Investor.A MAGAZINE OF THE AMERICAN CHAMBER OF COMMERCE IN GEORGIA geISSUE 22 AUG.-SEP. 2011

Includes articles from the FT

Sochi Prepares for Winter Games

From Downtown to Out of Town

Three Views on Trading with America

Enrique Iglesias: The Key to Tourists?

Investor.ge

Investor.ge CONTENT

Investment/ 19 Poaching on Development Business: Hunters 6 Investment in Brief track a new A brief synopsis of market and better new investments and regulations business news. Hunting tours, hunting farms, hunting 8 CNN: Eye on restaurants and hunting Georgia stores. Georgia has a CNN highlights long tradition – and Georgia’s reforms and potential for the hunting successes. market. AmCham Georgia’s 9 From Downtown to 22 Event tourism: key to Annual July Fourth Picnic Out of Town: A shift millions? 56 to the suburbs From MTV to folklore, A new suburb at Lisi wrestling to gourmet Lake might boost cooking, festivals, 36 Emerging Market 44 Success in broader interest in conventions and Investors Cast Wider Shaumiani: Funds suburban living concerts are an effective Net from Burns Supper way to attract tourists FT report on investors Finance IT Education 10 Building Georgia’s and their pocket books. looking to new markets. for IDPs Image Abroad The first large scale An interview with 26 Creating a Brand: Culture Tbilisi Charity Gala Redjeb Jordania, the Competition has 39 Georgia’s Quest for Burns Supper raised son of Georgia’s first sparked innovation Modern Hospitals, enough funds to equip president Noe Jordania. in marketing One Bed at a Time a small computer Facebook and other Private investment room, provide internet 12 Trading with types of social media in new hospitals connectivity and America: Three are transforming how is spurring the maintenance funding to Views Georgian companies government’s plans to get the IT education ball Better marketing and brand their products modernize the country’s rolling more organization and communicate with crumbling medical can help Georgian consumers. infrastructure. companies break into the US market. The Financial Times 42 Zviad Tsikolia: 30 The power of the Georgian industrial 14 Selling, Selling, Sold tried and tested designer crafts Online auctions are brand images for gaining traction in FT report on the market international brands Georgia value of established Georgian industrial brands. designer Zviad 16 Ancient Kvevri Wine Tsikolia has left his could bolster Wine 32 Sochi boosts mark on designs for Tourism and Exports infrastructure to Bugatti, Castel beer, The ancient – and dying prepare for the Khvanchkara wine and – technique of making games Georgia’s latest military wine in clay vessels FT report on Sochi’s hardware. could be Georgia’s key building before the to bolster wine tourism Winter Games. and exports. 35 Poland begins terms as EU president FT report on Poland’s turn at the EU helm...... 46

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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 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 Molly Corso, Maia Edilashvili, Monica Ellena, stated. AmCham Georgia neither endorses, Eteri Maisuradze, Nino Patsuria, nor can be held liable for any eventuality Jefferson Sommers II arising from the use of any product or

Photographs Molly Corso, Davit Khizanishvili, service advertised within the pages of this Kakha Chkhataraishvili, Peter Nasmyth issue.

Intern Aleqsandre Bluashvili Investor.ge is printed by CEZANNE AmCham Georgia Cover www.enriqueiglesias.com 36a Lado Asatiani Street, 3rd fl oor Special thanks to the AmCham Editorial Board – Irakli Baidashvili, Betsy Haskell, Tel: 2 22-69-07 Badri Japaridze and Stephanie Komsa – the AmCham staff, Aleqsandre Bluashvili, [email protected] Peter Nasmyth for the generous use of his photograph on page 10, and The Financial Times (FT). [email protected], www.amcham.ge www.investor.ge

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15-16 hectares of plantations in Adjara. predominately of red wine (about 70 In Brief The company expects the fi rst harvest percent). in 2013-2014 and is planning to export the majority of the crop to Turkey and X-ray Installed at Poti Railway A brief synopsis of new investments and Europe. The company bought farm Junction business news compiled machinery in Turkey and saplings of 12 A new X-ray scanner will enable by Investor.ge’s Eteri high-yielding varieties of bilberry in the customs offi cials to check all incom- Masuradze. US. Subtropic Fructice was founded with ing cargo at the port without opening Georgian investments in 2010; to date containers. The Chinese government the company has invested 1 million lari fi nanced the system with a $30 million in the project. grant.

