in press-release.

May 2017 Was Second- Record growth in renewables in warmest May on Record 2016 despite investment wobble

W The FINANCIAL

M

ay 2017 was the second-warmest May in 137 years of modern record-keeping, according to a monthly analysis of global temperatures by scientists at NASA’s Goddard Institute for Space Studies (GISS) in New York.

Last month was 0.88 degrees Celsius warmer than the mean May temperature from 1951-1980. The two top May temperature anomalies have occurred during the past two years. 2016 was the hottest on record, at 0.93 degrees Celsius warmer than the May mean temperature.

May 2017’s temperature was 0.05 degrees Celsius cooler than May 2016. It was just 0.01 degrees Celsius warmer than the third warmest May, which occurred in 2014.

The monthly analysis by the GISS team is assembled from publicly available data acquired by about 6,300 meteorological stations around the world, ship- and buoybased instruments measuring sea surface temperature, and Antarctic research stations.

The modern global temperature record begins around 1880 because previous observations didn’t cover enough of the planet. Monthly analyses are sometimes updated when additional data becomes available, and the results are subject to change.

The FINANCIAL

ind, solar and other renewables represented 55% of new electricity generation capacity in 2016 with a record 138.5 gigawatts installed globally, according to a report by the United Nations Environment Programme (UNEP) and Bloomberg New Energy Finance.

As a result the proportion of electricity from renewable sources rose to 11.3%, up from

10.3% in 2015.

Among other trends, the authors noted a shift in the solar market, where investment is moving away from residential towards large commercial scale projects. There was also a breakthrough of ‘hybrid’ projects, where two technologies such as hydro and solar or wind and solar, are sited at the same location.

The authors considered 2016 to be a turning point for cost competitiveness, with investments in renewables being made overwhelmingly on a market basis, independent of

subsidy schemes.

Despite this, investment in renewables actually fell in 2016, to a total of $241 billion.

This trend was only bucked in Europe, which experienced a 3% increase. The report authors attributed the global drop in part to a fall in the cost of renewables, with capital expenditure per megawatt down by more than 10% for wind and solar. Slowdowns in China and Japan were also blamed. Investment was predicted to pick up again in 2017 off the back of the Paris climate change agreement.

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green business Irakli Abesadze: MEMBER OF THE MOVEMENT FOR FREEDOM

“Railway cargo turnover and profit are decreased.”true Valeri KVARATSKHELIA

O

EU Members agree on 30% target for energy efficiency

Graph 1: Railway Cargo Turnover

FactChek

n 8 June 2017, at the session of the Parliament of Georgia, a member of the Movement for Freedom – European Georgia, Irakli Abesadze, stated: “In 20072008, railway cargo turnover was approximately 23 million tonnes, whilst in 2012 it was decreased to 20 million tonnes, in 2015 it dropped further to 14 million tonnes and for this year, planned annual amount is 11 million tonnes.

Correspondingly, railway profits were also reduced. If in the tree year period, 20092012, railway profit reached USD 227 million, in 2013-2016 it was three times less and constituted USD 87 million.”

FactCheck took interest in the accuracy of the statement.

For the last 25 years, the largest turnover of cargo transported by Georgian Railway was registered in 2006, when the figure was 22.6 million tonnes. As the graphic bellow illustrates, in the period of 2005-2012, cargo turnover has been constantly exceeding 20 million tonnes and the only exceptions are post-crisis 2009 year with 17.1 million tonns of transported cargo and 2010, when the cargo turnover was 19.9 million tonnes.

In 2013, railway cargo turnover dropped to 18.2 million tonnes, trend of decline has been kept in place and in 2016, volume of cargo transported by railway constituted only 11.9 million tonnes. The figure of the trade turnover of the first four months of 2017 is decreased as compared to the same period

Source: Georgian Railway of the previous year and is only 3.6 million tonnes. FactCheck was unable to find information about the planned trade turnover of 2017.

In regard to financial figures of the Georgian Railway, Graph 2 illustrates those stats. Irakli Abesadze’s figures are given in USD, whilst financial indicators in the Georgian Railway’s documents are given in GEL. Therefore, considering the signficant fluctuation of GEL to USD exchange rate during the period of analysis, it is practically impossible to verify Irakli Abesadze s figures vis-à-vis official data. On the other hand, several different financial indicators (operating profit, profit before tax, net profit) can be used to measure the volume of profit. Hence, evaluation of trend of changes of financial figures in the given part is a better indicator than comparison of absolute numbers.

In the period of 2007-2015, with post-crisis 2009 being the only exception, Georgian Railway’s profits have a growth trend and decline of profits is

registered only in 2016. At the first glance, this is illogical in light of the significantly reduced cargo turnover. However, if we takeinto account the fact that tariffs of cargo shipment are denominated in foreign currency, it will be obvious that a principal factor behind the growth of GEL denominated profits is depreciation of GEL exchange rate instead of any real positive development.

This assessment is further corroborated by explicit decline trend of profitability. In 2015, Georgian Railway’s net profit became negative (loss) for the first time since 2007. In terms of absolute figures, total net profit in 2013-2016 reached GEL 104 million, which is 3.7 times less (GEL 389 million less) as compared to the total figure of 2009-2012. Of note is that the comparison of similar periods illustrate that in 2013-2016, operating profit has increased 1.5 times. However, as we have already mentioned, since the tariff is denominated in foreign currency, the aforementioned growth is largely stipulated by GEL depreciation.

CONCLUSION GEORGIAN RAILWAY’S CARGO TURNOVER REACHED ITS PEAK 22.6 MILLION TONNES IN 2006 AND AVERAGE ANNUAL CARGO TURNOVER IN 2007-2008 WAS 21.7 MILLION TONNES. SINCE 2013, DECLINE TREND OF CARGO TURNOVER HAS BEEN OBVIOUS AND ACCORDING TO 2016 DATA, GEORGIAN RAILWAY TRANSPORTED ONLY 11.9 MILLION TONNES OF CARGO. FACTCHECK COULD NOT FIND INFORMATION ABOUT PLANNED CARGO SHIPMENT FIGURES FOR 2017.

