Us Business in Georgia 2014 by The FINANCIAL

PRIME PRI M ADSS ME

News Making Moneyy

3 November, 2014

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GOLDE GOL DE N S P PO O NSO NS O R R::

In Georgia, local and international politics matter, but not for everyone

AmCham President: “Restrictive Visa Regime has been a Nightmare for Many Foreigners” The FINANCIAL

MERAB PACHULIA GORBI

Georgia Needs Punitive Damages By FLORIAN BIERMANN ISET

few days ago, I was walking in Kostava Street towards the Philharmony when I passed a construction site that was separated from the sidewalk by a wooden fence. Continued on p. 2

Georgian Copyright Association Collected Record High 1.9 Million

http://www.financial.ge

SPO N SO R S:

mCham Georgia members do not feel there has been any notable improvement of the Georgian investment climate since the new government came into power in 2012, said Sarah Wil-

liamson, President of the American Chamber of Commerce in Georgia. The recent changes on the ownership of agricultural land and the new immigration policies have left many foreigners questioning whether or not they are actually welcome in Georgia. In addition, some potential changes in the law on the postal service

have caused serious concern among many AmCham members. “There is a fear that post service will be monopolized by the Government. This would send an extremely negative image of Georgia as a free market economy. Continued on p. 3

Switching from

Consumption to Saving The FINANCIAL

ing less valuable if not useless. Switching from consumption to saving is what Aieti Kukava, CEO at Alliance Group Holding recommends. As well-known investor W. Buffet recommends “spend the money what’s left after saving”. The company plans to focus on encouraging entrepreneurial spirit in the regions during the coming

years. The credit bureau was the first project that was launched in 2003. Creditinfo Georgia still remains the only credit bureau in Georgia. Together with AGH, it is currently owned by four leading commercial banks and an international partner company. Continued on p. 4

Wilhelmsen Ships Service to Open New Terminal and Facilitate Shipment of New Cars The FINANCIAL

ilhelmsen Ships Service Georgia, a leading company in the South Caucasus region, has plans to expand by investing in new logistics facilities in Georgia. The company management

is currently working on the development of the new vehicles logistics business. WSS Georgia controls a significant share of the South Caucasus logistics market and continues to maintain a strong position in the industry. “Since its establishment in the region our company has been constantly investing,”

Joseb Gorgiladze, General Manager of WSS Georgia, told The FINANCIAL. “We are expanding our container terminal in Poti and planning to build new ones in other places. We are also working on a new vehicles logistics project. Continued on p. 8

The FINANCIAL

he Georgian Copyright Association expects to accumulate 30-35% more royalties by the end of the current year. The Association has distributed GEL 800,000 to authors. Continued on p. 12

CURRENCIES Nov 1 1 USD 1.7542 1 EUR 2.2064 100 RUB4.0425 1 TRY 0.7979

Oct 25 1.7525 2.2171 4.1916 0.7819

MFI Crystal Achieves 108% Increase of Borrowers in 2014 The FINANCIAL

rystal, one of the leading microfinance organizations in Georgia, has boosted its credit

portfolio by 62% in 2014 in comparison with the prioryear period. The company plans to expand its market share and reach 9%. Wellorganized risk management is what has helped Crystal to maintain an overdue loan

portfolio of less than 2%. Enhancing the financial literacy of the population is considered highly important by the management of Crystal. Continued on p. 10

Presentation of Samsung Galaxy Note 4 and Samsung Galaxy Alpha in Tbilisi See on p. 7

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US Business in Georgia CURRENT PRICES ON GASOLINE AND DIESEL

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COPYRIGHT AND INTELLECTUAL PROPERTY POLICY The FINANCIAL respects the intellectual property of others, and we ask our colleagues to do the same. The material published in The FINANCIAL may not be reproduced without the written consent of the publisher. All material in The FINANCIAL is protected by Georgian and international laws. The views expressed in The FINANCIAL are not necessarily the views of the publisher nor does the publisher carry any responsibility for those views. PERMISSIONS If you are seeking permission to use The FINANCIAL trademarks, logos, service marks, trade dress, slogans, screen shots, copyrighted designs, combination of headline fonts, or other brand features, please contact publisher. “&” is the copyrighted symbol used by The FINANCIAL FINANCIAL (The FINANCIAL) is registered trade mark of Intelligence Group ltd in Georgia and Ukraine. Trade mark registration by Sakpatenti - Registration date: October 24, 2007; Registration N: 85764; Trade mark registratrion by Ukrainian State Register body - Registration date: November 14, 2007. ADVERTISING All Advertisements are accepted subject to the publisher’s standard conditions of insertion. Copies may be obtained from advertisement and marketing department. Please contact marketing at: marketing@finchannel.com see financial media kit online www.finchannel.com/MediaKit Download RATE CARD

KHACHAPURI INDEX TAKES A BREATHER ON THE WAY UP

fter consistent increases in two previous months, the average cost of cooking one standard Imeretian khachapuri stayed at 3.35 GEL in October 2014, unexpectedly bringing the Khachapuri Index to a halt. The Index dropped 0.1 % month-on-month (compared to September 2014) and year-on-year (compared to October 2013). There was quite a bit of regional variation in the Khachapuri Index dynamics. The Index lost 1.8 % and 1.2% in Tbilisi and Kutaisi, respectively; Batumi experienced the largest decline (-6.5%) at the end of the tourism season. The only city preserving the usual upward trend of the Index is Telavi (up by 9.9%). The price variation between the

most expensive (Kutaisi) and the cheapest (Batumi) cities reached 0.42 GEL.

Despite this temporary respite, the Khachapuri Index will continue to increase in the coming

months due to a seasonal decline in the supply of cheese, the main khachapuri ingredient.

Georgia Needs Punitive Damages

NO LITIGATION TRADITION

Georgian friend who happens to be an attorney. Based on my experiences with lawyers in other countries, I expected that he would urge me to initiate a lawsuit because of my damaged coat. Yet to the contrary, he told me that it would be difficult to find a lawyer who would work for me if I would bring my coat to court. A damaged coat would not be considered a serious case in Georgia (this is very much different than in the United States, where I could not only expect money for buying a new coat, but also receive punitive damages, which I will discuss a bit further down). But when is an issue serious enough to be taken to court in Georgia, and what happens then? In the conversation with my friend, it became clear that there is a problem that prevents litigation from being effective in Georgia. To describe the point, let me provide yet another example (there are so many). In Vera there are several houses which have stairs that lead from the sidewalk to entrances of cellars. Sometimes, e.g. in Belinski Street, there is no railing around those stairs, so that one can easily fall down about 2 meters, in particular when it is dark. If I would fall down, a Georgian court would clarify whether any party, the owner of the house or the municipality owning the sidewalk, was negligent in not installing a railing. The court process could be lengthy and it would not be clear what would be the outcome. The same with the hazardous construction site and the elevator – at court one would have to determine whether anybody is guilty of negligence, and the outcome would not be clear. Unlike in other countries, there is not much of a tradition in such litigation cases in Georgia, so that

By coincidence, a day after my coat was ripped up I met with a

Continued on p. 16

By FLORIAN BIERMANN DISTRIBUTION The FINANCIAL distribution network covers 80 % of key companies operating in Georgia. 90 % is distributed in Tbilisi, Batumi and Poti. Newspaper delivered free of charge to more than 600 companies and their managers. To be included in the list please contact distribution department at: distribution@finchannel.com CONTACT US EDITOR-IN-CHIEF ZVIAD POCHKHUA E-MAIL: editor@financial.ge editor@finchannel.com Phone: (+995 32) 2 252 275 HEAD OF MARKETING LALI JAVAKHIA E-MAIL: marketing@financial.ge marketing@finchannel.com Phone: (+995 577) 74 17 00 CONSULTANT MAMUKA POCHKHUA E-MAIL: finance@financial.ge Phone: (+995 599) 29 60 40 HEAD OF DISTRIBUTION DEPARTMENT TEMUR TATISHVILI E-MAIL: distribution@financial.ge Phone: (+995 599) 64 77 76 COPY EDITOR: IONA MACLAREN COMMUNICATION MANAGER: EKA BERIDZE Phone: (+995 577) 57 57 89 PHOTO REPORTER: KHATIA PSUTURI MAILING ADDRESS: 17 mtskheta Str. Tbilisi, Georgia OFFICE # 4 PHONE: (+995 32) 2 252 275 FAX: (+95 32) 2 252 276 E-mail: info@finchannel.com on the web: www.financial.ge daily news: www.finchannel.com

Intelligence Group ltd. 2014 Member of

ISET

few days ago, I was walking in Kostava Street towards the Philharmony when I passed a construction site that was separated from the sidewalk by a wooden fence. Suddenly, I heard the ugly sound of fabric torn apart. Yes, it had happened! My nice winter coat was ripped up by a rusty nail that stuck out of the fence, causing a huge hole in the coat that went down to the lining. Was it my own fault? Well, it was already dark and the nail could hardly be seen, and I was speaking with somebody walking next to me. Therefore, I think I am innocent. One rather has to curse the anonymous moron who erected a fence with a rusty nail sticking out next to a sidewalk where thousands of people are passing every day. Negligence in every-day life haunts me since my very arrival to Tbilisi. When three years ago I was looking for an apartment, my agent took me to a house that was still under construction while the apartments were already being rented out. The apartment she wanted to show me was in the tenth floor, but the elevator was arguably not made for the transportation of people but for building material and machines. It was embedded into a provisional metal scaffold in the staircase, loosely attached to the walls, with a rusty motor and electric wires sticking out. While the apartment agent stepped into the elevator with somnambulistic certainty, I insisted to walk to the tenth floor. She was pretty surprised about my fear, even seemed to find it funny, but when I pointed out the various issues of the elevator she agreed that “it might not be according to the regulations”. Moreover, after I described some of the scenarios that could happen with such an elevator, she admit-

A few days ago, a rusty nail like this destroyed my nice winter coat. Even more annoying than having to get a new winter coat is the fact that in Georgia I have little chances to successfully sue the perpetrator. (Source: Wikimedia Commons)

ted: “I have never thought about that”. Then she walked up with me to the tenth floor. A few weeks later, I was shocked again. Every 5 minutes a crowd of people leaves Marjanishvili Metro station and pours onto the square where Marjanishvili crosses Agmashenebeli. At that time, major renovations and building activities were taking place on that square, and the people who left the metro station had no choice but to pass through the huge construction site. There was no pedestrian passage and not even a protective fence with rusty nails – everybody had to go directly through the construction site. This was really

scary, as giant construction vehicles were passing, excavators were digging holes, and there were trenches that had to be passed on wooden planks. Letting crowds of people, among them old persons and families with children, pass through that dangerous area was highly negligent. Obviously, the operator of the construction site seemed to be not concerned about the safety of anybody.

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FINANCIAL HEADLINE NEWS & ANALYSIS FINCHANNEL.COM | 3 NOVEMBER, 2014

US Business in Georgia

AmCham President: “Restrictive Visa Regime has been a Nightmare for Many Foreigners” The FINANCIAL By MADONA GASANOVA

mCham Georgia members do not feel there has been any notable improvement of the Georgian investment climate since the new government came into power in 2012, said Sarah Williamson, President of the American Chamber of Commerce in Georgia. The recent changes on the ownership of agricultural land and the new immigration policies have left many foreigners questioning whether or not they are actually welcome in Georgia. In addition, some potential changes in the law on the postal service have caused serious concern among many AmCham members. “There is a fear that post service will be monopolized by the Government. This would send an extremely negative image of Georgia as a free market economy. We are working with our counterparts in the Ministry of Economy, and elsewhere, to try and see this come out in an acceptable compromise without placing unfair restrictions on international parcel service companies and others,” Sarah Williamson, President of the American Chamber of Commerce in Georgia (AmCham Georgia), told The FINANCIAL. SARAH WILLIAMSON, President of the American Chamber of Commerce in Georgia

US FDI amounted to USD 33 million during the first half of 2014, down from USD 0.6 million from prior-year periods. “There is very little difference and there aren’t many specific reasons, though the law on ownership of agricultural land has been mentioned as part of the problem,” Williamson explained. “Still, US investments remain one of the largest at 15% of all FDI in Georgia. We are expecting to see more US investment at the end of 2014,” she added. Q. The Georgian Dream Party is celebrating its two year anniversary this year. Which are the main steps you would underline that have improved the Georgian investment climate? A. The new government, both before and after the elections, has stressed the importance of attracting more investments into Georgia. Investment funds have been created with government participation, which I think has the potential to interest investors. However, overall, we are still looking and hoping for significant improvement in the investment sphere. I cannot say that my members feel there has been any notable improvement. According to the last figures from the Ministry of Economy and Sustainable Development, the increase of FDI in Georgia was just 0.3% in 2013. This is simply not enough for Georgia to grow and prosper as we all want and need. Q. What have been the main steps that have caused dissatisfaction among American businessmen established in Georgia? A. There are several legislative

initiatives from the Government that raise concerns not only from American business but also from almost all businesses, both foreign and domestic. Some of those include the moratorium on ownership of agricultural land, as well as the current proposed changes that would become permanent if passed by parliament. The very restrictive visa regime has been a nightmare for many foreigners as well as Georgian businesses who employ foreigners. The implementation has been very poor with conflicting answers coming from various ministries and departments of the Government. The Government claimed to have given foreigners many months to prepare for this when in fact several regulations and clarifications were not announced until days before the September 1, 2014 enactment. Taken together, the changes on ownership of agricultural land and the new immigration policies have left many foreigners questioning whether or not they are actually welcome in Georgia, which is not the feeling they have ever experienced here before. Personally, I do not believe that the Government intended for this to be the case, and I do not feel unwelcome in Georgia myself, but I do believe that they need to better understand the dangerous perception that many do have based on the recent changes and the negative way those changes are being implemented. On the positive side, while these are the problems that answer your question, we are also pleased that we have the opportunity to engage with government and try to reach suitable compromises. In both cases mentioned above, we are engaging with the

Ministry of Justice, Ombudsman, National Investment Agency, and others, and we highly appreciate the opportunity to do so. Also, many of our members have expressed serious concern over some potential changes in the law on the postal service. There is a fear that post service will be monopolized by the Government. This would send an extremely negative image of Georgia as a free market economy. We are working with our counterparts in the Ministry of Economy, and elsewhere, to try and see this come out in an acceptable compromise without placing unfair restrictions on international parcel service companies and others. Q. In September Georgia received a special package from NATO. In accordance, a NATO training center is going to be opened in the country. Is this decision bringing a greater sense of protection for US businesses in Georgia, or is it raising more fear in line with Russia’s dissatisfaction? A. AmCham fully supports Georgia’s NATO aspirations and is proud that the US Government remains Georgia’s strongest supporter on this track. Therefore we were pleased to hear of NATO’s positive steps at the September summit, including the training center. As for Russia’s dissatisfaction, Georgia has already repeatedly declared its strong will to become a member of the alliance and to maintain its course on a pathway towards Europe. Therefore, the threat from Russia remains with or without the NATO training center and as such, I believe most of us here on the ground will be glad to have the added support.

Q. How much confidence do you have in the new Georgian leadership’s ability to support US business? A. I feel very confident in the Prime Minister’s and Minister of Economy and Sustainable Development’s desire to attract and support US businesses. During their visits in the USA, both mentioned the importance of attracting the larger, more brand-recognizable, US businesses to Georgia. Doing so will be very difficult, in the best of circumstances, but we are very happy to hear that there is going to be a strong effort to do so. AmCham firmly believes that the best advertisers of Georgia as a place to invest are those companies and individuals who have already invested in Georgia, and therefore it is imperative that the Government take excellent care of the loyal investors the country has simultaneously with its efforts to bring in new companies. We have regular meetings with government representatives and we are able to deliver this message, along with other more specific ones. We appreciate their will of cooperation and hope the Government will remain opened for further discussions on supporting current and future US businesses, and all businesses, in Georgia. Q. How risky is investing in Georgia? A. As we all know, Georgia remains ranked among the best places for “Ease of Doing Business”. The signing of the DCFTA and Association Agreement with the EU will also have a very positive effect on portraying Georgia as a positive investment environment. The main risk remains Georgia’s politi-

cal situation, including internal and external factors. Q. Where is the place for Georgia vis-à-vis US policy on Russia and Eurasia? A. Georgia is a very important partner for the USA and with good reason. Georgia is a regional hub and one of Asia’s main gateways to Europe. In such a diverse region as the Caucasus, it is important to have a reliable and close partner like Georgia. Particularly, the role Georgia plays in getting oil and gas to Europe without relying on Russia should be hugely important for the US as it gives our closest allies, the EU countries, the ability to be less dependent on Russia and to hopefully, eventually, make better geopolitical decisions of their own without having to have so much fear of retaliation from Russia by means of cutting off energy supplies. Q. Which new US businesses have been established in Georgia during the current year? A. I can mention the project of the new American hospital in Tbilisi, which will be co-financed by American and Georgian businesses. The amount of investment will be USD 60 million. It is planned to employ 400 persons. While not only from the US, the new gas pipeline that BP is building is fantastic for Georgia. There are several new US franchises: Wendy’s, Subway, Precision Auto Tune, and others that I can’t yet mention. There are new hotels coming in various parts of the country which have US shareholders and brands. Q. Are there any big American companies interested in entering the Georgian market? A. It is not an easy task to attract big businesses from the USA in such a small country. An FTA with the United States would be a strong incentive for foreign investors to move or open production centers in Georgia, since only products manufactured in the country will be eligible for a low or no tariff regime. Q. Economically, what will Georgia need to do to move ahead from where it is today to where it wants to go in the next several years? A. First and foremost, Georgia must show its commitment to maintaining a pro-business environment (legislative framework, improved education systems, SME development & support, etc). We must all work together to see that businesses in Georgia are healthy and are therefore attractive partners and competitors for their foreign colleagues so that Georgia can attract more FDI into the country. Strengthening ties with the EU will be helpful, and Georgia needs to be aware of protecting its own interest and integrity in doing so. More government support through a higher level inclusive dialog with the business community is essential in achieving these goals.