Georgia Expects $1 billion FDI Israeli Investors to cultivate Clean Energy Invest AS to in 2011 Greenhouse in Kobuleti develop Hydro-power Project The Georgian government expects Israeli businessmen are planning to in Adjara foreign direct investment to double this use 23 000 Ha of land in Adjara to build lean Energy Invest AS, an Oslo- year, after falling 65 percent over the past a fruit greenhouse. They plan to cultivate based company, will invest two years, said Minister of Economy and 5 000 Ha in by the end of 2012. (National Cup to $385 million to develop Sustainable Development, Vera Kobalia. Investment Agency, July 2011) a hydro-power plant (HPP) cascade Georgia may receive more than $1 project on the Adjaristskali River in the billion of investment, mainly in hydro- Bananas from Kakheti Adjara Autonomous Republic. The proj- power projects. Tourism is also expected The fi rst batch of Kakhetian bananas, ect involves construction of a four-stage to lure investors after more than 2 million cultivated in a local village, will hit the cascade with a total capacity of over 257 people visited the former Soviet republic market soon. The bananas have been MW. The cascade includes the following last year. grown in Grujaani. plants: Zomleti HPP, Vaio HPP, Korom- Foreign direct investment fell to kheti HPP and Chorokhi HPP. $553.1 million last year from $658.4 Pernod Ricard Sells Shares in million in 2009 and $1.56 billion in 2008. Georgia’s GWS International Finance Pernod Ricard, the French drinks Corporation (IFC) Invests in Four Countries Consume 76% giant sold shares in Georgian Wine and Georgian Healthcare Group of Georgia’s Wine Exports Spirits LLC (GWS) to the Georgian unit IFC, a member of the World Bank Georgia’s exports to Ukraine (worth of Marussia Beverages BV, wine and Group, is investing $3 million in equity $18 million, or 46 percent of total), spirits group registered in the Nether- in Archimedes Health Developments, a Kazakhstan ($5.9 million, 15 percent), lands. The prices of the shares has not newly-created company established by Belarus ($3.9 million, 10 percent) and been disclosed. (Rustavi 2 July 28 2011) Archimedes Global, a Georgian-based Poland ($2 million, 5 percent) account medical insurance group to help expand for 76 percent of the country’s total wine Food Producers to be Fined for access to health insurance and health exports. Exports to the United States Violations services in Georgia and other emerging were worth $986,000 – three percent of The Parliament has adopted legisla- markets in Eastern Europe and Central the total wine exports. tive amendments, imposing fines on Asia. In total, Georgia exported $39.3 mil- food producer companies from July 1 lion of wine in 2010, an increase of 22.8 for violations. Bilberry to be Cultivated in percent compared to the previous year. Unauthorized production or distri- Adjara According to the Georgian Wine Asso- bution of food will be subject to a 300 According to Dato Khilaishvili, ciation, 80 percent of wine produced in lari fi ne. representative of Subtropic Fructice, Georgia is white, which is very popular Other companies will have until June the company will cultivate bilberry on in the local market, while exports are 1, 2012, to meet food safety standards.

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A week of reports on the world’s largest news network put Georgia and its successes and obstacles in living rooms around the world. Now it is up to Tbilisi to hold viewers’ attention and turn exposure on CNN into tourism and investment.

Eye on Georgia: CNN highlights reforms and traditions

rom First Lady Sandra Roelofs’ try that had a revolution a while back,” Newton, an international correspon- second job as a delivery nurse commented the program’s presenter, dent who last visited Georgia in 1999, Fto new discoveries in Dmanisi, Paula Newton. stressed that the program ran live during CNN viewers had a front row seat on Ms. Newton also suggested that prime-time for European audiences and life in Georgia during a week-long pro- now is a good time to look back on the as a result it should bring Georgia to the fi le on the network’s Eye on Georgia changes that have happened since Geor- attention of a whole new audience. program. gia’s Rose Revolution. “We believe that our viewers are The profi le was the last in a string “. . . it is a good opportunity to access interested – whether that interest in the of programs dedicated to developing what happened, what are the challenges – story really pulls through and gives economies. what has worked, what hasn’t worked… Georgia any long term recognition is an “. . . we have been to India, we have What can you accomplish, what can you open question that I can’t really answer,” been to Ukraine, Germany – they are go- get done in an eight year period.” she said. ing to Mongolia next – I think you just The profi le looked at reforms to the “At the same time if you see that try to look for countries that don’t get police force and the education system, people are searching on cnn.com [for a lot of exposure but are interesting… the government’s experiment to revive Georgia], considering that we have mil- We have this huge Arab spring going on the agriculture sector by bringing farmers lions of unique viewers every month to and all these different revolutions in all from South Africa to cultivate the land, our website in general … that has got to these countries. as well as the First Lady and the latest say that it is reaching people that it would It is important to go back to a coun- discoveries in Dmanisi. not have if we were not here.”

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From Downtown to Out of Town: A shift to the suburbs

A new suburb at Lisi Lake might boost broader interest in The U.S. Embassy in Tbilisi was one of the first to move to the suburbs suburban living – a trend that is slowly catching on in Tbilisi.