IN LIGHT OF DECREASED CARGO TURNOVER, GEL DENOMINATED TOTAL PROFITS HAS BEEN GROWING. THE REASON BEHIND THAT IS THE DEPRECIATION OF GEL, WHILST TARIFFS ARE DENOMINATED IN FOREIGN CURRENCY. AT THE SAME TIME, FIGURES OF PROFITS BEFORE TAX AND NET PROFIT ARE SIGNIFICANTLY DECREASED. IN 2015, FOR THE FIRST TIME DURING THE PERIOD OF ANALYSIS, GEORGIAN RAILWAY’S NET PROFIT IS NEGATIVE (LOSS). ACCORDING TO THE DATA OF THE FIRST QUARTER OF 2017, INCOMES ARE DECREASED BY GEL 4 MILLION AS COMPARED TO THE SAME PERIOD OF THE PREVIOUS YEAR AND NOW CONSTITUTE GEL 104 MILLION. THEREFORE, IRAKLI ABESADZE’S STATEMENT IS TRUE.

TRUE

The FINANCIAL

B

russels – The Energy Ministers of EU states have agreed to support a target of 30% improvement in energy efficiency by 2030, amid arguments between states that wanted more ambition and those who wanted more flexibility.

In the process of reaching the agreement, the Council

dropped the part of the Commission’s proposal that would have made this target binding. Additionally, the Council’s position reduced the Commission’s proposed 1.5% annual energy savings obligation to 1%. Member states have also now requested exceptions for certain industries for up to 35% of expected energy savings.

Central and Eastern European countries, backed by the UK, wanted to remain at the 27% target agreed by EU lead-

Tips for Going Green Continued from p. 9

Spread the word Make your environmental policy clear to new staff at induction so they know what they can do to help.

Use signs around your business and on your website, packaging and invoices/receipts to tell customers what you are doing to help the environment.

Encourage suppliers to help you; for example, your email sign-off could include a request not to print emails unless necessary.

Saving water in your business Saving water is everyone’s business, and all workplaces should aim for long-term water efficiency. Using water efficiently makes good business sense and also helps conserve a vital natural resource.

By carefully managing your water use you can: cut costs develop an eco-friendly image attract environmentally conscious customers.

The following guide can help your business become more water efficient.

Assessing water use in your business As our economy grows, so too does our demand for water. Business and industry therefore have a responsibility to become efficient water users. This means working out how much water your business uses, and then coming up with a plan to save water.

Environmental risks to your business The views expressed in this website are those of FactCheck.ge and do not reflect the views of The FINANCIAL or the supporting organisations

ers in 2014, but other states pushed for greater ambition.

In the end, France and Germany introduced an amendment to remove the word ‘binding’ from the text, to secure agreement from the UK and others.

The Council’s position will face strong resistance from the European Parliament, who are showing more ambition. The two institutions will both need to approve the final legislation.

The environment can pose many risks to your business, but climate change is perhaps

the biggest environmental risk. Climate change refers to the build-up of man-made gases in the atmosphere that trap the sun’s heat, causing changes in global weather patterns. It has environmental, economic and social impacts.

Climate change risks for your business may include: frequent extreme weather - you may have increased insurance costs, more damage to property and resources, and disruption of power and water. Customers may be unable to visit or contact your business, or suppliers may be unable to deliver goods or services. decreased demand - there may be less demand for your goods and services if they are not environmentally friendly, or competitors with energy-efficient products may target your customers. It may also be difficult to attract and retain staff if your business is not sustainable. global impacts - overseas suppliers may be unable to deliver goods or services due to climate change events in their country or international customers being encouraged to buy locally. increased costs - you may experience higher costs for energy, water and other resources.

Water restrictions may also affect your business.

Prepare a risk management plan Identify the risks that climate change brings to your business and prepare a risk management plan that deals with climate change.

Then plan ways to manage these risks. Assess how climate change is already affecting your business and how it could affect it in the future.

Taking steps now to address climate change risks can save your business from financial or other problems, and improve the sustainability of your business.

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green business

Investing in Renewables Key Figures: The FINANCIAL

G

lobal new investment in renewables excluding large hydro fell by 23% to $241.6 billion, the lowest total since 2013, but there was record installation of renewable power capacity worldwide in 2016. Wind, solar, biomass and waste-to-energy, geothermal, small hydro and marine sources between them added 138.5GW, up from 127.5GW in the previous year.

This 2016 gigawatt figure was equivalent to 55% of all the generating capacity added globally, the highest proportion in any year to date.

Investment in ‘new renewables’ capacity was roughly double that in fossil fuel generation in 2016, for the fifth successive year. The proportion of global electricity coming from these renewable sources rose from 10.3% in 2015 to 11.3% in 2016, and prevented the emission of an estimated 1.7 gigatonnes of CO2.

There were two main reasons for the fall in investment in renewables in 2016. One was lower costs, with average dollar capital expenditure per MW down by more than 10% for solar photovoltaics, onshore wind and offshore wind, improving the competitiveness of those technologies. The other was not so positive – there was a marked slowdown in financings in China, Japan and some emerging markets during the course of the year.

Overall, renewable energy investment in developing countries fell 30% to $116.6 billion, while that in developed economies dropped 14% to $125 billion. China saw investment plunge 32% to $78.3 billion, breaking an 11year rising trend. Mexico, Chile, Uruguay, South Africa and Morocco all saw falls in investment of 60% or more, on a mixture of scheduled pauses and delays with auction programmes and financings. Jordan was one of the few new markets to buck the trend, investment there rising 148% to $1.2 billion.

Among developed economies, the US saw commitments slip 10% to $46.4 billion, as developers took their time to build out projects to bene t from the ve-year extension of the tax credit system. Europe enjoyed a 3% increase to $59.8 billion, led by the UK on $24 billion and Germany on $13.2 billion, down 1% and 14% respectively. Japan slumped 56% to $14.4 billion.

Europe’s investment owed its resilience to record commitments to offshore wind, totalling $25.9 billion, up 53% thanks to final in-

vestment decisions on mega-arrays such as the 1.2GW Hornsea offshore wind project in the UK North Sea, estimated to cost $5.7 billion. Not all of 2016’s offshore wind boom was in Europe – China invested $4.1 billion in the technology, its highest figure to date.

The most hopeful sign last year for the future greening of the global electricity system was a succession of winning bids for solar and wind, in auctions around the world, at tariffs that would have seemed inconceivably low only a few years ago. The records set last year were $29.10 per MWh for solar in Chile and $30 per MWh for onshore wind in Morocco, but there were other eye-catchingly low outcomes to auctions from Dubai to India, and Zambia to Mexico and Peru.

Availability of nance does not appear to be a bottleneck to investment in renewables in most countries. Indeed, investor hunger for what many regard as mature technologies helped to fuel record acquisition activity in the clean power sector worldwide last year, totalling $110.3 billion, up 17%. Purchases of assets such as wind farms and solar parks reached a highest-ever gure of $72.7 billion, while corporate takeovers reached $27.6 billion, some 58% more than in 2015.