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US Business in Georgia

Switching from

Consumption to Saving ALLIANCE GROUP HOLDING PROMOTING ENTREPRENEURIAL SPIRIT IN GEORGIA

The FINANCIAL By MADONA GASANOVA

ocused on creating and enjoying maximum comfort today, consumers are buying goods and services that are not creating value for the long term wealth of the individuals, moreover soon these goods are becoming less valuable if not useless. Switching from consumption to saving is what Aieti Kukava, CEO at Alliance Group Holding recommends. As well-known investor W. Buffet recommends “spend the money what’s left after saving”. The company plans to focus on encouraging entrepreneurial spirit in the regions during the coming years.

AIETI KUKAVA, CEO at Alliance Group Holding

The credit bureau was the first project that was launched in 2003. Creditinfo Georgia still remains the only credit bureau in Georgia. Together with AGH, it is currently owned by four leading commercial banks and an international partner company. After the successful launch of the first project, Alliance Group Holding was established in 2005, together with American and European shareholders. Initially the company offered financial services to the market, in terms of micro finances and leasing. Later it expanded its service offerings into the consulting field. Currently, AGH incorporates diversified subsidiaries, with unique products and market position. The financial services include: leasing, microfinance, investment banking. The consulting services are broader and start from property valuation and management, IT, financial and energy consult-

ing and business information. Besides Tbilisi, its services are available in Kutaisi, Zugdidi, Batumi, Rustavi and Tsalka. The customers range from Micro, very small and SME segment to corporations. “Each year has had its own outstanding success and achievements. When you see the growth and progress of the previous year, you realize that you are on a right path. Last year was very exciting and successful for us. We expanded our regional network and implemented several innovative projects and services. Launching an online business directory was one of the most important projects. It is the largest and most continuously updated database of Georgian companies. The directory includes comprehensive information about 20,000 most active companies registered in Georgia. It allows users to search for companies by sectors, look for the services

they provide, along with their contact data. The directory has been very useful and popular among foreign investors as well as local organizations and start-ups,” Aieti Kukava, CEO at Alliance Group Holding, told The FINANCIAL. In 2013 AGH started the construction of a small hydroelectric power station. The management considered the energy field to be one of the most promising in Georgia. “Together with our international investors and partners we have big plans for this area. In the next 7 years we plan to attract a significant volume of investments in this sector and to acquire the country’s hydropower potential,” said Kukava. Q. Microfinance, leasing, property assessment, risk management and consulting is but an incomplete list of the services that you offer. Which of them are the most in demand?

A. Micro financing, micro leasing and consulting service are the most demanded among the representatives of SME business. When it comes to corporate clients and international investors, they are mostly requesting risk management, analytical products, strategic business planning, consulting and fundraising services. Financial services comprise 60% of AGH’s operations; the remaining 40% is made up of consulting services. Q. How affordable are your services for SME companies? A. Our customer base is quite diversified. Our clients include micro, small and medium-sized businesses, as well as large corporations, local and foreign international financial institutions, the embassies of different countries, and non-governmental organizations. Our services are tailored to

meet the demands of small businesses. The client can take advantage of a one-stop shop principle. They receive not only a financial product, but also consulting services, which help them to properly and effectively use financial resources. We have always followed the principle of responsible lending in micro-financing. We comprehensively study our client’s business before lending to them and consult our borrowers on loan amounts they can serve in order to prevent their over-indebtedness. On a higher level of development we offer more qualified service for SME consumers. Our subsidiary is selected as a consulting company by USAID and EBRDfunded projects. As a result, for a number of entrepreneurs consulting is funded by these organizations and they receive it free of charge. Q. Alliance Group Leasing has more than 4,000 clients, within which leasing transactions account for over GEL 20 million. Leasing still remains less popular in Georgia and continues to be dominated by the bank and microfinance loans. What is the reason for this? A. About 3-15% of renewal of fixed assets is financed by leasing companies in developing countries. Meanwhile the same figure reaches 30% in developed countries. The share of leasing is just 2% in Georgia. The remaining 98% of fixed assets is financed through bank, micro-finance or own financial resources. Many people in Georgia do not know that leasing has many advantages in comparison with a standard banking loan. Leasing is a more accessible service. It does not require collateral, as a leasing asset is a subject of collateral. Leasing has flexible payment system. The company provides full support to its customers in relationship with providers and traders. Due to the existing legislation, the development of the leasing market was limited in Georgia till 2011. The recent changes in civil and tax codes encourage the development of the leasing market. It allows customers to use the leasing service in better conditions. However, due to the lack of awareness, consumers prefer to use standard loans. We are optimistic, however that the conditions on the market will change gradually. Q. Tell us please, from the example of Alliance Group Capital, how active are start-ups and which are the most attractive business sectors for them? A. Alliance Group Capital finances start-ups as well as existing businesses, which require different type of financial products than bank loans. Young entrepreneurs are more active in start-up businesses. They get involved in businesses of a single risk transaction as well as in modern information technology. We believe that IT has a great potential in Georgia. With the development of traditional industries, modern technologies are one of the main prerequisites for economic development in Georgia. There is a potential to develop such services, which are in demand not only within the country but also on international markets. Q. What are the main mistakes made by startups and what are your recommendations for

them? A. Any inexperienced entrepreneur, whether in Georgia or abroad, imagines that they will be able to achieve success in a short-term perspective. However, maintaining success requires dedicated work and concerted effort. Many people with interesting ideas fail to achieve their goals. In many instances, entrepreneurs start a business without any exact plan, budget or market study. Therefore, it is necessary to get qualified consultations before starting a business even with your own financial sources. That is what we take into consideration when financing a start-up business. We rigorously evaluate any business idea, measure the risks, study market and potential consumer behaviour and the competition. Only then we develop realistic plans consisting of several stages. This is everything that a final business plan includes. To first critically analyze ideas and only after that start their implementation is our main suggestion for start-ups. The support of qualified staff is also important for this purpose. Q. The National Credit Information Bureau is focused on developing, processing, issuing and distributing business information in Georgia. How big is the interest in the Georgian business environment today? A. We have been operating in the field of business information for twelve years. We are providing information about Georgian companies to global business information companies such as D&B, Coface, Kompass and others. International interest in Georgian business has grown over the last few years. Inquiries from international partners in the last 3 years have increased by 17%. We are sending the processed information of local companies from various industries, mostly on large and medium-sized companies. Q. The representatives of which companies are more interested in the Georgian business environment, and in which sectors specifically? A. The interest towards Georgia has always been from European as well as Asian countries. The investors pay a lot of attention to the political and economic situation of the country. During recent years, many investors have been closely watching the situation in the country. They have been in standby mode. We went through a very difficult time politically. Georgia has proved that it has one of the most attractive investment environments in the region. Asian and Western European investors became more active this year. We plan to launch various projects in different sectors, such as energy, real estate and information technology. Q. Energy is one of the most fast-growing sectors in Georgia. Meanwhile the country still has to import this resource in winter. How would you estimate the potential of this field and when can Georgia become an exporter of energy resources? A. Georgia is ranked among the top five countries with the highest per capita hydro Continued on p. 7

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US Business in Georgia

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HEADLINE NEWS & ANALYSIS

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US Business in Georgia

Switching from Consumption to Saving Continued from p. 4

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resources. Only 18% of the country’s resources have been utilised. Consequently, the potential is truly remarkable. Investment in the energy sector has become popular among investors only a few years ago and interest in this sector is increasing annually. However, energy requires a long-term investment. The average project takes 3-5 years to be completed. Accordingly, replacing import cannot be achieved easily. However, in the event of stable investment, within 7-10 years Georgia will be able to not only satisfy its own consumption, but also become significant exporter of hydro power energy. We have been involved in the energy sector since 2011. We are currently constructing the first small hydro-power plant. Together with our international partners, we plan to implement a number of important investments in this field. Q. How flexible is Georgian business towards modern technologies? A. The disregard of modern technologies in a globalized competitive world may become detrimental to any business. Georgian business has come a long way since the country’s independence. Nevertheless, there are some fields in which Georgia is dominant in the region. The banking sector and communications are one of these fields, in which modern technologies are actively used. However, other sectors should also feel the importance of technological innovations. One of the main cornerstones

of our work at AGH is the introduction of innovative products and services. It helps us to achieve success and increase our efficiency. The increase of efficiency in a competitive and sustainable economy is one of the essential prerequisites for the success of any business. Q. We rarely see holdings in Georgia that include the activities of different profiles. What were the main criteria while deciding which service to implement? A. Innovation, optimal diversification of services, constant increase of efficiency, implementation of services and products based on the country’s needs - this has always been the main basis of our work. Our goal is to fully comply with our customers’ interests. Establishing trustful and long-term cooperation with customers has been a cornerstone of our philosophy. As for the different profiles, each direction is a single ring of one complete chain. All of this creates the basis of success for the company, its customers and country as a whole. We consider CSR to be an integral part of AGH. We use it in our daily activities. Our internal politics is based on a respect for human rights, gender equality, environmental protection, transparency and accountability. All our actions are governed by the fundamental resolve to act responsibly and on behalf of future generations to ensure economic, environmental and social progress. In 2010 we founded the charity fund Ardza. It carries out projects funded by AGH in three main directions: pro-

moting business ethics among young entrepreneurs, the rehabilitation and preservation of Georgia cultural heritage and environmental projects. Q. Which innovative projects will you offer to your customers? A. First of all, we are working to introduce to clients an alternative source of income for them. For this purpose, it is necessary to improve the financial education of our citizens. It is time to decrease consumption and expenditure and switch more to saving. Saving properly is crucial. Each deferred saving can bring more income tomorrow. It is necessary for the customer to see the various ways and means by which individual and its family will get financial stability to create a secure future. These are the ways and means we offer to our customers. Encouraging entrepreneurial spirit in the regions is one of our main priorities. We will focus on supporting independent start-ups and the expansion of existing ones. Growing and progressing from small and medium sizes to more expanded scales is what our financial and consulting company offers to entrepreneurs.

Presentation of Samsung Galaxy Note 4 and Samsung Galaxy Alpha in Tbilisi

he leader of the world market of high technologies, company “Samsung Electronics” has held presentation of new models of mobile devices Samsung Galaxy Note 4 and Samsung Galaxy Alfa in the hotel “Rooms Tbilisi”. The guests had opportunity to examine the new devices right during the presentation and test their new functions. The Galaxy Note series itself is an extraordinary innovation in the sphere of high technologies – the big screen and popular function S PEN create new standards in the culture of mobile phones. The Galaxy Note series brought the novelty and almost forgotten culture in to the world of cellular communication to make notes by means of a pen but already in a digital format. New Samsung Galaxy Note 4 gives consumers all advantages of the Note technology and unite all the latest technologies that are expected traditionally by users of Galaxy. Samsung Electronics also represents the new, unique Samsung Galaxy Alpha smartphone. Users of the device will be able to appreciate all its advantages – refined design, the compact dimensions, a metal frame and pleasant surface. The device keeps all technical and innovative advantages of Galaxy series characterizing for premium class smartphones. Elegant and practical Samsung Galaxy Alpha is optimum combinations of style and advanced technologies, completely meeting all requirements of the market. It is already unimportant where you are; now we have an opportunity to display everything in a digital format, to carry out your professional duty at any time, in any point of the world. The first presentation of new models of the Galaxy series was held in Berlin on September 3. The German users were the first to appreciate all advantages of novelties, their unforget-

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table design combined with all technological achievements of an era of smartphones. Only after a couple of weeks of the first presentation, the new devices appeared on Georgian market. Those who appreciates design and high technologies, beauty and functionality, possibilities of a digital era and the habit, which almost consigned to the past to write by hand – will appreciate new development of “Samsung Electronics”. Moreover, the most important – smartphones of the Korean giant in the sphere of high technologies guarantee the highest quality and reliability. After all “Samsung Electronics” is one of world leaders in development and production of hi-tech products – TVs, smartphones, computers, printers, the medical equipment and many other. The company official representative office operates in Georgia for 9 years now and presents the market with all the innovative products of Samsung. Samsung has developed a special protective hologram for mobile devices indicating that they are already tested and fit the Georgian market. The special technical group examines each mobile phone by different parameters before going to realization, e.g. how they fit the parameters of local mobile operators, how well the Georgian menu works, etc. Right this protective hologram is the guarantee that the purchased phone is developed for Georgian users exclusively and thus the quality is guaranteed.

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Wilhelmsen Ships Service to Open New Terminal and Facilitate Shipment of New Cars The FINANCIAL By MARIAM PAPIDZE

ilhelmsen Ships Service Georgia, a leading company in the South Caucasus region, has plans to expand by investing in new logistics facilities in Georgia. The company management is currently working on the development of the new vehicles logistics business. WSS Georgia controls a significant share of the South Caucasus logistics market and continues to maintain a strong position in the industry. “Since its establishment in the region our company has been constantly investing,” Joseb Gorgiladze, General Manager of WSS Georgia, told The FINANCIAL. “We are expanding our container terminal in Poti and planning to build new ones in other places. We are also working on a new vehicles logistics project. New vehicles logistics is not very well developed in Georgia and we are working hard for it to get to the same level of internationally accepted standards as there is in developed countries. Currently, all new vehicles are trucked from Turkish ports to the South Caucasus region. Normally vehicle manufacturers, especially luxury car manufacturers, choose to take less risk during transportation, which means that they would prefer to transport the vehicles by sea as far as possible. So, our aim is to create proper facilities near Georgian ports to enable this,” he added. “Our local company is a leader in several segments of the industry. These are dry bulk handling, container terminal services, ships agency and port operation. WSS Georgia represented MSC between 1997 and 2009 and it was and still remains the number one shipping line in the region. WSS Georgia also represents NYK in Georgia. It is all of these factors that make WSS Georgia a leader in the industry,” Gorgiladze said. WSS Georgia is part of the global Wilhelmsen Ships Service, Wilh. Wilhelmsen Group Company. The vision of the company is “Shaping the maritime industry”, expressing the aspiration to lead the way in maritime solutions to improve the way shipping works. The company will through highly recognised brands, consideration for the environment and an unparalleled global network, deliver products and services, which significantly improve customers’ operational efficiency. By combining competence in terms of people, processes and innovation, the company will shape the dynamics of the maritime service industry to the benefit of customers. The values are customer

centred, empowerment, learning and innovation, stewardship, and teaming and collaboration. Wilhelmsen Ships Service’s slogan reads “Optimising performance”, reflecting true ambition to make a difference in the maritime industry; one workforce, partnering together with customers to increase operational efficiency and find the best solutions for individual customers and the industry as a whole. Wilhelmsen Ships Service’s headquarters are at Lysaker, outside Oslo, Norway. The company is divided into four main regions; Europe, Asia Pacific, the Americas and Africa, the Middle East and Black Sea, with regional headquarters in Lysaker, Singapore, Houston and Dubai. There are 4,500 specialised marine professionals worldwide - ready and mobilised to meet customers’ ever-changing needs. The company services 2,200 ports in 125 countries, making the company the world’s largest maritime network. Last year the company made product deliveries to 24,000 vessels and handled 67,000 port calls. On average the company delivers a marine product every 2nd minute. “Wilhelmsen Ships Service started business activity in Georgia in 1996. The first shipments were from the American humanitarian aid which was sent to Georgia, Armenia and Azerbaijan. The company’s global existence allowed it to seize the business opportunities in Georgia and accordingly established a strong team to serve the first US humanitarian cargo in those early years. Again, the company’s global character resulted in WSS bringing the second largest shipping line in the world, MSC, to Georgia,” said Gorgiladze. “The company first became known in the region as Barwil Georgia. Currently, WSS is a partner in 3 different legal entities. These are Barwil Georgia ltd - terminal services, Wilhelmsen Ships Service Georgia ltd - logistics and ships agency services, and B&P - port operation. All of these companies are leaders in their activities, this once again shows WSS’s success in the region,” he added. “One of the challenges for logistics companies is the lack of well-developed specialized facilities and infrastructure. By this I mean that ports, railway as well as logistics and terminal service providers have to improve their capabilities, such as faster and more efficient operation, modern and specialized equipment etc. we have seen a significant growth of the market since our arrival in the region. As the market grows, every year we witness the appearance of new logistics companies as well as the entrance of shipping lines that are well-known worldwide. Respectively, we have seen a lot of developments since the ‘90s and I believe that there will be further developments in this growing market. The industry growth is the result of a better economy, and the future success of WSS, and not only WSS, is of course strongly reliant on this. As mentioned earlier, our company is constantly investing which means we are constantly growing and developing,” concluded Gorgiladze.

