New Year Brings a Welcome Merger…

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www.georgiatoday.ge Issue no: 806/8 • DEC. 29 - JAN. 7, 2015 • PUBLISHED TWICE WEEKLY PRICE: GEL 2.50

In this week’s issue... Mikheil Janelidze to Fill FOCUS Minister of Foreign Affairs ON BUILDING A Post BETTER GEORGIA PAGE 2 PAGE 15 Russia to Abolish Wheat Export Tax, Stability Expected PAGE 3

Tbilisi Development Fund, Making Tbilisi Shine PAGE 4

Humanity Georgia: Better

The 35-story Batumi Tower is being re-designed to become a complex Products, Lower Prices comprising of presidential, deluxe and standard aparthotels, indoor and outdoor swimming pools, restaurants, a ﬁ tness center, a lounge bar, and a casino PAGE 6

Oil Prices: Falling Again New Year Brings a Welcome Merger… PAGE 8 and the Expectation of More to Come Tegeta Motors: Make Your objectively considered as the leading English BY KATIE RUTH DAVIES IRAKLI TEVDORASHVILI, PUBLISHER OF Car History GEORGIAN JOURNAL: I am sure that both language newspaper in Georgia. However, the our readers and partner companies will sup- merger with Georgian Journal will give us an port our decision and accept it positively. The increased opportunity to improve the news- PAGE 11 eorgia’s English language news- merger will help us to fully concentrate on one paper quality, both in terms of content and paper market is facing a signifi cant product through joint efforts, optimized distribution. Thus, our partner companies will change as two independent English resources and shared experience in the news- benefi t from the best advertising platform with language newspapers, Georgia paper publishing business. As a result, Georgia no alternative of such quality and effi ciency in New Ski Today and Georgian Journal, Today will not only keep its leading position the country. Gannounce a merger in the last week of 2015. but will increase its market share to present a The recent merger follows on from a rebrand- Lift Station English language newspaper Georgian Jour- more advanced and more interesting product ing and redesign by Georgia Today late autumn, nal, published by ‘Palitra Media,’ is to become to its target audience. as well as the move to expand readership by Kokhta part of Georgia Today. The latter will keep its introducing the new weekly Georgia Today/ twice weekly publications - Georgia Today on GEORGE SHARASHIDZE, PUBLISHER & Business edition, covering the latest econom- Opens in Fridays and Georgia Today/Business on Tues- GENERAL MANAGER OF GEORGIA TODAY: ics, law and business news and analysis, in days, with an increased page volume - while This change will defi nitely affect Georgia’s addition to the general news coverage offered Bakuriani Georgian Journal will become a purely online English language media market. Georgia Today, on Fridays. media source under its previous name. with its fi fteen years market presence, was Continued on page 2 PAGE 13

Prepared for Georgia Today Business by Markets Asof25ͲDecͲ2015 STOCKS Price w/w m/m BONDS Price w/w m/m BankofGeorgia(BGEOLN) GBP18.94 Ͳ3,4% +4,5% GEOROG05/17 101.38(YTM5.82%) Ͳ0,3% +0,1% GHG(GHGLN) GBP1.64 +2,5% Ͳ6,1% GEORG04/21 104.14(YTM5.95%) Ͳ0,2% Ͳ2,7% TBCBank(TBCBLI) US$10.10 +1,0% +18,8% GRAIL07/22 102.00(YTM7.36%) Ͳ Ͳ2,8% GEBGG07/17 103.94(YTM5.02%) ͲͲ COMMODITIES Price w/w m/m CrudeOil,Brent(US$/bbl) 37,89 +2,7% Ͳ17,9% CURRENCIES Price w/w m/m GoldSpot(US$/OZ) 1076,10 +0,9% +0,5% GEL/USD 2,3900 +0,2% Ͳ0,2% GEL/EUR 2,6236 +1,2% +3,0% INDICES Price w/w m/m GEL/GBP 3,5535 Ͳ0,1% Ͳ2,1% FTSE100 6254,64 +3,3% Ͳ1,3% GEL/CHF 2,4280 +0,9% +3,5% FTSE250 17415,10 +1,8% +1,8% GEL/RUB 0,0339 +0,9% Ͳ7,4% DAX 10727,64 +1,1% Ͳ4,0% GEL/TRY 0,8173 Ͳ0,4% Ͳ1,4% DOWJONES 17552,17 +2,5% Ͳ1,5% GEL/AZN 1,5326 Ͳ32,8% Ͳ33,0% NASDAQ 5048,49 +2,5% Ͳ1,3% GEL/AMD 0,0050 ͲͲ MSCIEMEE 112,78 +1,9% Ͳ8,5% GEL/UAH 0,1044 +3,6% +3,3% MSCIEM 804,29 +1,8% Ͳ3,8% EUR/USD 0,9125 Ͳ0,8% Ͳ3,0% SP500 2060,99 +2,8% Ͳ1,3% GBP/USD 0,6740 +0,4% +2,0% MICEX 1734,21 +0,9% Ͳ5,4% CHF/USD 0,9882 Ͳ0,4% Ͳ3,3% MSCIFM 2358,72 +2,1% Ͳ1,9% RUB/USD 70,3763 Ͳ0,5% +7,4% GTIndex(GEL) 885,86 ͲͲTRY/USD 2,9124 +0,2% +0,8% GTIndex(USD) 728,29 Ͳ0,2% +0,2% AZN/USD 1,5575 +48,9% +48,8% GEORGIA TODAY 2 BUSINESS DECEMBER 29 - JANUARY 7, 2015 Mikheil Janelidze to Fill Minister of Foreign Affairs Post