MAIA EDILASHVILI Bendukidze, commercial director with phase, which will take one year and end Rakeen, said that the Uptown Tbilisi by July 1, 2012,” said Mariam Zaldastan- ust ten minutes from downtown project is “creating a destination” outside ishvili, the marketing and artistic director Tbilisi, Green Town Lisi could the city. of Lisi Development. According to her, Jjump start a new demand for sub- “This is a psychological moment,” sales are “quite intense.” urban living, developers believe. he said. “We are creating a destination, If the project generates enough de- Projects like Rakeen’s Uptown Tbili- not just shopping. People can go there mand it could be an impetus for new si (scheduled to open later this year) and all day.” building projects in the suburbs and Tbilisi Diplomatic Village – a develop- Nikoloz Urushadze, the general downtown, Urushadze said. ment of 45 American-style houses – are director of Paragon, a Tbilisi-based real “[This project] will increase competi- also tapping into a new desire to move estate consulting company, said residents tion with the buildings downtown and at out of the city. of Tbilisi who want the quiet life of the the same time increase the need for high With multifunction recreation zones suburbs have previously opted for Tskne- quality projects,” Urushadze said. and modern architecture, Green Town ti or other villages that border Tbilisi. The group purchased the land in 2007 Lisi, a 355 hectare project, will aim to “What happened in the big industrial for $182 million. create a health-spa suburban experience cities many years ago, is now taking The initial investment cost of the complete with walking trails, sulphur place in Georgia,” Urushadze told In- project is estimated at over $100 million, baths and a spa center. vestor.ge. and is being fi nanced with assistance by Out of town developments are in- “Projects like Lisi will spark even the US Development Bank OPIC and creasingly part of Tbilisi’s broad devel- greater interest towards this new trend.” the Netherlands entrepreneurial develop- opment. In an earlier interview, Tengiz “Construction has started on the fi rst ment bank.

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Redjeb Jordania and Tamara Megrelishvili at Prospero’s Building Georgia’s Image Abroad

As more and more Georgians settle abroad, the Diaspora’s potential to I was living in Paris.” popularize its distant homeland is increasing. One of Georgia’s most That 1991 trip inspired him to write famous émigré sons, Redjeb Jordania, is bringing stories and images of his his book of memoirs at age 71. He went father’s homeland to readers around the world through his books of short on to publish two books of short stories, stories. some of which are based on Georgia. The work has made him a literary ambassador for his father’s homeland – eorgia’s culture – its glorious Bolshevik invasion in 1921, Jordania a role Jordania said he did not plan on, heritage of art, literature and grew up listening to tales of life in an but is a natural part of being an émigré. Gmusic – will keep émigrés idyllic Lanchkhuti at the turn of the 20th “Let’s say that anyone from any coming back and encourage them to century. country who has a certain amount of teach others about their distant home- The images of his father’s homeland, authority – even if he or she doesn’t want land, says Redjeb Jordania – the émigré coupled with a love of Georgian music to – becomes a representative of their son of Georgia’s first president, Noe and culture, helped forge in him a core country,” he said. Jordania. identity as a Georgian, albeit one who “It happens automatically.” For Jordania, his father’s stories of could not travel home until he was over The growing Georgian Diaspora his native village in Guria created a 70 years old. will increasingly take up that role, he magical land he later weaved into the “You are always Georgian, you are predicted, noting that even the third and mosaic of his short stories. Available in from Georgia and when it became pos- fourth generation feel a connection to English online and at Prospero’s Books sible, naturally – I had heard everything their ancestral home, thanks to Georgia’s in Tbilisi, Escape From The South Fork: about it and dreamt of it and here we are,” powerful cultural heritage – especially its And Other Stories include tales from he said during a visit to Tbilisi in May. music and language. Georgia, France and elsewhere. “I grew up with the impression that “In many ways it is a good thing for Born in Paris after his father was Lanchkhuti was the most important place Georgia that there is an increased Dias- forced to leave Georgia following the in Georgia, if not the world – even though pora,” he said.

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ent policy and platform which can ac- Trading with America: Three Views commodate not only the government efforts but also the private sector and Better marketing and more organization can help Georgian companies business association efforts, then it will break into the US market – and bring more US investors to Georgia, diplomats and business advocates believe. be a synergy, you would have fi lled that gap,” he said.

Mamuka Tsereteli: Interest in Georgia “Increasing” Awareness about Georgia’s potential Batu Kutelia: Database, Sector both countries. for investment and trade is growing, Specific Summits Needed to “One success will lead to another noted Mamuka Tsereteli, the president of Bolster Trade and other companies will follow suit,” the America-Georgia Business Council. eorgian – and American – busi- he said. Just two years ago, it was hard to nesses need more information attract participants to the council’s bi- Gabout market conditions and Davit Rakviashvili: Platform annual investment events. Today, how- investment opportunities in each coun- Needed to Bring Trade ever, he said there is an “increase in that try, noted former Ambassador to the US Partners Together interest currently, toward the country Batu Kutelia. More follow up with business is again, toward specifi c businesses here.” Business trade summits and preferred needed to capitalize on the Georgian Part of that stems from a new con- trading programs are good for raising government’s efforts to attract invest- fi dence in Georgia’s stability. But it is awareness but Georgian companies need ment and new trade partners, according also a refl ection of a global trend: private more specific, market information to to Deputy Ambassador to the United groups and hedge funds are shopping for enter the US market, Kutelia said in an States Davit Rakviashvili. better returns on investments in emerg- email interview with Investor.ge “Government continues to make ing markets. “When it comes to the US market, signifi cant steps on the policy level… To capture and sustain their interest, Georgian businessmen encounter sub- now is kind of the right time to capitalize however, Tsereteli noted there is a need stantial challenges which impact signifi - on all of that,” he said during a visit to for well written, easy to understand pro- cantly their desire to go for it,” he said,. Tbilisi in August. posals for specifi c industries and sectors. “[E]ducation and training inter- Rakviashvili’s vision is to create a There is also an absence of “positive change” is needed to “increase interest trade mission or platform where a well stories” about investors who have turned and motivation for businesses to consider informed staff can make the embassy’s a profi t and left the market, examples the US market,” Kutelia said, adding that contacts with chambers of commerce and of how investing in Georgia can be a more promotion of Georgia’s strengths is the business community more effective. money maker. needed to attract “multinational compa- The idea was born from the gap be- On October 25, AGBC is holding its nies” to Georgia. tween the government’s efforts and the annual conference in Georgia – an op- “[W]e have signed a memorandum of impact on the ground. portunity, Tsereteli noted, to turn interest understanding with EXIM bank, which “When you try to analyze the situ- into future business. underlines 7 key sectors of cooperation. ation, you see there is defi nitely a lack “There is a tremendous potential Some projects are under negotiations of the follow up on marketing,” he said. upside. The thing is to fi rst let those op- and hopefully, they will end successfully The exact shape of the new organiza- portunities be known to those potential because time has come to start utilizing tion – which could be based in capitals investors. That is the purpose of our these mechanisms,” he noted. around the world – is still under discus- conference,” he said. Now the deputy head of the National sion. But the key, noted Rakviashvili, “I think we need to make sure the Security Council of Georgia, Kutelia will be creating an effective platform to positive stories of companies which ex- said stronger trade ties will lead to more support potential trade and investment. ited Georgia with a profi t are known… investment opportunities for business in “If one manages to have the coher- we need to publish the positive cases.”