JOSEB GORGILADZE, General Manager of WSS Georgia

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MFI Crystal Achieves 108% Increase of Borrowers in 2014

MALKHAZ DZADZUA, CEO at microfinance organization Crystal

“The political changes that took place in Georgia in 2012 have brought businesses more freedom, property protection and less pressure. The partial opening of the Russian market has turned out to be quite stimulating. The reduction of political risks has encouraged a sense of stability and predictability. However, I would not say that everything is perfect in this regard. Room for improvement still remains,” Malkhaz Dzadzua, CEO at microfinance organization Crystal, told The FINANCIAL. Dzadzua said that the recent Ukrainian conflict has not changed their foreign partners’ attitude towards the region. “Our funding has actually doubled since the 2012 elections. Crystal is mainly receiving financial resources from international investors. Such an increase of funding means that the attitude of investors is quite positive. As for the impact of the Russian-Ukrainian crisis, it has not yet been reflected in our investors’ approach.” “However, further escalation of the situation may contribute to several restrictions and the reduction of funding. A part of our agro credit consumers are trading with Ukraine. Accordingly, their business could be jeopardized. Hopefully, the parties and the international community will soon be able to find a reasonable solution,” he added. Dzadzua estimated the current year for Crystal to be quite productive. The company had a successful growth period. The company’s total assets have increased by 64% as of 1 October, 2014, in comparison with the prioryear period. They amounted to GEL 73 million. The volume of loans issued reached GEL 62 million. The sum is 62% more than it was in the same period of the previous year. The number of active borrowers increased by 108% and reached 34,000. Q. There were 67 microfinance organizations in Georgia as of the end of 2013. Do you not think that there is an abundance of MFIs on the market? A. A total of 67 MFOs on such a

portant are state regulations in this regard? A. I am generally in favour of minimum government interference in the business sector. However, total ignorance or lying in the “invisible hand” of the market is not the right approach. The dangers outweigh the benefits in this case. The central bank can impose some important and clear regulations. Transparency and protection of consumers’ rights should be obligatory for financial institutions. From 2010 Crystal has been reflecting the effective interest rate in an agreement. However, the majority of MFIs are not doing it. There“I WAS BORN AND WENT TO fore, consumers are mostly unaware SCHOOL IN THE GALI REGION of the real cost of OF ABKHAZIA. NOW I LIVE WITH credit. The quality of consumers’ proMY FAMILY IN KUTAISI SINCE THE tection and competitiveness of the WAR”. sector will improve by settling this particular demand and fore the financial institutions should introducing a few simple regulations. Q. We frequently hear statebe totally responsible for such risks and take into account the relevant ments regarding the imporcosts and reserves of the product’s fi- tance of increasing the financial literacy level of citizens. Can nancial structure. The major problems are constituted this solve the growing problem by a second category of clients (wilful in the financial sector and how defaulters). They manage to borrow do you envision the training of more than they need and misuse it. the population? A. Enhancing the literacy level of This step is often backed by various manipulations and also by the poor the population is one of the most efrisk management of the banks. Such fective ways of reducing the problem. risks increase in direct proportion to It is a good solution for establishing the enlargement of the sector and the an effective, civilized and competeasy availability of credits. Preven- ing financial market. Such a problem tion is the key factor in this case. The exists even in developed countries. solvency and financial viability of a So, the Government and responsible borrower should be carefully studied. companies are frequently encouragLoans that are issued very quickly, en ing educational projects. This does masse and without proper financial not mean a deep and academic finananalysis, accumulate into such a cat- cial literacy. The usage of credits in egory. simple and clear language should be With minimal and effective regula- included in the messages delivered tions the Government really can re- to the population. It should include duce these risks. Establishing prudent advice and simple instructions, like lending standards for MFIs is the key when we read a warning message on issue. The standards should be related cigarette packaging regarding their to the maximum transparency of loan harmfulness. Educational projects will pricing, conditions and all basic pa- not solve the whole problem, as a prorameters. Delivering full information portion of people quite often do not for consumers is crucial. Support- listen or follow proper advice anyway. ing financial education projects is a It is the same with smokers: Despite second important step. It is essential the warnings the majority continue to provide consumers with proper smoking even when they know that it knowledge and help them to make the is harmful. However, this is an imporright choice. Finally, supporting start- tant minimum step and “must do” that up businesses and micro-insurance a government should take for citizens systems, which will be tailored to the together with the financial sector. needs of the low income population, I am proud to state that Crystal is will also be helpful. actively involved in the international Q. What is the share of over- consumer protection campaign “Bordue loans at Crystal? row Wisely”. There are 12 countries A. Traditionally MFI Crystal has participating in the campaign. It was been keeping up one of the best re- initiated by the Polish Microfinance sults in term of overdue loans in the Center. In this campaign the populasector. Currently they measure just tion is provided with specially pre0.7% of our credit portfolio. The total pared information brochures and a problematic portfolio including over- simple guide. Consumers are advised due, restructured and write-off is less on how to borrow wisely, on what than 2%. to pay attention to while cooperatThis figure has not changed in the ing with banks, what questions to ask past two years. themselves before making decisions, Q. MFIs are focused on financ- how to calculate the optimal amount of ing SME businesses. How has the loan, which information to request, the activity of this sector in- what their rights are and so on. I am creased since significant politi- hopeful that with this campaign we cal changes took place in Geor- will contribute to the improvement of gia in 2012? the financial literacy of our population. A. Crystal is mainly financing micro and small businesses, including family-type small farmers. Over the past year our credit portfolio has grown by 62%. Respectively, we can conclude that political changes have brought about positive changes for this sector. A large part of our growth comes from agricultural loans. State agricultural programmes are also contributing to it. Q. The president of the central bank has in the past referred to the impact of the unregulated banking sector and its threat to the financial sector. How improblem and what is the role of the Government in this? A. Overdue loans are a complex problem. They require extremely careful, calculated and long-term approaches from all sides, including state institutions. Overdue loans are divided into two categories: wilful and unwillful defaulters. Separating these two categories of defaulters and providing them with a different strategy is a significant factor. No one is secured from natural business risks. They arise beyond our control. There-

The FINANCIAL By MADONA GASANOVA

MFO. In addition, we already manage to offer competitive prices on a number of products. Q. A solid number of MFIs’ consumers are those who have been refused lending by commercial banks. How big is the risk factor for MFIs in this case? A. I would not say that the consumers of Crystal are those who have been declined by banks. In terms of Crystal such customers make up just 10-12% of our total borrowers. The majority of our clients are applying to us due to the above-mentioned advantageous factors we provide. In general, consumers that have been declined by banks are not automatically bad payers. THE SMALL PROJECT ORIGINALLY The main difference is in the specific apSTARTED WITH USD 10,000 STARTproach towards lending criteria and riskUP CAPITAL AND THEN TURNED appetite of financial INTO THE USD 35 MILLION institutions. We carefully analyze a client’s LEADING MFI IN GEORGIA. income and expendiCRYSTAL HAS 25 BRANCHES WITH ture dynamics, business skills, experi400 EMPLOYEES. ence, solvency, social status, and then take a final decision. One of the main purposes Q. Despite the large number of the microfinance institution is of MFIs, traditional banking serving a low-income and financially products are still dominating excluded segment. The leading MFIs on the Georgian market. What have very well-organized risk manare the competitive advantages agement systems. Accordingly, the of MFIs by which they can man- quality of our portfolio is much better age to compete with commer- than that of banks. Q. How is the risk managecial banks? A. Besides MFOs there are several ment of Crystal run? A. We use the best and most efbanks actively presented on the microfinance market. However, due to ficient risk management standards the specifics of the market we remain that currently exist on the internathe market leaders. The simplicity of tional microfinance market (mainly loan issuing, minimal documentation based on CGAP methodology). Thereand bureaucracy, unsecured and non- fore the volume of our overdue loans collateral loans, broad geographic makes up less than 1%. It is one of the reach and easy access to the regions, best indicators in the sector. Q. Overdue loans remain opportunity to take higher but manageable risks, many years of experi- one of the biggest challenges of financial institutions. What ence and specialization in micro-businesses are the key advantages of the is your vision for solving this limited market as Georgia is probably more than enough. However, it should be noted that the majority of them are quite small in size. The bulk share of the real market is controlled by just 5-6 MFOs. I think that the extension and consolidation of small MFOs will soon start. As a result, the market will determine the optimal number. The market share of Crystal is 7% for now. Based on the successful results of previous years, we plan to expand and increase our market share to 9% for 2015.

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Georgian Copyright Association Collected Record High 1.9 Million The FINANCIAL By MADONA GASANOVA

he Georgian Copyright Association expects to accumulate 30-35% more royalties by the end of the current year. The Association has distributed GEL 800,000 to authors. The Russian Federation is the top country in terms of usage of Georgian copyrighted works. Georgian folklore is popular in Japan. Meanwhile, HoReCa sector is the largest payer of copyright in Georgia. “The Association has achieved significant success in terms of distribution of royalties. The royalties collected throughout 2013 exceeded GEL 1,900,000. The sum is about eight times larger than the average volume of previous years’ payments,” Giga Kobaladze, Chairman at the Georgian Copyright Association, told The FINANCIAL. “Over 45% of the total royalties is made up by the HoReCa sector. The number of major users also includes TV broadcasters and cable operators,” said Kobaladze. In Kobaladze’s words, the Association launched a reform process in 2011. “Lots of activities were carried out

GIGA KOBALADZE, Chairman at the Georgian Copyright Association

in order to make the usage of copyright legal. Everyone who uses copyright should have to obtain proper permission from the author. We arranged hundreds of meetings with the users of copyright and explained to them the demands of the law and the need for its protection. In this regard, the Government, as well as the authors themselves, started

to be more active in terms of the nature and usage of copyright,” he said. “Authors have clearly understood how copyright protection can become a source of income for them. The previously incorrect practice of authors, when they were ignoring copyright violation, or just avoiding speaking about it publicly, has gradu-

ally changed. All of these groundbreaking changes have been backed by international organizations. They were and still are fundamentally interested in copyright protection in Georgia. All the listed factors have contributed to positive results of our work. The success has been reflected in an increase in collected royalties. The amount of royal-

ties is increasing by 30-35% annually. We are planning to achieve the same growth by the end of 2014,” said Kobaladze. Q. How are fees calculated for users? A. The number of segments of copyright users exceeds 40. Representatives of each segment that uses copyrighted works is obligated to pay royalties in accordance with the law. The Association issues licenses for such users. There are two types of licenses: general and so-called blanket licenses. The general license is mostly issued for one-time usage of the product, like in the case of using music in a commercial. The majority of licenses are of the blanket type though. In this case the user receives the right for multiple usages of the copyrighted works. The method of calculation of the royalties varies in accordance with the segments. For example, in the case of food establishments the royalties are calculated in line with the number of seats. Shopping centres pay in accordance with square meter. TV and radio broadcasters are charged due to the interest rate of their income. Q. What amount has the Association distributed among authors?

A. The royalties paid to authors amounted to GEL 800,000 in 2013.The figure is significantly higher than the average royalty received by authors in previous years. We are expecting a 35% increase in this direction by the end of the current year. Q. By how many percentages is the usage of foreign authors’ work exceeding that of locals? A. The usage of foreign products in Georgia, like in the whole world, is higher than of local products. This is logical. The repertoire of a single country cannot exceed the whole repertoire of the rest of the world. Georgian repertoire makes up 30% of the total that is used. The remaining 70% is made up by foreign repertoires. This figure is almost the same all over the world. The rare exceptions are the UK and USA. Q. In which foreign countries are Georgian repertoires used most frequently? A. Georgian repertoire is most often used in Russia. The size of this country and the inertia of cultural relations in the past are the main contributing factors to Continued on p. 18

In Georgia, local and international politics matter, but not for everyone MERAB PACHULIA GORBI

Chart 1:

Q. When you get together with friends or relaƟves, would you say you discuss poliƟcs frequently, occasionally or never about...?

Table 1:

Demographic variables (frequently or occasionally talks about local poliƟcs)

hen it comes to political matters, we Georgians talk a lot, especially among friends or relatives. We are a bit more interested in local issues compared to what is going on internationally. While the majority of us is concerned and talk about domestic or international politics, interests differ among the population. A large majority of Georgians frequently discuss politics with their friends or relatives regardless of its nature - local or international. I remember we almost never discussed local politics back during the Soviet times, perhaps because local government officials had very limited if any independence from Moscow, and elections were just a formality that could more aptly be called “selections.” Much more of our time was spent discussing international politics, though this was based on either limited information provided by Western radio stations (VOA, BBC, RFE/ RL) or easily available Soviet propaganda. Obviously, both lacked comprehensiveness compared to what is available today. The data presented below is based on GORBI’s nationwide public opinion surveys. Some of the questions we are repeatedly asking respondents to keep up on changes

Source: GORBI, Georgian naƟonwide surveys.

in public mood. These questions are also asked in various countries, thus allowing for comparison across nations. Historically, based on longitudinal survey projects (the World Values Survey or European Values Surveys (which GORBI is in charge in Georgia) the overall number of those who are spending their free time to discuss politics is steadily growing. There are several contributing factors, with the largest being ongoing democratisation around the world since the collapse of Soviet Union and increasing internet penetration globally. When it comes to Georgia, 7 out of 10 respondents discuss local political matters fre-

quently or occasionally, fewer respondents (four percentage points) talked about international issues. These numbers did not change significantly since August 2012. In addition, those who never discussed international political issues make up approximately one third of the total population and since August 2012, on average, around 27% of respondents never discussed domestic issues with their friends. Like elsewhere, Georgian society is made up of many groups each with its own different value structure, preferences and demographics. Here I am focusing only on differences among demographic variables in order to

Source: GORBI, Georgian naƟonwide surveys.

quickly analyze who spends most of their time talking about local politics. Males are spending more time talking about local politics compared to females, 71% and 63% respectively. And age does matter too – the young cohort of the Georgian society spends significantly less time discussing political issues compared to older groups. Champions are respondents aged from 45 – 54, with (77%) of this group engaging in political discussions. Those who possess higher education (and there are around 27% with higher education, based on the 2002 census) talk about politics two times or more compared to those with primary education

(44% vs. 81%, respectively) and the poorer a Georgian is, the less he or she is discussing domestic politics with peers. Such discussions are positive since they associate the public with the political decision-making process and this is even more desired for us at this stage in Georgia’s democratisation. Theory says that frequent political discussions may increase public engagement in community affairs and civic participation and we will soon see whether this is the case in practice. However, one thing is certain – if you don’t want to talk about politics while having an informal meeting with a Georgian person, you’d better make sure that he/she

holds no diploma, is impoverished or is young. Since 2003, GORBI remains an exclusive member of Gallup International research network for its two decades of experience in survey research in post-Soviet Union countries, as well as Mongolia and Iraq. All surveys were conducted on a national representative sample of 1,000 respondents; data retains a 3% margin of error, with confidence at 95%. This data was provided exclusively to the Financial. Please do not visit our site ( www.gorbi.com ); it is under construction.