Minister of Economy to be Appointed Vice PM the current Vice PM and Minister of of Georgia’s acting Foreign Minister, BY ZVIAD ADZINBAIA Energy, Kakha Kaladze. Giorgi Kvirikashvili, for the Prime Min- “Once Parliament approves the new ister’s post. government, Dimitri Kumsishvili will be After the parliamentary session, the eorgia’s candidate Prime Vice PM,” Kvirikashvili said. nominee declared that he does not rule Minister, Giorgi Kvirikash- The announcement follows the resig- out a reshuffl ing of the Cabinet, however, vili, has announced that nation last Wednesday of Ex-PM Irakli he does not foresee any dramatic shifts. Dimitri Kumsishvili, Min- Garibashvili. The entire Cabinet is sus- The remaining procedure for forming ister of Economy and Sus- pended awaiting the instalment of a new a new government is up to the legisla- graduate studies in International Law BY ZVIAD ADZINBAIA Gtainable Development, is to occupy the PM. The parliamentary majority of Geor- tive body, Parliament, which is expected and European Law at Diplomatic Acad- position of Vice Prime Minister alongside gian Dream has endorsed the candidacy to approve the new Cabinet. emy of MFA Russia. Janelidze holds a Master’s degree in eorgia’s candidate PM, Business Administration with Distinc- Giorgi Kvirikashvili, has tion from Grenoble Graduate School of announced he will soon Business and Executive Master of Busi- New Year Brings a Welcome Merger… present the acting govern- ness Administration from Caucasus mental team to Parliament School of Business, Tbilisi. Gfor approval. At different times, Mikheil Janelidze and the Expectation of More to Come Kvirikashvili named Deputy Foreign has acted in both, private and govern- Minister Mikheil Janelidze as candidate mental sectors. Before being appointed Continued from page 1 Georgia, both tourists and business out Georgia’s HORECA, WHERE.ge for Foreign Minister. First Deputy Minister of Foreign Affairs From 2016, Georgia Today will also travelers, will be equipped with the will assist tourists to plan their holidays Mikheil Janelidze earned his fi rst BA of Georgia in September 2015. Since be presenting: new comprehensive tourist guide, and adventure tours with more practi- degree in International Relations from November 2011, Janelidze worked as a WHERE.ge, unique in content and dis- cal and up-to-date information though Tbilisi State University back in 2002. Deputy Minister of Economy and Sus- WHERE.GE: Each foreign visitor to tribution network. Accessible through- both print and online content. Subsequently, he continued his post- tainable Development of Georgia. GEORGIA TODAY DECEMBER 29 - JANUARY 7, 2015 BUSINESS 3 Russia to Abolish Wheat Export Tax, Stability Expected Levan Silagava, Head of the Flour Producers including in Russia, and this is the reason Association BY ANA AKHALAIA for the recent decision. “The wheat harvest was good this year According to Silagava, when a com- and Russia found it diffi cult to export pany imports fl our from other countries, ead of the Flour Produc- their products because it had an export it takes benefi ts from the state. There- ers Association, Levan tax. Accordingly, in order to sell wheat fore, it is diffi cult to compete with other Silagava, has claimed that on the world market at competitive countries. This is why, he says, there is Moscow is planning to prices, tax reductions would be neces- USD 40 difference on 1 ton between abolish or signifi cantly sary,” said Silagava. milled fl our prices in Russia and in Hreduce export tax on wheat. The Russian From February 1st, 2015, Russia set Georgia. government’s decision may provide fl our export tax on wheat at 15% +7.5 euros of “Russian fl our takes 90% of the wheat and bread price stability in Georgia. the value. Additionally, Russia reinforced market in Georgia. As a result, if this Silagava said that this is a very positive processing factories and decided to sup- trend continues, local production will decision, not only for Georgia but for port fl our export in order to create a be replaced by imports, and therefore the world markets, too. The wheat har- domestic product and employ a local the state budget will suffer, jobs will be vest is quite good throughout the world, workforce. cut and so on,” said Silagava. The Happy Company Invests in Children’s Creativity and Learning Winkler, the shop sells toys for children years ago but keep an eye on their BY PENELOPE CUMLER designed to awaken their creativity and beloved homeland with the interest, promote hands-on learning. The corner also shared by parents, of promoting shop features an open area for children the educational opportunities of chil- n time for the New Year, new and walls lined with shelves of scientifi c dren. While living in Hamburg they ideas about playing and learning experiments and arts and crafts sup- often noticed the type of activities chil- are on view at the Happy Com- plies and kits produced by well-known dren engaged in: project based play that pany, which recently opened their companies such as Kosmos and Max promoted concentration by following doors at 9 Abashidze St. in Vake. Bringmann KG/Folia®, primarily Ger- through on a process, such as scientifi c TheI brainchild of two Georgia natives, man manufacturers. experimentation or building a model Lasha and Nino Papukashvili, and a The Georgian natives, professional airplane. Educational toys from Kosmos are among the many fun and creative items available at the Happy Company in Vake German and friend of Georgia, Tobias chemists, immigrated to Germany many Continued on page 14