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Investor.ge Selling, Selling,

ETERI MAISURADZE

nline auctions are gaining traction in Geor- gia: in August the government used an on- Oline auction to privatize the management rights of the country’s main television tower and Tbilisi City Hall launched online property auctions this year. Investor.ge publishes a brief summary of sales over the past three months.

Management of Alfa-Com, Tbilisi, which owns the largest television tower. The initial list price was 100 thousand lari; the winning bid – by a business – was 110 Hospital privatization thousand lari. The Michael Guramishvili Pedi- 776 square meter plot of land with buildings, Marneuli. The initial list price was atric Clinic LLC. The initial list 150 thousand lari; the winning bid – by an individual – was 160 thousand lari. price was $1 million; the winning bid – by an individual – was $2.16 482 square meter plot of land with building, Tbilisi. The initial list price was 47 million. thousand lari; the winning bid – by an individual – was 50 thousand lari. Central Republican Hospital. 776 square meter plot of land with buildings, Tbilisi. The initial list price was 27 Estimated worth of assets is $20 thousand lari; the winning bid – by an individual – was 30 thousand lari. million; the buyer, InterHealth Canada, will invest $25 million 141.24 square meter building plot, Marneuli. The initial list price was 25 thousand for rehabilitation. lari; the winning bid – by an individual – was 27 thousand lari.

67 square meter plot, Zugdidi. The initial list price was 1,300 lari; the winning bid – by an individual – was 7,100 lari.

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Ancient Kvevri Wine could bolster Wine Tourism and Exports

The ancient – and dying – NINO PATSURIA 8000-year Vintage technique of making wine in growing trend for wine The ancient technique of clay vessels could be Georgia’s afi cionados to travel abroad fermenting wine in enormous hand key to bolstering wine tourism to experience new vintages crafted clay vessels led the Travel and wine exports, industry A with unique fl avors, in exotic locations specialists believe. Now the Channel’s Isabelle Legeron – host country has to work on getting could also provide a powerful boost for and creator of the ‘That Crazy the word out. Georgian wineries and traditions. Frenchwoman’ wine travel program – In particular, Kvevri Georgian to fi lm a show about the process. wine made using the ancient method Legeron is fascinated by the Kvevri could help catapult wine tourism – and its story – a history and tradition, and eventually wine exports, sector she said, that makes Georgian wine analysts believe. unique and attractive for wine lovers

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around the globe. on an ancient methodology but are new growing regions” – a trend that has “There is an extraordinary story to to the West.” made billions of dollars for the wine tell [in Georgia]... It is not only a very The Georgian method of using industry across the globe, from the beautiful country but it is has a unique Kvevri to make wine dates back eight United States to New Zealand. wine-making tradition, the Kvevri,” thousand years, noted Tina Kezeli, The Wine Institute, a California- she said in an email interview. executive director of the Georgian based organization dedicated to the Kvevri is the Georgian name for Wine Association. state’s wine industry, reported that large – some as big as 500 kilograms “Nobody has such an uninterrupted 20.7 million tourists visited vineyards – handmade vessels that have been wine-making practice,” she said, “for and wineries in California last year, used for thousands of years to ferment us wine is not a product made for spending $2.1 billion. Georgian grapes into wine. profi t; it is intertwined with culture New Zealand has experienced The vessels are made with and religion… Foreign marketing a similar boom: the number of Georgian clay, moulded into the form specialists tell me that they make international tourists traveling to of a giant spinning top – a fat middle legends out of nothing while we have vineyards increased from 126.9 and two tapered ends. The jugs are plenty of ready-made legends and we thousand in 2003 to 177.7 thousand in treated with a lime wash and buried have to use them.” 2008. deep in the ground, where the grapes Working with EPI, the Georgian ferment into wine. From Vine to Tourist Wine Association together with The process is completely natural, Kezeli and other wine specialists Georgian wine producers and tourism creating pure, organic wine. In her are hoping to capture a growing agencies has created a strategy to show, Legeron noted that the clay gives interest among wine lovers: traveling duplicate that success in Georgia. In the beverage a unique taste. in pursuit of new vintages and unique June a group traveled to wineries in “A good wine is one with tastes. the United States to experience the character,” she said during the A USAID Economic Prosperity industry fi rst hand; they returned with program. “I think the tradition is what Initiative (EPI) report on tourism an action plan to make wine tourism a really makes the wine unique.” development noted that wine tourism reality at home. The trip was funded by Some wineries in Georgia are is “expanding in most major wine the US Department of Commerce and making Kvevri wine, although the craft is on the decline since it is labor intensive and produces less wine than modern techniques. But returning to Georgia’s wine roots makes good business sense, noted Giorgi Margvelashvili, general director of Tbilvino Winery. Tbilvino started producing and exporting Kvevri wine this year. “The Georgian wine industry should try to present unique Georgian wines on the international market and minimize copying western wines,” he said. “We have a bigger chance to take a niche through local wines; lately wine buffs are seeking new, different wines and tastes – and Georgia has the chance to promote its wines which are based