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Georgia Leads the Irakli Gharibashvili: Ranking in the Region Prime Minister of Georgia

“This (Shah Deniz Stage Two) is a USD 45 billion project of which USD 2 billion will be invested in Georgia.” Giorgi NASRASHVILI FactCheck

n 20 September 2014, the Prime Minister of Georgia, Irakli Gharibashvili, attended the official opening ceremony of the South Corridor ofthe Sangachli Terminal in Azerbaijan. After the ceremony, Mr Gharibashvili stated: “The project of the 21st century with the name of Shah Deniz Stage Twois starting. This is a USD 45 billion project of which USD 2 billion will be invested in Georgia.” FactCheck took interest in the Prime Minister’s statement and verified its accuracy. The Shah Deniz (King of the Sea) gas field was discovered in 1999. With one trillion cubic meters of gas it is one of the biggest naturalgas condensate deposits in the world. Shah Deniz is locatedon the Caspian Sea shelf from 50 to 500 meters underwater, 70 km southeast of Baku. The first stage of the Shah Deniz project started in 2006. Its maximum discharge is nine billion cubic meters of gas per annum. The second stage of Shah Deniz (Full Field Development [FFD]) means the transit of an additional 16 billion cubic meters of gas per year. By the calculations of British Petroleum (BP), which is in charge of this project, USD 28 billion of capital investment will be necessary for the production of gas and its

transportation to the GeorgiaTurkey border. From these 16 billion cubic meters, the transit route known as the South Corridor with its additional pipeline system will provide Turkey with six billion cubic meters (bcma) of gas per year whilst the remaining ten billion cubic meters per year will supply the European market. As a result of Shah Deniz Stage Two, natural gas extracted from the Caspian Sea will reach the European market for the first time. Shah Deniz Stage Two includes: Construction of two additional bridge-linked offshore platforms. Drilling 26 new naturalgas producing wells. Construction of a 500 kmlong underwater pipeline which will connect the wells and the terminal. Modernisation of the seaconstruction vessels. Expansion of the Sangachli Terminal. The construction of the South Corridor requires the strengthening of the existing infrastructure and the development of a new pipeline system. The South Caucasus Pipeline will be widened by a new parallel pipeline crossing Azerbaijan and Georgia. The new Trans Anatolian Pipeline (TANAP) will transport gas from the GeorgiaTurkey border through the territory of Turkey. Construction of the Trans Adriatic Pipeline (TAP) in Europe.

According to the project, the first supply of gas will reach Georgia and Turkey by the end of 2018 whilst Europe will receive gas one year thereafter. The expansion of the South Caucasus Pipeline is part of the Shah Deniz Stage Two project.According project. According to BP, BP, the Shah Deniz Stage Two and the South Caucasus Pipeline projects include a total of USD 45 billion in investments and it is expected that USD 2 billion worth of foreign direct investments (FDI) will be made in Georgia. The expansion of the South Caucasus Pipeline will enable Georgia to transit more gas as well. According to BP, the benefits for Georgia resultingfrom the expansion of the Pipeline include: Spending 20% of the total sum (approximately USD 400 million) on local products and service (with local contractors). About 2,000 new jobs at the peak of the construction and 125 long-term jobs. About 350,000 tonnes of material transported using Georgian ports and railway. The company also says that there already exists a USD 528 million project for supporting the expansion of the South Caucasus Pipeline. It includes the construction of a 16-km access road, two 120 MW compressor stations and a new pressure-measuring and regulating station. The construction work is expected to be finished by the end of 2018.

CONCLUSION According to BP, the Shah Deniz Stage Two and the South Caucasus Pipeline Expansion projects include a total of USD 45 billion in investments. BP also says that Georgia will benefit both as a recipient of gas from the second stage of the Shah Deniz project and as a recipient of USD 2 billion in investments. In total, 20% of these investments are expected to be spent on local products and service with local contractors. FactCheck concludes that Irakli Gharibashvili’s statement: “The project of the 21st century with the name of Shah Deniz Stage Two is starting. This is a USD 45 billion project of which USD 2 billion will be invested in Georgia,” is TRUE.

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

The FINANCIAL

5 percent of economies in Europe and Central Asia implemented at least one regulatory reform aimed at making it easier for local entrepreneurs to do business in 2013/14, a larger percentage than in any other region, according to a new World Bank Group report. Since 2005, Georgia implemented the largest number of reforms in the region, with 36 (second only to Rwanda worldwide), followed by the former Yugoslav Republic of Macedonia with 34. The DB2015 ranking shows no major change for Georgia compared to DB2014. Economies in Europe and Central Asia further improved the regulatory environment for local entrepreneurs, adding to the gains recorded in the past decade. For example, 10 years ago, starting a new business took a Macedonian entrepreneur 48 days. Today, the process can be completed in 2 days. Georgia has the region’s highest ranking on the ease of doing business, at 15 among 189 economies worldwide: DB2015 ease of doing business rank: 15 DB2014 back-calculated ease of doing business rank: 14 DB2015 distance to frontier score: 79.46 DB2014 back-calculated distance to frontier score: 79.61; improvement: −0.15 Doing Business finds that Azerbaijan and Tajikistan were among the top improvers worldwide in 2013/14 in the areas of business regulation measured by the report. Challenges continue in both countries, however. For example, obtaining an electricity connection takes longer for entrepreneurs in these two countries than it does for their counterparts in most other economies in Europe and Central Asia. Challenges persist across the region’s economies even as the regulatory framework for entrepreneurs continues to improve, emphasizing the need for further regulatory reforms. This is particularly so in such areas as construction permitting, getting electricity, and trading across borders, all areas in which the region’s economies are in the bottom half of the global ranking on average. This year, for the first time, Doing Business collected data for a second city in the 11 economies with a population of more than 100 million. In the Russian Federation, the report now analyzes business regulations in both Moscow and St. Petersburg. Differences between cities are common in indicators measuring the steps, time, and cost to complete regulatory transactions where local agencies play a larger role, finds the report. The report finds that Singapore tops the global ranking on the ease of doing business. Joining it on the list of the top 10 economies with the most businessfriendly regulatory environments are New Zealand; Hong Kong SAR, China; Denmark; the Republic of Korea; Norway; the United States; the United Kingdom; Finland; and Australia. The annual World Bank Group flagship Doing Business report analyzes regulations that apply to an economy’s businesses during their life cycle, including start-up and operations, trading across borders, paying taxes, and resolving insolvency. The aggregate ease of doing business rankings are based on the distance to frontier scores for 10 topics and cover 189 economies. Georgia has the region’s highest ranking on the ease of doing business, at 15 among 189 economies worldwide. For the first time this year, Doing Business collected data for a second city in the 11 economies with a population of more than

100 million. In the Russian Federation, the report analyzes business regulations in both Moscow and St. Petersburg. Globally, Croatia improved the most in the area of dealing with construction permits in 2013/14, while Romania improved the most in the area of paying taxes and Kosovo in the area of enforcing contracts.

ARMENIA Armenia made starting a business easier by streamlining postregistration procedures. Areas of business regulatory reform: Starting a business DB2015 ease of doing business rank: 45 DB2014 back-calculated ease of doing business rank: 49 DB2015 distance to frontier score: 70.6 DB2014 back-calculated distance to frontier score: 69.3; improvement: 1.3

AUSTRIA Austria made starting a business easier by reducing the minimum capital requirement, which in turn reduced the paid-in minimum capital requirement, and by lowering notary fees. Areas of business regulatory reform: Starting a business DB2015 ease of doing business rank: 21 DB2014 back-calculated ease of doing business rank: 19 DB2015 distance to frontier score: 77.4 DB2014 back-calculated distance to frontier score: 77.1; improvement: 0.3

AZERBAIJAN Azerbaijan made starting a business easier by reducing the time to obtain an electronic signature for online tax registration. It made transferring property easier by introducing an online procedure for obtaining the nonencumbrance certificate. And Azerbaijan made paying taxes easier for companies by introducing an electronic system for filing and paying social insurance contributions. Areas of business regulatory reform: Starting a business, Registering property, Paying taxes DB2015 ease of doing business rank: 80 DB2014 back-calculated ease of doing business rank: 88 DB2015 distance to frontier score: 64.1 DB2014 back-calculated distance to frontier score: 62.0; improvement: 2.1

BELARUS Belarus made paying taxes easier for companies by introducing an electronic system for filing and paying contributions for the obligatory insurance for work accidents—and by simplifying the filing requirements for corporate income tax and value added tax. On the other hand, it increased the ecological tax rate and made bad debt provisions nondeductible for purposes of the corporate income tax. Areas of business regulatory reform: Paying taxes DB2015 ease of doing business rank: 57 DB2014 back-calculated ease of doing business rank: 57 DB2015 distance to frontier score: 68.3 DB2014 back-calculated distance to frontier score: 67.1; improvement: 1.2

BELGIUM Belgium made resolving insolvency more difficult by establishing additional requirements for commencing reorganization proceedings, including the submission of documents verified

by external parties. Areas of business regulatory reform: Resolving insolvency (making it more difficult) DB2015 ease of doing business rank: 42 DB2014 back-calculated ease of doing business rank: 40 DB2015 distance to frontier score: 71.1 DB2014 back-calculated distance to frontier score: 71.1; improvement: 0.0

BULGARIA Bulgaria made starting a business easier by lowering registration fees. Areas of business regulatory reform: Starting a business DB2015 ease of doing business rank: 38 DB2014 back-calculated ease of doing business rank: 36 DB2015 distance to frontier score: 71.8 DB2014 back-calculated distance to frontier score: 71.7; improvement: 0.1

CYPRUS Cyprus improved its credit information system by adopting a central bank directive eliminating the minimum threshold for loans to be included in credit bureaus’ databases. And it made paying taxes easier for companies by reducing the number of provisional tax installments for corporate income tax. Areas of business regulatory reform: Getting credit (credit information), Paying taxes DB2015 ease of doing business rank: 64 DB2014 back-calculated ease of doing business rank: 62 DB2015 distance to frontier score: 66.6 DB2014 back-calculated distance to frontier score: 65.9; improvement: 0.7

ESTONIA DB2015 ease of doing business rank: 17 DB2014 back-calculated ease of doing business rank: 16 DB2015 distance to frontier score: 78.8 DB2014 back-calculated distance to frontier score: 78.5; improvement: 0.3

FRANCE France made starting a business easier by reducing the time it takes to register a company at the one-stop shop (Centre de Formalités des Entreprises). Areas of business regulatory reform: Starting a business DB2015 ease of doing business rank: 31 DB2014 back-calculated ease of doing business rank: 33 DB2015 distance to frontier score: 73.9 DB2014 back-calculated distance to frontier score: 72.2; improvement: 1.7

GERMANY Germany made starting a business more difficult by increasing notary fees. And it made transferring property more costly by increasing the property transfer tax rate. Areas of business regulatory reform: Starting a business (making it more difficult), Registering property (making it more difficult) DB2015 ease of doing business rank: 14 DB2014 back-calculated ease of doing business rank: 13 DB2015 distance to frontier score: 79.7 DB2014 back-calculated distance to frontier score: 80.0; improvement: −0.3

Continued on p. 17

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS FINCHANNEL.COM | 3 NOVEMBER, 2014

US Business in Georgia

PASHA Bank a Diamond Sponsor of Business Zurab Japaridze: Brilliance Award “According to the 2013 economic

ASHA Bank, a full service corporate bank, sponsored annual Business Brilliance Award Ceremony, hosted by London based Global Event and Training Group, BOC (Blue Ocean Consultancy). In October 2014, BOC Global Events Group was back to Tbilisi for the 2nd year running, hosting the annual Business Brilliance Award Ceremony with an exclusive Business Development Forum for progressive Leaders, Marketing and Communications Seniors of Georgia, and its neighboring countries, to find the tools to work smarter and keep up with the fast changing marketplace. Participants were given an opportunity to attend the master classes of world popular marketing and public relations specialists. They were introduced to coming trends at marketing fields. Presentations of world leading brands: Microsoft, Greenwich Village PR, Bupa, UNICEF were featured during the conference. This International Conference was packed with insights from World-class Speakers and some of the leading innovators, who put a fresh perspective on the current drivers of the dynamic business world. The Business Brilliance Award, together with local leading Media and Press has celebrated some of the most innovative Businesses, as well as Personal achievements across various industries and

forecast of the Ministry of Finance of Georgia, the economy should have reached GEL 32 billion in 2014. According to the current forecast, we will be losing GEL 3 billion. We have lost more than USD half a billion in currency reserves from the end of 2013 to the beginning of 2014. You have planned a GEL 1,631 million loan which you are not able to implement.” Mariam CHACHUA FactCheck

sectors. “Georgian economy continues to grow. We are observing the continuing entrance of international companies. The volume of foreign investments also increases. So the local resources require the expertise and information that the speakers and invited quests of the ceremony can share with them” said Shahin Mammadov, CEO at PASHA Bank Georgia. In Mammadov’s words, it is a big honor for him that PASHA Bank Georgia was a sponsor of such a reputable ceremony. “PASHA Bank

has joined Georgian business community and we feel responsibility for supporting its further development,” Mammadov told. “I would like to congratulate the winners of the award. Business Brilliance Award is one of the highest profile awards and winning this Trophy says a lot about the quality of organization and the strength of its management team. Winners had one thing in common - being truly excellent at what they do and have proved this by winning a Business Brilliance Award,” said Mammadov.

Smart Supermarket launches the German Product Festival

FactCheck took interest in the economic processes in the country and verified the accuracy of the given statement. According to the Ministry of Finance of Georgia, the 2013 forecast set the 2014 nominal GDP of Georgia at GEL 32.4 billion which corresponds to the numbers stated by the MP. The forecast changed in 2014 and reduced to GEL 29.4 billion. Hence, the difference is, indeed, GEL 3 billion. As for the foreign currency reserves, according to the National Bank of Georgia, they have been reducing since October 2013. FactCheck wrote about this issue earlier in the year as well. The reduction of currency reserves from November 2013 to February 2014 was due to the depreciation of the national currency. Georgia has a floating exchange rate to foreign currencies. Thus, the exchange rate of the GEL is determined by demand and supply and the National Bank does not intervene in this. However, in the case of sharp changes in the exchange rates of the GEL, the National Bank is authorised to resort to exchange rate stabilising operations which it did last year – in order to stabilise the exchange rate of the GEL, the National Bank sold USD 440 million in reserves on a foreign exchange auction.

In total, the foreign currency reserves reduced by USD 545 million from November 2013 to February 2014. The trend continued until July 2014, causing a total reduction of USD 611 million. However, the foreign currency reserves increased by USD 213 million in August 2014 and amounted to USD 2,489. In total, the foreign currency reserves reduced by USD 400 million from October 2013 to September 2014. International reserves, 92% of which consists of currency reserves, are one of the indicators of the economic stability of a country. Hence, keeping the reserves at an adequate level is very important. It should be noted that according to the recommendations of international credit organisations, the amount of international reserves should be able to cover the expenses of three months of import in order to ensure the currency safety of the country. The average monthly import of Georgia in 2014 equalled GEL 688 million. The international reserves amounted to USD 2,489 at the end of August 2014. Hence, the ratio of reserves to import was 3.6 which means that the reserves are 3.6 times more than the monthly import of the country. As for the planned loan, the 2014 forecast of the loan set its amount at GEL 1,631 million. FactCheck also wrote about this topic earlier in the year. It should be noted that

the 2014 annual budget allocates GEL 598 million for servicing the debts of the previous years. Thus, the net increase of the public debt (increase - decrease) amounts to GEL 1,038 million. According to the Budget Implementation Report, the increase of the public debt happens mainly by increasing the domestic debt. As for the external debt (mainly used for the implementation of targeted investment projects) its actual increase is significantly lower than initially planned. Specifically, according to the Budget Implementation Report of the first six months, the growth of the external debt is GEL 147 million instead of GEL 276 million as planned, constituting 53.2% of the six-month plan. According to the data of the first eight months, the growth of the external debt amounted to GEL 247 million as opposed to the initial plan of GEL 629 million, constituting 39.3% of the nine-month plan. According to the Budget Implementation Report of the first six months, the plan for servicing the public debts of the previous years was implemented by 96.8% (GEL 281 million). As the public debt of the country is being serviced successfully and the growth of the debt is lower than expected, we can assume that the growth of the public debt will be lower than the planned amount of GEL 1,038 million at the end of the year as well.

CONCLUSION

mart supermarket chain launches the German Product Festival. From the 1st to the 10th of November, customers will have a unique opportunity to purchase highquality German products discounted by up to 20%, including world-renowned brands like G&G, EDEKA, ELKOS, GOURMET, WESERGOLD, KUCHENMEISTER and many others in supermarkets located all across Georgia. In addition to all this, loyal customers of Smart will be able to buy various German product gift bundles at a discounted rate and taste selected German dishes. A special guest from KUCHENMEISTER, Tamara Melih, attended

the festival opening ceremony in Smart Vake. “For our ‘Quality in Details’ approach to be evident in every new offer from Smart, we have decided to significantly increase the leading European brands’ presence in our Everyday Product assortment. Products from Germany are distinguished by their quality and they constitute the biggest part of our imports from Europe. By launching the German Product Festival in Smart, we want to introduce our loyal customers to German production and by offering various promotional deals, make the highest quality products accessible for everyone. Special environment present throughout

this festival will enhance our unique Smart shopping experience, making it more pleasant and enjoyable.” - states Wissol Group President, Soso Pkhakadze. Smart is distinguished on the Georgian market by a wide range of consumer goods, offering up to 25 000 diverse products and European service standards. Wissol Group started the development of Smart supermarket chain in 2010. At present, Smart supermarkets operate successfully in Tbilisi, 13th km. of Aghmashenebeli Alley, Rustaveli Avenue, Vake, Vazisubani, Kakheti Highway, Batumi, Gudauri, Zugdidi, Marneuli, Akhaltsikhe, Kvareli and Gori Autobahn.