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OOPENPEN YYOUROUR DDOORS!OORS! GEORGIA TODAY 4 BUSINESS DECEMBER 29 - JANUARY 7, 2015 Tbilisi Development Fund, Making Tbilisi Shine iorgi Baidarashvili spoke completely new organizational structure benefi t of citizens, Tbilisi and the coun- in its place. While this attitude exists, ing routes, creating new attraction points, to Georgia Today about was introduced in the Fund, developed try. the pace of rehabilitation of historical and supporting the development of Tbi- the work of the Fund. by the employees, together with consult- areas will always be slow. Throughout lisi by promoting it together with the ing fi rm Synergy Group. TELL US ABOUT ANY the next years, the Fund will try to change relevant state and private tour operators. 2. The existing scheme of human DIFFICULTIES THE FUND existing stereotypes for the benefi t of G resource distribution has been rethought, FACES. HOW DOES THE the Old city. WHAT IS THE BENEFIT OF PLEASE SUMMARIZE 2015: with consideration of abilities and qual- FUND OVERCOME THEM? The third is that the legal regulations DEVELOPMENT OF THE WHICH ARE THE MOST ifi cations. Moreover, the Fund has been Claiming that we and the City Hall do need to be improved. Borders need to CAPITAL’S HISTORIC AREA? IMPORTANT PROJECTS? WHAT recruiting new employees in an on-going not face barriers, when works of this be determined for the Fund, the govern- This is a unity of decisions, developed WAS THE MAIN DIRECTION process. scope should necessarily be carried out, ment in general and business, which based on detailed research of up to 2200 OF WORK FOR THE FUND? The purpose of the Fund has been would be false. The most important instead of hindering will support saving buildings in the historic part of Tbilisi I have been Head of the Fund since July clearly defi ned and specifi ed and envi- problems, which we think we will be the monuments and using them in the and derived from evaluating the scope 1st, 2015, therefore it makes more sense sions preserving the historical appear- able to overcome through stable, con- correct way. Without this they will never of infl uence these can have on develop- to summarize the period over the last ance of Tbilisi and increasing the value tinuous communication, are the follow- have anyone responsible for their pres- ing the city. The concept determines in six months. of real estate. The renewed structure of ing: ervation. which sequence the Fund should work The second half of 2015 has been marked the Fund has been built on this principle First of all the attitude of citizens, espe- The Fund will not spare itself to make on saving the historic-cultural monu- by very important initiatives and changes and is comprised of the following three cially the ones who own the monuments a complex analysis in which the sequence ments. Specifi cally, it determines which for the Fund, there are three main aspects: permanent strategy action plans: and who have stereotypes regarding their all the necessary works should be car- monuments the Fund should work on new projects, organizing and implement- 1. Defi ne the opportunities and neces- real estate. It is incorrect to think that ried out in order to renew-preserve and out of all 1700 monuments. What is most ing the planning for rehabilitation of sities related to preserving the historical the border of your house is only your conserve historical monuments, and to interesting is that the prioritization of certain areas in 2016 and institutional appearance of the city and increasing door step, when you do not care what reveal incorrect, outdated legal barriers, working on these monuments is deter- development of the Fund. the value of properties (not only in mon- happens beyond it, when you are not as well as vacuums, and suggest oppor- mined not only based on the necessity Within a limited timeframe, in the sec- etary terms). interested in its constructional, visual tunities for correction. Afterwards, we of saving the monument, but also on ond half of 2015, extremely important 2. Plan correct ways of using these or hygienic state. It is also incorrect to will develop initiatives about changes what effect saving it have on the devel- projects have begun in the historical part opportunities for the benefi t of the city. think that only the government is respon- and try to improve the situation in the opment of the street, district, region and of the city and in terms of touristic devel- 3. Realize these opportunities in a legislation for managing the historical the city, as well as in terms of touristic- opment. The rehabilitation projects of qualifi ed, rapid and correct manner. monuments. social and commercial-economic aspects. the Wine Rise, Gudiashvili Square and The activities of the Fund have always Therefore, in terms of objectivity, the historical buildings in the second part been and will continue to be related to TELL US ABOUT NEW PROJECTS Fund has very clear action priorities for of Agmashenebeli will become a foun- improving the touristic, economic and FOR THE UPCOMING YEAR organizing the processes of rehabilita- dation for the increase of social and social potential of the city. In the areas The main concentration in 2016 will be tion of historic-cultural monuments in economic welfare of the citizens of Tbi- where the Fund is carrying out its activ- on rehabilitation of the second part of the upcoming 2-3 years. lisi. ities, the visual side of the city is improved, Today, interest Agmashenebeli Avenue and the main The second direction, which envisages the condition of monuments, the number part of Gudiashvili Square. WHICH OF THE ONGOING preparation of projects for 2016, started, of tourists and visitors is increasing, and towards historical Also, fi nishing the majority of reha- PROJECTS WOULD also in rapid mode, in September and the value of the property and the price bilitation works within various separate YOU SINGLE OUT? October. The planning of the rehabilita- of its usage (rent). All this is the basis monuments in the projects that have started in 2015, with All of them are important, so it is diffi - tion of up to 45 houses located in the for the improved welfare of our citizens. all addresses on the Wine Rise among cult to choose a single one. In short, it second part of Agmashenebeli Avenue, Old city is them, Khetagurov’s House-Museum, is very important to connect the already will be fi nished by the end of this year. WHICH REHABILITATION Medicine Museum, various places in rehabilitated parts of Tbilisi with tour- Moreover, preparation works will be PROJECTS INVOLVING unhealthy and Kvemo Kala, and residential buildings istic and commercial points and the parts ready for 15 historical monuments and/ UNIQUE HISTORIC HOUSES on Tumaniani and Betlemi streets that are interesting in terms of social life or public infrastructural projects. These WOULD YOU DISTINGUISH? rather short-term... At the end of the fi rst half of 2016, the with each other. will serve as the basis for a very loaded One of the best examples in this regard planning of next year’s projects will In this regard we plan to connect Piro- yet correct working plan for the Fund is No.36, D. Agmashenebeli Avenue, with with a focus on begin, for which the preparation project smani Street, which is connected to two next year. its wonderfully painted entrance. The on concepts of development of the Piro- large shopping centers in the city center The same year, based on the Gudiash- residential block on Shalva Dadiani Street, demolishing a smani-Constitution-Kargareteli- – Tbilisi Central and Kavasla, with a vili Square conservation, we plan to start No.32-34 is also very important as it is Agmashenebeli-Orbeliani avenues will highly important transportation hub working on plans for the rehabilitation considered as the oldest building in the building and be fi nished by the end of 2015. This pro- (Railway Square), to the already partly of those addresses in the most severe historical district of Tbilisi. Its reha- ject will determine the opportunities of rehabilitated Agmashenebeli Avenue via state, and also to make the plans for bilitation is planned for 2016. constructing a development in the stated areas, and the Constitution-Kargareteli Streets. Later, works that should be carried out on the The main action area of the Fund Fund will use them in the following 2-3 after rehabilitating this part of Agmashen- second part of Agmashenebeli Avenue, includes up to about 2000 monuments, bigger one in its years. ebeli, Dry Bridge and Orbeliani Squares which will clarify what further decisions with 18th century monuments on Gudi- and the rehabilitated Gudiashvili Square need to be taken. ashvili Square, buildings on Agmashen- place WHAT IS THE IMPORTANCE will be connected with the rehabilitated The third direction, which started in ebeli and Orbeliani Square among them. OF TOURISM FOR THE Kvemo Kala. It will be logical to reha- August, concerns organizational and The processes for planning the reha- sible for preserving and developing the REHABILITATED OLD CITY? bilitate the roads leading to the Sameba methodological development of the Fund bilitation of these has started. We hope property, which is often more than 100 WHAT ABOUT THE CHARM Fortress and interconnecting the stated as well as personnel management: that we will be able to rehabilitate the years old. When the attitude of the pop- AND ATTRACTION OF THE enormous rehabilitated touristic zone 1. At the beginning of November, a ones that are in the most severe state. ulation is that they should necessarily OLD CITY IN GENERAL? with it as Sameba represents a critical In this regard, in order to determine gain something from the project, it Deriving from the historicity of Tbilisi, attraction for the city, together with many the priorities correctly, with the help of becomes very diffi cult for the Fund to it is extremely interesting in terms of other buildings. While visiting Tbilisi, the company “Geography,” the Fund car- carry out the works at the relevant pace, tourism and it will become even more a tourist will by all means fi nd himself ried out a unique project for accounting to keep up with the pace with which the appealing if we are able to foresee the here. Wine Rise is part of this route, and evaluating the conditions of his- historical monuments are damaged daily. target area of exactly what touristic which is why its rehabilitation is impor- torical monuments and for determining Second is the attitude and stereotypes fl ow Tbilisi can gain in the next 3-5 tant within this route and not as a sepa- the right necessary works. Such thorough of business representatives towards his- years. rate unity of addresses. study and evaluation of monuments for torical monuments and how they should It will be diffi cult to use the touristic The main action the planning of rehabilitation, restora- be used. Today, interest towards his- potential of Tbilisi correctly if we don’t HOW DOES YOUR IDEAL tion, and conservation has never been torical monuments in the Old city is identify the potential touristic streams TBILISI LOOK? area of the Fund carried out Tbilisi. This research is a unhealthy and rather short-term. Most and stimulate the creation of interesting It would be a city loved by people, in clear and correct action framework- of those who are interested in monu- attraction spots for them. In future, the which each street, house, garden, square, includes up to decision of the Fund for the following ments perceive them as a problem if they Fund will try to develop interesting entrance or elevator is an object that is 3-5 years, made in order to use those want to build something and/or purchase routes for potential tourists based on handled just like our own homes... A about 2000 unique opportunities that exist due to it; they focus on demolishing the monu- this principle with all elements: creating place where people care for their city, monuments the many historical buildings, for the ment and constructing a bigger building interesting connections between exist- respect each other and our guests.