New investment in solar in 2016 totalled $113.7 billion, down 34% from the all-time high in 2015, due in large part to sharp cost reductions – and to real slowdowns in activity in two of the largest markets, China and Japan. India saw the construction of the Ramanathapuram solar complex in Tamil Nadu, billed as the world’s largest ever PV project at some 648MW. Wind followed closely behind solar, at $112.5 billion of investment globally, down 9% despite the boom in offshore projects. However, while solar capacity additions rose in the year to a record 75GW, sharply up from 56GW, wind capacity additions fell back to 54GW in 2016 from the previous year’s high of 63GW. The smaller sectors of renewable energy had mixed fortunes in terms of investment last year. Biofuels fell 37% to $2.2 billion, the lowest for at least 13 years, biomass and waste held steady at $6.8 billion and small hydro at $3.5 billion, while geothermal rallied 17% to $2.7 billion and marine edged down 7% to $194 million.1 One of the up-and-coming innovations in renewable power is the siting of two different technologies in the same location, to make use of shared land, grid connections and maintenance, and to reduce intermittency.

Source: Frankfurt School of Finance & Management

Giorgi Kvirikashvili: PRIME MINISTER OF GEORGIA

“In the first four months of 2017 gross domestic product increased by 4.3%, exports rose by 29%, number of tourists increased by 22% whilst volume of remittances ue r t grew by 26%.” ly Nino NADARAIA

O

FactChek

n 19 June 2016, the Prime Minister of Georgia, Giorgi Kvirikashvili, delivered a speech at Ferero Company’s social responsibility strategy presentation. The Prime Minister stated: “According to the data of the first four months of 2017, real gross domestic products increased by 4.3%, exports rose by 29%, number of tourists increased by 22% whilst the volume of remittances grew by 26%.”

FactCheck took interest in the accuracy of the statement.

According to the preliminary assessment of the National Statistics Office

t s o M

of Georgia, in April 2017, real GDP increased by 2.1% as compared to the same period of the previous year. The real average growth rate of the first quarter of 2017 reached 5%, whilst average real growth rate of the first four months of 2017 was 4.2%.

In regard to export of goods, according to the data of the National Statistics Office of Georgia, in January-April 2017 exports reached USD 788 million, which is 29.7% more as compared to the same period of the previous year. The import of goods has also increased by 12.7% in the first four months of 2017, whilst foreign trade turnover increased by 16.6%. In January-May, the volume of exports of goods is increased by 29%.

According to the border

crossing statistics of the Ministry of Internal Affair’s Information-Analytical Department, in January-April 2017 the number of tourists has increased by 26.9% as compared to the same period of the previous year. In January-May, the number of tourists has increased by 25%.

According to the statistical data of the National Bank of Georgia, in JanuaryApril of 2017, the volume of remittances grew by 19.3% as compared to the same period of the previous year. In January-April this year, USD 396 million was transferred to Georgia from abroad, whilst in January-April of 2016 total amount of remittances to Georgia was USD 332 million.

In January-May of 2017 the volume of remittances grew by 20.4%.

CONCLUSION ACCORDING TO THE FIRST FOUR MONTH’S DATA IN 2017, REAL GDP INCREASED BY 4.2%, EXPORT ROSE BY 29.7%, THE NUMBER OF TOURISTS INCREASED BY 26.9%, WHILST THE VOLUME OF REMITTANCES GREW BY 19.3%.

THEREFORE, THE PRIME MINISTER OF GEORGIA HAS PROVIDED PRECISE FIGURES IN REGARD TO GDP REAL GROWTH AND EXPORT, WHILST HIS FIGURE IN REGARD TO TOURISM (22%) WAS BELLOW THE REAL NUMBER AND IN REGARD TO REMITTANCES WAS HIGHER THAN THE ACTUAL AMOUNT. FACTCHECK CONCLUDES THAT GIORGI KVIRIKASHVILI’S STATEMENT IS MOSTLY TRUE.

MOSTLY TRUE

The views expressed in this website are those of FactCheck.ge and do not reflect the views of The FINANCIAL or the supporting organisations

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green business

How can Georgian economy benefit from bitcoin?

FROM ISET ECONOMIST

Continued from p. 6

For more:

cryptocurrency. Its description was first published under the name Satoshi Nakamoto 5 in 2008, and after 2009,6 there has been open source software for the use of Bitcoin, which was one of the major factors in encouraging the formation of the Bitcoin network. There are no transaction fees, and as already mentioned, the miners who authorize transactions are given Bitcoins as remuneration. Bitcoin value is not attached to any asset or currency, but its value to other currencies is formed according to the supply and demand of the open market.

Moreover, it’s also worth noting that the network cannot churn out an unlimited number of Bitcoins, because the network has its own protocol – only 21 million Bitcoins can ever be created by “miners,” but at the same time these coins can be divided into smaller parts (the smallest divisible amount is one hundred millionth of a Bitcoin and is called a “Satoshi”, after the founder of Bitcoin).

ISET-PI.GE/blog

Figure 1. Market Price of Bitcoin (USD) - Average USD market price across major Bitcoin exchanges

Georgia’s “Mining” Potential

Source: https://blockchain.info/charts/market-price?timespan=all Graph 1. the circulation of information in Bitcoin system

Risks and Benefits Generally, the high growth rate of internet users and the expansion of digital transactions has imposed many limitations on traditional currency and exchange systems. In his article “What are Bitcoins – Pros and Cons, Investment Opportunities” (2014), Michael Lewis argues that currently the limitations include time delays, high expenses and security risks.

Moreover, these limitations become more burdensome when a given transaction involves parties from different countries with different national currencies and with complex products.

Hence, the idea of international currency creation in a digital environment (that is independent of a country or central bank intervention) found its advocates in the economy, and the currency started to expand and increase in value. The author also claims that bitcoin has quite a long journey before it becomes a serious substitute for existing electronic transaction systems. Hence, in the period of transition, cryptocurrencies provide real advantages (benefits) and disadvantages (risks) – listed in Table 1 - for users and the economy as a

the efficiency of buying securities. But on the other hand, this network also carries a significant amount of risk; for instance, the network could be used to finance terrorism and increase transactions on the black market.

Table 1 Benefits Protection From Payment Fraud Reduced Possibility of Identity Theft Direct Transfers for Immediate Settlement Access to Historically Inaccessible Markets

Lower Fees

whole.