The economic growth forecast of the beginning of 2014 did indeed change as compared to the similar forecast of 2013. Specifically, the forecast amount of the GDP reduced from GEL 32,450 million to GEL 29,352 million which means that it reduced by GEL 3 billion as stated by the MP. The foreign currency reserves reduced by USD 545 million in the period mentioned by the MP whilst the planned amount of debt for 2014 – GEL 1,631 million is not being fully implemented. FactCheck concludes that Zurab Japaridze’s statement: “According to the 2013 economic forecast of the Ministry of Finance of Georgia, the economy should have reached GEL 32 billion in 2014. According to the current forecast, we will be losing GEL 3 billion. We have lost more than USD half a billion in currency reserves from the end of 2013 to the beginning of 2014. You have planned a GEL 1,631 million loan which you are not able to implement,” is TRUE.

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

CMYK

HEADLINE NEWS & ANALYSIS

3 NOVEMBER, 2014 | FINCHANNEL.COM

US Business in Georgia

TBC Bank named as the Best Private Bank in Georgia in 2014

BC Bank named Best Private Bank in Georgia in 2014 by The Banker and Professional Wealth Management (PWM) Magazines. The Banker and PWM extend the prestigious competition to Georgia for the first time. According to an announcement from the publications, 136 banks from 60 countries were considered for the awards by 15 private banking industry experts. TBC Bank was commended for its ability to effectively reach nonresident Wealth Management

clients through its representative office in Israel, and its successful application of multichannel capabilities in the private banking lines. Commenting on the news, Vakhtang Butskhrikidze, TBC Bank’s Chief Executive Officer said: “We are very proud of this pioneering achievement in the field of private banking. TBC Bank’s VIP Banking, introduced in 2005, was one of the first services of its kind to be established in the Georgian market. It has since developed into a strong brand renowned for bespoke relationship management, highly-tailored

products and world-class staff expertise. This prestigious award from The Banker and PWM Magazine brings welcome recognition for the longstanding excellence of our private banking business lines.” The annual Awards recognize players that are emerging as industry leaders in private banking. Private banks operating in Europe, Asia, North America, Middle East, Latin America and Africa, or globally, are evaluated against a set of growth and performance measures, as well as on their particular private banking services.

FINANCIAL

Georgia Needs Punitive Damages Continued from p. 2

many of such issues would be brought to court essentially for the first time. Elsewhere, in particular in countries with a legal tradition that was not interrupted by foreign occupation and integration into the Soviet Union, almost all litigation scenarios were already discussed at some point in the past. There were so many coats ripped open in Western European countries in the last decades that there is a well-established standard how such cases are to be assessed by a court. Therefore, in most cases one would not have to go to court at all. In a standard case, the party who was negligent would anticipate that there was no chance to win the legal battle and pay compensation right away without involving a court and lawyers, or the victim would refrain from going to court. Consequently, it will be more difficult to find rusty nails sticking out of wooden fences in those countries, because negligence will almost surely lead to compensation payments if there is a damage. Only unusual cases, like my coat being ripped up by a nail while walking on a way where I was not allowed to walk, would have to be legally fought out. In winter, owners of houses in Germany are obliged to remove the snow from the sidewalks in front of their houses.

This works pretty well in as there are few houses where the snow is not removed. The reason is that if I would slip on the sidewalk in front of such a house and break my arm, I would not even have to go to court – the “perpetrator”, the person who did not remove the snow, would be told by their lawyer that this is a hopeless case. They would pay my hospital stay and other compensation without a legal battle.

THE SMARTEST SOLUTION If the government wants to ensure that safety standards are fulfilled, it could send inspectors to the construction sites, manufacturing plants etc. and do direct controls of the safety standards. This is, however, not only costly but has limited effectiveness, because the inspectors can only spot-check and it is easy to fool them. An effective litigation practice, on the other hand, does not cost anything and the fear of lawsuits effectively incentivizes everybody to abide by safety standards. Thus, even if controls are carried out additionally (which may be necessary with activities where a damage could not easily be attributed to a particular company or person), effective litigation is the method of choice to enforce safety standards. The United States exploit the advantages of litigation to

the maximum. Stella Liebeck had arguably one of the best days of her life when in 1994 she poured McDonald’s coffee over her lap. At court, she was awarded a payment of 2.86 million dollars from McDonald’s, 2.7 million of which were not paid for her medical expenses but as punitive damages. Punitive damages are no compensation for the damage that was inflicted, but serve to deter the offender from being negligent. To incentivize people to go to court also with minor issues and in this way to quickly create legal practice which makes litigation efficient, Georgia would be welladvised to introduce sufficiently high punitive damages into their legal system. If there were substantial punitive damages in Georgia, then the construction company in Kostava Street would have made sure that there are no rusty nails sticking out. Because then I would have gone to court, and in addition to the $100 for my coat I would have received, say, $10,000 in punitive damages!

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

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS

FINCHANNEL.COM | 3 NOVEMBER, 2014

US Business in Georgia

Doing Business in Georgia:

Georgia Leads the Ranking in the Region Continued from p. 14

GREECE Greece made starting a business easier by lowering registration costs. And it made transferring property easier by reducing the property transfer tax rate and eliminating the requirement for a municipal tax clearance certificate. In addition, Greece made enforcing contracts easier by introducing an electronic filing system for court users. Areas of business regulatory reform: Starting a business, Registering property, Enforcing contracts DB2015 ease of doing business rank: 61 DB2014 back-calculated ease of doing business rank: 65 DB2015 distance to frontier score: 66.7 DB2014 back-calculated distance to frontier score: 65.0; improvement: 1.7

KAZAKHSTAN Kazakhstan made registering property easier by introducing effective time limits and an expedited procedure. And it made trading across borders easier by opening a new border station and railway link that helped reduce congestion at the border with China. In addition, Kazakhstan made enforcing contracts easier by introducing an electronic filing system for court users. Moreover, Kazakhstan made resolving insolvency easier by clarifying and simplifying provisions on liquidation and reorganization, introducing the concept of creditors’ meetings, expanding the rights of creditors during insolvency proceedings, authorizing payment in kind to secured creditors, and clarifying the process for submitting creditors’ claims. On the other hand, Kazakhstan made paying taxes more complicated for companies by introducing a mandatory contribution to the National Chamber of Entrepreneurs and by increasing the vehicle and environmental taxes. Areas of business regulatory reform: Registering property, Trading across borders, Enforcing contracts, Resolving insolvency, Paying taxes (making it more difficult) DB2015 ease of doing business rank: 77 DB2014 back-calculated ease of doing business rank: 76 DB2015 distance to frontier score: 64.6 DB2014 back-calculated distance to frontier score: 63.6; improvement: 1.0

LATVIA Latvia made paying taxes easier for companies by simplifying the value added tax return, enhancing the electronic system for filing corporate income tax returns, and reducing employers’ social security contribution rate. On the other hand, Latvia made starting a business more difficult by increasing registration fees, bank fees, and notary fees. Areas of business regulatory reform: Paying taxes, Starting a business (making it more difficult) DB2015 ease of doing business rank: 23 DB2014 back-calculated ease of doing business rank: 21 DB2015 distance to frontier score: 76.7 DB2014 back-calculated distance to frontier score: 76.6; improvement: 0.1

LITHUANIA Lithuania made starting a business easier by eliminating the need to have a company seal and speeding up the value added tax registration at the State Tax Inspectorate. And it made dealing with construction permits easier by reducing the time

required for processing building permit applications. In addition, Lithuania made enforcing contracts easier by introducing an electronic filing system for court users. Areas of business regulatory reform: Starting a business, Dealing with construction permits, Enforcing contracts DB2015 ease of doing business rank: 24 DB2014 back-calculated ease of doing business rank: 24 DB2015 distance to frontier score: 76.3 DB2014 back-calculated distance to frontier score: 75.9; improvement: 0.5

MOLDOVA Moldova made starting a business easier by abolishing the minimum capital requirement. In addition, it made paying taxes easier for companies by introducing an electronic system for filing and paying social security contributions. On the other hand, it increased the minimum salary used for calculating the environmental tax liability. Furthermore, Moldova increased the employers’ health insurance contribution rate and introduced new filing requirements for value added tax. Areas of business regulatory reform: Starting a business, Paying taxes DB2015 ease of doing business rank: 63 DB2014 back-calculated ease of doing business rank: 82 DB2015 distance to frontier score: 66.6 DB2014 back-calculated distance to frontier score: 62.8; improvement: 3.8

NETHERLANDS DB2015 ease of doing business rank: 27 DB2014 back-calculated ease of doing business rank: 26 DB2015 distance to frontier score: 75.0 DB2014 back-calculated distance to frontier score: 75.0; improvement: 0.0

POLAND Poland made getting electricity less costly by revising the fee structure for new connections. And it made transferring property easier by introducing online procedures and reducing notary fees. In addition, Poland made trading across borders easier by implementing a new terminal operating system in the port at Gdansk. Areas of business regulatory reform: Getting electricity, Registering property, Trading across borders DB2015 ease of doing business rank: 32 DB2014 back-calculated ease of doing business rank: 30 DB2015 distance to frontier score: 73.6 DB2014 back-calculated distance to frontier score: 73.4; improvement: 0.2

RUSSIAN FEDERATION The Russian Federation made starting a business easier by eliminating the requirement to deposit the charter capital before company registration as well as the requirement to notify tax authorities of the opening of a bank account—a reform applying to both Moscow and St. Petersburg. In addition, it made transferring property easier by eliminating the requirement for notarization and introducing tighter time limits for completing the property registration. This reform also applies to both Moscow and St. Petersburg. Areas of business regulatory reform: Starting a business, Registering property DB2015 ease of doing business rank:

62 DB2014 back-calculated ease of doing business rank: 64 DB2015 distance to frontier score: 66.7 DB2014 back-calculated distance to frontier score: 65.0; improvement: 1.6

SPAIN Spain made starting a business easier by introducing an electronic system linking several public agencies and thereby simplifying business registration. It made transferring property easier by reducing the property transfer tax rate. And it made paying taxes less costly for companies by reducing the statutory corporate income tax rate. In addition, Spain made resolving insolvency easier by introducing new rules for out-of-court restructuring, introducing provisions applicable to prepackaged reorganizations, and making insolvency proceedings more public. Areas of business regulatory reform: Starting a business, Registering property, Paying taxes, Resolving insolvency DB2015 ease of doing business rank: 33 DB2014 back-calculated ease of doing business rank: 32 DB2015 distance to frontier score: 73.2 DB2014 back-calculated distance to frontier score: 72.2; improvement: 0.9

FUEL PRICES ELECTRICITY HOUSEHOLDS FUEL TAXES

FUEL PRICES January 5, 2013

Unleaded (Superbleifrei, Euro sans plomb, Euro95) Retail Price

Country

Diesel (Gazole, Gasóleo)

Price (Excluding VAT)

Retail Price

Price (Excluding VAT)

Austria

€ 1.390

€ 1.158

€ 1.359

€ 1.133

Belgium

€ 1.636

€ 1.352

€ 1.492

€ 1.233

Bulgaria

€ 1.265

2.49 лв.

€ 1.054

2.08 лв.

€ 1.304

€ 1.087

€ 1.407

€ 1.348

Czech Republic

€ 1.393

35.00 Kč

€ 1.151

28.93 Kč

€ 1.433

36.00 Kč

€ 1.203 € 1.184

29.75 Kč

€ 1.607

11.99 kr

€ 1.286

9.59 kr

€ 1.460

10.89 kr

€ 1.168

8.71 kr

Estonia

€ 1.239

€ 1.033

€ 1.293

€ 1.078

Finland

€ 1.603

€ 1.293

€ 1.521

€ 1.227

France

€ 1.650

€ 1.380

€ 1.493

€ 1.248

Germany

€ 1.577

€ 1.325

€ 1.453

€ 1.221

Greece

€ 1.681

€ 1.367

€ 1.411

€ 1.147

Hungary

€ 1.387

Ireland

€ 1.590

Italy

407 Ft

€ 1.092

320 Ft

€ 1.424

€ 1.293

€ 1.752

418 Ft

€ 1.121

€ 1.531

€ 1.448

€ 1.697

€ 1.402

Latvia

€ 1.319

Ls 0.922

€ 1.090

Ls 0.762

€ 1.321

Ls 0.923

€ 1.092

Ls 0.763

Lithuania

€ 1.360

Lt 4.70

€ 1.124

Lt 3.88

€ 1.299

Lt 4.49

€ 1.074

Lt 3.71

Luxembourg

€ 1.317

Malta

€ 1.500

Netherlands

€ 1.782

Poland

€ 1.347

Portugal

€ 1.749

Romania

€ 1.271

€ 1.145

€ 1.218

€ 1.271

€ 1.380

€ 1.473 5.49 zł

€ 1.095

€ 1.025

€ 1.169

€ 1.491 4.46 zł

€ 1.364

€ 1.422 5.66 lei

€ 1.059 € 1.232 5.56 zł

€ 1.109

€ 1.489 4.56 lei

€ 1.309

5.83 lei

€ 1.056

Slovakia

€ 1.504

€ 1.253

€ 1.431

€ 1.193

Slovenia

€ 1.486

€ 1.238

€ 1.385

€ 1.154

Spain

€ 1.372

€ 1.134

4.52 zł

€ 1.211

€ 1.343

4.70 lei

€ 1.110

Sweden

€ 1.646

14.18 kr

€ 1.317

11.34 kr

€ 1.642

14.14 kr

€ 1.314

11.31 kr

United Kingdom

€ 1.624

£ 1.321

€ 1.353

£ 1.101

€ 1.714

£ 1.394

€ 1.428

£ 1.162

EU AVERAGE

€ 1.496

€ 1.234

€ 1.181

€ 1.432

ELECTRICITY HOUSEHOLDS Retail (end-user) energy prices for households. Two consumption levels are identified. Research methodology. Consumption: 3,500 kWh/year (± 25%)

Consumption: 7,500 kWh/year (± 30%)

Country

€ per kWh Electricity

Country

€ per kWh Electricity

Austria

€ 0.1988

Austria

€ 0.1798

Belgium

€ 0.2134

Belgium

€ 0.1940

Bulgaria

€ 0.0829

Bulgaria

€ 0.0823

Cyprus

€ 0.2850

Cyprus

€ 0.2800

Czech Republic

€ 0.1480

Czech Republic

€ 0.1276

Turkey made enforcing contracts easier by introducing an electronic filing system for court users. However, it made starting a business more difficult by increasing the notary and company registration fees. And it made paying taxes more costly for companies by increasing employers’ social security contribution rate. Areas of business regulatory reform: Enforcing contracts, Starting a business (making it more difficult), Paying taxes (making it more difficult) DB2015 ease of doing business rank: 55 DB2014 back-calculated ease of doing business rank: 51 DB2015 distance to frontier score: 68.7 DB2014 back-calculated distance to frontier score: 68.4; improvement: 0.3

Denmark

€ 0.2982

Denmark

Ukraine made paying taxes easier for companies by introducing an electronic system for filing and paying labor taxes. On the other hand, it increased the environmental tax. Areas of business regulatory reform: Paying taxes DB2015 ease of doing business rank: 96 DB2014 back-calculated ease of doing business rank: 112 DB2015 distance to frontier score: 61.5 DB2014 back-calculated distance to frontier score: 59.2; improvement: 2.3

329 Ft

€ 1.245

TURKEY

UKRAINE

2.13 лв.

Cyprus Denmark

€ 1.152

2.55 лв.

