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BUSINESS WEEK August 4, 2014 #65

August 4, 2014, Issue 65

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caucasian1 Government will Issue 5 000 GEL to Citizens for Founding Micro Enterprises Rakia and Co-Investment Fund work together on the enterprise establishment project Pg. 5

BE INFORMED, DO BUSINESS

GEORGIA KOHL&PARTNER INTRODUCE TSKALTUBO SPA RESORT DEVELOPMENT MODELS

PASHA BANK - GENERAL SPONSOR OF INTERNATIONAL CHESS FESTIVAL

CIS EUROPEAN BUSINESS LOBBY WARNS NEW RUSSIAN SANCTIONS WILL HIT UKRAINE AND EU

he Moscow-based Association of European Businesses , which represents more than 600 European companies working in Russia, said on Wednesday it “deeply regrets” the new sanctions. Pg. 10

AZERBAIJAN AZAL TO CARRY OUT REGULAR DIRECT FLIGHTS TO BISHKEK

zerbaijan Airlines, the biggest Azerbaijani airline and national flag carrier, will perform regular direct flights to Kyrgyzstan’s capital starting from October 26. Pg. 11

WORLD NEWS INDIA SLAMS DOOR ON $1TN WTO DEAL OVER CUSTOMS RULES

he World Trade Organization got a surprise setback on Thursday when India, pushing for concessions on agricultural stockpiling, vetoed plans for universal customs rules. Pg. 13

RATING OF COMMERCIAL BANKS IN TERMS OF TOTAL ASSETS, STOCK CAPITAL, TOTAL LOANS, TERM DEPOSITS, NET PROFITS AND RESERVES ON AVAILABLE LOSSES

or example, in the reporting period Bank of Georgia’s total assets grew to 900 million GEL, while TBC Bank’s total assets increased by over 350 million GEL year on year. According to the no. 145 decree of the President of the National Bank of Georgia (NBG) on determination of financial transparency regulations, Georgia-based commercial banks are to publish quarter financial reports. Thus, commercial banks have published 2Q14 financial report (30.06.2014). We have found it interesting to introduce rating of commercial banks due to several basic indicators that give comprehensive information on both the bank sector and the operation and development tendencies of this or that separate commercial bank. The last issue of the Banks&Finances newspaper has published a quarter financial report for 15 commercial banks out of 21 banks. The previous issue had published a report for three commercial banks. In the current issue we are introducing a rating of commercial banks due to total assets, stock capital, total loans, terms deposits, net profits and reserves on available losses for all commercial banks in Georgia. It is worth noting total assets of commercial banks have considerably increased compared to the same period of 2013. Consequently, the growth tendency was registered for total assets and term deposits. Net profits of commercial banks have also risen. Pg. 9

Pg. 2

WILL VTB BANK CARDS WORK ABROAD? The USA Sets Sanctions against VTB and SberBank FREE TRADE REGIME SUSPENSION WITH RUSSIAN WILL NOT DESTROY GEORGIAN Pg. 2 ECONOMY

Pg. 5

Tbilvino Founders Find Russia’s Decision Expectable Pg. 5

Today, we are working on our wagon production to reduce energy use and to make more high speed trains We decided to invest here because we are absolutely sure that Georgia will stay stable Pg. 4

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MAIN EVENTS caucasian business week

August 4, 2014 #65

WILL VTB BANK CARDS WORK ABROAD? The USA Sets Sanctions against VTB and SberBank

FREE TRADE REGIME SUSPENSION WITH RUSSIAN WILL NOT DESTROY GEORGIAN ECONOMY

he Georgian Presidential Advisor for Economic Affairs, Giorgi Abashishvili, has recently met with representatives of the country’s small business. “The issue of signing a comprehensive free trade zone agreement with the EU was the main topic of discussion during the meeting,” Abashishvili told media on August 1. “The promotion of Georgian products, as well as Russia’s reactions was among other issues which were discussed in the meeting,” he added. Abashishvili further said Russia’s suspension of free trade agreement with Georgia will not greatly damage the Georgian economy. “It is very difficult to find the economic motives behind Russia’s decision, as the Free Trade Agreement with the EU poses no threat to the Russian market,” he said. “It is necessary to stress that this means the transition to a tariff regime, rather than a ban on trade. We, like other countries, will continue trading with Russia, but not in the free trade regime. Unlike past years, today the export structure of Georgia is significantly diversified. Thus, the reduction of trade turnover with Russia will not greatly damage our economy,” he noted. Introducing the tariffs can lead to a rise in the price of Georgian products in the Russian market, Abashishvili added. Earlier, the Russian Ministry of Economy and Development worked out the government’s draft decree on suspending the free trade agreement between Russia and Georgia. The relevant document is available on the single legal information portal, RIA Novosti reported. The suspension of the free trade agreement with Georgia was coordinated with Russian relevant Ministries - Foreign Ministry, the Ministry of Economic Development and the Ministry of Justice - according to the draft decree. The agreement was signed on February 3, 1994. The Russian Federation Economy Ministry has developed a government draft resolution on suspension of free trade agreement with Georgia. The Russia’s decision to change the economy

policy with Georgia was driven by the Georgia’s July 18, 2014 move for ratifying a Deep and Comprehensive Free Trade Area Agreement (DCFTA) with the European Union (EU) and by other geopolitical developments. According to the January to June 2014 report, Russia is recorded as Georgia’s third partner country in terms of exports volume (9%) and sixth partner country in terms of imports volume (5.7%). In the reporting period, Georgia’s exports to the Russian Federation marked 134 million USD (37% .in total trade with Russia) and the imports equaled 229 million USD. Georgia’s major exports items for the Russian market in May 2014 are as follows: water (33%), wines (28%), electricity (11.9%), iron/steel (10.1%) and ferroalloys (4%). Georgia’s major imports product from Russia is grain (18%). Growth in prices on Russian products will not be considerable, because the main imports products grain is taxed by a 0% rate, under the Georgian legislation. The Russia’s decision to suspend a free trade agreement with Georgia will result in upturn in prices on Georgian products on the Russian market. For example, mineral water tariff on the Russian market is 15%, wines – 5%-15%-20% due to varieties, food products – 19.9%, beef – 25%, vegetables – 5%-15%, fruits – 5%-10%, iron and steel – 5%, ferroalloys – 5%. According to the foreign trade statistics, the ratio of Georgia’s trade with the Russian Federation in Georgia’s total turnover is 9% of exports. Thus, the suspension of the free trade agreement will somehow affect on the Georgian economy, but this will not be very painful as it would be in case of embargo that was introduced in 2006. The decision will also raise prices on Georgia’s exports products and the demand will be supposedly fall on them in Russia. In this situation, exporter companies should maximally diversify exports markets and shift focus from the Russian market. To this end, they should follow the DCFTA agreement and occupy their niche timely and in larger volumes on European markets.

KOHL&PARTNER INTRODUCE TSKALTUBO SPA RESORT DEVELOPMENT MODELS

ohl & Partner presented possible development models of Tskaltubo spa Partnership fund and its consultant Swiss company Kohl & Partner organized 3-day workshop on the development capacities of Tskaltubo resort zone. Discussion was organized on the models presented by the representatives of Swiss company - Andrei Grib and Martin Shmidl. Kohl & Partner informs that opinions and recommendations shared on the workshop will be reflected in the final concept. Representatives of Partnership Fund, World Bank, Municipal Development Bank, National Tourism Administration and local tourism asso-

s it is known, the U.S. and EU announced sanctions against several Russian state banks, among them “VTB Bank”, which has a branch in Georgia. Whether sanctions will have an impact on the Georgian representation? At this stage, the representatives of “VTB-Georgia” do not make any comments about it. Georgian experts have expressed their assumptions about it. According to the expert Roman Gotsiridze, any complications cannot be expected in the short term. “In the short term,”VTB Georgia” is unlikely to be affected. I mean 1-2 years. But over time, if the sanctions continue, or even are further tightened, of course, there will be problems. The bank will have to seek new sources of funding, review the portfolio. Furthermore, it is unclear whether the Georgian branch will receive financial assistance from the central office, as because of their problems, the central bank’s management might have no time for the Georgian branch. In any case, I see no prospects of development of the bank until the sanctions are in force, “- said the expert. According to Director of the “First Credit Union”

Givi Korinteli, it is difficult to predict what will happen in the future. It is possible that statements about sanctions will be only political, and there will be no real consequences. We should not expect that because of the current situation, the central office of the bank will decide to close the branches, as these banks are very active and successful. And it is very important to understand what sanctions exactly include. The banking sector is a complex business. a ban can be imposed, but a possibility to find some loopholes still remains. In the long term, we cannot predict anything in this regard, although it is clear that if the sanctions continue for several years, thennot only “VTB” will suffer but the entire Russian banking system. The NGO “Society and banks” believes that sanctions against VTB will not affect the Georgian clients, as the Georgian branch has enough equity, moreover, “VTB Georgia” is an independent financial and legal entity. “At this stage, the bank’s customers have no reason to panic. They can easily cooperate with the bank. Though, of course, over time sanctions will have some impact, “- the organization states.

FINANCE MINISTER EXPECTS ADDITIONAL 15-20 MILLION GEL FROM RUSSIAN IMPORTS TAXATION

inister of Finance Nodar Khaduri stated that we’re transferring to the same trade regime with Russia, in which we trade with EU, China and many other countries. As Minsiter of Finance stated to the journalists after the Friday session of the government, according to government’s calculations, taxation of our products in Russia should not cause significant price increase on these products and considerable reduction of the export. The products imported from Russia will also be subject of the custom tax. In total, according to Khaduri’s calculations, budget of Georgia will

additionally get 15-20 million GEL. “It’s clear that Russia decided to leave free trade regime and it’s not good. Meanwhile I should say that it’s not a tragedy”, - Nodar Khaduri stated. It’s noteworthy that in January-June of the current year products of $229,715 million were imported from Russia to Georgia. Deputy Minister of Economy and Sustainable Development Mikheil Janelidze stated that, in the case of fulfillment of the initiative, Russia will be able to establish tariff of 20%. Considering import in January-June and maximal tariff, Georgia would have received customs incomes of $45.943 million in 6 months.