GEORGIA TODAY 6 BUSINESS DECEMBER 29 - JANUARY 7, 2015 Humanity Georgia: Better Products, Andrey Kuzma, Director of Humanity Georgia and Natia Turnava, of the Partnership Fund. Humanity Georgia has entered the Lower Prices Georgian pharmaceutical market with ambitious plans

agement,” said Andrey Kuzma, the Direc- ers on the Georgian pharmaceutical of medication is not transparent the law cal drug manufacturing factory will be BY ANA AKHALAIA tor of the company. “A large part of the market and I think that it will be very keeps it confi dential. equipped with the latest technology, company’s employees have a lot of expe- diffi cult for them to compete with the “When a drug is not accompanied by modern laboratory quality inspection, rience working with world brands, such new company,” Chelidze said. I believe a document which does confi rms its warehousing and other necessary infra- umanity Georgia has as SANOFI and PFIZER. Humanity that the new company should enter authenticity, it means that we are not structure. entered the Georgian Georgia is a dynamically developing the market with just the right market- insured from questionable products,” The factory, which will employ 300 pharmaceutical market company and our goal here is to estab- ing moves. In general, the pharmaceu- Chelidze said. “In general, when we talk people, including local and foreign spe- with ambitious plans and lish ourselves in the Georgian pharma- tical market is a living process, con- about drug effectiveness, the most impor- cialists, will produce at least 800 types aims to offer a wide range ceutical business as a affordable, safe stantly changing. It is natural that one tant is bioequivalence. It does not have of medicine, both for local use and for Hof medicines in the near future. Accord- and quality product supplier.” player goes and another enters. a great importance which the producing export. A certain number of drugs will ing to the company, at the fi rst stage, According to Kuzma, their products Monopoly in Georgia is out of the countries are; the important thing is to be imported by the company, which they they will be offering the most common are certifi ed by the manufacturer EU question. And, as it is easy to start a identify bioequivalence correctly. I believe plan to sell at reasonable prices in Geor- consumption drugs in Georgia at the GMP as well as with serial control of the business [here], all kinds of imports that if the drug quality control tightens gia. end of December. World Health Organization certifi ed can be carried out.” it will refl ect on prices. Accordingly, The agreement for the new USD 130 The entrance of the new pharmaceuti- laboratory. She also discussed the control on access to medicines will increase. million project was signed between the cal company is positively assessed by President of the Association of Phar- imported drugs in Georgia which are JSC Humanity Georgia was founded Partnership Fund, Humanity Holding specialists, doctors and politicians alike, maceutical Companies, Irina Chelidze, not properly checked. She suggests that by Austrian company Humanity Hold- GmbH and project company Humanity who agree that it will contribute to com- who met with the Director of Humanity the government establish a laboratory ing GmbH which will build a high-tech Georgia. petition on the country’s pharmaceutical Georgia, said that the company repre- which will control imported medications, pharmaceutical factory in Tbilisi with The Company believes that importing market and increase access to medicines. sents a wide range of generic drugs on since the product identity is not con- the Partnership Fund. The Ministry of safe and affordable medicines will guar- “Our company is young but our advan- the Georgian market and mostly offers fi rmed in any way with the current reg- Health and Social Affairs will actively antee a drop in prices on the Georgian tage is that the best specialists with great medicines produced in India. istration. participate in the project. pharmaceutical market averaging 30% experience are in the company’s man- “Today, there are several strong play- She further stated that the distributors The European standard pharmaceuti- or more.

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Total area - 110 m2 Balcony - 6 m2 (Agmashenebeli Street view) Balcony - 9 m2 (Sea view) 2 Bedroom - 20 m2 Total area - 53 m 2 Living room - 21 m2 Balcony - 6m 2 Kitchen - 20 m2 Bedroom - 14 m Hall - 10m2 Living room 2 Bathroom - 5 m2 and kitchen - 24 m Hall - 4 m2 BathroomBaBatthrooomm - 5m5m2

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GEORGIA TODAY 8 BUSINESS DECEMBER 29 - JANUARY 7, 2015

The Galt & Taggart Research team comprises Georgian and Azerbaijani ﬁ nance and economic experts who have broad experience of covering the macro and corporate sectors of the two countries. Our current product offering includes Georgian and Azerbaijan macroeconomic research, Georgian sector research, and ﬁ xed income corporate research. For free access to Galt & Taggart Research, please visit gtresearch.ge or contact us at [email protected]. Oil Prices: Falling Again