AUG.-SEP. 2011 17 Investor.ge

Georgian National Tourism Agency to create a database of Kvevri wineries as well as universal standards for wine producers who use the technique. Kezeli said a Kvevri Symposium is planned for September – an event that will bring elite wine connoisseurs and writers to Georgia. There are also plans to support (and promote) Georgia’s unique tradition of producing wine in monasteries. “Some famous wine experts and writers discover absolutely unbelievable things when they come here,” she said, adding they are “astounded” by the country’s rich wine history and art. “We have to make this Kvevri Symposium an annual event to raise awareness of our country and make it a wine tourism destination.” Legeron’s show has already made an impact, noted Tabagari, who is also the head of Caucasus Travel. She said 60 British wine experts are planning to visit Georgia in September – a trip planned after they watched the Travel Channel show. Legeron said Georgia has “untapped potential” to develop wine tourism at home, especially if infrastructure to promote Kvevri wine is developed. “I know foreigners will be very interested to discover this tradition. I have had great feedback from people who watched the show and their In May the government hosted a wine tasting event in Tsinandali response was unanimous. Everyone who has seen the show wants to come and visit Georgia,” she said. USAID, and organized by AmCham educate foreigners (and Georgians) “Once people have been to Georgia, Georgia. A wine tasting for Georgian about the country’s “hidden treasure” they will then seek to buy the wine in wines in New York to showcase local of wine. their home countries. This opens up vintages was sponsored by American Ia Tabagari, president of the markets for wine growers. Developing Friends of Georgia and AmCham. Association of Georgian Incoming wine tourism is a sure way to build a Topping the list is the need to Tour Operators, is working with the customer base outside of Georgia.”

18 AUG.-SEP. 2011 Investor.ge

Poaching on Business: Hunters track a new market and better regulations

Hunting tours, hunting farms, MAIA EDILASHVILI ing clothing and paraphernalia, from hunting restaurants and hunting guns to boots to dogs, is expensive – guns stores. Georgia has a long tradition eer, poems and folklore are range from 800 to 5000 lari, and hunt- of hunting – and the potential to dedicated to hunting in Geor- ing clothes can be just as expensive. But develop a rich niche market for gia – a rural survival skill that local and foreign hunters if it can B hunting entrepreneurs believe hunting find a balance between protecting has evolved into a booming business in tourism could be even bigger. its natural resources and promoting Tbilisi. Ramaz Chadashvili, a long-time them. Shops dedicated to selling guns and hunter, senses that there is untapped hunting apparel dot the city. business potential in the Georgians’ love Sales at Denti, a hunting store in of hunting. Tbilisi, peak in August during the weeks This summer he opened a hunting preceding the autumn hunting season. restaurant, Nabuli, in Tbilisi’s Saburtalo Paata Museridze, the owner, said they district. At Nabuli, hunters wear their sell twice as many guns in August than passion on their sleeve. Hand-carved during the rest of the year, when sales hunting scenes adorn the fi replace while average at 20-30 a month. hunting-themed paintings and deer horns This can be a good business as hunt- hang from the walls.