€ 0.2562

Estonia

€ 0.0989

Estonia

€ 0.0948

Finland

€ 0.1566

Finland

€ 0.1369

France

€ 0.1412

France

€ 0.1279

Germany

€ 0.2541

Germany

€ 0.2406

Greece

€ 0.1265

Greece

€ 0.1553

Hungary

€ 0.1708

Hungary

€ 0.1616

Ireland

€ 0.1920

Ireland

€ 0.1604

Italy

€ 0.2031

Italy

Latvia

€ 0.1187

Latvia

€ 0.1193

Lithuania

€ 0.1200

Lithuania

€ 0.1201

Luxembourg

€ 0.1707

Luxembourg

€ 0.1587

Malta

€ 0.1695

Malta

€ 0.1829

Netherlands

€ 0.2208

Netherlands

€ 0.2439

Poland

€ 0.1488

Poland

€ 0.1419

€ 0.2485

Portugal

€ 0.1689

Portugal

€ 0.1547

Romania

€ 0.1095

Romania

€ 0.1074

Slovakia

€ 0.1677

Slovakia

€ 0.1501

Slovenia

€ 0.1447

Slovenia

€ 0.1335

Spain

€ 0.1959

Spain

€ 0.1777

Sweden

€ 0.2098

Sweden

€ 0.1821

United Kingdom

€ 0.1419

United Kingdom

€ 0.1265

Notes: - Amount is in euro (€) per kiloWatthour (kWh). - Price data for non-eurozone countries are in euro. The average exchange rate valid for the referenced month is applied. - Prices include: market price, transmission through main and local networks, administrative charges and all taxes.

FUEL TAXES January 5, 2013

Country

Unleaded (Superbleifrei, Euro sans plomb, Euro95) Crude

Margin Excise duties

VAT

Retail price

Diesel (Gazole, Gasóleo) Crude

Margin Excise duties

VAT

Retail price

Austria

€ 0.512 € 0.164

€ 0.482

€ 0.232

€ 1.390

€ 0.512 € 0.224

€ 0.397

€ 0.227

Belgium

€ 0.512 € 0.226

€ 0.614

€ 0.284

€ 1.636

€ 0.512 € 0.293

€ 0.428

€ 0.259

€ 1.492

Bulgaria

€ 0.512 € 0.179

€ 0.363

€ 0.211

€ 1.265

€ 0.512 € 0.253

€ 0.322

€ 0.217

€ 1.304

€ 1.359

Cyprus

€ 0.512 € 0.281

€ 0.359

€ 0.196

€ 1.348

€ 0.512 € 0.361

€ 0.330

€ 0.204

€ 1.407

Czech Republic

€ 0.512 € 0.123

€ 0.516

€ 0.242

€ 1.393

€ 0.512 € 0.232

€ 0.440

€ 0.249

€ 1.433

Denmark

€ 0.512 € 0.187

€ 0.587

€ 0.321

€ 1.607

€ 0.512 € 0.212

€ 0.444

€ 0.292

€ 1.460

UNITED KINGDOM

Estonia

€ 0.512 € 0.098

€ 0.423

€ 0.207

€ 1.239

€ 0.512 € 0.173

€ 0.393

€ 0.216

€ 1.293

Finland

€ 0.512 € 0.131

€ 0.650

€ 0.310

€ 1.603

€ 0.512 € 0.245

€ 0.470

€ 0.294

€ 1.521

France

€ 0.512 € 0.261

€ 0.607

€ 0.270

€ 1.650

€ 0.512 € 0.308

€ 0.428

€ 0.245

€ 1.493

Germany

€ 0.512 € 0.159

€ 0.654

€ 0.252

€ 1.577

€ 0.512 € 0.239

€ 0.470

€ 0.232

€ 1.453

The United Kingdom made starting a business easier by speeding up tax registration. In addition, it made paying taxes less costly for companies by reducing the corporate income tax rate—though it also increased the landfill tax. Areas of business regulatory reform: Starting a business, Paying taxes DB2015 ease of doing business rank: 8 DB2014 back-calculated ease of doing business rank: 9 DB2015 distance to frontier score: 81.0 DB2014 back-calculated distance to frontier score: 80.8; improvement: 0.2

Greece

€ 0.512 € 0.185

€ 0.670

€ 0.314

€ 1.681

€ 0.512 € 0.223

€ 0.412

€ 0.264

€ 1.411

Hungary

€ 0.512 € 0.161

€ 0.419

€ 0.295

€ 1.387

€ 0.512 € 0.223

€ 0.386

€ 0.303

€ 1.424

Ireland

€ 0.512 € 0.193

€ 0.588

€ 0.297

€ 1.590

€ 0.512 € 0.254

€ 0.479

€ 0.286

€ 1.531

Italy

€ 0.512 € 0.232

€ 0.704

€ 0.304

€ 1.752

€ 0.512 € 0.298

€ 0.593

€ 0.295

€ 1.697

Latvia

€ 0.512 € 0.170

€ 0.408

€ 0.229

€ 1.319

€ 0.512 € 0.250

€ 0.330

€ 0.229

€ 1.321

Lithuania

€ 0.512 € 0.178

€ 0.434

€ 0.236

€ 1.360

€ 0.512 € 0.260

€ 0.302

€ 0.225

€ 1.299

Luxembourg

€ 0.512 € 0.171

€ 0.462

€ 0.172

€ 1.317

€ 0.512 € 0.217

€ 0.330

€ 0.159

€ 1.218

Malta

€ 0.512 € 0.290

€ 0.469

€ 0.229

€ 1.500

€ 0.512 € 0.276

€ 0.382

€ 0.211

€ 1.380

Netherlands

€ 0.512 € 0.231

€ 0.730

€ 0.309

€ 1.782

€ 0.512 € 0.289

€ 0.431

€ 0.259

€ 1.491

Poland

€ 0.512 € 0.203

€ 0.380

€ 0.252

€ 1.347

€ 0.512 € 0.267

€ 0.330

€ 0.255

€ 1.364

Portugal

€ 0.512 € 0.326

€ 0.584

€ 0.327

€ 1.749

€ 0.512 € 0.333

€ 0.366

€ 0.278

€ 1.489

Romania

€ 0.512 € 0.153

€ 0.360

€ 0.246

€ 1.271

€ 0.512 € 0.228

€ 0.316

€ 0.253

€ 1.309

Slovakia

€ 0.512 € 0.227

€ 0.515

€ 0.251

€ 1.504

€ 0.512 € 0.295

€ 0.386

€ 0.239

€ 1.431

Slovenia

€ 0.512 € 0.235

€ 0.491

€ 0.248

€ 1.486

€ 0.512 € 0.281

€ 0.361

€ 0.231

€ 1.385

Spain

€ 0.512 € 0.197

€ 0.425

€ 0.238

€ 1.372

€ 0.512 € 0.267

€ 0.331

€ 0.233

Sweden

€ 0.512 € 0.185

€ 0.620

€ 0.329

€ 1.646

€ 0.512 € 0.248

€ 0.554

€ 0.328

€ 1.642

United Kingdom

€ 0.512 € 0.167

€ 0.674

€ 0.271

€ 1.624

€ 0.512 € 0.242

€ 0.674

€ 0.286

€ 1.714

€ 1.343

CMYK

HEADLINE NEWS & ANALYSIS

FINANCIAL

3 NOVEMBER, 2014 | FINCHANNEL.COM

US Business in Georgia

Tech Companies Raise Most Americans Say Employers Record US$24.8 Billion Should Never Discriminate, Poll Globally in Q3 2014 The FINANCIAL

The FINANCIAL

record US$24.8 billion was raised by technology companies in the third quarter of 2014, with 18 technology companies from six different countries completing their initial public offerings (IPOs) during this time frame, a 50 percent increase in volume over last year. Third quarter proceeds also exceeded the US$17.8 billion raised in the second quarter of 2012 when Facebook completed its IPO of US$16 billion, according to PwC’s Q3 2014 Global Technology IPO Review. “Record IPO proceeds in the third quarter reflect the continued economic recovery and underlying optimism prevailing around the world. While the final quarter of the year has started with rising market volatility, investor faith in the future of the technology sector remains strong, meeting and even exceeding historical norms,”Raman

Chitkara, Global Technology Industry Leader, PwC, said.

CHINA DOMINATES THIRD QUARTER TECHNOLOGY IPO ACTIVITY Chinese companies accounted for over 50 percent of the volume and 93 percent of proceeds from technology IPOs during the quarter. Of the 18 tech IPOs completed during the third quarter, 10 were Chinese companies. Eight Chinese companies completed IPOs on Chinese exchanges compared to five in the second quarter, with two listing on the Shanghai exchange, four on the Shenzhen exchange and two on the Hong Kong exchange. Two Chinese companies listed outside China on US exchanges, Alibaba on the NYSE and iDreamsky Technology on NASDAQ.

IPO proceeds from Chinese exchanges rose 41 percent from $US767 million in the second quarter to US$1,085 million in the third quarter. As with the past several quarters, Internet Software & Services and Software maintained their positions as the most active subsectors for tech IPOs. Internet Software & Services had six IPOs and raised US$22.8 billion in the third quarter compared to 20 IPOs and US$5.1 billion in proceeds in the second quarter, and six IPOs with US$0.6 billion in the third quarter of 2013. Alibaba’s US$21.8 billion IPO dominated the sector in the third quarter. The Semiconductor subsector had four IPOs in the third quarter compared to one in the same quarter of 2013. Proceeds increased to US$533 million from US$71 million the previous year. All four semiconductor IPOs were Chinese companies—two listing on the Shanghai exchange and two on the Shenzhen exchange.

wenty years after its introduction, the Employment NonDiscrimination Act (ENDA) is still being debated in Congress and across the United States. While most Americans continue to give the bill strong support, a new national survey shows that most Americans simply don’t believe that employer exemptions are justified when it comes to basic workplace safeguards for lesbian, gay, bisexual and transgender (LGBT) Americans. Slightly over half (55%) of all adults don’t believe that any employers should be exempt if federal law were expanded to include protection from job discrimination based on sexual orientation and gender identity. When asked specifically, some Americans do agree with certain exemptions. The latest survey shows only about a third (35%) of all adults believe churches or other houses of worship should be exempt, and three in ten (30%) believe privately held businesses with owners citing religious beliefs should be exempt. Also, just a fifth (21%) of adults believe publicly

held businesses citing religious beliefs should be exempt, and 19% believe small businesses generally should be exempt.

STRONG SUPPORT FOR TRANSGENDER EMPLOYEES The survey also showed continued support for federal policies that end job discrimination for lesbians, gay men and bisexuals, as well as transgender employees. Two-thirds (65%) of American adults agree that federal law should be expanded to include protection from job discrimination based on sexual orientation and gender identity. Also, when it comes to protections for transgender employees, more than half (54%) of all adults strongly agree that transgender workers should be treated equally and fairly as all other workers.

MARRIAGE EQUALITY AND THE LGBT WORKFORCE Since the U.S. Supreme Court overturned signifi-

cant portions of the Defense of Marriage Act (DOMA) last June, many states also have repealed their bans against same-sex marriage. With this sea change, growing numbers of LGBT employees wish to live and work in states that recognize their legal relationships today. The 2014 Out & Equal Workplace Survey reports that: Three out of five (60%) LGBT adults prefer a job with an employer in a state where same sex marriages are recognized over an employer in a state that does not recognize same sex marriages, other factors being equal, compared to 51% in 2012. Nearly a third (30%) of LGBT adults would consider changing jobs if their employer required them to transfer to a state where same sex marriages were not recognized, compared to 20% in 2012. Thirty percent (30%) would also consider declining a job promotion if it required them to transfer to a state where same sex marriages are not recognized, compared to 22% in 2012.

Georgian Copyright Association Collected Record High 1.9 Million Continued from p. 12

this. So, the Russian Authors Society collects the largest amount of royalties for Georgian authors. Georgian copyrighted works, particularly, Georgian folklore, is frequently used in Japan. The list of users comprises those from post-Soviet countries, as well as Western Europe and the USA. Q. How frequently is Georgian authors’ copyright violated abroad? A. The violation of copyright takes place not only in Georgia, but also abroad. There are occasions when the production of our members is used in foreign countries without permission. In this case, our association contacts its sister societies operating in the territory where the violation has taken place. We then ask them to eradicate the violation. The system works likewise when the copyright of foreigners is infringed on Georgian territory. This mechanism is quite effective. There have been cases when with mutual assistance the vi-

olators have paid compensation. However, this is the only mechanism, which is offered by our type of associations in line with our competence. In the event of a need for court proceedings abroad, the author is forced to act with their own efforts against the infringer. Q. How has the understanding of copyright been changing among the Georgian population every year? A. The modern mechanisms of copyright protection have only a short history in Georgia. It was first launched in 1999. The Georgian law on Copyright and Related Rights was adopted then. The field was non-prioritized and other daily problems existed in the country. Accordingly, proper attention was not paid to it neither by authors nor by the Government. In 2011, the authors themselves decided to change the situation. With the election of new execution in the Association the situation started to become rectified. The low level of public awareness caused by the lack

of information was the main problem at that time. The Association had a major focus put on it. We launched a campaign focused on changing public attitude towards copyright issues. We did a lot of work in this regard. Targeted promo campaigns, workshops for authors and users together with foreign experts, as well as training programmes for students were all arranged by the Association. We published a regular magazine “Copyright”, which was the first magazine to exist in this field in the country. Professional literature and information brochures were also published. Almost all of our activities were covered in the media. All this significantly contributed to the increase of awareness by authors and by users. We started the formation of new tariffs on usage of copyright that were acceptable for both sides. The work of the Association has since then strengthened and become more transparent and public. The institution has become more flexible. As a result of a lot of work the pub-

lic’s attitude towards this area has gradually changed for the better. Authors have realized that copyright is not only about their moral, but also material satisfaction. In turn, users understand that violating copyright is illegal and that they must comply with the law on this matter. Nonetheless, the situation in Georgia in this regard is still behind that in developed countries. As opposed to here, they have 200 years of history of copyright regulation and the public’s attitude towards it is already firmly established. Violation of copyright is still common in Georgia. The relatively small history of this institution and economic hardship are the main reasons behind it. So, the Association is still actively continuing its work in order to overcome the challenges that exist in this direction. Q. What is the section of the Government that is in charge of regulating this sphere? A. The involvement of the Government is also vital for

this sphere. The Government should ensure the enforcement of existing legal mechanisms. This should be achieved through fines or other sanctions. This will greatly assist the eradication of existing violations and their further prevention. There is an entire chapter devoted to the subject of copyright in the Association Agreement. It includes the state’s duties in this. So, I am hopeful that the recently signed AA will give impetus to the Government and will become more effective in terms of this. Q. In which categories do you encounter the majority of copyright violations? A. Singling out one particular category is difficult. We find law-breakers in almost every category, when users decline to pay royalties. The main segment is constituted by the music sphere however. Music is the most voluminous, it is the most used and over 60-65% of our regulation sphere is made up by music. There have been cases of users having to pay compensation for violation. Such

cases mostly occur through involvement of the courts. Going through the courts is the only legal mechanism for us to be able to combat copyright infringement. We are not an administrative body and we have no right to fine or impose any other sanctions. Q. If we compare copyright in Georgia to its neighbouring countries, which of them are the most advanced and which the least? A. I am proud to state that due to the reforms implemented by the Association Georgia topped the list of postSoviet countries by royalty collection and distribution in 2013. Georgia surpassed even such large countries as Russia and Ukraine. This once again underlines the fact that copyright in Georgia is an important intangible wealth. Its protection is vital for the development of artistic fields. This result is a good motivator to combat abuses in this area more effectively and make our copyright protection index equal to that of Eastern European countries.

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS

FINCHANNEL.COM | 3 NOVEMBER, 2014

20 Telavi Str. Tel: 277 20 20 Fax: 277 21 20

www.sheraton.com/tbilisi

US Business in Georgia Ice cream, coffee, blended drinks, pastry, salads… Open 8am-2am (May-October)

8am-1am

(November-April)

Addr: 12 Eristavi Str. (at the round garden) 34 Leselidze Str. 7a Pekini Str. Phone: 299 03 99; 574 74 69 69 info@lucapolare.com www.lucapolare.com

AeroSvit Representative office in Georgia Address: 25 st.Leselidze Office 205 Tbilisi 0160, Georgia Tel: 243 96 93 Fax: 243 96 93 tbilisi@aerosvit.com

1 Brother Kakabadze Str.

15 Lubliana Str.

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

La Brioche

37 Chavchavadze Ave. Tel.: 291 30 26; 291 30 76

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

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

Addr: Batumi, Georgia, Parnavaz Mepe №25

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

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

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

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

Because life is about living

Hotel “O. Galogre” The tickets are available at tbilisi international airport freedom square 4 courtyard marriott hotel, 1st floor

Tel: 2400 400; 2400 040

36 Al. Kazbegi ave. Tbilisi, 0177, Georgia Tel/Fax: 229 43 43 info@intercontinental.ge www.intercontinental.ge

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

LE MARAIS

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

Village Anaklia, Zugdidi, Georgia Tel: 2 60 99 90 2 60 99 91

Literary cafe “MONSIEUR JORDAN” V. Gorgasali st.,17 Tel.: 275-02-07

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

32 Abashidze Str. Tel: 222 40 83

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

50 Chavchavadze Ave. Tel: 2 91 52 42

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

www.hotelanaklia.com

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

Fragola

Erekle II str. Tel: 555 00 44 46

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

3 Tabidze Str. 2 Kazbegi Ave. Tel: 570 10 33 19

fragola.cafemail@gmail.com

GEORGIA PALACE HOTEL

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

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

Georgian Real Estate Management The Green Building, 6 Marjanishvili Street, 0102 Tbilisi Tel: 243 30 77, Fax: 243 30 79 www.firstbrokerage.ge E-mail: info@firstbrokerage.ge

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

№ 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

Divan Suites Batumi

4 Kargareteli str. Tel; 2236278 www.kenari.ge info@kenari.ge

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

BUSINESSTRAVELCOM HOTEL AND AIRTICKET BOOKING: 2 999 662 | SKY.GE

CMYK

HEADLINE NEWS & ANALYSIS

FINANCIAL

3 NOVEMBER, 2014 | FINCHANNEL.COM

US Business in Georgia

 HYDROTHERM LTD.