Concerning the benefits and risks of Bitcoin, the International Monetary Fund released its first report on “Virtual Currencies and

Risks Financing Illegal and Immoral Activities High Risk of Loss • Lack of Security • Increased Regulation • Limited Scaling • Lack of Application Excessive Volatility

Beyond: Initial Considerations” (2016). The report mostly focuses on cryptocurrencies like Bitcoins, and the authors discuss both pros and cons of its

existence. According to the IMF report, Bitcoins can generally speed up transactions, lower the cost of remittances, increase financial inclusion, and increase

Bitcoin is quite familiar to Georgian society. First, it caught mass attention when Bit Fury7 (one of the leading full service blockchain8 service provider technology companies, operating in U.S., Iceland, London, Amsterdam, Georgia and Hong Kong) set up a data exchange center (for mining) in the city of Gori in 2014, with the support of the Georgian Investment Fund. the low cost of electricity, low taxes, and the sustainable business and investment environment were the most encouraging factors for Bit Fury to enter the Georgian market. Taking into account the benefits provided by the Georgian market, the company decided to build up a second data exchange center in the capital city of Georgia (17 km from the center and close to main airport – located in Gldani).

With 100 MW (megawatt) energy capacity, it is greater than the data center in Iceland (1.2 MW) and the data center in Sweden (10 MW).

Moreover, the Free Industrial Zone in Tbilisi (which includes preferential taxes9) was one of the driving factors for Bit Fury to open the second data center. The firm invested 100 million USD in the second project and it is the biggest Bitcoin data center located in Georgia.

Recently, in collaboration with Bit Fury, the Georgian government came up with an innovative system of registering land titles via private blockchain. This activity was the first time the government used the bitcoin blockchain infrastructure and, since Bitcoin is often associated with illegal activities, this was a good opportunity to improve Bitcoin’s reputation around the country. According to the official representative of Bit Fury in Georgia,10 the 100 million USD investment will bring modern information technologies into the country, and Georgia itself will be added to the innovative technologies world map. Taking into account the recent development of cryptocurrency mining in Georgia, one could

argue that our country might find a niche in providing technological services in the long run, which in fact might lead to an increase of exported service. At the same time, the Georgian market should maintain a competitive advantage on the global market in order to attract foreign investors.

1 https://www.cryptocoinsnews.com/Bitcoin-in-japanofficially-recognized-in-aprilasset-or-expense/ 2 A cryptocurrency (or crypto currency) is a digital asset designed to work as a medium of exchange using cryptography to secure the transactions and to control the creation of additional units of the currency. Cryptocurrencies are a subset of alternative currencies, or specifically of digital currencies.

3 Founded in 2013, Bitmain Technologies, described as the world’s most valuable Bitcoin company, was established to develop and sell the world’s leading Bitcoin miners using Bitmain’s ASIC chip technology.

4 Bitcoins 5 In November 2008, a paper was posted on the internet under the name Satoshi Nakamoto titled Bitcoin: A Peer-toPeer Electronic Cash System.

6 On January 3rd, 2009, an anonymous computer programmer (or programmers) going by the name Satoshi Nakamoto mined the first block of the Bitcoin blockchain, kickstarting the world’s first fully realized crypto-currency 7 Full service block chain service includes Bitcoin mining. This kind of mining pools are offering already built blockchain utilities to investors (who are interested in Bitcoin mining). For instance, if you want to mine Bitcoins and do not want to build up your own block (or blockchain) you can pay fixed amount of money to Bit fury and buy the space in the pool. After having your specific number of blocks in the Bit fury pool, you get the corresponding share of Bitcoins.

8 A blockchain is a distributed database that is used to maintain a continuously growing list of records, called blocks. Each block contains a timestamp and a link to a previous block. A blockchain is typically managed by a peerto-peer network collectively adhering to a protocol for validating new blocks. (source: https://en.wikipedia.org/ wiki/Blockchain).

9 For example, companies that produced products for export in the Zone will be exempt from taxes, except lease tax and income tax [on the salaries of employed people].

10 http://agenda.ge/ news/48424/eng

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green business

Zarapxana

to Promote Rich Georgian Jewellery Traditions Abroad The FINANCIAL

Z

by MARIAM PAPIDZE

arapxana, the leading jewellery manufacturing company in Georgia, is continuing to bring new life to the country’s centuriesold jewellery traditions and further promote them beyond Georgia.

Zarapxana also intends to broaden its chain by opening a new shop in the capital Tbilisi. Furthermore, the company is taking actions to improve its existing collections as well as create new ones.

The company currently operates five fashionable shops in Georgia, which are visited by about 10,000 customers. These stores offer a rich choice of collections, including: a bridal collection; a church collection; souvenirs created based on the motifs of antiquities found at Georgian archaeological excavations, such as lions, deer, rams, etc; and the Mtskheta collection, which is inspired by the exhibits kept in this ancient city of Georgia.

“Right now we are working on a unique collection, which will be the new word in art jewellery by combining Zarapxana’s refined style with artistic taste,” said Ketevan Gognadze, Director of Zarapxana.

Meanwhile, Zarapxana plans to open a training centre in the jewellery field, which will be the first of its kind in Transcaucasia.

“We are actively involved in restoring and reviving the ancient jewellery technological processes such as filigree, dewing, and drawing on stone. We also plan to open a Museum of Jewellery, where the best samples of Georgian jewellery goods will be showcased.

Georgian as well as foreign visitors will be welcomed at the Museum,” she said.

Zarapxana has been making all these efforts since a new management group came to the company, starting a new stage of development for the company.

“In 2016-2017 a new management group started running Zarapxana and accordingly, we have changed the direction of the company and the way it is positioned on the market. We are in the process of renewing and improving the technological process which is directly linked to the company’s strategic plans. These plans are developing the corporate segment and presenting the Zarapxana brand abroad,” said Gognadze.

“We will introduce an original loyalty programme in the nearest future, which will be a novelty not only for Zarapxana but for the whole of Georgia’s jewellery field,” she added.

Refined jewellery goods built upon the best jewellery traditions is something that was highly appreciated by the more than 100 experts which named Zarapxana a Golden Brand winner company this year.

“Our goal is to maintain the number one position in the Georgian jewellery market through our energetic work and distinctive products, to make the outcome of our hard work desirable for each of our customers,” Gognadze said.

KETEVAN GOGNADZE, Director Of Zarapxana

Q. What is Zarapxana’s contribution to developing Georgia’s jewellery market?

A. Our mission is complicated as well as pleasant. Since 1939 Zarapxana has been preserving and developing the jewellery heritage of Georgia.