S7 AND URAL AIRLINES ASKED FOR PERMISSION FOR REGULAR FLIGHTS

ir companies S7 and Ural Airlines applied to Russian Federation for the permission of regular flights to Georgia. Information about it is published on the official website of Air Transport Agency of Russian Federation (RosAviation). Currently there are direct regular flights between

Georgia and Russia. The countries have charter flights provided by Ural Airlines and S7. As it’s known, UTair and Aeroflot have also applied for the regular flights in Tbilisi. RosAviation stated to Interfax that these air companies received permission last week, but they will be able to start flights only after responsive Note from Ministry of Foreign Affairs of Georgia.

TELASI ELECTRICITY CONSUMPTION GROWS BY 7% YEAR ON YEAR

ciation, specialists from urbanity, architects and European spa resorts participated in the workshop. Reminding that partnership Fund started working on the development concept of Tskaltubo resort in May. They hired Kohl and Partner to study resort capacities. The research includes technical-economic analysis, development of the actives belonging to the state, technical research of the natural actives, settlement of the resort complex and infrastructural renovation plan. The research will be completed in several months. By the fall Partnership Fund will have prepared development concept for Tskaltubo resort zone.

BUSINESS WEEK caucasian

The Editorial Board Follows Press Freedom Principles Publisher: LLC Caucasian Business Week - CBW DISTRIBUTED FREE OF CHARGE Director: Levan Beglarishvili Mobile phone: 591 013936; 577965577 Commercial Department: Irakli Lekvinadze Email: caucasianbusiness@gmail.com WWW.CBW.GE

ompany Telasi published operational data of the first half of 2014. In the first half of the year Telasi consumed electricity of 1 billion 100,85 million KW/hours, which is 7% (72,6 million KW/hours) more than amount consumed in the first half 2014 (1 billion 28,21 million KW/hours). Economic growth and increased number of the consumers caused increase of electricity consumption. Compared to January-June 2013, in the same period of 2014 amount of the electricity consumed by the subscribers increased by 8% (79,47% million KW/hours) and equaled to 1 billion 47,55 million KW/hours. The data increase was mainly caused by reduction of loss. In 6 months 2014 number of Telasi subscribers

increased by 3,3% (17 thousand) in comparison with the same period 2013 and equaled to 532,5 thousand subscribers, out of which 484,1 thousand are individuals, 48,5 thousand - legal entities. According to data of 6 months of 2014, total length of the company’s electro transmission lines equaled to 4 443 km, which is 4,8% (204km) more than in the same period 2013 (4 239km). Total length of the electricity lines increased because of the network development, increased number of subscribers and reconstruction-modernization works. Telasi is one of the largest companies in Georgia in energy distribution, which distributes electricity in Tbilisi. In August 2003 Telasi became part of Inter-Rao. Inter-Raw owns 75% of the Telasi stocks, 25% belongs to government of Georgia.

The weekly is distributed to top companies, banks, embassies, state sector, Tbilisi and Batumi hotels, Tbilisi, Batumi and Kutaisi Airports, as well as in the town of Marneuli. The newspaper will also penetrate Azerbaijan in the near future

PUBLICITY August 4, 2014 #65

caucasian business week

INTERVIEW August 4, 2014 #65

caucasian business week

BADRI TSILOSANI - TODAY, WE ARE WORKING ON OUR WAGON PRODUCTION TO REDUCE ENERGY USE AND TO MAKE MORE HIGH SPEED TRAINS BADRI TSILOSANI - Owner of Georgian Carriage Builders Holding Georgian Carriage Builders produces freight and passenger train carriages and wagons for the domestic and the international market. The company’s owner, Badri Tsilosani, spoke to The Report Company about the company’s history and current activities.

- Can you provide an overview of the main activities of the company and its history so far? - The company is 130 years old. It was established in 1883. We renovate and build all types of freight vans and passenger trains, as well as locomotives. Our clients are not only Georgian Railway but all the railways of the post-Soviet Union countries; Azerbaijan, Russia, Ukraine, Turkmenistan, Armenia, the entire region. Although railway wagons tend to be government infrastructure we also have private clients including logistics companies. Approximately 70 percent of the wagon price consists of the metal detailing, and we were importing this detailing from places like Ukraine, India, China and Russia but we have recently decided to create a casting production line so the scrap we have is recycled.

- How would you appraise the company’s performance up to now and what are your current plans for expansion? - During the time of the Soviet Union, this factory was government property. After I graduated from university I came to work here, and moved on to become the director of the company after working as an engineer, in construction and in financial auditing. When the Soviet Union collapsed all the factories were privatised. I bought some shares. When it was the property of the Soviet Union, this factory did very well because all the orders of the materials, everything, from Russia were coming to use but after the collapse of the Soviet Union the factory was in bankruptcy because we had no orders and no materials, nothing. We had to rebuild it. Until 2003-2004, it was difficult to do business in Georgia. Everything was ruined. There was no bank system, no infrastructure and no communications. But especially during the past three or four years we have had growth. As a result we have been producing new models of wagons and we’re currently working on additional types of wagons. We have a great project; we are beginning to produce ISO-standard 20- and 40-feet containers. We are also making machinery for agriculture and the wine industry. Today, we are working on our wagon production to reduce energy use and to make more high speed trains. While in the past we worked to Soviet and then Russian standards, we are now moving more towards Eu-

ropean standards. European standards are higher especially in environmental terms. Ever since the new prime minister came into power, the business environment has been very good in Georgia. - What sort of investment did you have to make to rebuild the business? - We spent more than US$10 million to make the machinery production lines. All the engineering staff to be re-certified and the buildings had to be renovated. We built two factories approximately five years ago from nothing. This involved many millions of dollars of investment. - Are you looking more to European markets for export? - Yes. We have great desire to move more to the European markets. We are working with Italian, Bulgarian and German partners. - Is the railway business growing? - The railway business is growing in our region. We intend to make more profitable products. For example, we want to make flat wagons that will carry containers, which are more profitable from the point of view of logistics. Geographically our country is a transit country and all countries transport cargo through our country so we have to make the infrastructure to facilitate this. If there are no wagons this cargo cannot cross Georgia. - What is the advantage of rail transport versus other modes of transport? - In the post-Soviet Union countries, rail transport is very popular because of its safety and its lower environmental impact. There are good

trends around railway transport. - What makes Georgia attractive to foreign investors? - Geographically we are between Asia and Europe. We are a transit country. In the past few years our government has put in place a good tax regime and we now have lower taxes than in Europe. Georgia is not very intensively invested so it’s a new market and it will be very interesting for investors to explore our country. We are also the oldest nation in the world and our aim is to move to Europe because our beginnings come from Europe. We believe we are not Asian people. - What are your plans and outlook for the future? - We have a five-year plan and it consists of more modification of the wagon business. We will produce agricultural machinery, and we are in negotiations with Turkish partners about making a lift production line. We are working to develop more capacity here because the aim is to make all of our production processes 100 percent Georgian. We are also in negotiations with European, especially Italian, companies to do some production here because we have a low cost labour force and a tax advantage so Georgia can be a base to export to Europe. We intend to increase production capacity by 10 percent, which is a lofty aim for us. We have 2,200 people here and we intend to double that number. We think we will double our tax contribution to Georgia within the next two to three years. the-report.net

MICHAEL HAMPEL - WE DECIDED TO INVEST HERE BECAUSE WE ARE ABSOLUTELY SURE THAT GEORGIA WILL STAY STABLE MICHAEL HAMPEL - General director of HeidelbergCement Georgia German multinational building materials company HeidelbergCement has been in the Georgian market since 2006. Today, it operates four cement plants and one cement terminal in the country. Given Georgia’s economic growth and large investments in infrastructural projects, the company expects a significant increase in cement consumption. Michael Hampel, HeidelbergCement Georgia’s general director, spoke to The Report Company about why the future looks bright for Georgia.

- What made Heidelberg Cement decide to invest in Georgia? - Cement is a real long-term business, where you invest a lot of money and don’t see returns until at least ten years later. You can never predict what will happen in any country of the world in ten years, so this is an entrepreneurial risk. However, when we make our investment decisions, from the beginning we have to have a feeling that a country is safe and secure and that the political environment is stable. We had covered the region around the Caucasus already and that was the reason why we came here, being sure that the mind-set of the people and the cultural background, which is important as well, fitted with the ethos of Heidelberg Cement. We decided to invest here because we are absolutely sure that Georgia will stay stable. Whether Georgia will enter the EU or not, I’m sure that this will not be a decisive factor for stability. The Georgia of today and Georgia in the future is from our estimation and perspective a safe place and we absolutely feel welcome here. - In terms of perceptions, to what extent do you think recent developments in Ukraine affect Georgia on an international level? - I talk a lot with German investors and people can differentiate between Ukraine and Georgia. People understand that Georgia cannot be compared with Ukraine. These are two separate is-

sues and this is what I tell everybody that wants to come here: Ukraine is different from Georgia. - Do you have any plans for further expansion in Georgia? - We have seven kilns and at the moment five kilns are running. In June 2014, we will begin with the sixth kiln. That means we still have one kiln which is not running, so we could produce a lot more if needed. Twenty-five percent of our production at the moment is exported to Azerbaijan. We don’t know how that market will develop, but one thing is clear: if Georgia needs additional volumes in the next two years we will be able to deliver whatever is necessary. We have just started a project of one million tonnes in additional capacity. We are looking for the right equipment. We will build up a new kiln line which will take us at least two and a half years because this is a big project. The cost will be around €100 million. At the beginning of 2016, the capacity here in Georgia will be three million tonnes and that is enough for the big boom that will come in Georgia, I’m absolutely sure. - A large part of the costs involved in cement production come from energy consumption. How do energy costs in Georgia compare with other manufacturing locations? - The most important cost factor is fuel, which is coal and gas. Electricity is important but by far not as important as fuel and coal. For electricity, we are operating in 42 countries worldwide and Georgia is one of the five best in costs for electricity, but Georgia is one of the five worst in coal, in fuel. That means we have extremely high fuel costs here, but that is due to the fact that in Georgia there is only low quality coal and we have to mix that with international coal that comes from Ukraine or Russia and the transport costs are very high on that, so we have a disadvantage in fuel but an advantage in electricity. - After the 2008-2009 financial crisis, Georgia took a hit in its real estate and construction markets. To what extent do you see the country recovering?