AUG.-SEP. 2011 19 Investor.ge

“Hunting tourism development needs fee is 100 lari, while killing a hare costs compared to 124 last year. special infrastructure and our restaurant 2 lari and for a pheasant the fee is 15 lari. Dalis Mta (Dali Mountain) hunting is part of that,” he said. “Such restaurants Ivris Chalebi consultant Gia Asa- farm in Kakheti is home to 132 bird spe- are a commonplace in the West.” tiani believes hosting groups of foreign cies, 31 varieties of reptile, 25 types of Chadashvili hopes the restaurant, ‘hunting tourists’ is a natural extension mammals and three species of amphib- which boasts an exotic menu – including of their business, although at the mo- ian. Poachers have wrecked havoc on the roast pheasant – will become a hang-out ment he admits that few guests come for farm, noted director Beka Gonashvili. for hunters and gourmands, and the base hunting alone. “We just had to give up this business,” for more hunting-related businesses. On the crossroads of one of the larg- he said. “We’ll cooperate with the tour agen- est bird migration paths in the world, By law in Georgia hunting is allowed cies to attract foreigners; in the future we Georgia is a paradise for bird hunting, only on specially allocated areas such as may even acquire license for a [hunting] particularly quail and pheasant. hunting farms and only at certain times of farm…” he said. Expansion plans also Bear and rabbit hunting is also popu- the year on those species which are not include opening shops in popular tour- lar: Georgians have been hunting bears on the verge of extinction but many hunt- ist areas such as Svaneti, Signaghi and for centuries, especially in the mountain- ers and environmentalists don’t believe Batumi. ous regions. the system is working. Ivris Chalebi (Iori Groves) is part of the Kazbegi Business Group and in 2006 Fight against poachers Government response opened a lodge which allows hunting, The appearance of new hunting- There are plans to help hunting farms investing half a million lari in the busi- themed businesses is a sign of optimism develop – a move the government and ness. The farm has 1,530 hectares in the for the industry. However, a potentially conservationists believe will help busi- Kakheti region - Sagarejo, Signaghi crippling mixture of poachers, high ness and the wildlife. and Dedoplistskaro, where along with prices and environmental concerns The Ministry of Energy and National fi shing, the hunting of wild boar, pheas- threaten to stunt growth even as local Resources plans to issue farms licenses ant, partridge, various species of duck entrepreneurs pursue foreign hunters and of longer validity and allow them to de- and goose is permitted as well as of fox, tourist groups. velop farms on bigger areas. However, wolf, jackal, hare and badger. Government fi gures show a slight offi cials told Investor.ge there are no Hunting farms must pay a hunting fee increase in poaching this year: 133 cases plans to increase the fi nes or punishments to the state. For killing a wild boar the were registered from January to May for poaching.

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20 AUG.-SEP. 2011 Third business roundtable with the Government of Georgia

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Event Tourism: Key to millions?

22 AUG.-SEP. 2011 Investor.ge

From MTV to folklore, wrestling headlines. But the flashy lights and year-round city destination, noted Vaja to gourmet cooking, festivals, sounds of MTV mean much more: con- Diasamidze, the acting head of the de- conventions and concerts are an certs are one part of a lucrative formula partment of tourism in Adjara. effective way to attract tourists that turns tourism into a heavy hitter for “All spring, we need some festivals, and their pocket books. But planning and promotion are key to local business and economies. famous singers, to bring more tourists translating events into revenue. Last year, meetings (and other events, and to give tourists more attractive activi- like concerts, conventions, and exhibi- ties [to come],” he said in an interview tions) brought a cool $106 billion to before the summer season. the US GDP, according to a 2011 report Folk festivals, Turkish pop stars, and op star Enrique Iglesias rocked published by the Convention Industry conferences – like the annual Batumi Batumi to MTV fame on August Council – making it the tenth largest Expo – are all geared to bring tourists P2, a concert that reportedly at- industry in the United States. during the off season. tracted several thousand fans and gener- The fi ndings in Canada are similar: a Maia Sidamonidze, the head of the ated thousands of lari in revenue for local report issued last year found that meet- Georgian National Tourism Agency hotels and restaurants. ings and event-type tourism led to $32.2 (GNTA), stressed that MICE tourism The MTV event was the latest in a billion in domestic spending, and $11.3 could be a vehicle to promote tourism long series of concerts choreographed to billion to the country’s GDP. outside of the traditional resort spots – bring international fame – and its lucra- Meetings, Incentives, Conferences, like Batumi – and into the regions. tive sidekick tourism – to Batumi. In the Exhibitions or, for industry insiders, “MICE tourism in general, meet- month leading up to the Iglesias concert, MICE, is a type of tourism packaged ings, concerts, events and all kinds of Batumi hosted Chris Botte, Sting, Macy as destination travel that could be pure festivals, I would say these are a priority Gray, and a score of jazz musicians. gold for Georgia, local tourism industry for us. First of all to promote Georgia as specialists believe. a tourism destination but also it is quite MICE means money Events, like conferences and fes- interesting market for us because we The music is nice, the publicity – a tivals, could help Batumi reinvent think it has potential,” she said. welcome change from confl ict-driven itself from a summer beach resort to a GNTA has paired up with USAID’s

The May “Vine to Wine” event in Kakheti brought wine experts from around the world.

