Ski Georgia! a Look at Investment in Winter Destinations
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Investor.A MAGAZINE OF THE AMERICAN CHAMBER OF COMMERCE IN GEORGIA geISSUE 24 DEC.-JAN. 2011/12 Includes articles from the FT More Cheese, Please Georgia’s First World Standard Gulf Course American Baseball Fans Send Uniforms for Little League Ski Georgia! A look at investment in winter destinations Investor.ge Investor.ge CONTENT Investment/ 21 Georgian Wine: Development To Hong Kong and 6 Investments in Brief Beyond A brief synopsis of Tbilisi is focusing on new investments and new markets for its business news. wine, particularly fast growing markets in 9 Georgia on Google Hong Kong, China and Maps India.. Georgia is no longer a white spot on Google, 24 Recycling in thanks to JumpStart, a Georgia: A Wasted Tbilisi-based NGO. Opportunity or an Opportunity for 10 Tbilisi, the City that Waste? Loves You – Even Recycling is big business Without a Car around the world, but Happy Holidays! City Hall, together with not in Georgia. Investor. See page 57 for more Christmas Cheer from Dutch the Asian Development ge looks at why not. Bank, is upgrading Design Gardens public transportation. 26 More Cheese, Please! 34 Low-Key Leaders 40 Stage Left: The 12 Bring Manufacturers The passion of an May Unlock New Potential of the to Georgia: A New ethnographer for Problems for Banks Georgian Film Plan Georgian cheese is FT report on the Industry GNIA is working giving the country its challenges facing Investor.ge spoke with on new incentives latest international new CEOs at major producer Gia Bazgadze to attract Turkish calling card. European banks. about the commercial light manufacturing potential of Georgian companies. IT Special Feature 36 Man in the News: films. 28 GITI Conference: Alexei Navalny 14 Ski Georgia Showcasing FT profile on the man 42 NY Baseball Fans Investor.ge looks at Georgia’s Potential some are calling Donate Gear new investments and as an IT Hub in the Russia’s Julian Assange. and Uniforms to development projects in Caucasus Georgian Players Georgia’s ski resorts. The second article in a Culture New batting tees, three part series about 38 Stage Right: uniforms and gloves 18 Hotels: High the IT sector. Bollywood Directors will help struggling Occupancy, High Spotlight Growing Georgian baseball Expectations The Financial Times Interest in Georgian players. High seasonal 29 Model that Works Film occupancy rates are Even in Turbulent Foreign film producers bolstering expectations Times and directors – for a boom in the hotel FT report on the including Bollywood sector. resilient outsourcing – are taking a new look market. at Georgia. 20 Good Inspector, Bad Inspector: New 32 ‘Tis Not the Season Programs Seek to to be Shopping Ease Tax Evasion FT report on economic The Georgian Revenue impact of holiday Service is betting on shopping . two new programs to eradicate lingering problems for tax payers. .................... 46 DEC.-JAN. 2011/12 3 Investor.ge AmCham Georgia Patron Members: © The American Chamber of Investor.ge Commerce in Georgia, 2011 All rights reserved. No part of this magazine may be re-printed, or reproduced or utilized in any form or by electronic, AmCham Executive Director George Welton mechanical or other means now known or hereafter invented, including photocopying Editor in Chief Molly Corso and recording, or in any information Copy Editor Fiona Coxshall, Kate Davies storage or retrieval system without permission. Marketing & Promotion Bella Makaridze, Diana Karibova The opinions expressed in this magazine Promotional Design Levan Baratashvili do not refl ect the opinion of the American Chamber of Commerce in Georgia nor its Magazine Design and Layout Giorgi Megrelishvili Board Members or staff, unless otherwise Writers Helena Bedwell, Aleqsandre Bluashvili, stated. AmCham Georgia neither endorses, Molly Corso, Maia Edilashvili nor can be held liable for any eventuality arising from the use of any product or Photographs Molly Corso, Jackie Koney service advertised within the pages of this issue. Investor.ge is printed by CEZANNE AmCham Georgia 36a Lado Asatiani Street, 3rd fl oor Tel: 2 22-69-07 Special thanks to the AmCham Editorial Board – Irakli Baidashvili, Betsy Haskell, [email protected] Badri Japaridze and Stephanie Komsa – the AmCham staff, Aleqsandre Bluashvili, as well as COATS, Dutch Design Gardens, GITI, TBC Bank and Tbilisi International [email protected], www.amcham.ge Players Foundation for the generous use of their photographs for the social section. www.investor.ge 4 DEC.-JAN. 2011/12 Investor.ge DEC.