- The crisis in 2008 brought consumption down from 1.2 million tonnes for the whole country to 900,000 tonnes in 2009. Since that, consumption has been growing steadily and in the last six months we really feel that the market is booming. This year we expect consumption of 1.6 million tonnes and we think that this will go up to 1.8 million tonnes in the next two years. This demand will come from the hydropower plants that have to be constructed as well as the highway from Tbilisi to the Black Sea. In most countries around the world, construction is like a locomotive of the rest of the economy. If construction is growing, you know the country is developing. This is the first industry that really grows, and it’s the first industry, when the economy goes down, to go down as well. We see that this year will be a boom year in Georgia. - Having been active in Georgia for several years and one of the largest foreign investors in the country, what has the company learnt about doing business in Georgia? - I can only speak for my own experience and my experience is that I think the Georgians learnt from me and I have learnt from the Georgians. The combination of Georgian flexibility and the German structure and way of working is perfect. I had to learn to be a little bit more flexible; they had to learn to be a little bit more process-oriented, so everybody has learnt from each other. If you work with Georgians you don’t have to teach them the basics of our mind-set because they have the same mind-set. They are far away from Europe in terms of distance but you can work with the people here in the same way as you work with people in Europe. That was really surprising to me. I have been here for four years and that’s because I like the country, I love the people and to develop something in a team here is possible. You can be active and that’s possible here. - There’s a lot of talk about Georgia’s move closer to the EU; what do you think that Georgia offers the EU? - Georgia offers people that are eager to perform

which is different to a lot of countries in Eastern Europe, and a market that has a big chance to be the spot from where European companies can do business with the region. In Georgia people find an environment where they can start their business easily. The way of doing business is very similar to the European Union and this is the big advantage of Georgia and it makes our work quite easy. Georgians are like Europeans; you can talk with them in an open way and you can discuss ideas. That is a big advantage. - Do you think that moving closer to the EU represents a turning point in Georgia’s history? - I cannot see any big turn now. I think Georgia was always, from the mind-set of the people, oriented towards Europe. They never felt Asian or Russian. The link to Europe was always there. Most people speak English; many of them speak German and French. You can see quarters here in Tbilisi built a century ago by the Germans and the French. Their culture was always linked to the European Union so it’s not a big change; this was always in the nature of this country. The Georgians don’t want to get into the European Union in order to get a lot of money for their development. They want to be part of a stable economic system and to have the possibility to attract people to their country. - Georgia is forecasted to grow at 6.5 percent over the next two to three years; where do you see the key drivers of the economy? - The hydropower plants will create growth because Georgia has a negative trade balance so they have to export more and so to export electricity to Turkey, which is a net importer of electricity, is a really good idea. The new government is developing this sector in a very sensitive and intelligent way. They know that these power plants have to come but they ensure that the environmental risks are dealt with. Tourism is of course a big part of the development as well, and the third area is agriculture. In the former Soviet Union, Georgia was known for fruit, for wine, and that has to come back.

BUISNESS & ECONOMY August 4, 2014 #65

caucasian business week

RAKIA AND CO-INVESTMENT FUND WORK TOGETHER ON THE ENTERPRISE ESTABLISHMENT PROJECT

akia plans implementation of a new project along with Co-Investment Fund. As head of Rakia Georgia and Rakeen Development - Guga Tsanava stated to GBC, active negotiations are going on the implementation of the joint project with the fund. In the case of completion of the negotiations, in about a month the sides will announce start of project feasibility study. Guga Tsanava does not specify in which sector is planned project implementation, although he says that it will be industry and the enterprise will be located in one of the regions of Georgia. “We are on the first stage of project implementation. We plan conduct of feasibility study of the project. After the research we’ll be aware on the technical and financial details and make decision whether it s implementation is worthy. On this stage I can only tell that the case is about the joint investment”, - Guga Tsanava states.

GOVERNMENT WILL ISSUE 5 000 GEL TO CITIZENS FOR FOUNDING MICRO ENTERPRISES

n Friday Deputy Minsiter of Economy and Sustainable Development Keri Bochorishvili explained details of the new government program, which will be added to Produce in Georgia program from September. The government hopes that the program will promote micro-business in all regions of Georgia. 20 million GEL is assigned for the promotion of the micro-business. The amount will support to 3200 entrepreneurs in all regions of Georgia. It will provide creation of 4600 new jobs. The program includes components of financial aid, improvement of business management skills. Financial aid component means allocation of 500 GEL contribution to the beginner entrepreneurs; in the case of entrepreneur group maximal amount is 15 000 GEL. Share of the financial aid applicant equals to 20%. n the framework of business management skills improvement component, the beneficiary entre-

preneurs will get professional business consultations, trainings and individual consulting free of charge.

ALDAGI DISSOLVED IN THREE TBILVINO FOUNDERS FIND RUSSIA’S COMPANIES nsurance company Aldagi completed reor- As for life and property insurance line, Insurance DECISION EXPECTABLE ganization process. As a result, directions Company Aldagi will work on this direction.

ecision made by Russia about abolish of free trade regime with Georgia has not been unexpected for the founder of Tbilvino - Zurab Margvelashvili. The businessman stated to GBC that this expectation always exited. The company exports Georgian wine to 30 countries and among them in EU countries. On this stage, when specific details of the new trade regime are not still known, Tbilvino will not make any decision in advance. “This expectation always existed and exists. Our wine is exported in 30 countries and among them

in EU countries. When we know new trade rules, we’ll be able to calculate all data. When concrete number is known, well make a decision. Currently talking about the decisions is not serious and is early. We should acquire to the new regulations, meet our Russian partners; we should clarify how our product price will increased on the Russian market and how it maintain competitiveness in the case of the new prices. After that, in several months, we’ll have new numbers for the new trade regime. Only after it the question whether we leave Russian market will become actual and timely”, - Zurab Margvelashvili stated. Georgia and Russia signed free trade agreement in 1994. It considered cancellation of the customs fees, taxes and tolls, which have equal impact on the export and import of the goods. The regulations dealt to the products made in the countries of the agreement sides. To abolish the regime, Ministry of Economic Development of Russia prepared governmental resolution project, which states that it’s agreed with Ministries of Foreign Affairs, Justice and Economy of Russia. Reminding that from September 1 main part of the Deep and Comprehensive Free Trade Zone Agreement, considered by Association agreement of Georgia and EU, enters into force. It will give opportunity to Georgian entrepreneurs to trade toll-free in EU.

of health and life, also property insurance was separated from each other. JSC states that as a result of reorganization, on one hand, healthcare business, on the other hand, life and property risks insurance business were separated. “This will enable each direction to actively develop each direction for further growth and development and improve service quality”, - the company management states. They informs that insurance company Imedi-L will work for health insurance direction, medical corporation Evex will provide medical services.

The company also explains that return of Imedi-L in the health insurance business was caused by its positive reputation and high awareness. Medical service business was also rebranded. It includes My Family Clinic (794 beds) and Unimed (1,143 beds). The clinics will work under the name of Medical Corporation Evex, which unites 36 clinics throughout Georgia. “Medical Corporation Evex is a different brand from Aldagi and Imedi-L. The decision is determined by the aim - establish Evex as a powerful and independent brand”, - the JSC states.

PSP INSURANCE: WE ARE AMONG THREE MAJOR AUTO INSURANCE COMPANIES

he company reports that according to Q1 data, according to attracted bonuses, PSP Insurance ranked third. The company attracted 984 thousand GEL in the segment. “It’s a very important achievement, because the company has been working in this direction only 2 years”, - the company states. They also inform that PSP Insurance had also considerable advance in the complex health insurance (insurance of health, life and accident)

and ranks 4th on the market. Bonuses attracted from the combined corporate packages equals to 4,015 million GEL and is only 439 thousand GEL less to the data of company Irao, which ranks 3rd. “The success is additional stimulus for the youngest insurance company, which obtained name of the most operative and comfortable insurer in the corporate health insurance soon after the establishment”, - management of PSP insurance states.

GEORGIA EXPORTS 1.6 MILLION USD SPICES TO RUSSIA IN 1H14

GEORGIA’S EXPORTS TO CHINA GROWS BY 68%

hina remains in the top-3 list of the largest trade partners of Georgia. Export with them has increased by 68% in a year. Geostat informs that in JanuaryJune export to China amounted to $30,6 million. Over half of it - $19 million comes on the copper ores and concentrates. Copper waste and scrap ranks second with almost $9 million. Top-3 list includes wine, export of which has in-

creased by 16%, to $2,2 million. In January-June of the current year commodities of $349,6 million have been imported from China. Black metal construction occupy highest share in import with $23,3 million. $17 million comes on the calculation machines and locks, 12,4 million - on various phone devices. Top-5 list includes washing machines - 10,3 million and flat-rolled carbon steel - 10,2.

reatest share of the export from Georgia to Russia comes on wine and mineral waters. Geostat informs that according to data of 6 months 2014, this commodity group takes 41,4% and 26,9% shares in the export to Russia. In the monetary expression it equals to %55,5 million and $36,1 million. It’s noteworthy that 66% of the wine and 49,7% of the export from Georgia comes on Russia. Top-10 list of the export products include ferroalloys - 9,5 million. It’s only 5,9% of the total export of ferroalloys. In the same period motorcars of $7,4 million were exported to Russia, which is 2,5% of the total export. As for Ethyl alcohol and spirituous drinks, export of this group equals to 72 million. It is 16,4% of the total export of spirituous drinks. Top-10 list includes electricity (4,07 million); tubes, pipes and hollow profiles (2,6 million); carbonated water and with sugar supplements (1,67 million), spices (1,6 million) and citruses

fresh or dried (1,3 million). It’s noteworthy that 9,4% of the total export of Georgia comes on Russia and with this data Russia is in the top-3 list of export partners of Georgia. Georgia resumed trade relations with Russia after 7-year pause, only last spring. According to latest data, Russia ranks 4th among the trade partners of Georgia. Trade turnover with Russia equaled to $364 million in January-June, which is 7% of the total turnover.