Using natural and precious, as well as semiprecious and un-precious stones, Zarapxana creates its gold, silver and copper jewellery based upon the best jewellery traditions.

In spite of fruitfully implementing those traditions and adhering to the rich historical heritage, Zarapxana never fails to be up-to-date. This refers to both aspects of jewellery pursuit: the manufacturing techniques as well as the product design.

While creating a new collection Zarapxana also takes fashion trends into account, and as a result creates contemporary jewellery perfectly seasoned with national elements.

Moreover, Zarapxana offers different kinds of exclusive services to its customers. We started collaboration with local fashion designer Irakli Nasidze, who designed a special collection for Zarapxana based on the motif of birds. This was the first precedent, but the company plans to continue collaborations with other famous Georgian designers.

In general, the collection at Zarapxana is renewed twice a year.

Q. What are the service standards that are introduced by Zarapxana? How are customers welcomed at Zarapxana stores?

A. Zarapxana has been in the service of developing Georgian jewellery culture for several decades. Customers are always met by very friendly and experienced professionals who are always ready to help them.

Zarapxana offers its customers exclusive services, like for example an individual service, where customers are able to create their ‘dream jewellery’. Customers can create their own designs and concept by themselves or with the help of our professional advisors, who will make some changes to our initial designs.

At Zarapxana stores the customers are served by highly qualified, professional consultants.

Today, about 100 people work at Zaraxpana. The company constantly cares about improving their skills.

Periodically, we invite local or international consultants to share their experience with our staff. Also, our employees often participate in international jewellery exhibitions where they catch up on the latest trends and developments of the industry.

At the same time, we have also shared our experience with guests from European and Asian countries.

Q. As of today Zarapxana offers 10 different collections to customers and among them is a kids collection. Which jewellery is the most liked by children?

A. Creating the kids collection has its own special history. The inspiration for the collection is a 12-yearold girl, who had the idea of creating the kids collection with her beautiful sketches. The collection was created in 2008 and is one of the most popular ones. The collection is very cute due to its universal design which is its main concept.

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Advertiser: GPH. Contact FINANCIAL Ad Dep at marketing@finchannel.com

NEW

ACTIVE REPAIR TRIPLE CORRECTION: WRINKLES RADIANCE SKIN TEXTURE

Advertiser: PSP. Contact FINANCIAL Ad Dep at marketing@finchannel.com

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green business Georgian Real Estate Management The Green Building, 6 Marjanishvili Street, 0102 Tbilisi

15 Lubliana Str.

Tel: 251 00 01 Fax: 253 00 44 info@zarapxana.ge www.zarapxana.ge

CITY AVENUE Hotel Agmashenebeli Ave.140B; 0112, Tbilisi, Georgia; Phone: +995 32 2244 144 Email: info@cityavenue.ge; Web: www.cityavenue.ge

Tel: 243 30 77, Fax: 243 30 79 www.firstbrokerage.ge E-mail: info@firstbrokerage.ge

La Brioche Addr: Batumi, Georgia, Parnavaz Mepe №25

Tel.: 260 15 36 info@piazza.ge, www.piazza.ge

1 Brother Kakabadze Str. P: (+995) 322 555 888 M: (+995) 596 555 885 E: info@vinotel.ge, reservation@vinotel.ge W: www.vinotel.ge

Mrgvali Baghi Square; 7a Pekini Ave.34 Kote Afkhazi Str;125 David Aghmashenebeli Ave

Tel: +995 322 380802; info@lucapolare.com www.lucapolare.com; LucaPolareOriginal

Tel: 292 29 45; Fax: 292 29 46; tk@mcdonalds.ge

Addr: # 14/14 I.Kurkhuli Str. Tel : 55 66 55 http://www.laerton-hotel.com/

4 Freedom Square, Tel: +995 32 254 70 30 Fax: +995 32 254 70 40 tbilisi@citadines.com

13, Rustaveli Avenue.; Tel.: 2 779 200 www.TbilisiMarriott.com tbilisi.marriott@marriotthotels.com

4, Freedom Square, Tel: 2 779 100 www.CourtyardTbilisi.com courtyard.tbilisi@marriotthotels.com

Because life is about living

45a M.Kostava St., 0179 Tbilisi, Georgia;

Tel: +995 422 229000 E-maill: info.batumi@ sheraton.com www.sheraton.com/batumi

Radisson Blu Iveria Hotel Rose Revolution Square 1 Tel.: 240 22 00; Fax: 240 22 01 info.tbilisi@radissonblu.com radissonblu.com/hotel-tbilisi

Betsy’s Hotel 32-34 Makashvili Street, 0108, Tbilisi, Georgia

Tel.: 293 14 04, Fax: 299 93 11 info@betsyshotel.com www.betsyshotel.com

GEORGIA PALACE HOTEL

275 Agmashenebeli Ave., Kobuleti, Georgia Tel: 2242400 Fax: 2242403

Radisson Blu Hotel Batumi 1, Ninoshvili str., Batumi Tel/Fax: 422255555 info.batumi@radissonblu.com radissonblu.com/hotel-batumi

Address: Jordania/Z. Gamsakhurdia Str. 8/15 (422)255 522 info.batum@divan.com

Tel: 2300099 E-mail: info@hi-tbilisi.com www.hi-tbilisi.com

Hotel “O. Galogre” 8, Vakhtang Gorgasali Str. Batumi, Georgia Tel: +995 422 27 48 45 info@hotelgalogre.com www.hotelgalogre.com

Tel: 31 99 99 hotel@tifilis.ge addr: #9 Grishashvili Str.

Best Western Tbilisi № 1 Kheivani street 12/13; Tbilisi, Georgia Phone: (+995 32) 2 24 23 21; Phone: (+995 32) 2 24 23 22 E-mail: reservation@cronpalace.ge

Addr: 11, Apakidze str.