AUG.-SEP. 2011 23 Investor.ge

Economic Prosperity Initiative to de- Svaneti or other popular tourism destina- events, many festivals, it can give sup- velop MICE tourism in Georgia. The tions a day or two before the event. port to Georgia to attract many tourists,” agency is preparing a catalogue of po- “[I]f something happens we are al- she said. tential MICE venues around the coun- ways trying to [bring tourists] but it is “So I think it should be done annu- try, and an action plan to develop more very hard to get information about when ally, like wine. I think it will be great if infrastructure and promotion. it happens. If we know it, we try to bring it is every year to attract people.” tourists there,” Tabagari said. Events like the Jazz Festival and the Promotion: the key to success Sidamonidze stressed that the GNTA native folkart Artgene Festival, have at- Fashion shows, wine conferences, is publishing a quarterly calendar of tracted a following among tourists. tasting exhibitions, and folklore festivals events, although sometimes festivals and Mikheil Giorgadze, the director of could provide a steady stream of visi- regional celebrations are planned too late Eastern Promotions – the company that tors, noted Ia Tabagari, president of the to be included. In addition, the agency’s produces the annual jazz concerts, said Association of Georgian Incoming Tour website is only partially operating due to tour operators from Israel and other Operators, if they are properly promoted. a rebranding program. countries contact him through Facebook In July, there was no information The key to cultivating interest is to to arrange trips around the concert dates. available about upcoming concerts or create annual events, noted Natia Cholo- “Both the number of people increase festivals at the main tourism center in kashvili, a founder of Smart Pencils, a from year to year and the number of Tbilisi. The lack of information is frus- PR and Event-management company foreigners. This year we have direct trating for tour operators like Tabagari. based in Tbilisi. bookings from tourism agencies, asking Festivals and concerts “attract tour- Cholokashvili and her team have for arrangements for people in Israel, Ar- ists,” she said, but only if tour operators brought guests from around the world to menia, Azerbaijan, Ukraine, and Baltic know about them in advance. fashion shows and a wine tasting event States,” he said. She added that sometimes tour op- in Georgia. “They came to us. This makes us erators only fi nd out about festivals in “If there will be many interesting happy because they came to us.”

24 AUG.-SEP. 2011 Investor.ge

AUG.-SEP. 2011 25 Investor.ge

Creating a Brand: Competition has sparked innovation in marketing

Facebook and other types of social media are transforming how Georgian companies brand their products and communicate with consumers. Companies are also increasingly aiming to produce highly localized brands by highlighting their connection to the country with the ues of Georgian celebrities and traditional Georgian themes.

arket savvy Georgian companies are building brands – and brand loyalty – as Mmarket competition grows. New advertising campaigns, corporate logos, product placement and sponsored television shows are pushing marketing strategies into popular cul- Facebook users in Georgia have increased to ture. approximately 640 thousand this year. Map courtesy of www.icrossing.co.uk Bank of Georgia is at the frontier of the push,

26 AUG.-SEP. 2011 Investor.ge

using Georgia’s popular Nichieri (Talent) al platform before and we saw that people the right note with clients about quality, show to promote name recognition, and were a little bit lost with the brand and price and service is key. playing up features on its Facebook site the connection was not strong,” he said. Magticom has invested in its local to engage clients. “We need a strong connection be- branding story: a local company built A new advertising campaign for the tween the brand and the customers.” by Georgians who invested in building bank’s exclusive deal with American Creating a connection is the corner- a strong Georgia. Express uses Georgian faces to popular- stone of Bank of Georgia’s new branding In addition to stressing the quality of ize the global brand. efforts – and a driving trend for big com- its services, Lobzhanidze said focusing The plan to go local came from the panies in competitive sectors, according on its local roots is a core part of the bank, noted Alexander Katsman, when to Elena Gordeeva, the program director company’s strategy. they realized Georgians were discon- at NIMA marketing school in Tbilisi. “Our slogan is “We are doing Geor- nected from the product. Branding, Katsman commented, is gian [business], we are doing it for Although it took a lot of effort to more “customer-centric” than marketing Georgia,” he said. convince American Express to give them since it seeks to “create… a promise and “That is our attitude and our company the green light, the marketing strategy to build around that promise.” strategy. For Georgians it is important to “. . . fi nally what are we trying to realize that this company is doing some- do? – we are creating some set of values thing for this country and it is not just a and ideas so that people will love to be team that generates revenues.” engaged with us and become the fans and Geocell, a competitor, is also focused the advocates for our brand,” Katsman on building its customer base. explained. Geocell enjoys one of the highest loy- Gordeeva said that while the art of alty rates in Georgia: in 2010 Extended marketing is still developing in Georgia, Performance Satisfaction Index scores Bank of Georgia is not the only company for Geocell and Lailai (a service provided looking to build a brand in the Georgian by the company) were nearly 90 percent market. Telecom carriers like Magticom, -- Geocell 89.5 and LaiLai 87.9. Loyalty Geocell and Beeline are using colors, ratings were also high, Geocell 93.8 and prime time ads and television personali- LaiLai 93.3. ties to push their products. A rebranding campaign has been very Competition is driving the race for successful: Geocell has also been brand- innovative branding strategies for mobile ing itself aggressively. The company phone operators as well, noted Magti- adopted a new purple colour in a wave com’s Chief Marketing Offi cer, Irakli of advertisements in 2009, blanketing Lobzhanidze. the market to the extent that everything “Enormous” competition within purple now seems connected to Geocell. the telecoms industry – where three A long and successful partnerships operators are “pushing” for customers with Georgian actor Duta Skhirtladze and new clients – is driving marketing also stimulated the company to stay departments to use branding to create engaged with consumers and promote has been a success: Georgians began loyalty, he said. consumer loyalty. connecting with American Express and “When we have a huge variety of Facebook and social media are also the product took off. products on the market and when the a major focus. for Katsman and his team Katsman, the bank’s chief branding supply is higher than the demand and as they seek to build the bank’s brand. offi cer, started the strategy a year ago the consumer has to choose between By using Bank of Georgia’s fb profi le to when he moved to Bank of Georgia from two identical products, then branding engage with potential clients, they give Sarke, a local advertising agency. matters,” Lobzhanidze explained, adding people a chance to comment on services “We launched this brand on the glob- that selling a simple message that strikes and expectations.