BUSINESS caucasian business week

August 4, 2014 #65

NATAKHTARI BEER FESTIVAL ENDED WITH FIREWORKS IN TELAVI singers and groups took part, including: David Iluridze’s Band, Friendly Mosquito, Goblins, Latino Boyes, Group All, Ani Kekua and Frani. Natakhtari, Kozel, Mtieli, Efes and Kaizer beers were presented at the festival. „This is a family celebration, anyone can attend the Beer Festival regardless the age, we took care of everyone, especially of kids. We arranged the Kids’ corner with Natakhtari Lemonade, where they were being entertained. Also, various contests and games were held. The festival tradition-

elavi hosted the Beer Festival at its main square for the second time on July 26-27. The first Georgian analogue of festivals held in various countries of America and Europe was organized traditionally by Company Natakhtari. The festival in Telavi this year was too crowded. Local residents decided to spend weekend with Natakhtari. “Smile, drink and have fun…” – was the motto of the event. The festival bar installed at the main square of the city was the longest one in open air in Geor-

ally ended with an interesting and tasty musical program and firework,” - explained Sandro Kakulia, the beer festival organizer. Natakhtari will organize the festival traditionally in the other large cities as well. It took start towards regions in Rustavi, where the beer festival was held for the second time. The festival was hosted by Telavi on July 26-27. It will be held in Gori on August 2-3, in Batumi on August 9-10, in Kutaisi on August 16-17, in Poti on August 23-24 and in Zugdidi on August 30-31.

gia. There was a special currency- Beer Coin introduced on the festival territory for buying beer. Guests could purchase the coins on site and then exchange those for beer at the bar. The price of 1 coin was GEL 1.50. In addition, various competitions in beer drinking and the other entertaining games were held for guests. In Telavi like Tbilisi and Rustavi the Festival was opened by Black Shielders. Natakhtari thought of children as well and animators were entertaining kids with various games in the Natakhtari Lemonade’s Corner. The Festival traditionally had the interesting and unforgettable musical program were popular

ARTGENI 2014 HELD AT ETHNOGRAPHIC MUSEUM WITH HEALTHY WATER SUPPORT

rtgeni 2014 Festival traditionally took start at the Ethnographic Museum in Tbilisi on July 20. One of the supporters of the festival is Company Healthy Water (Tskali Margebeli). The festival guests had the opportunity to taste Margebeli Products as well as Nabeghlavi and Bakhmaro, unique waters of Healthy Water Company. Margebeli Holding Corner in open air was one of the most distinguished and attractive. At the end tasting of Marneuli Food Factory products was organized. “Artgeni can be named as one of the most important cultural events of the last decade in Georgia, which is of cognitive type. It is very important for Healthy Water Company to support such initiatives contributing to presentation of individual character and culture of various regions of Georgia and to making the youth interested in rich Georgian folklore. Thanks to Artgeni the attention towards Georgia’s folklore is growing and

more and more people show interested in our historical and cultural heritage. Our Company will always be ready to popularize the similar events. We do hope that our cooperation will continue in the future and acquire larger scale”- said Healthy Water representatives. This year, the guests had the opportunity to listen to various types of music. On July 20 the event got opened with presentation of Megrelian Folklore. The final concert was held yesterday. In parallel to concerts, the exhibition of folk craft works was organized during one week. Entertaining performances and folk games were held, in addition, catering outlets were opened where the guests could have the best choice for relaxation. Artgeni has turned into peoples’ celebration for already ten years. The festival is non-commercial and aims to popularize Georgia’s folklore, search for less known and unknown works and art pieces and introduce those to the public and finally archive and keep the found materials.

BUSINESS August 4, 2014 #65

caucasian business week

“FOODPANDA” HOLDS ONE OF THE LEADING POSITIONS IN GEORGIA’S MOBILE APPLICATION BUSINESS The Service Which Amaze Georgian Users

rdering food online in Tbilisi using through the website - www. foodpanda.ge – is becoming more and more demanded. Everyone likes it – regardless of profession, age in any environment The German brand began operating on the Georgian market on March 21st, 2014. Despite the short time span, it already managed to catch the interest of a large chunk of society. The service, which is a novelty on the Georgian market, has been positively received by the customers. “This is a service which amazed its users!” – says the loyal userbase. The German brand has ambitious goals and plans for the Georgian Market. According to Foodpanda’s director, Giga Kerkadze, the number of

customers is rising at a stable rate and has already passed the 8 thousand mark. “As of this day, there’s 62 famous restaurants in partnership with ‘Foodpanda’, and their quantity will undoubtedly grow in the coming months,” – explains the director. It’s notable that the Foodpanda mobile application has already been downloaded over 5000 times in Georgia. If we take into account that the application launched just in May, this is a substantial indicator “Our application is currently being downloaded at a rate of 110-120 a day and a 35-40% of our orders are directly coming in via this channel. We can proudly say that Foodpanda holds one of the leding positions in Georgia in mobile application business,” notes Giga Kerkadze.

PASHA BANK GENERAL SPONSOR OF INTERNATIONAL CHESS FESTIVAL

ASHA Bank, a full service corporate bank, was the general sponsor of the 9th International Festival - Nana Alexandria Cup - 2014. Out of the 9 years of Festival’s history, Pasha Bank has been the largest sponsor of the Festival. The 9th Poti International Chess Festival Nana Alexandria Cup - 2014 was held from the 12-20 July. The Festival was established in 2006 by the local government. It consists of ten events, including both child and professional competitions. A total of 380 participants from eight countries participated in the Festival in 2013. This year the Festival brought together nearly 400 players from 9 countries, these included Georgia, Azerbaijan, Iran, Israel, Jordan, Kazakhstan, Turkey, Russia and Armenia. “PASHA Bank is investing a fairly solid fund

in sponsoring various events, especially those linked to intellectual performance. There are various challenges that the changing world offers up to us. Accordingly, investing in human resources is the best investment for the success of both companies and countries. Our support of this important festival is aligned with our strategy to contribute to the further development and popularity of the most intellectual sport. Georgia has a big history of chess. The country has produced world-famous chess players that have played a significant role in the history of this sport,” said Shahin Mammadov, CEO at PASHA Bank Georgia. By engaging young children in such activities as chess, we are actively contributing to the development of academic and life skills in these youngsters, who are our future talent base,” said Mammadov.

PRESENTATION caucasian business week

August 4, 2014 #65

BANKS RATING August 4, 2014 #65

caucasian business week

RATING OF COMMERCIAL BANKS IN TERMS OF TOTAL ASSETS, STOCK CAPITAL, TOTAL LOANS, TERM DEPOSITS, NET PROFITS AND RESERVES ON AVAILABLE LOSSES VTB Bank assets rose by over 250 million GEL. Azerbaijani PASHA Bank that has recently appeared on the Georgia market increased total assets from 34 million GEL to 127 million GEL. Total assets of the Batumi Branch of Turkish Is Bank have grown by over 22 million GEL (from 26 million GEL to 48 million GEL). Kazakh Halyk Bank and Bank Constanta, a TBC Bank subsidiary, have also recorded considerable growth. Halyk Bank’s total assets

have increased by over 30 million GEL year on year to 135 million GEL, while Constanta Bank’s total assets have grown by 105 million GEL to over 405 million GEL. A total of 7 commercial banks have ended the reporting period (Progress Bank, PASHA BankGeorgia, Investbank, BTA Bank, KOR Standard Bank, Privatbank, Batumi Branch of Is Bank) in losses and their total losses marked 22 million GEL. We should also note total profits of the remaining

14 commercial banks are over 200 million GEL and traditionally a major ratio (over 130 million GHEL) is recorded for Bank of Georgia and TBC Bank. Total loans issued by commercial banks as of June 30, 2014 marked over 11.6 billion GEL, up 0.5 billion GEL compared to 1Q14 and up over 2.5 b billion GEL compared to June 30, 2013. This and other interesting indicators are published in these below ratings:

RATING OF COMMERCIAL BANKS DUE TO TOTAL ASSETS (IN THOUSANDS OF GEL)

RATING OF COMMERCIAL BANKS DUE TO TERM DEPOSITS (IN THOUSANDS OF GEL)

RATING OF COMMERCIAL BANKS DUE TO STOCK CAPITAL (IN THOUSANDS OF GEL)

RATING OF COMMERCIAL BANKS DUE TO NET PROFITS (IN THOUSANDS OF GEL)

RATING OF COMMERCIAL BANK DUE TO LOANS (IN THOUSANDS OF GEL)

RATING OF COMMERCIAL BANKS DUE TO RESERVES ON AVAILABLE RESERVES (%)