Tel.: 2 300 777

HOTEL SPUTNIK BATUMI

6 Kavsadze Str. Tel: 2 25 15 45 2 55 44 55 www.lottravel.ge

HOTELS & PREFERENCE HUALING TBILISI

Tel: 2400 400; 2400 040

26 May Square

Divan Suites Batumi

E-mail: info@gph.ge, www.gph.ge

The tickets are available at tbilisi international airport freedom square 4 courtyard marriott hotel, 1st floor

Tel.: (+995 32) 219 11 11 www.hotelcoste.ge

13 Shavteli Str. Tel: 2439494 info@ambasadori.ge www.ambasadori.ge

Tel: 2 50 50 25; 2 97 32 97 Fax: 2 50 50 26 Email: info@hotelspreference.ge

Addr: Hualing. Tbilisi Sea New City

4 Freedom Square Tel: 2988 988, Fax: 2988 910 E-mail:gmt@gmt.ge, www.gmt.ge

28, Shervashidze Ascent; Batumi/Georgia Tel: +995 (422) 27 60 66; +995 577 65 08 08 E mail: sales@hotel-sputnik.com; www.hotel-sputnik.com

5 Chavchavadze Ave. Tel.: 222 44 17 577 22 99 22 plasticsurgerygeo.com

For advertising please contact: 577 741 700 marketing@finchannel.com

Address: 1/3 Melashvili Street 6000 Batumi,Georgia | +995 422 225790 www.batumiworldpalace.com info@batumiworldpalace.com

Tel: 277 00 40/50 Addr: 20 Metekhi str. http://www.tbilisiinn.com/ info@tbilisiinn.com

LEOGRAND HOTEL & CASINO Tel: 0422 24 20 20; info@leograndhotel.com Addr.Gogebashvili Str. 60; Batumi

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green business markets

Weekly Market Watch ECONOMY Real GDP grew 5.3% y/y in May 2017 Georgia’s economy expanded 5.3% y/y in May 2017, after growing 2.1% y/y in previous month, according to GeoStat’s rapid estimates. Overall, in 5M17 GDP growth was 4.5% y/y. Monthly rapid

estimates are based on VAT turnover, fiscal and monetary statistics.

Real GDP growth, %

Key macro indicators 5M17 GDP (% change) GDP per capita (ppp) GDP per capita (US$)

NPLs at 3.7% in May 2017

Population (mn) Inflation (eop) Gross reserves (US$ bn)

In May 2017, the banking sector loan portfolio increased 14.3% y/y after growing 13.3% y/y in previous month, excluding the exchange rate effect. In unadjusted

2016

WEEKLY MARKET WATCH EXCLUSIVELY PROVIDED TO THE FINANCIAL BY GALT & TAGGART

Georgia sovereign credit ratings

International ranking, 2016-17

2015

4.5%

2.7%

2.9%

…

10,044

9,601 3,767

…

3,853

3.7

3.7

3.7

6.6%

1.8%

4.9%

2.8

2.8

2.5

CAD (% of GDP)

…

13.5%

12.0%

Fiscal deficit (% of GDP)

…

4.1%

3.7%

Total public debt (% of GDP)

…

44.6%

41.4%

Source: Official data, IMF, G&T

Ease of Doing Business # 16 (regional leader)

Source: GeoStat

terms, loan portfolio was up 25.7% y/y and 0.9%

Loan and deposit dollarization

BB-

Ba3

BB-

Stable Affirmed Nov-2016

Positive Affirmed Mar-2016

Stable Affirmed Mar-2017

Economic Freedom Index # 13 (mostly free) Global Competitiveness Index # 59 (improving trend) Source: World Bank, Heritage Foundaition and World Economic Forum

Source: Rating agencies

m/m to GEL 19.1bn (US$ 7.9bn). Deposits were

up 12.4% y/y excluding the exchange rate effect.

Nominal Effective Exchange Rate and Real Effective Exchange Rate

In unadjusted terms, deposits were up 21.4% y/y and up 1.1% m/m to GEL 16.4bn (US$ 6.7bn).

Deposit dollarization reached 68.6% (+1.6ppts y/y and -0.1ppts m/m).

NPLs stood at 3.7% in May 2017, flat y/y and m/m.

NBG Purchased USD$ 40.0mn

Source: NBG

Source: NBG Note: Index growth means appreciation of exchange rate, decline means depreciation of exchange rate.

FIXED INCOME

M2RE 10/19

Nikora 03/18

Source: Bloomberg

Source: Bloomberg

Local bonds Amount, US$ mn Issue date

TBC Bank Group (TBCG LN)

Georgia Healthcare Group (GHG LN)

BGEO Group PLC (BGEO LN)

Corporate Eurobonds: BGEO Group Eurobonds (BGEOLN) closed at 5.6% yield, trading at 101.8 (-0.1% w/w).

Bank of Georgia GEL-denominated Eurobonds (GEBGG) were trading at 100.3 (unchanged w/w), yielding 10.9%.

GOGC Eurobonds (GEOROG) were trading at 105.5 (+0.1% w/w), yielding 5.1%. Georgian Railway Eurobonds (GRAIL) traded at a premium at 110.2 (-0.2% w/w), yielding 5.4%.

Georgian Sovereign Eurobonds (GEORG) closed at 111.8 (-0.1% w/w) at 3.5% yield to maturity

GWP 12/21

EQUITIES

Georgia Eurobonds, YTM (%)

On 26 and 28 June 2017, the NBG intervened on the FX market and purchased US$ 20.0mn and US$ 20.0mn, respectively on its foreign exchange auction.

Overall, NBG purchased US$ 89.8mn YTD.

Eurobonds GLC 09/17

GEBGG 06/20

GEOROG BGEOLN 04/21 07/23

GEORG 04/21

GRAIL 07/22

30*

25.0

5.0

10.0

500*

250

350

500

500

12/16

10/16

03/16

09/14

06-17

04/16

07/16

04/11

07/12

Maturity date

12/21

10/19

03/18

09/17

06-20

04/21

07/23

04/21

07/22

Coupon, % Fitch/S&P/ Moody's Mid price, US$

10.50**

7.5

11.0

8.75

11.0

6.750

6.000

6.875

7.750

BB-/-/-

-/-/-

-/-/-

-/-/- BB-/-/Ba3

BB-/B+/-

BB-/-/B1 BB-/BB-/Ba3 B+/B+/-

n/a

101.6

101.3

100.4

100.3

105.5

101.8

111.8

110.2

Mid yield, %

n/a

6.75%

9.0%

6.50%

10.9

5.1

5.6

3.5

5.4

Z-spread, bps

n/a

n/a

n/a

n/a

346.1

333.7

170.6

348.5

364.4

BGEO Group (BGEO LN) shares closed at GBP 34.94/share (+0.06% w/w and -5.49% m/m). More than 452k shares traded in the range of GBP 34.11 – 35.41/share. Average daily traded volume was 115k in the last 4 weeks. FTSE 250 Index, of

Source: Bloomberg

Source: Bloomberg

which BGEO is a constituent, lost 0.88% w/w and lost 3.39% m/m.

The volume of BGEO shares traded was at 1.15% of its capitalization.