investment and production compared Saudi Arabia, abandoned its traditional sanctions following the Russia-Ukraine lar strong, which will also support low BY KOBA GVENETADZE to a decade or longer needed for con- role as the global oil market’s swing confl ict. oil prices. ventional oil drilling. Moreover, uncon- producer—a supplier with spare capac- Overall, while both supply and demand The above factors suggest that while ventional shale oil producers can adjust ity that can infl uence market prices by factors played a role, the supply side gradually recovering from the current il prices keep falling, below output levels reasonably quickly to adjusting output—by leaving the pro- factors appear to have weighed more level, oil prices can be expected to stay all previous projections changing demand. duction quotas unchanged in the face on the recent drop in oil prices. relatively low for some time. A good and expectations. The A shift in the strategic behavior of the of growing non-OPEC supplies a year way to sense where the oil prices are price of Brent crude sank Organization of Petroleum Exporting ago. Some analysts argued that Saudi WHAT’S NEXT? heading is to look at the futures’ prices to US$34.8 per barrel on Countries (OPEC), accounting for 40% Arabia’s decision was aimed at slashing Given the dominance and size of the as they refl ect market participants’ DecemberO 21, the lowest level since May of the world’s oil supply, is another the profi ts, and ultimately the oil pro- supply factors in the recent collapse of expectations. The Brent futures con- 2004. This is 44% and 69% percent lower important contributor to the current duction, of the US shale oil producers oil prices, oil producers’ investment tracts dynamics as of today show that than the prices in June 2015 and June supply glut. OPEC, and in particular with relatively high extraction costs. decisions will largely shape the longev- the market participants expect a slow 2014, respectively. Natural gas and coal While falling oil prices will force some ity of the current low oil price cycle. A recovery in oil prices. The moderately prices followed the trend, but fell by shale oil producers out of business, Rys- long period of high hydrocarbon prices upward sloping futures prices will sup- less as these fossil fuels are generally tad Energy, an oil and gas consulting can create preconditions for them to posedly discourage risky and bold invest- priced through oil-indexed contracts company offering analysis of the global fall: high oil prices encourage massive ment in the oil sector, but provide enough with some lag. Such a sharp drop in oil databases, is of the view that US shale investments in new production capaci- incentives to carry on the ongoing pro- prices is not unique. Refl ecting various production has so far remained eco- ties that can lead to a sharp increase in jects and start investing in new viable geopolitical, economic and security fac- nomical despite the drop in oil prices production and result in global oversup- ones. tors, “Black Gold” prices have fallen In 2015, growth as the breakeven price—the minimum ply of oil. The residual oil is stockpiled, sharply three times in the near past: in price level at which extracting oil remains providing comfort to oil consumers and LAST, BUT NOT LEAST 1985-86, in 1990-91, and in 2008-2009. in emerging profi table—for shale oil has also been pushing oil prices down. According to While supporting global growth, low Low oil prices are good for the global falling every year. OPEC’s decision to the Rystad Energy analysis, the current oil prices, unfortunately, promote usage economy, because they translate into economies—main maintain its collective production target oil supply glut and collapse in oil prices of energy intensive technologies in lower cost of production, thus boosting unchanged in its recent meeting kept are direct consequences of overinvest- industry and agriculture, thus causing profi ts and savings and enabling higher consumers of the the oil market oversupplied and pushed ment by the oil and gas industry in 2013 environmental damage from production investments. A period of low oil prices the prices further down. and the fi rst half of 2014. Oil and gas of fossil fuels and increasing emissions is also a good time for the reduction of growing oil Some geopolitical events also sup- companies invested as much as 900 bil- of carbon dioxide and other greenhouse energy subsidies which were at US$548 ported the increase in oil supply. Against lion USD in exploration, drilling, fi eld gases. More importantly, low hydrocar- billion (0.7 percent of the world GDP) production—is many analysts’ expectations, crude oil development, and fi eld maintenance in bon prices provide little incentive to at end-2013. production recovered quickly in Libya 2013. OECD crude oil inventories, accord- policymakers to fund research and Projecting medium to long-term oil despite unrest and elevated security ing to the IEA, were at a record high 3 development of renewable (hydro, solar, prices has often proved to be an unsuc- projected to concerns. Invasion of Iraq by the Islamic billion barrels at end-September 2015. wind) sources of energy and cleaner cessful endeavor because of the variety State militants in June 2014 did not dis- Based on the same logic, falling oil energy technologies. Introduction of a and complexity of factors affecting the decline for the 5th rupt the oil production of OPEC’s second prices should lead to lower capital invest- tax on carbon is often suggested by price movement. Instead, let’s look at largest producer as the confl ict did not ments in the oil sector and impact future economists to reduce the environmen- the reasons behind the recent oil price consecutive year spread to the south, where the country’s oil production with some lag. Rystad tal damage from carbon emissions. Until collapse and try to understand if low largest oilfi elds are located. Furthermore, Energy reports that fearing plunging oil this happens, however, let’s hope that prices are likely to persist. to 4% compared Russian crude oil production has recently prices, global oil companies have can- the recently adopted United Nations reached a post-soviet record high despite celled or deferred about US$175 billion Climate Change Conference Paris dec- WHY DID OIL PRICES PLUNGE? to 4.6% in 2014 Slowdown of the global economy is the main demand factor behind the fall in oil prices. Global economic growth is projected to decelerate from 3.4% in 2014 to 3.1% this year, implying a weak- ening demand for oil. More importantly for the oil sector, 2015 growth in emerging economies—main consumers of the growing oil production—is projected to decline for the 5th consecutive year to 4% compared to 4.6% in 2014. Based on the BP database, the annual oil consumption growth in 2014 fell to 0.9% compared future upstream investments by mid- laration, which aims to transform the to an average annual growth of 1.8% 2015. Overall, global exploration and energy sector by accelerating invest- during 2010-2013. The IEA estimates production spending has been cut by ments in cleaner technologies and energy global oil demand in the last quarter of US$250 billion in 2015 versus 2014 and effi ciency, will bring tangible results 2015 to increase by only 1.3 million bar- a further US$70 billion reduction is even in the environment of low oil prices. rels per day (mbd) from a year earlier, projected for 2016. These cutbacks will which is signifi cantly lower than the 2.1 eventually slow down the growth of oil mbd annual demand growth registered supply and put upward pressure on oil in the third quarter of this year. prices. Expected higher growth of emerg- Emergence of US shale oil appears to ing economies in 2016 (4.5 percent) will be the strongest supply factor that con- also push up global demand for oil. tributed to the drop in oil prices. Thanks Three additional factors could infl u- to the so-called “shale revolution”, a new ence the global oil prices in the near horizontal drilling technology that ena- future. First, last week the US congress bles extraction of oil from tight rock removed the 40-year old export ban on formations, the US has added about 4 crude oil exports. This means that US million barrels (about 5% of 2014 oil producers will soon be able to export production) of unconventional crude to light crude oil to already oversupplied oil markets over the last four years, mak- international markets. Second, Iran’s ing the US the world’s largest oil pro- likely return to the global oil market in ducer in 2014. Shale oil production has 2016 is expected to increase global sup- a considerable advantage over conven- ply of oil, causing global oil prices to Author Koba Gvenetadze is on leave from tional oil drilling. It requires a relatively ease. Third, the US Federal Reserve the International Monetary Fund (IMF). The low capital cost and has a much shorter Bank’s recent increase of the policy views presented in this article do not repre- life cycle (3 years) between the fi rst interest rate is likely to keep the US dol- sent those of the IMF or its Executive Board.

GEORGIA TODAY 10 BUSINESS DECEMBER 29 - JANUARY 7, 2015 Furniture Made in Georgia to Head to Sunny Spain

having already been selected and to Outdoor Furniture does not pay cus- for third countries. The tariff established bank provided a USD 150,000 loan to BY ANA AKHALAIA appear in Spanish stores from spring. tom tax which enables it to access the by the EU is 5.6% of the value of this the company. Enterprise Georgia will The company is also in negotiation market of the EU member country. The type of furniture. co-ﬁ nance 10% from a 13% total loan with Armenia and Azerbaijan. Deep and Comprehensive Free Trade Before the DCFTA, preferential trade interest for two years. utdoor Furniture, one of “We are sending only straw furniture Agreement (DCFTA) between Georgia was possible with GSP+ according to Outdoor Furniture bought new equip- the many companies which is seasonal for spring, summer and the EU came into force on Septem- which such products were also released ment, expanded and improved the pro- under the Produce in and autumn,” said Shota Bukhaidze, ber 1st, 2014. This provides preferential from tax but temporally. Outdoor Fur- duction process with the loan. Accord- Georgia program, is plan- Director of Outdoor Georgia. “We trade relations between Georgia and niture company has DCFTA on a per- ing to the director, the company is now ning to enter European couldn’t produce enough for export the EU, in particular, it repeals import manent basis. manufacturing wooden straw furniture market.O before but now we are actively working and export taxes on products in trade. Expansion and re-equipment of the with the new equipment. The number The company will send its furniture in this direction. We will export chairs, Under the DCFTA, the customs tax furniture company was carried out under of employees has also increased from in Spain from January, with a collection deck chairs, sofas, tables and swings.” will be abolished which is mandatory the program Invest in Georgia. VTB 20 to 40.

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Russian Company Caught Selling Georgian Sulguni Cheese in Europe

was found on the internet. cal indications of agricultural and other BY ANA AKHALAIA Sulguni is registered as a Georgian food products was signed in 2010, at the geographical indication, therefore, its National Intellectual Property Center. production in other countries is consid- Sakpatenti registered Sulguni in 2012,” he Ministry of Agriculture ered to be counterfeiting. said Nikoloz Gogiladze, Chairman of discovered counterfeit Sul- The EU Association agreed on the Sakpatenti. “We are working on resolv- guni cheese in Italy and protection of products originating from ing this issue, it has already been dis- Bulgaria, Tengiz Kaland- a certain geographic area, however, the cussed at the joint committee meeting adze Deputy Head of the list does not include Sulguni and so they and, along with Georgian cheese, we will TFood Safety Agency, told eugeorgia.info. are unable to take appropriate action. also add other recently registered prod- Kalandadze states that Georgian cheese “The agreement between Georgia and ucts to the list. However, the document packaged by a Russian company in Europe the EU on the protection of geographi- needs to be ratiﬁ ed by Parliament.” GEORGIA TODAY DECEMBER 29 - JANUARY 7, 2015 BUSINESS 11 Tegeta Motors: Make Your Car History

ge, you can see all your operations, for details are conﬁ dential and only the BY ANA AKHALAIA example, when the last time was you direct owner will have access to the per- replaced the oil or accessory; receive sonal data. information via messages and even get If you plan to sell or change your car, egeta Motors is now offer- recommendations. At the same time, the the new user will not be able to see old ing its customers a new system will constantly remind you what data. In addition, the site has no editing innovative service which procedures are necessary for the optimal function, which means that conﬁ dential allows the car owner to see performance of your car. information is not in danger and, in the all his personal car data on My Car History personal page stores case of data loss, the owner can feel Ta computer screen: costs, savings, updates information about all the cars the owner secure. or different reminders with relevant has ever owned and used Tegeta Motors The program includes Loyalty Cards. recommendations and a general history services on. Of course, visitors to the With the My Car History project, new of the car. website can optionally show or hide this TEGETA CARDS were created: Tegeta After registering on www.mycarhistory. information. Most importantly, all the Classic, Tegeta Silver and Tegeta Gold.