CIS caucasian business week

August 4, 2014 #65

EUROPEAN BUSINESS LOBBY WARNS NEW RUSSIAN SANCTIONS WILL HIT UKRAINE AND EU

T EU SANCTIONS SOME OF RUSSIA’S BIGGEST BANKS, INCLUDING #1 SBERBANK

he European Union has imposed sectorial sanctions on five Russian banks, including the country’s biggest, Sberbank, as part of economic steps that Europe, along with the US, have taken against Moscow over the crisis in Ukraine. EU adds 8 individuals, 3 Russian companies to sanctions list over Ukraine crisis The list, published Thursday, includes Sberbank, VTB Bank, Gazprombank, Vnesheconombank (VEB) and Russian Agriculture Bank (Rosselkhozbank). These financial entities will be banned from raising capital on the EU’s capital markets. The sanctions – targeting banks with state ownership of over 50 percent – enter into force on August 1 and will be valid for one year. The decision can be reviewed after three months. “In order to restrict Russia’s access to EU capital markets, EU nationals and companies may no more buy or sell new bonds, equity or similar financial instruments with a maturity exceeding 90 days, issued by major state-owned Russian banks, development banks, their subsidiaries outside the EU and those acting on their behalf. Services related to the issuing of such financial instruments, e.g. brokering, are also prohibited,” the EU Council said in a statement. It excludes EU subsidiaries of the Russian banks. Only three of the banks on the sanctions list have subsidiaries in Europe: Sberbank, VTB and Gazprombank. Sberbank Europe AG (former Volksbank International) operates a network of banks in Central and Eastern European countries. Sberbank is the largest bank in Russia and Eastern Europe, and the third-largest in Europe. The bank caters to over 106 million customers in Russia alone, while over 11 million people use its services abroad. Sberbank’s majority shareholder is Russia’s Central Bank. The bank is the key lender to the Russian economy. According to the bank’s estimates, as of the end of 2013, Sberbank is the biggest receiver of deposits in Russia, with 43.3 percent of retail deposits, 32.7 percent of retail loans and 32.1 percent of loans to corporate customers. In 2013 Sberbank was ranked the world’s 63rd most valuable global brand by Brand Finance. The Sberbank brand was valued at $14.16 billion and is recognized as the most valuable brand in Russia. Gazprombank said in a statement that the new sanctions do not affect the bank’s financial stability and work. The bank continues to operate as usually providing services to both individuals and legal entities and transactions both in roubles and foreign currencies proceed without delays. The measures taken by the EU are almost the same as those imposed earlier by the US, the bank said. “In these circumstances, Gazprombank continues

to completely fulfill its liabilities to investors, depositors and creditors,” the statements published on the bank’s website reads. In response to the sanctions, VTB said that it strongly disapproves of the EU’s decision, adding that the bank and all its subsidiaries will continue to operate as usual. “Such actions contradict Europe’s democratic values, showing they have gone against their own interests to do the bidding of their senior colleagues from across the ocean,” the bank said in a statement. “These decisions are incompatible with the core principles and values of the free market, and discriminate against VTB as well as international investors. European authorities have de facto granted themselves the right to decide for investors where they may invest their own funds.” Earlier this week, Washington added new names to its list of sanctioned Russia-affiliated entities, including Russian Agriculture Bank and VTB, the second largest bank in the country. Sberbank was left untouched by the Americans. Russia’s Central Bank promised Wednesday to support financial institutions hit by Washington sanctions. On Thursday, as the EU made its announcement, the regulator said it was ready to offer hand to banks facing restrictions from the EU. “Banks affected by the EU sanctions are capable of coping with problems on their own,” the Central Bank’s press service told Itar-Tass. “Their foreign currency position is well-balanced. But if there are extra risk factors, the [Central] Bank of Russia is ready to offer liquidity under the existing instrument.” ARMS, EQUIPMENT EXPORTS & IMPORTS TARGETED Additionally, the EU imposed an embargo on the import and export of arms and related material to and from Russia. Also, exports of “certain energy-related equipment and technology” to Russia will be subject to prior authorization by EU authorities. “Export licenses will be denied if products are destined for deep water oil exploration and production, Arctic oil exploration or production and shale oil projects in Russia,” the EU said. The sanctions will only apply to new contracts and will not affect deals finalized before August 1. The French contract with Russia on the construction and shipment of the Mistral helicopter carrier warships will not be canceled under the new restrictions, since it was signed in 2011. The EU Committee of Permanent Representatives approved its toughest yet sanctions against Russia on Tuesday. On Thursday, the package was adopted by the EU Council and published in the Official Journal of the 28-member state union. Moscow slammed the move, saying it was disappointed by the EU’s inability to act independently from the US in the international arena.

he Moscow-based Association of European Businesses (AEB), which represents more than 600 European companies working in Russia, said on Wednesday it “deeply regrets” the new sanctions. “Considering the volume of trade between Russia and the EU, and Russia and Ukraine, the AEB expects that these new sanctions will not only hurt the Russian economy, but also will restrict growth in both the EU and Ukraine,” it said in a statement. The EU expanded its sanctions to block Russia’s oil and defense sectors, and any linked technology. VTB, the country’s second largest by assets and its subsidiary Bank of Moscow, as well as Rosselkhozbank (Russian Agricultural Bank) are now all banned from raising funds in European capital markets. Sanctions are scheduled to last for 12 months, but the EU will review the sanctions after three months.

On Wednesday Russia’s VTB called the move “politically motivated” and says it is “misguided” since the bank strictly adheres to all international laws and regulations. “We view this decision as politically motivated, unfair, legally dubious and economically damaging for all parties,” the bank’s statement said. The sanctions won’t be a setback for the banking group with more than $266 billion in assets, and it is“confident in our ability to raise new funding when necessary.” The other two Russian lenders – Rosselkhozbank and the Bank of Moscow – also said fresh EU restrictions won’t hit their operations, and that customers wouldn’t feel any blowback. International payment systems Visa and MasterCard, which have around 90 percent of the Russian market made a similar statement, saying their business in Russia will carry on as usual. Russia’s Central Bank said in a statement on Wednesday it will “take adequate measures” to support targeted banks should they need help.

KAZAKHSTAN PRODUCES 5,650 TONS OF URANIUM

azakhstan produced 5,650 tons of uranium in the second quarter of 2014. This figure corresponds to the planned indicators, Kazakhstan’s national operator Kazatomprom Joint Stock Company reported. Kazakhstan produced 5,590 tons of uranium in the second quarter of 2013. The volume of uranium production of Kazatomprom amounted to 3,278 tons in the second quarter of 2014. Also, Kazatomprom continued works in the field of conversion, enrichment and production of nuclear fuel in the second quarter. Kazakhstan possesses 0.85 million tons of uranium reserves. It ranks second in the world in

terms of the reserves, and first in terms of uranium mining. All the uranium produced in Kazakhstan is exported, particularly to China and Europe. Kazatomprom is Kazakhstan’s national operator for the export of uranium and its compounds, rare metals, nuclear fuel for nuclear power plants, special equipment, technologies and dual-use materials. Its principal activities are geological exploration, uranium production, the initiation of the nuclear fuel cycle, the production of construction materials, energy, science, social welfare and training. Kazatomprom is an active participant in the development of renewable energy in Kazakhstan. Kazatomprom is amongst the leading uranium mining companies in the world.

HONG KONG CASH HAVEN FOR RUSSIAN TELECOM OVER SANCTIONS

ussian mobile network MegaFon has decided to place 40 percent of its cash in Hong Kong dollars to diversify and de-dollarize. The move is also a preventative move to protect against Western-led sanctions. Dollar-based assets are a risk for the company, Chief Financial Officer Gevork Vermishyan toldBloomberg News in a phone interview. Hong Kong offers a simple alternative to the US dollar since the Hong Kong dollar has been pegged to the US currency since 1983. Its value mirrors the US dollar, and has never fluctuated beyond 1 percent above or below the US currency. The rest of the company’s cash is kept in rubles, according to Vermishyan. As of June 30, MegaFon had $1.3 billion in cash and cash equivalents. MegaFon is owned by Russia’s richest man Alisher Usmanov, and has an estimated value is $6 billion. One of Russia’s largest mobile carriers, MegaFon previously kept its foreign holdings in US dollars and euros, according to the company. It is working to lessen its dependence on foreign currency, Vermishyan said. “Keeping money in Hong Kong dollars is essentially equivalent to keeping it in US dollars because of the currency peg,” Vladimir Osakovsky, chief economist for Russia and the CIS at Bank of America Corp in Moscow, told Bloomberg. To date, MegaFon hasn’t been put on the US or EU sanctions list, but the company says it is “well-prepared” for any adversity the sanctions may bring. “For Russian companies it’s much safer from the standpoint of sanctions,” Osakovsky said. The US and EU unleashed ‘Tier 3’ sanctions against Russia this week, which aim to hurt energy, finance, and arms technology sectors.

If sanctions progress, the US may limit derivatives trading and short-term loans for Russian companies. Restrictions on money market financing and derivatives could be imposed if tougher sanctions are necessary, according to a US Treasury Department official. At present, US businesses and individuals are allowed to trade derivatives and debts with sanctioned Russian firms. Several of Russia’s top banks are now banned from raising funds in European capital markets, and they are only allowed to get short-term (under 90-day) loans from US banks. Sanctions are meant to punish Russia for its alleged hand in Ukraine’s separatist movement and the downing of flight MH17. The West is also going after companies that have investment and trade with Crimea, which rejoined Russia in March. Although MegaFon hasn’t formally entered the Crimean market, it is considering it. In mid-June, MegaFon competitor MTS began selling Russian SIM cards in Crimea, becoming the first Russian operator to work in the region. MTS and MegaFon also cancelled long distance fees for calls to and from Crimea and Russia, and now only charge domestic rates.