-JAN. 2011/12 5 Investor.ge Investments In Brief Georgian microfinance organization JSC MFO planting an additional 25 hectares to their 40 hectare plantation. “Crystal” receives equity investment from There are also plans for a processing plant; 80 of their harvest international financial institution DWM will be used to produce olive oil. JSC MFO Crystal and Developing World Markets Group (DWM) successfully closed an equity investment in Octo- Gulf buys several small scale petrol stations in ber, 2011. The DWM investment vehicle became the largest the regions of Georgia shareholder of Crystal through a $2 million investment in the “Gulf” management announced the company is ready to company’s equity. expand and is purchasing small stations throughout the country. With the additional funding, Crystal will be able to provide Over the next three years “Gulf” plans to construct 150 affordable loans for more middle and low income families. petrol stations. “Gulf” entered the Georgian market this year, taking over several existing players on the market including “Geolive” To Broaden Area of Olive Groves in “Sun Petroleum Georgia”, “Senta” and “Magnat.” Georgia Geolive, a Georgian-Turkish company, plans to expand its French Grocer in Georgia operations in Kakheti. “Geolive,” founded in 2009, has planta- Group Auchan SA, a French grocer, is considering the pur- tions in Kakheti, Imereti, KvemoKartli and Guria. According chase of Goodwill and G-mart in Georgia. The two hypermar- to management, the fi rst seedlings were a success so they are kets recently announced the merger whereby stores of G-mart 6 DEC.-JAN. 2011/12 Investor.ge DEC.-JAN. 2011/12 7 Investor.ge will start operating under the Goodwill brand, although they and the survey, see www.doingbusiness.org. will remain separate legal entities with their own management. “Fitch International Ratings Agency” has changed Georgia’s The deal will be confi rmed once Auchan tests its products Sovereignty Outlook from “Stable” to “Positive.” The agency, on the Georgian market. which predicts Georgia’s GDP will grow by 6% next year, Auchan has placed about 1000 kinds of goods in Goodwill granted Georgia a B+ rating. stores to test the local market. A spokesperson for Goodwill said a fi nal decision will be made after the company has assessed EBRD to finance Georgian commercial banks the demand for their products in Georgia. Bank of Georgia, TBC, VTB and Procredit Bank are set to Auchan has been in the grocery business for 50 years and receive EBRD funding to fi nance loans for agrobusiness. The operates a chain of super and hyper markets in twelve countries program, worth 40 million euro, is the fi rst for the Caucasus. around the world. Loans will be available in lari to help protect banks from cur- rency risks. Japan to Finance Grassroots Development Projects First Pro Golf Club in Region to open in Georgia Japan is providing $265,486 to improve the lives of Geor- “Primera Golf Club” will be Georgia’s fi rst 18-hole champi- gians living in rural areas. The funds will be spent on three onship golf course. The course and club, a $15 million invest- projects: $83,763 to set up new poultry farm for 1500 hens, ment, is slated to be fully operational by 2013. Grupo Pastor, including an incubator for 7500 eggs - in Dzevera village, near a Spanish development company with extensive experience in Gori in ShidaKartli region; in Akhaktsikhe, $73,312 will be the construction of luxury homes, villas and residential areas, spent on the purchase of two tractors for local farmers; and will manage the “Primera Golf Club” project together with its $108,411 will be used to build a 40-bed rehabilitation centre partners Getinsa and LV Salamanca. for people with disabilities in Ureki, Guria. The Japanese government has provided $362 million to as- “New Cement” opened factory in Kutaisi sist development in Georgia since 1998, funding a broad range The factory will produce a new type of cement that was of sectors from economic infrastructure to human resources developed in Georgia. At full capacity, the factory should pro- development. duce 100 thousand tons of cement a year starting from 2012. An estimated $750 thousand investment, the product was launched “Rakeen Development” to open biggest on the Georgian market after months of development and test- shopping mall in Tbilisi ing in Germany. Uptown Tbilisi, Rakeen Georgia’s shopping mall develop- ment, on November 23rd. Starting from April, major brands EU-Georgia free trade negotiations launched will be sold at the mall, including Zara, Bershka, Stradivarius, On December 12, 2011, the Prime Minister of Georgia Nika Massimo Dutti, Pull and Bear, Oysho, Gap, Banana Republic, Gilauri signed an agreement to start negotiations of DCFTA deal and NewLook. In addition, Carrefour plans a hypermarket at with the EU. The fi rst round of negotiations will take place in the mall. January 2012. Currently EU accounts for the 26% share of Geor- gia’s total foreign trade, and the government hopes a free trade Georgia-moving up in economics/business agreement with the EU will further strengthen EU-Georgia ties. ratings Georgia is now the 16th easiest country to do business in, Alitalia to start service to Tbilisi according to the World Bank’s 2012 Doing Business report. TAV Georgia reported that the Italian airline will start bi- Registering property - a procedure requiring two days at the weekly fl ights between Tbilisi and Rome; pricing and schedule cost 0.1% of property value - helped buoy the country’s rating are still to be determined.