TBC Bank Group (TBCG LN) closed the week at GBP 16.84 (-5.04% w/w and -6.82% m/m).

More than 819k shares changed hands in the range of GBP 15.50 – 16.52/share. Averaged daily traded

volume was 235k in the last 4 weeks.

Georgia Healthcare Group (GHG LN) shares closed at GBP 3.56/share (-6.38% w/w and +2.23% m/m). More than 215k shares were traded in the range of GBP 3.50 – 3.80/share. Average daily traded volume was 98k in the last 4 weeks.

The volume of GHG shares traded was at 0.16% of its capitalization.

MONEY MARKET Refinancing loans: National Bank of Georgia (NBG) issued 7-day refinancing loans of GEL 1,150mn (US$ 477.7mn).

Ministry of Finance Treasury Bills: 5-year GEL 20.0mn (US$ 8.3mn) T-Notes of Ministry of Finance were sold at the auction held at NBG on June 28, 2017. The weighted average yield was fixed at 8.228%. The nearest treasury security auction is scheduled for July 5, 2017, where GEL 50.0mn nominal value 1-year T-Bills will be sold.

T-bills / T-notes, yield curve

Monetary policy rate

*GWP 12/21 bonds are in Georgian lari

Eastern European sovereign 10-year bond performance Issuer Georgia Azerbaijan Bulgaria Croatia Hungary Romania Russia Turkey Source: Bloomberg

Amount, US$ mn 500 1,250 323 1,250 3,000 2,250 3,500 2,000

Coupon, % 6.875% 4.750% 5.000% 3.875% 6.375% 6.750% 5.000% 5.625%

Maturity date 12/04/2021 18/03/2024 19/07/2021 30/05/2022 29/03/2021 07/02/2022 29/04/2020 30/03/2021

Ratings (Fitch/S&P/Moody) BB-/BB-/Ba3 BB+/BB+/Ba1 BBB-/BB+/Baa2 BB/BB/Ba2 BBB-/BBB-/Baa3 BBB-/BBB-/Baa3 BBB-/BB+/Ba1 BB+/BB/Ba1

Mid yield, % 3.5 4.7 0.2 1.6 2.8 2.9 2.8 3.8

Source: NBG *Note: As of latest auction.

Source: NBG\

WEEKLY MARKET WATCH EXCLUSIVELY PROVIDED TO THE FINANCIAL BY GALT & TAGGART Investments (or any short-term transactions) in emerging markets involve significant risk and volatility and may not be suitable for everyone. The readers of this document must make their own investment decisions as they believe appropriate based on their specific objectives and financial situation. When doing so, such recipients should be sure to make their own assessment of the risks inherent in emerging market investments, including potential political and economic instability, other political risks including without limitation changes to laws and tariffs, and nationalization of assets, and currency exchange risk.

GALT & TAGGART Address: 79 D. Agmashenebeli Avenue, Tbilisi 0102, Georgia Tel: + (995) 32 2401 111 Email: gt@gt.ge

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green business industry insights by experto consulting

Experto Splashes Through The Swimming Pool Industry Keti SIDAMONIDZE and Ludovic GIROD

S

tereotypes are lazy thoughts: we do not need to listen or observe as we feel we know all about “that” topic already; except we do not – we just have a head full of prejudices. And yet, there are some notions that are never disputed. For instance, the fact that swimming is a life skill that opens the doors to not only a healthy lifestyle but to a lot of fun stuff as well! Now that we have established that, we can dive into the swimming pools topic and unveil the players on the Georgian market and beyond.

After all, the long-awaited summer heat wave has finally hit Tbilisi and we do need to cool our thoughts down somehow.

But before we do start presenting the players, let us state that prior to splashing out money on a private backyard or indoor swimming pool, you need to be reminded that just like anything else, swimming pools come in all diverse types, designs, sizes, shapes and are used for various purposes. Budget, available space size, local rules and availability of materials will all factor in to what type of pool you will eventually decide to install on your property.

Experto has approached practically all swimming pool providers in Georgia but we will only focus on three main players on the local market.

Our first respondent, Mr. Vakhtang Meskhi is the Director of AQUALINE, established back in 2006. “Our main activities are the design and construction of swimming pools, saunas and SPA zones, as well as the installation of water treatment technologies” stated Mr. Meskhi.

Since the establishment, they have implemented many projects in both private and public sectors: “Gained experience, our professional staff and the utilization of high quality products of leading swimming pool producers worldwide are the determinant factors of elevated level of trust our customers reward us with”.

AQUALINE closely observes the latest global trends in the construction of basins and water treatment technologies. “We try to make those innovative technologies available to the Georgian consumers in the shortest possible time. 97% of the products we offer to our customers is imported – about 72% from the European countries and 28% – from Turkey.”, revealed Vakhtang to Experto. AQUALINE represents many world leading brands in Georgia; besides, they have exclusive

representation rights for: PROCOPI (France), PAHLEN (Sweden), MAYTRONICS (Israel), EMEC (Italy), CDECK (Portugal), DINOTEC (Germany), DAB (Italy), HASERV (Estonia), GEMAS (Turkey), SENTIOTEC (Austria), ECOSOFT (Germany/Ukraine).

AQUALINE also offers the aftercare service to their consumers.

When asked about the size of the swimming pools market in Georgia, Mr. Meskhi told Experto that “unfortunately, we do not have any overall market stats, but if we look at our own numbers, there is a notable growth trend for sure. What concerns us the most is the shortage of qualified staff for the postsale market. Taking care of a swimming pool requires very specific knowledge”. That is one of the reasons why AQUALINE decided to actively cooperate with professional technical institutions and training centers: “besides this, we also regularly train and retrain our staff and take care of their professional development”. He further elaborated that “we constantly work with our consumers as well and explain to them the benefits of innovative technologies. For instance, if previously all our customers used service personnel for disinfection of their swimming pools, now over 37% of them use the automatic dosing system that controls water quality, dosage of chemicals and ensures water disinfection”.

According to Mr. Meskhi’s assumptions, it will soon be trendy in Georgia as well to install pools that more and more resemble natural reservoirs and/or ponds: “we already have some customers that refuse to use standard blue colored coverings and select white, sand, gray and/or green coverings”. It is not only the case of colors.

The director has noticed that while previously the price was the only determinant factor, now consumers are more

conscious and self-aware of health-related aspects as well and care increasingly about getting the pools that comply with international safety standards: “of course, the standard requirements of our business customers (hotels, spa centers, commercial pools, etc.) are higher compared to those of individuals.