AZERBAIJAN August 4, 2014 #65

caucasian business week

RUSSIA ORDERS AZERBAIJAN CONSTRUCTION OF HIGH SPEED CREW BOATS

ussian Maritime Register of Shipping signed a relevant contract with Baku Shipyard LLC for the construction of three 38М high speed crew boats (designer - SHIPTECH, Singapore) for Azerbaijan State Caspian Sea Shipping Company. The construction process is set to begin in August 2014 and the boats should be delivered to Russia by May 2016. The vessels are designed to transport personnel (up to 80 people) and various types of cargo to mobile offshore drilling units and other offshore oil and gas exploration and extraction facilities. According to their specifications, they can operate at up to 100 miles from the coast. The overall length of each boat is 38.22 meters, breadth - 8.2 meters, depth - 4.3 meters, draught - 2.25 meters and crew - 8 people. The order will help developing cooperation with the newly constructed shipyard in Baku. It will also be the first major project since Baku Shipyard reached full capacity in 2013. It is planned that the new high speed vessels will operate at the Gunashli, Chirag, Azeri, Bulla, Pi-

rallahi, West Absheron, as well as Chilov fields and areas of the Caspian Sea. Baku Shipyard LLC is a joint venture of Azerbaijan’s state energy company SOCAR, Azerbaijan Investment Company (AIC), and Keppel Offshore & Marine Ltd. (Keppel O&M). It was inaugurated by Azerbaijani President Ilham Aliyev in September 2013. Keppel O&M owns 10 percent of the project. The largest shareholder at 65 percent is SOCAR, followed by AIC which owns 25 percent equity in the company. The plant is expected to construct a large spectrum of specialized and merchant ships, including multi-purpose vessels such as platform supply vessels, tankers, and cargo ships. The enterprise has also ship-repair capabilities. The plant’s production capacity is 25,000 tons of steel per year. The facility is designed to produce four tankers with the deadweight of 15,000 tons or two tankers with the deadweight of 70,000 tons per year. At full capacity, the plant will be able to carry out up to 100 repair or rebuild works annually.

AZAL TO CARRY OUT REGULAR DIRECT FLIGHTS TO BISHKEK

zerbaijan Airlines (AZAL), the biggest Azerbaijani airline and national flag carrier, will perform regular direct flights to Kyrgyzstan’s capital starting from Octo-

ber 26. The news was announced by AZAL on July 22. The direct flights en route Baku-Bishkek-Baku will be implemented on Tuesdays and Sundays. On Tuesdays, the plane will depart from Baku at 20:20 (local time, GMT+5), and on Sundays - at 10:10. AZAL also plans to resume flights to Astrakhan, which will be carried out on Mondays beginning from November 3. The plane will depart from Baku at 19:00 (local

time, GMT+5), and arrive in the capital - at 05:35 the next day. The report did not indicate ticket prices due to lack of complete information about the new flights. As a regional and CIS leader in terms of the number of new aircrafts, AZAL offers its passenger flights to European countries, the CIS, Middle East, and Asia. The company cooperates with about 60 airlines to provide its passengers with an opportunity to travel freely around the world. Currently, AZAL’s fleet consists of Boeing 757200, Boeing 767-300, Airbus 319, Airbus A320, Airbus A340-500, Embraer ERJ 170-100LR and Embraer ERJ 190-100.

AZERBAIJAN’S OIL FUNDS TURNING INTO CHINESE YUAN

zerbaijan’s state oil fund SOFAZ which is in charge of accumulating and managing the country’s oil and gas revenues have taken some measures to include Yuan in its currency portfolio. SOFAZ Deputy Executive Director Israfil Mammadov said the fund has appealed to the People’s Bank of China to obtain quotes on indirect investment in the Chinese yuan onshore market with a view to diversify its investment portfolio. The fund, established in 1999 aimed at transforming rising hydrocarbon reserves into financial assets, started investing in new asset classes such as equities, real estate, and gold, as well as diversifying its currency portfolio toward the Turkish lira, Russian ruble, and Australian dollar, from 2012. “We intend to invest gradually, initially through the Chinese government securities. We will consider other investment tools available on the Chinese financial markets with the growth of our experiences,” Mammadov told local media. Mammadov further said the decision was made after a careful analysis of the fund’s portfolio with a view to use the opportunities available in the Chinese markets. “SOFAZ is in talks with the Chinese authorities. The approved quota will be announced after the two institutions sign an agreement, “ he said. Currently, the currency structure of the SOFAZ investment portfolio is as follows: 51.7 percent

of its total investment portfolio was concentrated in U.S. dollars (around $19.4 billion), 35.4 percent of its investment portfolio in euro (9.74 billion euro), 5.3 percent in British pounds (1.17 billion pounds), 1.2 percent in Turkish lira, 0.5 percent in Australian dollars, 1.3 percent in Russian rubles, and 1.2 percent in Korean Won. The remaining part of the portfolio (3.4 percent, or about $1.3 million) is concentrated in gold, which the fund began to purchase since the first quarter of 2012. The amount of the purchased gold stood at 30 tons 175 kg (970,146 ounces) as of July 1. According to SOFAZ’s investment strategy, up to five percent of its investment portfolio may be placed in stocks, up to five percent in real estate and five percent in gold. The assets of SOFAZ, that hit $37.622 billion as of July 1 , 2014, are placed partly in securities, money market instruments (deposits, bank accounts). The map of the fund’s assets is as follow: 55.18 percent of assets was invested in the European countries, 19.56 percent in North America, 12.33 percent in the Asia-Pacific region, 1.05 percent in the Middle East, 5.03 percent in South America, 6.84 percent in international financial institutions, and 0.01 percent in Africa. SOFAZ earlier announced that it analyzed opportunities for investment in East and Southeast Asia, conducted the necessary evaluations of investment prospects in the respective countries, and targeted the Asian market as the most promising destination for real estate investment. The main goals of SOFAZ include accumulation of resources and placement of the Fund’s assets abroad in order to minimize the negative affects on economy, the prevention of ‘Dutch disease’ to some extent, promotion of resource accumulation for future generations and support of current social and economic processes in Azerbaijan.

EBRD, UNIBANK TO PROVIDE LOAN TO AZERBAIJAN’S OIL-SERVICE COMPANY

he European Bank for Reconstruction and Development (EBRD) and Azerbaijan’s Unibank will provide a loan worth $10 million to Dalgidj LLC for the expansion of the company’s activities. “The loan will be used for the acquisition of a new remotely operated vehicle (ROV) and the construction of a new warehouse,” EBRD said on August 1. Neil McKain, the EBRD Head of Office in Azerbaijan, said this signing allows the bank to support the growth of a strong local company. “It illustrates how Azerbaijani enterprises are benefiting from offshore explorations and we are impressed by their successful efforts to meet highest international standards,” he noted. Jalal Gasimov, CEO of Unibank noted companies such as Dalgidj are the ones that drive the real sector of Azerbaijan’s economy and its modernization. “Thus, it is always a priority for us to support this sort of innovative company, especially considering that the project will create many jobs for skilled specialists. Our decision to finance this project is also an indication of the high level of cooperation between the EBRD and Unibank. As of today, this will be the largest project the EBRD has ever co-financed with any local bank in Azerbaijan. I would like to invite other businesses to take advantage of this very beneficial funding facility.”

The loan comes under the EBRD’s Medium-Sized Co-financing Facility which was established with local banks to meet the financing needs of successful medium-sized private companies in early transition countries. Strict technical and environmental requirements for offshore exploration are leading to an increased demand for underwater technical operations. Companies engaged in these activities are also facing strict requirements and strong competition. In these conditions professional staff and modern equipment are crucial for enterprises to succeed. Dalgidj, an Azerbaijan’s oil-service company, offers services such as diving inspections and underwater technical operations, which includes underwater welding and cutting at depths of up to 60 meters and ROV operations at depths of up to 1,000 meters in the Caspian Sea. The company provides these services to large oil companies which are active in the Azerbaijani sector of the Caspian Sea. The EBRD has been active in Azerbaijan since the country’s independence. To date the Bank has invested in 146 projects with over $2.5 billion across various sectors of the Azerbaijani economy. One of the EBRD’s priorities in the country is to support the growth of the non-oil private sector by investing in dynamic small and medium-sized enterprises.

SANCTIONS NOT TO AFFECT VTB BANK`S ACTIVITY IN AZERBAIJAN

ank VTB Azerbaijan” JSC works in normal mode, providing a full range of services for deposit and loan contracts as well as transactions including money transfer and payments with bank cards, despite the declared U.S. sanctions against a number of Russian banks on July 29, the bank told Trend. “We emphasize that the imposed sanctions will have no impact on our customers - the bank will continue to provide the full range of services and obligations in full volume in all currencies, with which it has worked. The representatives of Visa and Mastercard international payment systems have already confirmed that the bank plastic cards can also be used without limitation both on the territory of our country and abroad,” the bank said. In turn, the VTB Group in a statement issued on July 30 accepted the decision of the U.S. authorities restricting the bank in raising capital with regret. “In our opinion, it is absolutely inadequate, as VTB strictly fulfills all legislative norms, including the requirements of the U.S. regulatory bodies, which they are well aware. Thus, we consider this decision as purely politically motivated, unfair, contrary to the legal basis and inflicting mutual economic damage,” the report said. VTB is a strong backbone Russian credit institution with broad international presence and strong financial position. “Despite the U.S discriminatory decision, the VTB will fulfill all its obligations before its shareholders, customers and investors,” the Group said. U.S. decision on the restriction of the VTB`s access to the capital market will not affect the activities and the bank’s creditworthiness. VTB enjoys a good reputation among global investors, it has excellent expertise in borrowing not only in Western markets. Russian bank is confident that it can attract resources in the case of necessity. The U.S. imposed sanctions on July 29 against

the Bank of Moscow, VTB and Russian Agricultural Bank, prohibiting U.S. citizens and companies to acquire new issues of their shares and provide them with new loans over 90 days. All other operations with these banks are not subjected to the sanctions. Following the sanctions announced by U.S. President Barack Obama on July 29, the European Union has restricted access to its capital markets for “Russian financial institutions owned by the state”, stating that EU citizens and companies will no longer be able to buy or sell new shares, bonds, or “similar financial instruments “with a maturity of more than 90 days, issued by Russian state-owned banks, the development banks (Vnesheconombank), their “daughters” and those acting on their behalf. Earlier on July 29, the Central Bank of Russia announced that the banks that came under the sanctions are operating in normal mode, and the payments by using bank cards remain stable. At the same time, the regulator announced its readiness to provide the necessary support to these banks. The Russian offices of the Visa and MasterCard international payment systems also said that new sanctions imposed by the U.S. against Russian banks have no effect on their activities in Russia. U.S. and the EU do not recognize the annexation of Crimea to Russia and accused Moscow of intervening in Ukraine`s internal affairs. Russia denies it and calls similar allegations unacceptable. Since March, the Western countries have repeatedly imposed sanctions against a number of Russian politicians, businessmen and companies and threatened to extend the restrictive measures. VTB Bank (Azerbaijan) is a subsidiary of OJSC VTB Bank. VTB Bank and Ata Holding are shareholders of VTB Bank (Azerbaijan). VTB Bank (Azerbaijan) provides services to clients of corporate business, small business and private clients. Currently the bank is represented by four branches and the Office of customer service at the head office.