The Tegeta Classic will be given to all notiﬁ cation, constantly reminds users those who use the company’s services what needs to be changed or repaired. and, with the accumulated bonus points, This project has no analogue on the adequate services or products will be Georgian web and is available only for available. If the cost on the card is more Tegeta Motors customers, provides secu- than 500 GEL, it will be updated to Silver rity and reducing worry. The owners status. The Gold Card will be available will not have to ﬁ ll their car diary as after spending more than 1500 GEL. As Tegeta Motors will take care of all the for the advantages, Tegeta Silver owners details. will receive a 5% discount and Tegeta The website www.mycarhistory.ge also Tel: (995 32) 2 45 08 08 Gold owners – 10%. provides video instructions. Operators My Car History not only systemizes also can help you to create a personal 10 Galaktion Street E-mail: [email protected] the information, but also takes care of history of your car on Tegeta Motors the user’s security and, in the form of hotline: 226 44 44. GEORGIA TODAY 12 BUSINESS DECEMBER 29 - JANUARY 7, 2015 MetroCity: The Best Innovative Project

colleagues,” said Irma Kamadadze, Head familiarized ourselves with the Ukraine, BY EKA KARSAULIDZE of MetroCity Sales Group. “It was a very Azerbaijan, Belarus and Kazakhstan important forum for our company – we projects and established business rela-

ulticomplex construc- tionships with their representatives. tion project MetroCity We have already signed a number of Batumi was among the contracts and established formal rela- winners of the fi rst tionships.” Eastern Europe and The Forum also reviled the best con- AsiaM Real Estate Forum and Project struction project in seven categories: Awards. The Forum gathered 49 organ- the Best Offi ce Project, the Best Com- izations from Ukraine, Belarus, Kazakh- mercial Real Estate Project, the Best stan, Azerbaijan and Georgia and was Development Commercial Real Estate held under the Ukrainian Real Estate Project, the Best Residential Complex Club and EuropaProperty.com organi- Project, the Best Residential Complex, zation. the Best Multicomplex Project, the Best According to the organizers, the Forum Hotel Project, and awarded some spe- was a great platform for establishing cial prizes like the Best Innovation Pro- business contacts and fi nding new ject of the Year, which went to Metro- partners, as well as an effective way to City. advance projects, especially if the pro- MetroCity won the prize for Best ject is at an early stage of implementa- Innovative Project thanks to its unique tion. During the discussion, hot topics and multicomplex aspect, which includes were raised such as the real estate two residence complexes with 464 apart- market in Belarus and Ukraine in the ments from 38 m2 to 300 m2, two fi ve time of world economic crises, the star hotels, two casinos, private swim- attractiveness of the New Silk Road ming pools, panoramic terrace restau- countries – Georgia, Azerbaijan and rants, spa, a shopping center including Kazakhstan, as well as a third discus- 100 brand stores, sports club, a la carte sion panel fully dedicated to the Geor- restaurants, cinema, a bowling center, gian hotel market. a playground for children, a golden “There were various presentations, sandy beach and the biggest conference marketing research in the fi eld of audit hall in Transcaucasia for 1500 guests. and fi nancial accounting in the Forum. MetroCity is a huge construction in Moreover, we also had a presentation Batumi City, which was begun in Feb- of our MetroCity project and thought ruary 2015 and it will be successfully it was an interesting example for our completed in April 2017. GEORGIA TODAY DECEMBER 29 - JANUARY 7, 2015 BUSINESS 13 NBG Sells USD 20m to Strengthen Lari

The Rike-Narikala Cable Car will be open to citizens without charge from 23:00 on December 31 to 15:00 on January ﬁ rst from USD 2.699 billion at the beginning of 2015. BY KATIE RUTH DAVIES IMF mission said on December 8 that it “strongly BY KATIE RUTH DAVIES supports the NBG’s policy to allow the Lari to ﬂ oat and to limit foreign exchange interventions only he National Bank of Georgia (NBG) to dampen excess exchange rate volatility.” Travel Free sold USD 20 million at a foreign cur- The Lari has been stable at around 2.39-2.40 to bilisi Metro and the Rike Cable Car rency auction last week in order to the USD since the summer, yet since the beginning service will be running free of charge support the national currency Lari of the year has lost 27.6% of its value and 37% since on New Year’s Eve and Christmas Eve. (GEL) which, as a result, strengthened November 2014, when the Georgian currency began Around Tbilisi Mayor Davit Narmania toT 2.4023 per U.S. dollar from 2.4107. to depreciate due to global strengthening of the announced that the Metro and Rike- The move marked the central bank’s ninth inter- USD and a slowdown in export. NarikalaT Cable Car will function for longer and vention this year with total sales reaching USD The depreciation of GEL has increased the debt will be free to all. The Metro will be free from 23:00 286.96 million. burden of borrowers with loans in USD. Around Tbilisi this on December 31 to 04:00 on January 1, and from The beginning of this month saw Georgia’s foreign 64% of the total loans in Georgia have been taken 23:00 on January 6 to 04:00 on January 7. The Cable exchange reserves at USD 2.479 billion, up from out in a foreign currency, the majority of those Car will be open to citizens without charge from USD 2.449 billion the previous month, and down in USD. New Year 23:00 on December 31 to 15:00 on January 1. New Ski Lift Station Kokhta Opens in Bakuriani