Founded on March 10, 1998 in Tbilisi Registration number 202057745. Number of persons employed: in total 72 In 2007 the “hydrotherm” Ltd was certified by ISO 9001:200 Number of partners: 49 The firm’s activity is spread on the following spheres: water supply system; heating system (including the floor and walls heating system); air conditioning and ventilation systems; climatic systems; booster sets (mechanical, biological and chemical treatment of the water); swimming pools; engineering; equipment maintenance and service; BMS (Building management System); Renewable Systems (Solar Energy) “hydrotherm” deals with such companies, as: “aquatherm”, GIERSCH, WILO, BWT, SIMONA, PROCOPI, VIESSMANN, CLAGE (Germany), J.I.Industrial, ECOFLAM, EMMETI, IMAS, VALSIR, DELONGHI, MAPEI, TRANE, KLINKER-SIRE, ELBI, ROBUR, LOVATO (Italy), DE DIETRICH, TECOFI, POUJOULAT, FRANCE-AIR (France), ASTRAL EXPORT, REVIGLASS (Spain ), HL, AWBC (Austria), CALPAK (Greece),VBW (Poland) SIMENS, HONEYWELL, VEMEKS, KES KLIMA, VI-MA, TEKNOKLIMA, BSK, IZOCAM, SESINOKS, MAS-DAF, EMS (Turkey). Etc. In the coarse of years “hydrotherm” has executed a great number of sites, among them -SOROS foundation and Tacis office buildings, hotels “Marriott Tbilisi” and “Marriott Courtyard”, “Sheraton Metechi Palace”, ”Crown Borjomi”, “Gudauri Ski Resort”, ”Mtiebi”,”Iveria”, resting houses in Likani and Bazaleti (hotel, conference hall, bowling, disco), “Derby” company (swimming pools), ‘Ushba” and “Georgian Mineral Waters” companies (technological lines), , bank “Republic” central building, sporting complex in Bakuriani, shopping center “Queen”, Ministry of Defense officers barracks in Vashlidjvari, BP Codiani Sector, Germany consular building ,The President Palace, Georgian Parliament boiler House, national laboratories, located in Vashlidjvari, Gori, Dusheti, Gurdjaani, Marneuli, Kutaisi, Business center on the Freedom square, residential building and the office in Vazha-Pshavela Avenue, multifunctional building in the Freedom Square, offices, and many other sites. Since 2015 the company plans application of the renewable energy (solar systems), as in the cities, as well as in the countryside, with the aim of the hot water and heating supply. For this purpose, business plans are drawn up to get investment packages.

KAKHETIAN TRADITIONAL WINEMAKING Kakhetian Traditional Winemaking is one of the biggest wine and spirits producer. Contact information Tsintsadze St 12 0160 TBILISI Georgia

Type of company: Enterprise Field of activity: Production

Phone: +9953222327700 Fax: +99532223711 Email: n.ratianidze@ktw.ge Homepage: www.ktwgroup.ge Sector of activity Agribusiness / Tourism Company profile the main activity o the company is the production of highest quality wine and spirits and export world widely in more than 15 countries. KTW is also actively involved in wine tourism business, with having cellars and tasting halls, together with wine shops in various regions of Georgia. Cooperation proposal Assistance in connecting and cooperation with large EU distributors, concrete activities, like B2B meetings, tastings, conferences relevant to wine and tourism field. Promotion of country, as a cradle of wine and wine tourism center.

0159, Tsereteli ave. 118, Exhibition center «Expo-Georgia», pavilion number 10, Tbilisi, Georgia Tel: +995 (32) 235 72 01, +995 (32) 234 65 62 Fax: +995 (32) 234 68 08 Email: info@hydrotherm.ge sales@hydrotherm.ge mail@hydrotherm.ge

Innovative aspects and/or main advantages of the proposal The company KTW offers the highest quality products, that are made using ancient Georgian Traditional winemaking methods combined with modern elements. KTW owns several factories, equipped with modern technologies, and certified according to ISO standards (22000:2005), coming out from the fact that company produces wine from both, eastern and western parts of Georgia, we have wineries, both in Kakheti, the motherlaand of Georgian winemaking, and in West, in Keda, in Adjara Region. Company offers the big diversity of products, starting from ordinary line of wines and continued with Special Premium Collection, that includes the wines made with rare Georgian varieties, and ending with highest quality spirits, that are export leaders on several international markets. Together with wine business the company is actively involved in Wine tourism, KTW is the owner of several wine Cellars in different regions, that are equipped with ancient traditional Georgian wine making vassels, Qvevries, that deserve a great interest among the visitors, as well as modern tasting halls with professional wine experts, that will provide you with all the necessary information about Georgian Wine,indigenous Georgian grape varieties, Georgian culture and History. From 2014, KTW turned into the KTW Holding, that unites wine producing company, HORECA, wine tourism and at last KTWAGRO, that is already successfully launched and will represent the Georgian Jams, Georgian sauces, Bay leaves and other Georgian spices. The main advantage of our company, is all the above mentioned, that all these different fields are united in one holding. KTW holding is the producer of PURE GEORGIAN PRODUCT and SERVICES.

GEOPAY LTD

LTD ,,ORGTEQNIKA-SUKHUMI´

Information and Communication Technologies

Production of souvenirs

Contact information Type of company: Service sector 12a Kazbegi ave. Firosmani str. 15 Field of activity: Services 0160 Tbilisi Georgia

Contact information Gugunava st. #1, Kutaisi 4600 Kutaisi Georgia

Phone: Fax: Email: info@geopaysoft.com Homepage: www.geopaysoft.com Sector of activity Information and Communication Technologies Company profile Company´s main direction is other companies technical and technological support in ecommerce sphere Our services: Providing qualified IT consultations and recommendations Building an online store functionality Hosting, installation, integration with electronic payment systems Support of internetshop connection process with online payment system and appropriate SW design and implementation Providing of high quality and continuous webhosting oriented on internetshop Internetshop followupsupport after integration with online payment system Software development of call center and followupsupport of the system Cooperation proposal Offer: Geopay LTD is interested in long term cooperation and looking for an IT companies or companies which would cooperate with us in IT sphere. We would be glad to cooperate with companies in mutually favorable conditions in order to take participation in any kind of software development and of course would be glad if it would be connected with Ecommerce and online payment systems. Innovative aspects and/or main advantages of the proposal Geopay LTD has built strong partner relationships with leading Banks in Georgia do our best to take active participation in developing Ecommerce sphere in Georgia. We utilize these partnerships to keep our services and knowledge at the highest level, to promote, develop Ecommerce in Georgia and hold leader position in online payments quality SW creation, which allow us to give the proper IT service to our clients for their business advantage.

Type of company: Enterprise Field of activity: Production

Phone: Fax: Email: alu.gamakharia@mail.ru Homepage: Georgia Sector of activity Tourism Company profile The company’s aim is employment of IDPs and vulnerable parts of population, to get income and to use it in order to satisfy social economic interests of founders and staff. The company´s activities specific directions are: Laminate and wooden furniture manufacturing for schools and offices; Production of trash containers, bins, sidewalks, railings and others for cleaning of environment; Construction of small, nontraditional power installations using of renewable energy sources (biogas equipment, water heaters working on solar power, fruit dryer, etc.); Any profitable activity, allowed by the law. Cooperation proposal Manufacturing and sales organizations of ceramic souvenirs and household items made by Perevi unique clay, and other local raw materials (wood, mat, polymer waste, etc.). Arrangement of souvenir shops in Perevi, Sachkhere and Kutaisi. LTD ,,OrgteqnikaSukhumi” needs financial support from the investor´s in the amount of 110 thousand EUR, for the ceramics manufacturer technology equipment (pressure and furnace) and for export of the products.

CMYK

FINANCIAL HEADLINE NEWS & ANALYSIS

FINCHANNEL.COM | 3 NOVEMBER, 2014 NOVEMBER 3, 2014

Tel: 2 999 662 SPECIAL OFFER FROM BUSINESSTRAVELCOM TO

EGYPT!!!

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Band Zarebi SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Band “Wheels”, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band Restaurant “Dzveli Sakhli” 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Restaurant “Bermukha” Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Everyday from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet “Taoba”: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Café “Kala” 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Rezo Kiknadze - saxophonist Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Goblins» (Covers)

Cinema

«Rustaveli» Cinema 5 Rustaveli Ave. Tel: 293-22-53, 2 555-000 «Big Hero» 3D; «Land Mine Goes Click»; «Dracula Untold»; «Gone Girl»; «Annabelle»; «The Boxtrolls» 3D (Ticket Price: 7,50 - 12,50 GEL) «Amirani» Cinema 36 Kostava Str. Tel: 299-99-55 «Big Hero» 3D; «Land Mine Goes Click»; «Dracula Untold»; «Gone Girl»; «Annabelle»; «The Boxtrolls» 3D (Ticket Price: 7,50 - 12,50 GEL)

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Gallery

The exhibition «Istanbul and Poetical Abstractions» by famous Turkish painter Devrim Erbil. Simon Janashia State Museum 3, Rustaveli Ave. Tel: 299-80-22 Museum is working every day except Monday. From 10:00 till 18:00 till - November 21 Solo Exhibition of Barbara Aslamazashvili «Nature Morte» Gallery Vernissage 49, Leselidze str. (49, Kote Apkhazi str.) Phone: 2 998808/ 599 563580 Gallery is open 7 days a week from 12:00 to 19:00 till - November 6 Lado Gudiashvili Exhibition Hall invites you at the solo exhibition – «The island in the exhibition space» by Lali Kutateladze. Lado Gudiashvili Exhibition Hall 11 L. Gudiashvili Str. Tel: 293 23 05 Exhibition Hall is working every day, 11:00 - 18:30 except Mondays and official holidays. Entry: Adults - 5 GEL / People from 6-18 - 3 GEL / Students and pensioners (with ID) - 3 GEL / Admission is free for orphan groups (with proof of status) and for children under 6 till - November 5 Andrey Balanchivadze International trust invites you at the opening of an exhibition «Balanchivadzes». Simon Janashia State Museum 3, Rustaveli Ave. Tel: 299-80-22 Museum is working every day except Monday. From 10:00 till 18:00 till - November 4

NOVEMBER 4, 2014

1 To

Tbilisi From

Day

Almaty

Depart

Arrive

1.2.4.6.7 01:05;13:25;22:20 06:40,19:00;03:50+1

Flight# 4L303

Amsterdam

1.3.6

05;10,07:00

07:55;09:40

A9 651

Athens

1,4

05:15,

07:15

A9 693

Baku

DAILY

02:20,11:10;13:40

04:30;13:20;15:50

J2 224/226

Batumi

DAILY

09:30

10:05

A9 505

Dubai

2.5.6.7

05:30; 07:30

08:55; 10:55

4L301

Doha

DAILY

20:00;14:30

14:30;18:30

QR 254/252

Frankfurt

2.6

15:50

18:10

A9 621

Istanbul

DAILY

04:15;08:25; 11:20

Istanbul

DAILY

04:40; 05:30

05:45; 09:25;12:50 TK 1387/1383 06:00; 06:50

PC 463/451

Istanbul

05:45

07:10

KK 381

Kiev

DAILY

06:50,16:40,19:20

08:20,18:05,20:45

PS 728

Kharkov

11:25

12:40

Z6 708

Minsk

DAILY

03:50

06:00

B2 1736

Munich

DAILY

04:01

06:00

LH 3215

Paris

2.5

16:15

19:15

A9 627

Prague

2.6

04:30

06:20

OK 935

Rome

2,4,5,7

05:00

07:15

AZ 551

Riga

1.3.4.6

05:45

08:25

BT 725

Tel-Aviv

DAILY

07:25,18:30

09:10,20:15

A9 695

Tel-Aviv

1.4.5

01:05,02:35;07:10

02:55,04:25,09:00

IZ418

Vienna

4.7

08:15

09:45

A9 681

Urumqi

2.4.6

22:40

07:30+1

CZ 6040

Warsaw

DAILY

04:45

06:25

LO 724

Days=( 1-Monday, 2-Tuesday, 3-Wedsday, 4-Thursday, 5-Friday, 6-Saturday, 7-Sunday. )

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Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Band «Wheels», DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Everyday from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Maia Kankava Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Goblins» (Covers)

Cinema

US Business in Georgia 2 1

Akhmeteli Theatre 8 Vekua Str. Tel: 262-54-37, 262-59-73, 262-61-97 Navigator K. Gamsakhurdia State Sokhumi Drama Theatre Director: David Sakvarelidze Cast: Lili Khuriti, Badri Begalishvili, Giorgi Gasviani, Nana Khuriti, Edem Khvichia, Nikoloz Tserediani, David Beradze, Besarion Karchava, Izolda Bokuchava Duration: 70 minutes Date: November 4 Time: 19:00 Price: 7 GEL

Gallery

NOVEMBER 5, 2014

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Band Zarebi SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Band «Wheels», DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band MacLaren’s Irish Pub 5 Rkinis Rigi (Chardin) Mob: 599 57 85 49 21:30 - Enjoy a unique ambiance of 60s-70s hits and improvisations by David Gabidzashvili and David Barnabishvili. Great mood is guaranteed! Spend evening at the warmest pub in the city! Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian Dances Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Everyday from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Live Band Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «The Jumping General»

Cinema

Theatre Rustaveli Theatre 17, Rustaveli Ave. Tel: 272-68-68 Host and Guest Director: Valerian Gorgoshadze Cast: Bacho Chachibaia, Manana Abramishvili, Ia Sukhitashvili, Levan Khurtsia, Gela Lezhava Duration: 135 minutes Date: November 5 Hall: Small Stage Time: 19:00 Price: 8, 10 GEL Marjanishvili Theatre 8 Marjanishvili Str. Tel: 2 955-966 University of Laugh Director: Levan Tsuladze Cast: Nato Murvanidze, Nika Kuchava Duration: 105 minutes Date: November 5 Hall: Big Stage Time: 20:00 Price: 11 GEL Marjanishvili Theatre (New Stage) 5 Marjanishvili Str. Tel: 2 955-966 Recipe of Inspiration Director: Nino Akhvlediani Cast: Ketevan Tskhakaia, Manana Kozakova, Davit Khurtsilava Duration: 95 minutes Date: November 5 Time: 20:00 Price: 14 GEL Liberty Theatre 2 Rustaveli Ave. Tel: 298-58-21 So what if wet lilac is wet Director: Gogi Todadze Cast: Giorgi Bakhutashvili, Otar Lortkipanidze, Nikoloz Paikridze, Medea Jibladze, Tamar Tavkhelidze, Tamar Aznarashvili, Mariam Karkashadze, David Kolelishvili Date: November 5 Time: 19:00 Price: 6, 9, 11 GEL

Gallery

Theatre Marjanishvili Theatre 8 Marjanishvili Str. Tel: 2 955-966 The ART Director: Temur Chkheidze Cast: Zura Kipshidze, Mikheil Gomiashvili, Aleko Makharoblishvili Duration: 105 minutes Date: November 4 Hall: Big Stage Time: 20:00 Price: 4 - 10.50 GEL Marjanishvili Theatre (New Stage) 5 Marjanishvili Str. Tel: 2 955-966 Doubt Director: Guram Vashakidze Cast: Nani Chikvinidze, Zviad Skhirtladze, Nino Tsuladze, Nino Dumbadze Date: November 4 Time: 20:00 Price: 14 GEL Liberty Theatre 2 Rustaveli Ave. Tel: 298-58-21 Jeans Generation Director: Davit Doiashvili Cast: Marina Janashia, Nana Darchiashvili, Goga Chkheidze, Dima Merabishvili, Merab Kolbaia, Lela Metreveli, Jaba Kiladze, Mariam Nadiradze, Apolon Kublashvili, Sandro Margalitashvili Duration: 165 minutes Date: November 4 Time: 19:00 Price: 6, 12, 14 GEL