PUBLICITY caucasian business week

TBILISI INTERNATIONAL FESTIVAL OF THEATRE International Program

with elegant touch of reality… SEPTEMBER 20 - OCTOBER 8

23, 24, 25 SEPTEMBER, 2014 Invisible Flock with Hope and Social

BRING THE HAPPY Directed by Invisible Flock

ABOUT PERFORMANCE: Bring the Happy is an ongoing project about happiness, an attempt to map moments and memories of happiness. A first kiss, a lost love, a longed for baby, childhood heroes, a proposal, a dance, a chance encounter – where did it happen and how happy did it make you feel on a scale from 1 to 10? Invisible Flock will create a giant 3D map of the city and invites you to explore the map, discover what makes others happy and where, and in turn submit your own happy moment or memory to add to the evergrowing database of happiness. The memories collected will be taken and transformed into Bring the Happy Live a spectacular performance. The Live show retells the memories and stories collected across the UK and combines them with those from Tbilisi.

Somewhere between a wedding and a wake, the memories collected in all of their beautiful, sometimes tragic, sometimes ridiculous and often hilariously mundane glory are taken and retold in an emotional roller coaster of an evening.! In collaboration with Hope & Social the live performance promises to be an interactive, intimate and highly moving evening where you are invited to toast, dance, laugh, cry and join us in celebrating happiness. Venue: KAKHA BAKURADZE’S MOVEMENT THEATRE Duration: 90 Minutes, without intermission Web-site: www.bringthehappy.co.uk www.invisibleflock.com www.tbilisiinternational.com www.facebook.com/TbilisiInternational

August 4, 2014 #65

WORLD NEWS August 4, 2014 #65

caucasian business week

INDIA SLAMS DOOR ON $1TN WTO DEAL OVER CUSTOMS RULES

he World Trade Organization got a surprise setback on Thursday when India, pushing for concessions on agricultural stockpiling, vetoed plans for universal customs rules. The deal could have added $1 trillion and 21 million jobs to the world economy. The July 31 deadline on the first proposal for major global economic reform in two decades a series of customs procedures known as “trade facilitation” – left negotiators empty handed after India refused to sign up to it. India, with its large number of poor and new nationalist government, had demanded the exclusive right to subsidize and stockpile grains which is not permitted by WTO rules. The WTO, experiencing what may be its worst setback in its 19year history, reluctantly admitted defeat. “We have not been able to find a solution that would allow us to bridge that gap,” WTO Director-General Roberto Azevedo told negotiators in Geneva just hours before the deadline was set to lapse. Some analysts are of the opinion the failure represents the beginning of a new era of trade deals, which will depend more on individual economies forging their own initiatives, as opposed to at-

tempting to force global reform. “Today’s developments suggest that there is little hope for truly global trade talks to take place,” Jake Colvin at the National Foreign Trade Council, a leading US business group, told Reuters. “The vast majority of countries who understand the importance of modernizing trade rules and keeping their promises will have to pick up the pieces and figure out how to move forward.” Whether or not other countries will pick up the dropped ball and try to move forward despite the loss is not yet clear, but the present mood is noticeably downbeat. “We’re obviously sad and disappointed that a very small handful of countries were unwilling to keep their commitments from the December conference in Bali, and we agree with the DirectorGeneral that that action has put this institution on very uncertain new ground,” US Ambassador to the WTO Michael Punke told reporters. Meanwhile, there is speculation that some countries may decide to go ahead with the plan without India’s support. However, Azevedo said that while the world’s largest economies had choices on how to respond to the failed talks, the poorest economies would suffer the brunt of the fallout.

ARGENTINA BLAMES US AUTHORITIES FOR TRIGGERING DEFAULT

rgentina has accused the US of judicial malpractice and threatened to take it to the International Court of Justice, as it allowed two small hedge funds drag Buenos Aires into default and made creditors and ordinary people suffer. The majority of bond holders agreed to write-off two thirds of Argentina’s debt held since it defaulted in 2001-2002. However a group of hedge funds, or as Argentina calls them “vulture fund” investors, who did not agree to the write-off, are now insisting on full payment of all the debt. The problem arose after the US court prevented Argentina paying $539 million to its creditors, saying it should first pay $1.5 billion to compensate those investors who never accepted the restructuring deal. The deadline set to by the US judge to pay the debt expired on Thursday at 04:00 GMT after which the US court froze Argentina’s payments to other bond holders, pushing the country into a technical default. “To say that Argentina is in technical default is a ridiculous hoax,” the Daily Telegraph quotes

Jorge Capitanich, Argentina’s cabinet chief, accusing Judge Griesa of acting as an “agent” of speculative funds. “There’s been mala praxis here by the US justice system, for which all three branches of the government are responsible. Argentina has tried to negotiate in good faith,” he added. Argentina has threatened to take the US to the International Court of Justice for judicial malpractice. After the deadline Standard & Poor’s immediately declared the country to be in “selective default” As a result, the most important index of the Buenos Aires Stock Exchange, the MERVAL, fell 7 percent as Argentina’s banks plunged by 12 percent. Even the US Dow Jones Industrial Average fell by 1.6 percent in late trading. However Argentina’s President Christina Kirchner denies the country is in financial default, stressing that it still has opportunities to compromise with international debt holders. The latest default is expected to exacerbate Argentina’s economy already hit by recession, analysts say. However they stress the effect will be easier than the economic meltdown 13 years ago when savers’ accounts were frozen to stop a run on the banks, and dozens died in violent street protests.

MCDONALD’S NEW NUGGETS ARE MADE OF FISH AND TOFU IN JAPAN

f you’re wary of chicken and beef products after a major meat supply scandal in Asia, the McDonald’s in Japan could have an alternative for you -- tofu and fish nuggets. On Wednesday, McDonald’s in Japan rolled out Tofu Shinjo McNuggets, a doppelganger of the Chicken McNugget made from a mishmash of minced white fish, tofu and vegetables including edamame, soy beans and carrots. Deep-fried to a golden-brown and shaped just like the original chicken version, the Tofu Shinjo McNugget is crispy on the outside and mushy on the inside. The fast food chain is known for adding dishes with local flavor to its menu; for instance McDonald’s India has the McAloo Tikki sandwich which caters to vegetarian patrons with its potato and peas patty, and gazpacho in Spain. Tofu Shinjo McNuggets are available from July 30 to early September only in Japan. The country’s unit of McDonald’s says the tofu and fish nuggets were planned as part of McDonald’s summer products, long before the China meat scandal broke. Last week, a video surfaced in Chinese media, showing appalling practices in a Shanghai foodprocessing factory that supplies ingredients to many international restaurant brands including

McDonald’s, Starbucks and Yum Brands. Workers at the Chinese subsidiary of Illinoisbased OSI Group said that the meat smelled bad, and they could be seen in the footage processing meat that had fallen on the floor. Shanghai Municipal Food and Drug Administration subsequently found that expired beef and chicken products were processed and repackaged with new expiration dates at the plant. The tainted meat supply from the food processing plant of Shanghai Husi Food, has been found to reach across China, all the way to Hong Kong, and to Japan -- where it affected 20% of their meat for chicken nuggets triggering sporadic shortages over the weekend. By Monday, McDonald’s Japan restored most of its chicken products by getting supplies from Thailand. But it may run out of chicken products for its Chick Crisp Muffin and Chicken Egg Muffin, the company told CNN. On Tuesday, McDonald’s Japan CEO Sarah Casanova apologized and promised to strengthen food safety measures, including more transparency in the country of origin for its products. The fast food chain in Japan said it will fall short of profits and sales targets after its longtime meat supplier was shut down.

PUBLICITY caucasian business week

APARTMENT

Every Wednesday At 21:00 On GDS TV Full of humor

Anchors â&#x20AC;&#x201C; Kotiko Toloraia, Levan Gogoreliani will offier refined humor, provide good mood and invite interesting guests for the program audience. The program consists of three parts: the first block offers humor and apolitical monologue with funny video clips, pictures and so on. The second and third blocks are dedicated to famous public figures that will be invited as guests. The show will start Wednesdays at 21 oâ&#x20AC;&#x2122;clock and it will cover all interesting issues excluding politics to guarantee good mood for the audience.