The opening was attended by Georgia’s candidate Prime Minister, Giorgi Kvirikashvili, and acting Ministers of the Georgian Cabinet. Photo: Georgian National Tourism Administration

the private sector. BY ANA AKHALAIA The Mountain Resorts Development Company under the Ministry of Economy and Sustainable Development, and investment company GRDC, renovated ski lift station was opened are actively involved in the development of the on Kokhta Mount in Bakuriani, one historic resort of Bakuriani and from 2016, a 500- of Georgia’s leading ski resorts, on bed tourist infrastructure will be built at Kokhta. December 27th. The opening was Bakuriani is one of the locations where the Geor- attended by Georgia’s candidate gian Ski Federation is holding the 2015-2016 season PrimeA Minister, Giorgi Kvirikashvili, and acting Ski Championship. With the opening of a new ski Ministers of the Georgian Cabinet. lift, the ﬁ rst stage of the Ski Championship was After an eight-year pause, the Kokhta 6-chair launched with a giant slalom on the 27th Decem- Ski lift was rebuilt by leading Austrian company ber and a slalom competition on the 28th. Doppelmayr in three months. The total length The high level tournament, is supported by the of the renewed Kokhta ski track is 3 km and 100 Ministry of Sport and Youth Affairs and the m, now the most challenging track in Bakuriani. Mountain Resorts Development Company. The The maximum altitude is 2100 m. The new ski Georgian Cup of the Ski Championship, spon- lift has been launched with a mid-station. sored by Silknet, is to include all the country’s The multi-million dollar project was imple- active ski resorts: Gudauri, Bakuriani, Goderdzi mented with collaboration between the state and and Mestia. GEORGIA TODAY 14 BUSINESS DECEMBER 29 - JANUARY 7, 2015 The Happy Company Invests in Children’s Creativity and Learning

visits with suppliers. Ms. Papukashvili is in Germany and Georgia and searching talking with local schools and other edu- enthusiastic about all there is to do and is for partners and venues to realize further cational institutions to bring these prod- already planning to expand on the idea of programs and events to be offered in the ucts to Georgia as a local distributor. The bringing creativity and educational-based future such as a Little Scientists Club and Happy Company shop, with 5 employees, play to Georgia. The Happy Company is an Artists Club for children to be led by is open hours from 11 to 8 Monday to Fri- in exchange with scientists and teachers local professionals. The company is also day and 12 to 8 on Saturday and Sunday.

Continued from page 5 together and promotes happiness, experi- ences needed in Georgia, she says. This is Their ideas about the effi cacy of these how they came up with the idea of the educational toys and their benefi ts for Happy Company. “We wanted to bring to children were further confi rmed by the people in Georgia what we had experi- presents they gave their own nieces and enced ourselves.” nephews back in Georgia. The children They thought through the earlier phases loved the toys. of their idea and then contacted the “Creativity and scientifi c inquiry doesn’t German Business Association Georgia end with childhood,” explained Ms. Papu- (DWVG) http://georgien.ahk.de/ at 24 kashvili. Taken from their own professional Rustaveli Avenue for help in realizing their experience with brainstorming and crea- project. The DWVG helped them build a tivity as an input process that brings inner network of contacts for fi nding products calm and satisfaction, Ms. Papukashvili and partners. They also visited trade fairs believes that these toys bring families in Germany with further plans for more WHAT’S ON IN TBILISI

THEATRE CINEMA LOVE THE COOPERS MUSEUM IOSEB GRISHASHVILI TBILISI (Info Above) HISTORY MUSEUM INVITES Language: Russian YOU TO THE PHOTO GEORGIAN NATIONAL GABRIADZE THEATRE AMIRANI CINEMA EXHIBITION OF HIROTAKE Start time: 11:40, 14:30, 17:45, 20:10, MUSEUM SIMON Address: 13 Shavtelis St. Address: 36 Kostava Str. MAEDA. 22:35 JANASHIA MUSEUM Telephone: 2 98 65 93 Telephone: 2 99 99 55 Ticket price: 8.50 – 14.50 Lari www.kinoaﬁ sha.ge Address: 4 Rustaveli Ave. GALLERY December 31 CAVEA IMAX Telephone: 2 99 80 22, 2 93 48 21 MARSHAL DE FANTIE’S December 29-31 www.museum.ge Address: 2 Tvalchrelidze Str., THE NATIONAL GALLERY DIAMOND STAR WARS: THE FORCE East Point Rezo Gabriadze AWAKENS ARCHAEOLOGICAL TREASURE Address: 11 Rustaveli Ave. Directed by Rezo Gabriadze Directed by J.J. Abrams December 29, 30 PERMANENT EXHIBITION www.museum.ge English Subtitles Cast: Daisy Ridley, John Boyega, STAR WARS: THE FORCE Start time: 20:00 Oscar Isaac AWAKENS November 17 - May 1 December 25 – February 10 Ticket price: 10, 15, 20 Lari Genre: Action, Adventure, Fantasy (Info Above) GEORGIAN NATIONAL MUSEUM GEORGIAN NATIONAL MUSEUM Language: English Language: English AND ALEXANDER KARTVELI DIMITRI SHEVARDNADZE TBILISI NODAR DUMBADZE Start time: 20:10 Start time: 22:30 ASSOCIATION PRESENT AN NATIONAL GALLERY INVITES STATE CENTRAL CHILDREN’S Language: Russian Language: Russian EXHIBITION DEDICATED TO YOU TO THE EXHIBITION THEATRE Start time: 20:10, 22:50 Start time: 13:00, 16:30, 19:30, 22:55 THE GREATEST MILITARY DEDICATED TO THE 120 YEAR Address: 99/1 Agmashenebeli Ave. Ticket price: 11.50 – 14.50 Lari Ticket price: 19 Lari AIRCRAFT DESIGNER IN ANNIVERSARY OF THE Telephone: 295 39 27 HISTORY. DISTINGUISHED GEORGIAN BRIDGE OF SPIES BRIDGE OF SPIES MODERNIST ARTIST SHALVA KIKODZE. December 29 Directed by Steven Spielberg (Info Above) December 21 – January 30 THE EXHIBITION NEW YEAR EVE AND COSMIC Cast: Tom Hanks, Mark Rylance, Language: English THE TRAVELING MUSEUM OF ALIENS Alan Alda Start time: 19:45 BAIA GALLERY Genre: Biography, Drama, Thriller THE CAUCASUS Tale Language: Russian Address: 10 Chardin Str. Language: Russian Directed by Dimitri Gvtisiashvili Start time: 13:30, 16:45, 22:00 Telephone: 2 75 45 10 Start time: 14:30, 22:30 SHALVA AMIRANASHVILI Language: Russian Ticket price: 8-13 Lari Ticket price: 9.50 – 14.50 Lari MUSEUM OF ART Start time: 12:00 December 27 – January 8 LOVE THE COOPERS Address: 1 Lado Gudiashvili St. Ticket price: From 6 Lari IRAKLI PARJIANI’S EXHIBITION LOVE THE COOPERS (Info Above) Telephone: 2 99 99 09 Directed by Jessie Nelson Language: Russian www.museum.ge THE EUROPE HOUSE TBILISI VASO ABASHIDZE Cast: Diane Keaton, John Goodman, Start time: 12:10, 14:30, 17:00, 20:00, MUSIC AND DRAMA STATE Address: 1 Freedom Sq. Ed Helms 21:45 December 16 – January 15 THEATRE Telephone: 2 47 03 11 Genre: Comedy Ticket price: 12 – 13 Lari THE JANI MEDZMARIASHVILI’S Address: 182 D.Agmashenebeli Ave. Language: Russian SOLO EXHIBITION Telephone: 2 34 80 90 Start time: 14:30, 22:30 POINT BREAK December 15-January 17 www.musictheatre.ge Ticket price: 9.50 – 14.50 Lari Directed by Ericson Core IOSEB GRISHASHVILI PSILOCYBIN MUSHROOMS Cast: Édgar Ramírez, Luke Bracey, TBILISI HISTORY MUSIC December 29 RUSTAVELI CINEMA Ray Winstone MUSEUM - KARVASLA DIVORCE Address: 5 Rustaveli Ave. Genre: Action, Crime, Sport Address: 8 Sioni Str. Directed by Davit Doiashvili Telephone: 2 55 50 00 Language: English Telephone: 2 98 22 81 TBILISI CONCERT HALL Musical www.kinoaﬁ sha.ge Start time: 19:30, 17:30 Address: 1 Melikishvili St. Start time: 19:00 Language: Russian December 10 - January 5 Telephone: 2 99 00 99 Ticket price: From 8 Lari STAR WARS: THE FORCE Start time: 12:00, 14:40, 17:20 GEORGIAN NATIONAL MUSEUM AWAKENS Ticket price: 7-12 Lari IOSEB GRISHASHVILI TBILISI December 29, 30 TBILISI CIRCUS (Info Above) HISTORY MUSEUM INVITES WORLD FILM MUSIC Address: 1 Heroes Sq. Language: Russian THE PEANUTS MOVIE YOU TO THE PHOTO MASTERPIECES Telephone: 298 30 35 Start time: 17:00, 19:30, 22:30 Directed by Steve Martino EXHIBITION OF HIROTAKE Special Guest: Anita Rachvelishvili Ticket price: 11.50 – 14.50 Lari Cast: Noah Schnapp, Bill Melendez, MAEDA. Georgian Philarmonic Orchestra December 29, 30 Hadley Belle Miller and Nikoloz Rachveli NEW YEAR JOURNEY TO BRIDGE OF SPIES Genre: Animation, Adventure, December 10 - January 5 Soloists: Natalia Kutateladze, Giorgi ISLAND LASTA-RIKA (Info Above) Comedy PROMOTING THE CULTURAL Tsagareli, Giorgi Shamanauri, Rezo Start time: December 29 - 17:00 Language: Russian Language: English COOPERATION BETWEEN Kiknadze December 30 – 13:00, 17:00 Start time: 14:00, 17:15, 19:45, 22:35 Start time: 16:00 GEORGIA AND JAPAN, THE Start time: 20:00 Ticket price: 9-10 Lari Ticket price: 10, 15, 20, 25 Lari Ticket price: 9.50 – 14.50 Lari GEORGIAN NATIONAL MUSEUM Ticket price: 15, 20, 25, 35, 45, 75 Lari GEORGIA TODAY DECEMBER 29 - JANUARY 7, 2015 BUSINESS 15 The Work Goes On: Red-Co Invests More than $50m in Georgia