We find it much easier to convince our business customers to implement novel technologies as their safety requirements are stricter and they have a higher footfall, thus higher responsibility towards their respective end-users” concluded Mr. Meskhi.

Our next respondent CMG Group has been operating on the Georgian market for the past five years. They offer a wide range of fiber glass products as well as a variety of composite materials needed for fiber glass production to Georgian consumers. CMG Group also produces boats, water bicycles, pools, manufacturing units and other products using fiber glass, which is an unprecedented case on the Georgian market.

Since 2015, they have been offering the Georgian brands of polyether CMG and FIBER PRO 1, produced by CMG’s own formula in one of the European factories in Germany. Mr. Gela Gelashvili, Director of CMG Group revealed to Experto that “we hope our products will end up being exported to Azerbaijan and Armenia in the nearest future. We have just started considering the matter”. He further elaborated that “this year we plan to manufacture fiberglass profiles, floors and fiber prefabricated bridges.

The lack of needed investments is holding us back, even though we have the capabilities to upscale the production”. CMG imports products/materials mainly from Germany, China, Turkey, and USA. At this point, their export activities are in the exploratory phase only.

The Director of CMG Group

also had trouble assessing the size of the swimming pool market in Georgia: “besides, fiberglass pools are a novelty for Georgia. We launched the product this year only. So, it is hard for me to assess the precise demand levels for this type of pool. But the interest is definitely there”. Before fiberglass swimming pools, CMG was producing tanks for fish farms, but because of lack of demand they switched to swimming pools. “We are confident in the quality of our goods and stress that products made in Georgia can be good and competitive compared to the European products, with price being even more appealing” concluded the CMG representative.

Our third respondent is NOKI, the winner of Golden Brand 2016. Georgia’s leading swimming pool designer and constructor is actively involved in establishing standards on the market, offering the highest quality services to about 1000 customers already. According to Mr. Zurab Glonti, Director of NOKI, for the past several years, they have successfully built dozens of swimming pools and managed to nurture strong customer trust thanks to their well-mannered, professional, experienced and responsible staff that deliver projects on time and within the preagreed budget using quality materials.

NOKI has been operating on the Georgian market for about 15 years already: “we serve anyone that is interested in modern swimming pools, European standard materials and qualified service. Everything related to swimming pools falls within our competence”, told the director to Experto. NOKI is the official representative of the renowned Czech Vagner Pool in Georgia. Besides this, the company cooperates closely with Berndorf Baderbau, Europe’s premier stainless-steel pool manufacturer; BWT, Europe’s leading water tech-

nology company; IPC Group, offering pool and veranda roofing systems; Maper Glas, engineering a large pool of overhead roofing systems and facades; and Speck, specialized in swimming pool pump products. “Our suppliers are such famous brands as Kripsol; FIP; Saci Pumps; Pentair; Chemoform Group; Zodiac and many others”, further elaborated Mr. Glonti.

NOKI takes pride in helping customers select the design of a swimming pool that is best tailored to the personal needs of each customer; They get involved in all aspects related to swimming pools: design and construction, as well as carrying out hydroisolation and pavement activities; installation of water filtering and heating systems; installation of water attractions, supplying of all possible accessories; selection and installation of pool roofing or cover construction; supplying of chemicals that control water quality; They are one of the few players on the market that provide warranty service as well.

The second week of July Experto will be hosting the representative of a prominent and well-established French producer of swimming pools with a trusted reference brand for more than 50 years. The Export Director of Desjoyaux, Mr. Alexandre Muela will be visiting Tbilisi for the first time to explore the opportunities Georgia has to offer. Desjoyaux is a pioneer and inventor of a unique concept: the in-ground pool within everyone’s reach: “In 1994, Desjoyaux pioneered the principle of swimming pools for all by marketing a standard model, suitable for water fun for the whole family. The private family pool has become the brand’s core activity, ranging basic kits ready to install to a fully equipped luxury pool”, explained the Export Director. Apparently, the concept is inspired by outboard engines and the ex-

clusive Desjoyaux system has a completely pipe-less design.

This eliminates the need for long and costly buried pipelaying work and reduces the risk of leaks: “innovation makes life of our customers simpler. Our pipe-less filtration, a patented structure with no technical compartment, shoulders less risk of leaks. We offer a structure designed to be simple and safe to assemble – a unique concept that leaves room for pleasure, and nothing but pleasure”, elaborated enthusiastically the representative of the French company.

According to Mr. Muela, “the Desjoyaux swimming pool had become popular very quickly. It continues to be successful today, thanks to its simplicity, craftsman’s production values applied on an industrial scale, and the endless possibilities that it offers in terms of shapes, options, equipment, etc. Today Desjoyaux is the world’s leading manufacturer of concrete in-ground swimming pools, supplying pools on all 5 continents”. Over 210,000 families have already chosen Desjoyaux to design their space for holidays at home with the help of over 450 dealers in 80 countries.

“Already being present in the region for 20 years in countries such as Azerbaijan and Russia, it has become relevant for us to already zoom in on Georgia just as we focused in Kosovo, Moldova, and Iraq years ago. Considering the developments in the Horeca sector and the planned/ongoing projects in Georgia, we would want seize the opportunity to find a local partner and develop our network in order to cater to the future demand on swimming pools in the country”, explained candidly Mr. Alexandre Muela. He further revealed that “we are currently building the first Aquapark in West Bank, working on a project of 100 pools in Bagdad – Iraq”.

It seems, the private swimming pools market is booming as more and more people want to be able to enjoy their holiday at home. As I am finishing the final lines of the article and before I do get a swimming pool in my backyard, I will head to the nearest outdoor swimming pool right away. Do join me but only under one very stringent condition – do not forget to put on plenty of sunscreen to protect your exposed skin!

Article is exclusively published in The FINANCIAL About authors: KETI SIDAMONIDZE, is the Managing Partner at EXPERTO Consulting; LUDOVIC GIROD, is the Director and Partner at EXPERTO Consulting A French-Georgian consulting company EXPERTO provides Market Entry Services for foreign companies interested in the Caucasus markets.

Visit company website www. experto.ge

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HEADLINE NEWS & ANALYSIS FINCHANNEL.COM | 3 JULY, 2017

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Advertiser: Castello Mare Hotel & Wellness Resort. Contact FINANCIAL Ad Dep at marketing@finchannel.com

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HEADLINE NEWS & ANALYSIS 3 JULY, 2017 | FINCHANNEL.COM

Advertiser: The FINANCIAL. Contact FINANCIAL Ad Dep at marketing@finchannel.com