Guests: Chele, Nutsa Mestumrishvili, Nuka Orjonikidze, Qeti Jaoshvili, Ruska Chumburidze, Tamuna Morchiladze

August 4, 2014 #65

TBILISI GUIDE August 4, 2014 #65

Embassy United States of America Embassy 11 Balanchivadze St., Dighomi Dstr., Tbilisi Tel: 27-70-00, 53-23-34 E-mail: tbilisivisa@state.gov; askconsultbilisi@state.gov United Kingdom of Great Britain and Northern Ireland Embassy 51 Krtsanisi Str., Tbilisi, Tel: 227-47-47 E-mail: british.embassy.tbilisi@fco.gov.uk Republic of France Embassy 49, Krtsanisi Str. Tbilisi, Tel: 272 14 90 E-mail: ambafrance@access.sanet.ge Web-site: www.ambafrance-ge.org Federal Republic of Germany Embassy 20 Telavi St. Tbilisi Tel: 44 73 00, Fax: 44 73 64 Italian RepublicEmbassy 3a Chitadze St, Tbilisi, Tel: 299-64-18, 292-14-62, 292-18-54 E-mail: embassy.tbilisi@esteri.it Republic of Estonia Embassy 4 Likhauri St., Tbilisi, Tel: 236-51-40 E-mail: tbilisisaatkond@mfa.ee Republic of Lithuania Embassy 25 Tengiz Abuladze St, Tbilisi Tel: 291-29-33 E-mail: amb.ge@urm.lt Republic of Latvia Embassy 16 Akhmeta Str., Avlabari, 0144 Tbilisi. E-mail: embassy.georgia@mfa.gov.lv Greece Republic Embassy 37. Tabidze St. Tbilisi Tel: 91 49 70, 91 49 71, 91 49 72 Czech RepublicEmbassy 37 Chavchavadze St. Tbilisi Tel: 291-67-40/41/42 E-mail: czechembassy@gol.ge Web-sait: www.mzv.cz Japan Embassy 7 Krtsanisi St. Tbilisi Tel: +995 32 2 75 21 11, Fax: +995 32 2 75 21 20 Kingdom of Sweden Embassy 15 Kipshidze St. Tbilisi Tel: +995 32 2 55 03 20 , Fax: +995 32 2 22 48 90 Kingdom of the Netherlands Embassy 20 Telavi St. Tbilisi Tel: 27 62 00, Fax: 27 62 32 People’s Republic of China Embassy 52 Barnov St. Tbilisi Tel: 225-22-86, 225-21-75, 225-26-70 E-mail: zhangling@access.sanet.ge Republic of Bulgaria Embassy 15 Gorgasali Exit, 0105 Tbilisi, Georgia Tel: +995 32 291 01 94; +995 32 291 01 95 Fax: +99 532 291 02 70 Republic of Hungary Embassy 83 Lvovi Street, Tbilisi Tel: 39 90 08; E-mail: hunembtbs@gmail.com State of Israel Embassy 61 Agmashenebeli Ave. Tbilisi Tel: 95 17 09, 94 27 05 Embassy of Swiss Confederation’s Russian Federation Interests Section Embassy 51 Chavchavadze Av., Tbilisi Tel: 291-26-45, 291-24-06, 225-28-03 E-mail: RussianEmbassy@Caucasus.net Ukraine Embassy 75, Oniashvili St., Tbilisi Tel: 231-11-61, 231-12-02, 231-14-54 E-mail: ukraina_pu@wanex.net; emb_ge@mfa.gov.ua Consular Agency: 71, Melikishvili St., Batumi Tel: (8-88-222) 3-16-00/ 3-14-78 Republic of Turkey Embassy 35 Chavchavadze Av., Tbilisi Tel: 225-20-72/73/74/76 E-mail: turkemb.tbilisi@mfa.gov.tr Address: 8, M. Abashidze str. Batumi, Georgia tel: (8-88-222) 7 47 90 Republic of Azerbaijan Embassy Kipshidze II-bl . N1., Tbilisi Tel: 225-26-39, 225-35-26/27/28 E-mail: tbilisi@mission.mfa.gov.az Address: Dumbadze str. 14, Batumi Tel: 222-7-67-00 Fax: 222-7-34-43 Republic of Armenia Embassy 4 Tetelashvili St. Tbilisi Tel: 95-94-43, 95-17-23, 95-44-08 E-mail: armemb@caucasus.net Web: www.armenianembassy.ge Consulate General, Batumi Address: Batumi, Gogebashvili str. 32, Apt. 16

caucasian business week Kingdom of Spain Embassy Rustaveli Ave. 24, I floor, Tbilisi Tel: 230-54-64 E-mail: emb.tiflis@maec.es Romania Embassy 7 Kushitashvili St., Tbilisi Tel: 38-53-10; 25-00-98/97 E-mail: ambasada@caucasus.net Republic of Poland Embassy 19 Brothers Zubalashvili St., Tbilisi Tel: 292-03-98 Email:tbilisi.amb.sekretariat@msz.gov.pl Web-site: www.tbilisi.polemb.net Republic of Iraq Embassy Kobuleti str. 16, Tbilisi Tel: 291 35 96; 229 07 93 E-mail: iraqiageoemb@yahoo.com Federative Republic of Brazil Embassy Chanturia street 6/2, Tbilisi Tel.: +995-32-293-2419 Fax.: +995-32-293-2416 Islamic Republic of Iran Embassy 80, I.Chavchavadze St. Tbilisi, Tel: 291-36-56, 291-36-58, 291-36-59, 291-36-60; Fax: 291-36-28 E-mail: iranemb@geo.net.ge United Nations Office Address: 9 Eristavi St. Tbilisi Tel: 225-11-26/28, 225-11-29/31 Fax: 225-02-71/72 E-mail: registry.geo@undp.org Web-site: www.undp.org International Monetary Fund Office Address : 4 Freedom Sq., GMT Plaza, Tbilisi Tel: 292-04-32/33/34 E-mail: kdanelia@imf.org Web-site: www.imf.ge Asian Development Bank Georgian Resident Mission Address: 1, G. Tabidze Street

Freedom Square 0114 Tbilisi, Georgia Tel: +995 32 225 06 19 E-mail: adbgrm@adb.org; Web-site: www.adb.org World Bank Office Address : 5a Chavchavadze Av., lane-I, Tbilisi, Georgia Tel: 291-30-96, 291-26-89/59 Web-site: www.worldbank.org.ge Regional Office of European Bank for Reconstruction and Development Address: 6 Marjanishvili St. Tbilisi Tel: 244 74 00, 292 05 13, 292 05 14 Web-site: www.ebrd.com Representation of the Council of Europe in Georgia Address : 26 Br. Kakabadze, Tbilisi Tel: 995 32 291 38 70/71/72/73 Fax: 995 32 291 38 74 Web-site: www.coe.ge

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

Restaurants CHARDIN 12 Tbilisi , 12 Chardin St. , Tel: 92 32 38 CAFE 78 Best of the East and the West Lado Asatiani 33, SOLOLAKI 032 2305785; 574736290 BREAD HOUSE Tbilisi , 7 Gorgasali St. , Tel: 30 30 30 BUFETTI - ITALIAN RESTAURANT Tbilisi , 31 I. Abashidze St. , Tel: 22 49 61 DZVELI SAKHLI Tbilisi , 3 Right embankment , Tel: 92 34 97, 36 53 65, Fax: 98 27 81 IN THE SHADOW OF METEKHI Tbilisi , 29a Tsamebuli Ave. , Tel: 77 93 83, Fax: 77 93 83 PICASSO Tbilisi , 4 Miminoshvili St. , Tel: 98 90 86 SAKURA - JAPANESE RESTAURANT Tbilisi , 29 I. Abashidze St. , Tel: 29 31 08, Fax: 29 31 08 SIANGAN - CHINESE RESTAURANT Tbilisi , 41 Peking St , Tel: 37 96 88 VERA STEAK HOUSE Tbilisi , 37a Kostava St , Tel: 98 37 67 BELLE DE JOUR 29 I. Abashidze str, Tbilisi; Tel: (+995 32) 230 30 30 VONG 31 I. Abashidze str, Tbilisi Tel: (+995 32) 230 30 30 BRASSERIE L’EXPRESS 14 Chardin str, Tbilisi Tel: (+995 32) 230 30 30 TWO SIDE PARTY CLUB 7 Bambis Rigi, Tbilisi Tel: (+995 32) 230 30 30 LOFT 11. I. Mosashvili str, Tbilisi Tel: (+995 32) 230 30 30 RESTAURANT NERO 21 Abano Street, Tbilisi Tel: (+995 32) 292 10 15

SH. RUSTAVELI STATE THEATRE Tbilisi. 17 Rustaveli Ave. Tel: 93 65 83, Fax: 99 63 73 TBILISI STATE MARIONETTE THEATRE Tbilisi. 26 Shavteli St. Tel: 98 65 89, Fax: 98 65 89 THEATRE OF PANTOMIME Tbilisi. 37 Rustaveli Ave. Tel: 99 63 14, (77) 41 41 50 Z. PALIASHVILI TBILISI STATE THEATRE OF OPERA AND BALLET Tbilisi. 25 Rustaveli Ave. Tel: 98 32 49, Fax: 98 32 50

Galleries ART GALLERY LINE Tbilisi. 44 Leselidze St. BAIA GALLERY Tbilisi. 10 Chardin St. Tel: 75 45 10 GALLERY Tbilisi. 12 Erekle II St. Tel: 93 12 89 GEORGIAN NATIONAL MUSEUM - PICTURE GALLERY Tbilisi. 11 Rustaveli Ave. Tel: 98 48 14 KARVASLA’S EXHIBITION HALL Tbilisi. 8 Sioni St. Tel: 92 32 27, KOPALA Tbilisi. 7 Zubalashvilebi St. Tel: 99 99 02, Fax: 99 99 02 MODERN ART GALLERY Tbilisi. 3 Rustaveli Ave. Tel: 98 21 33, Fax: 98 21 33 M GALLERY Tbilisi. 11 Taktakishvili St. Tel: 25 23 34 ORNAMENT - ENAMEL GALLERY Tbilisi. 7 Erekle II St. Tel: 93 64 12, Fax: 98 90 13

Akhvledianis Khevi N13, Tbilisi, GE. +995322958377; +995599265432

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

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

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

PUBLICITY caucasian business week

August 4, 2014 #65