Indeed, after purchasing the 35-story people and another is underway. Red-Co The potential of Gudauri is very impres- BY MARIAM KIASASHVILI WHAT ARE SOME OF THE OTHER Batumi Tower, a former to-be techno- manages the buildings and its infrastruc- sive and I believe the number of tourists ONGOING PROJECTS AND THE logical university building, for $25m in ture, as well as restaurants, swimming pool can even double in the near future, taking FUTURE PLANS OF RED-CO? March 2015 and with the obligation of and wellness center. The project employed into consideration tense relationships We have already signed a deal with Radis- stablished in 2012, Red-Co real spending another $15m on it in the fol- about 300 workers during construction, between the neighboring countries. How- son, which will open in one of our build- estate development company lowing three years, we have started an while 50 people are working there on an ever, at this point, the resort is not ready ings in Gudauri. This will be the fi rst 4 was one of the pioneers of enormous investment project. The tower everyday basis now. Apart from benefi ting to host such numbers of tourists and we or 5 star international brand-hotel in introducing an essentially new is currently being re-designed to fi nally the local population, the apartments have are thinking on expanding our works in Gudauri. Currently, we are fi nishing a type of residential complexes make up a complex comprising of presi- also proved interesting for foreigners. Most this area. After a hopefully positive out- $10m aparthotel project in Bakuriani. Eto the local housing market, specifi cally dential, deluxe and standard aparthotels, of them have been purchased by citizens come of negotiations with the government, Red-Co is building a house near Mziuri, ‘aparthotels,’ which have proved profi t- inner and outer swimming pools, restau- of Ukraine, Azerbaijan, Russia and some private owners and allocating relevant with commercial property and offi ces on able for the company and have attracted rants, a fi tness center, a lounge bar on top, European countries, which means they resources, we plan on constructing another the fi rst two fl oors and residential apart- a vast number of foreigners. By carrying and a casino. But since the stated building plan to spend their time, thus money, in 1000 rooms, thus providing relevant sup- ments on the rest. We already have con- out various construction projects across did not satisfy the standards necessary our country, and by doing so the overall ply to the growing demand. The total fi rmation from yet another Starwood the country, with the most remarkable for opening a 5 star hotel, which we had living standards and welfare should increase estimated investment by 2017 will be about family-member, W Hotels, which we hope ones in Gudauri and Batumi, Red-Co has planned beforehand, we have already in the region. $40m. to open in Tbilisi in the coming 2-3 years. thus contributed largely to boosting the started constructing an additional build- job market as well as the touristic poten- ing on the territory and are proud to have tial of the regions. Mirian Katamadze, signed a contract with Starwood Hotels General Director of Red-Co spoke to and Resorts on bringing in its luxury Georgia Today about the company, ongo- brand Le Meridien, which will be operating projects, future plans and how the ing in the country for at least 30 years. country benefi ts from them. We have hired up to 20, mainly international, consulting and operating fi rms DOES GEORGIA HAVE AN through tenders to work on the Le Merid- ATTRACTIVE INVESTMENT ian project. Having extensive experience MARKET AND HOW MUCH HAS in providing professional technical and RED-CO INVESTED SO FAR? management support, the local repre- Almost 90% of our investments are for- sentative of Aecom is coordinating and eign and most of them are channeled managing the construction process, Rooms towards touristic regions of Georgia, is working on the interior design, while which are highly attractive and carry others are focusing on issues of safety, enormous potential, though do not always lightning, conditioning, kitchen, etc. to satisfy the demands set by the industry be in compliance with highest possible in the 21st century, a case which we hope international standards. About 150 work- to change. As foreign investors can freely ers are currently employed on a rotation invest wherever they want in the devel- basis. And the complex comprised of oped world and any country would be Batumi Tower and Le Meridien, which more than happy to accept that, it has we plan to fi nish by the summer season been a challenge for Red-Co to persuade of 2017, will employee up to 400 people. them to focus on Georgia. However, Red- Co has succeeded and already invested RED-CO HAS BEEN FOCUSING more than $50m in the last two years with ON TOURISTIC REGIONS OF the prospect of doubling that in the forth- GEORGIA. ONE OF YOUR FIRST coming years. AND BIGGEST PROJECTS - NEW GUDAURI - HAS BEEN AN BATUMI WILL SOON BOAST IMPORTANT DEVELOPMENT THE HIGHEST CLASS HOTEL Starting construction in the middle of TO BE OPERATING TO THIS nowhere, we have already fi nished a com- DAY IN GEORGIA, TELL US plex with three aparthotels in Gudauri ABOUT THE PROJECT that can accommodate a total of 8000

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