Solo Exhibition of Barbara Aslamazashvili «Nature Morte» Gallery Vernissage 49, Leselidze str. (49, Kote Apkhazi str.) Phone: 2 998808/ 599 563580 Gallery is open 7 days a week from 12:00 to 19:00 till - November 6 Lado Gudiashvili Exhibition Hall invites you at the solo exhibition – «The island in the exhibition space» by Lali Kutateladze. Lado Gudiashvili Exhibition Hall 11 L. Gudiashvili Str. Tel: 293 23 05 Exhibition Hall is working every day, 11:00 - 18:30 except Mondays and official holidays. Entry: Adults - 5 GEL / People from 6-18 - 3 GEL / Students and pensioners (with ID) - 3 GEL / Admission is free for orphan groups (with proof of status) and for children under 6 till - November 5 The exhibition «Istanbul and Poetical Abstractions» by famous Turkish painter Devrim Erbil. Simon Janashia State Museum 3, Rustaveli Ave. Tel: 299-80-22 Museum is working every day except Monday. From 10:00 till 18:00 till - November 21

NOVEMBER 6, 2014

Cinema

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Band «Band’a’roll», DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band MacLaren’s Irish Pub 5 Rkinis Rigi (Chardin) Mob: 599 57 85 49 21:30 - Enjoy a unique ambiance of 60s-70s hits and improvisations by David Gabidzashvili and David Barnabishvili. Great mood is guaranteed! Spend evening at the warmest pub in the city! Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Everyday from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Guliko Chanturia Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Good Company»

Cinema

Theatre Rustaveli Theatre 17, Rustaveli Ave. Tel: 272-68-68 First Love Director: Nikoloz Heine-Shvelidze Cast: Levan Berikashvili, Zviad Papuashvili, Keti Khitiri Duration: 75 minutes Date: November 6 Hall: Experimental Stage Time: 19:00 Price: 6, 8 GEL Marjanishvili Theatre 8 Marjanishvili Str. Tel: 2 955-966 The Gronholm Method Director: Temur Chkheidze Cast: Eka Chkheidze, Nika Tavadze, Apolon Kublashvili, Aleko Makharoblishvili Duration: 110 minutes Date: November 6 Hall: Big Stage Time: 20:00 Price: 6 - 16 GEL Marjanishvili Theatre (New Stage) 5 Marjanishvili Str. Tel: 2 955-966 Tartuffe Director: Levan Tsuladze Cast: Nika Kuchava, Zviad Skhirtladze. Manana Kozakova, Barbare Dvalishvili, Tamar Bukhnikashvili, Zaza Iakashvili Duration: 140 minutes Date: November 6 Time: 20:00 Price: 14 GEL Liberty Theatre 2 Rustaveli Ave. Tel: 298-58-21 Flaming Lover Director: Tiko Katamashvili Cast: Salome Chulikhadze, Maraiam Nadiradze, Tiko Kordzadze Date: November 6 Time: 19:00 Price: 6, 9, 11 GEL V. Abashidze State Music and Drama Theatre 182 Agmashenebeli Ave. Tel: 234-80-90 Games in the Backyard Director: Manana Berikashvili Cast: Nana Butkhuzi, Ana Aleksishvili, Giorgi Vardosanidze, Sandro Davitashvili, Tornike Gogrichiani, Kakha Kincurashviili Duration: 75 minutes Date: November 6 Time: 19:00 Price: 8, 10 GEL Iliauni Theatre 32, I. Chavchavadze Ave. Tel: 229-47-15 The Cheaters Director: Rusudan Kobiashvili Cast: Lasha Ambidze, George Makharadze, George Chumburidze, David Davituliani, Temur Kvaratskhelia, Annie Talakvadze, Salome Mikadze, Marekh Kvizhinadze Duration: 130 minutes Date: November 6 Time: 20:00 Price: 7 GEL

Gallery

Solo Exhibition of Barbara Aslamazashvili «Nature Morte» Gallery Vernissage 49, Leselidze str. (49, Kote Apkhazi str.) Phone: 2 998808/ 599 563580 Gallery is open 7 days a week from 12:00 to 19:00 till - November 6 The exhibition «Istanbul and Poetical Abstractions» by famous Turkish painter Devrim Erbil. Simon Janashia State Museum 3, Rustaveli Ave. Tel: 299-80-22 Museum is working every day except Monday. From 10:00 till 18:00 till - November 21

NOVEMBER 7, 2014

Gallery

Theatre Rustaveli Theatre 17, Rustaveli Ave. Tel: 272-68-68 Soldier, Love, Bodyguard and... the President Director: Robert Sturua Cast: Nino Arsenishvili, Goga Barbakadze, Paata Guliashvili, Beso Zanguri, Nino TarkhanMouravi, Gagi Svanidze, Ia Sukhitashvili, Nika Katsaridze Duration: 170 minutes Date: November 7 Hall: Grand Stage Time: 19:00 Price: 6 - 12 GEL Marjanishvili Theatre (New Stage) 5 Marjanishvili Str. Tel: 2 955-966 Drunk Cherry Autor and Director: Levan Tsuladze, Alexander Eloshvili Cast: Eka Chkheidze, Malkhaz Abuladze, Manana Kozakova, Barbare Dvalishvili, Dato Khurtsilava, Keti Tskhakaia, Onise Oniani Date: November 7 Time: 20:00 Price: 14 GEL V. Abashidze State Music and Drama Theatre 182 Agmashenebeli Ave. Tel: 234-80-90 Games in the Backyard Director: Manana Berikashvili Cast: Nana Butkhuzi, Ana Aleksishvili, Giorgi Vardosanidze, Sandro Davitashvili, Tornike Gogrichiani, Kakha Kincurashviili Duration: 75 minutes Date: November 7 Time: 19:00 Price: 8, 10 GEL Iliauni Theatre 32, I. Chavchavadze Ave. Tel: 229-47-15 Eurydice Director: Otar Egadze, Milene Egiazarova Cast: Andrea Vachridze, Merab Chkheidze, Levan Mamniashvili, David Gigolashvili, Tatia Gabedava, Annie Talakvadze, Salome Mikadze, Zurab Gabunia Duration: 155 minutes Date: November 7 Time: 20:00 Price: 7 GEL Gabriadze Theatre 13, Shavteli Str. Tel: 790 98-65-91, 29865-90 The Battle of Stalingrad Marionette Theatre Author and Director: Rezo Gabriadze In Russian +10 years Date: November 7 Time: 20:00 Price: 10, 15, 20 GEL

Gallery

NOVEMBER 8, 2014

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Zarebi SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Veriko Turashvili & Live Band, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band & Nata Kurdovanidze; DJ Vako MacLaren’s Irish Pub 5 Rkinis Rigi (Chardin) Mob: 599 57 85 49 21:30 - Enjoy a unique ambiance of 60s-70s hits and improvisations by David Gabidzashvili and David Barnabishvili. Great mood is guaranteed! Spend evening at the warmest pub in the city! Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Every day from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian Dances Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Keti Paresashvili Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Rustavi 2» (Covers)

Cinema

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Agora Live Band, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band & Maka Durglishvili; DJ Paata MacLaren’s Irish Pub 5 Rkinis Rigi (Chardin) Mob: 599 57 85 49 21:30 - Enjoy a unique ambiance of 60s-70s hits and improvisations by David Gabidzashvili and David Barnabishvili. Great mood is guaranteed! Spend evening at the warmest pub in the city! Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Every day from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian Dances Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Maia Baratashvili Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Rustavi 2» (Covers)

Griboedov Theatre 2 Rustaveli Ave. Tel: 293-11-06 Casting Director: Nika Kvizhinadze Cast: Irina Kvizhinadze Date: November 8 Time: 18:00 Price: 5 GEL Gabriadze Theatre 13, Shavteli Str. Tel: 790 98-65-91, 29865-90 Ramona Playwright, Director, Set-Designer, PuppetDesigner - Rezo Gabriadze Puppets, Set and Props - Luka Gonashvili, Viktor Platonov, Aleksander Kheimanovski, Gela Jangirashvili, Aleksandra Luniakov, Svetlana Pavlov, Giorgi Giorgobiani, Levan Kiknavelidze, Artem Ozerov, Avtandil Gonashvili, Tamar Chalauri, Tamar Kobakhidze, Nana Chezghia Duration: 90 minutes Date: November 8 Time: 20:00 Price: 10, 15, 20 GEL

NOVEMBER 9, 2014

Clubs, Pubs…

Pub Nali 4/1 Kiacheli St. Tel: 243 04 20 21:00-00:30 - Nali Band SkyyBar 22 Metekhi Str. Mob: 592 32-32-32 21:00 - Agora Live Band, DJ Datuna City Time Leonidze/Machabeli Str. 1/6; Tel: 292 02 12 20:00-24:00 - Live Band & Maka Durglishvili; Karaoke, DJ Vako Restaurant «Bermukha» Agmashenebeli lane 13th km. Tel: 259 69 69; Mob: 598 59 69 69 Every day from 17:00 restaurant Bermukha is awaiting you with renovated hall and colorful show program. Music program starts from 19:00: Dato Archvadze’s quartet «Taoba»: Georgian folk and city songs. Estrada singers: Giorgi Tsiklauri, Nina Okroashvili, Giorgi Kakutia Restaurant «Dzveli Sakhli» 3, Sanapiro Str. Tel: 2 365-365 20:00-23:00 - Georgian songs with live performance Café «Kala» 8/10 Erekle II Str. Mob: 599 79-97-37 21:00 - Live Band Pub «Dublin» 8 Akhvlediani Str, Tel: 298-44-67 21:00-24:00 - Band «Rustavi 2» (Covers)

Cinema

Theatre Rustaveli Theatre 17, Rustaveli Ave. Tel: 272-68-68 Electra Director: Nikoloz Haine-Shvelidze Cast: David Gotsiridze, Beso Zanguri, Tamta Inashvili, Nino Kasradze, Irakli Macharashvili, Eka Molodinashvili, Gagi Svanidze, Lasha Jukharashvili Date: November 9 Hall: Grand Stage Time: 19:00 Price: 6, 8, 10, 12, 15, 20 GEL Marjanishvili Theatre 8 Marjanishvili Str. Tel: 2 955-966 Women Director: Tsitsino Kobiashvili Cast: Nino Zautashvili, Nino Dumbadze, Keti Chkheidze, Keti Gegeshidze, Irma Berianidze, Eka Mjavanadze, Zaza Goguadze, Temo Kiladze Duration: 130 minutes Date: November 9 Hall: Big Stage Time: 20:00 Price: 4 - 10.50 GEL Iliauni Theatre 32, I. Chavchavadze Ave. Tel: 229-47-15 The Cheaters Director: Rusudan Kobiashvili Cast: Lasha Ambidze, George Makharadze, George Chumburidze, David Davituliani, Temur Kvaratskhelia, Annie Talakvadze, Salome Mikadze, Marekh Kvizhinadze Duration: 130 minutes Date: November 9 Time: 20:00 Price: 7 GEL Royal District Theatre 10 Abesadze Str. Tel: 299-61-71 Streap-Tease Director: Nika Tavadze Cast: Paata Inauri, Data Tavadze Duration: 70 minutes Date: November 9 Time: 20:00 Price: 10 GEL V. Abashidze State Music and Drama Theatre 182 Agmashenebeli Ave. Tel: 234-80-90 The Lower Depths Directed by David Doiashvili Cast: Zaal Chikobava, Nana Butkhuzi, Ana Tsereleli, Tato Chakhunashvili, Tornike Gigrichiani, Aleksandre Begalishvili, Buba Gogorishvili, Nanka Kalatozishvili, Eka Demetradze, Shako Mirianashvili, Archil Sologhashvili, David Beshitaishvili Duration: 135 minutes Date: November 9 Time: 19:00 Price: 8, 10 GEL Griboedov Theatre 2 Rustaveli Ave. Tel: 293-11-06 Morozko Director: Linda Ubronavichute Cast: Mikhail Arjevanidze, Nina Ninidze, Mikhail Ambrosov, Medea Mumladze, Ivan Kurasbediani, Valentina Voinova Date: November 9 Time: 12:00 Price: 5 GEL Akhmeteli Theatre 8 Vekua Str. Tel: 262-54-37, 262-59-73, 262-61-97 Rapunzel Director: Lasha Gogniashvili Cast: Sophia Sebiskveradze, Giorgi Migriauli, Giorgi Chumburidze, Gvantsa Kandelaki, Tamta Patashuri, Jaba Japaridze Duration: 60 minutes Date: November 9 Time: 14:00 16:00 Price: 7, 10 GEL Gabriadze Theatre 13, Shavteli Str. Tel: 790 98-65-91, 29865-90 Autumn of my Springtime Marionette Theatre Author and Director: Rezo Gabriadze +10 years Date: November 9 Time: 20:00 Price: 10, 15, 20 GEL

Gallery

For more information, please, visit the following website: www. info-tbilisi.com E-mail: afisha@infotbilisi.com

CMYK

HEADLINE NEWS & ANALYSIS

US Business in Georgia

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FINANCIAL

3 NOVEMBER, 2014 | FINCHANNEL.COM

December

The FINANCIAL Special Edition focused on CSR Supported by UN Global Compact Initiantive in Georgia Phone: (995 32) 2252 275, Ext: 1 Direct call: (995 577) 74 17 00 ( PDLO PDUNHWLQJ#他QFKDQQHO FRP

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FINANCIAL HEADLINE NEWS & ANALYSIS

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US Business in Georgia SANCHO

LITERATURULI CAFÉ

4, Besiki Str. Tel: 2 519 966

23, Akhvlediani Str. Tel: 298 25 98

Hangar Bar

QUEUE

2, Tarkhnishvili Str. Tel: 244 45 46 31, Pekini Str. Tel: 231 30 57 22, Abashidze Str. Tel: 222 02 76 36, Kostava Str. Tel: 299 07 46

TSISKVILI

PREGO 10, Paliashvili Str. Tel: 225 22 58

#1 Freedom squ. Tel: 2 240 241

Red Café Bistro & Cafe

15, Erekle II. Tel: 293 14 11 # 71 Vazhaphavela Ave. Tel: 2201 211 info@redcafe.ge

25, Tarkhnishvili Str. Tel: 225 25 16 # 20 Shavteli Str. Tel: 293 10 80

Beliashvili Str. Tel: 253 07 97

Belle Ville

BUFFALO BILL

French - European barrestaurant Pleasant and cozy atmosphere High quality service, live music every day 26, l.Kiacheli Str. Tel: 293 65 53

Espresso Bar “RESPUBLIKA”

16, Marjanishvili Str. Tel: 555 003151 www.facebook.com/RespublikaEspressoBar

2, MarjaniSvili Str. Tel: 2 999 723

Book Corner

37, Kostava Str. Tel: 298 37 67 16, Akhvlediani Str. Tel: 293 60 52

PICASSO

4, Vashlovani Str. Tel: 298 90 86

24/

SIANG-GAN

41, Gamsakhurdia Str. Tel: 237 96 88

Prospero’s Books

34, Rustaveli Ave. Tel: (+995 32) 2923 592

VERA STEAKHOUSE

Better seen than heard

DISCOVERY

3 Vashlovani Str.; (“Super Babilon” oposit) Tel.: 298 90 86

13b, Tarkhnishvili Str. Tel: 223 24 30 contact@bookcorner.ge

40, Chavchavadze Ave. Tel: 229 42 30

For advertising please contact:

Entree 13 Taktakishvili Str. 20 Rustaveli Ave. 19 Petriashvili Str. 7 Pekini Str. 78 Chavchavadze Ave. (Bagebi) 86 Aghmashenebeli ave.

577 741 700 marketing@finchannel.com

Hotel Divan Suites Batumi No 8/15 Zhordania/Z. Gamsakhurdia Str. 6000 Batumi, Georgia Tel:+ 995 422 25 55 22 Fax:+ 995 422 22 86 85 info.batumi@divan.com.tr www.divan.com.tr

Tel.: 599 21 53 83

ENGLISH TEE HOUSE

5, Marjanishvili Str. Tel: 294 16 20 32, Paliashvili Str. Tel: 222 11 09

CAFE CINEMA

Addr: 3 Vekua Street. (Trade Center GTC) Tel.: 2 93 61 38

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

BUSINESSTRAVELCOM HOTEL AND AIRTICKET BOOKING: 2 999 662 | SKY.GE

CMYK

US Business in Georgia

HEADLINE NEWS & ANALYSIS

FINANCIAL

3 NOVEMBER, 2014 | FINCHANNEL.COM

Advertiser: Alliance Group Capital. Contact FINANCIAL Ad Dep at marketing@finchannel.com