AUG.-SEP. 2011 27 Investor.ge

At Bank of Georgia, Katsman and his team seek to build the bank’s brand Case: by using Bank of Georgia’s Facebook Nescafe “Coffee World” Romania profi le to engage with potential clients by giving people a chance to comment A case study provided by Publicis Hepta on services and expectations. Irina Sak, CEO of Publicus Hepta’s Caucasus offi ce, noted that Georgia is Background: one of the “fastest growing” Facebook As the leader of the soluble coffee market, NESCAFÉ is perceived as users in the world. Socialbakers, a site the most innovative brand, covering various consumer needs and coming dedicated to statistics on social media, up with new products and solutions. Nevertheless, it also has to overcome reported that the number of Georgians the misconceptions Romanians have that soluble coffee is not 100% natu- using Facebook grew from 480 thousand ral (like roasted and ground coffee) nor does it have any health benefi ts in January to 641.6 thousand in July – The approach is 360, but in addition to using the traditional channels nearly 15 percent of the population and Zenith Optimedia innovatively also activated the digital marketplace over 49 percent of the country’s online since 40% of potential NESCAFÉ consumers search the Internet daily population. on health-related subjects This makes the social networking site a “fantastic tool” for marketing – if The Insight: marketing departments know how to use The idea was to create a virtual branded coffee plantation, where each it – skills Georgian companies are still subscriber had to complete the actual production process to get a great developing. tasting mug of NESCAFÉ. Lobzhanidze said social media is part of Magticom’s marketing strategy, The Solution: but a relatively small part. In his opinion A NESCAFÉ branded online game platform was created. television is still the most effective way The incentive to play was a chance to win a Fiat Punto (as the major to reach the biggest share of Georgian prize) & 2 NESCAFÉ Dolce Gusto beverage systems. consumers. Social media was used to gather a community of players. Marketing departments however, are To get “coffee money” players would have to get as many people as increasingly using social media to gauge possible to visit their game plantation; more people = more game money. the success of television advertising Therefore each plantation owner would promote his page link to all his campaigns. friends, their visits allowing the owners to develop further. Katsman said the dialogue and chat platforms on Facebook help Georgians Results (in 2 months): feel included in the product and the pro- 5,170,798 unique users (out of 10 million unique users in Romania) cess of doing business – which is vital for 15,956,563 visits building relationships with future clients. 155,689 active accounts “We are not just trying to sell the Almost 1 million virtual NESCAFÉ mugs were created product to them, we try to improve the product and make the services better Business objective achieved: – we ask people and we consider their Increase soluble cup share by changing consumer misconceptions opinion,” he said. regarding soluble coffee. “We have pushed the boundaries in terms of communication because I think Communication objective achieved: the end result of that is that people them- Increase the percentage of total coffee consumers that view NESCAFÉ selves feel a part of the big game and an as being 100% natural. important part of it.”

28 AUG.-SEP. 2011 Investor.ge

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AUG.-SEP. 2011 29 Investor.ge The power of the tried and tested brand

30 AUG.-SEP. 2011 Investor.ge

in emerging markets - rather than with nearly a 50 per cent share of the domestic equivalents - due to their toothpaste market worldwide. perceived superior value and status. However, there is one major risk This is particularly evident in the when investing in brands: if anything luxury goods sector. With Chinese happens to sully the brand’s reputation, millionaires outnumbering those in the its pricing power and share price can UK or France, according to a recent be damaged irreparably. report by Capgemini and Merrill “If you tarnish your brand, it’s hard Lynch, emerging markets have become to get it back,” says Vaight. He points a key regions for sales of premium to a number of domestic Chinese product lines. companies that have recently suffered Scilla Huang Sun, manager of the health and safety scares - such as Julius Baer luxury brands fund, says shampoo company Bawang, whose that top-end western products have shares fell from more than HK$6 to huge appeal in emerging markets - and HK$1.3 last year. After a slump in the most sought-after brands are made value like that, Vaight says it is diffi cult in Europe. to build a brand up again. “Brand is so key,” she says. So, as companies enter emerging “Companies have to manage the markets, the ability to understand positioning of brands in the markets customer attitudes is crucial. Some carefully as it is the brand that has brands have failed to do this. pricing power.” Hyundai, for example, had to NATASHA CULZAC AND ALICE ROSS High-end fashion sales are adapt its cars to the Chinese market by booming, with Tiffany, Burberry putting more chrome on them - in order und managers are continuing and Hermès enjoying strong results to meet what Vaight calls an appetite to seek out the most popular recently, due in part to their exposure for “bling”. Fbrands in emerging markets, to to emerging markets. This week, Peter Kirkman, portfolio manager benefi t from higher consumer spending LVMH, maker of the popular Louis of the JPM Global Consumer Trends and higher standards of corporate Vuitton bags, issued results for the fi rst Fund says: “Many western brands governance. half of the yearshowing revenues up 13 fail in emerging markets because Many believe companies with per cent year-on-year. they fail to adapt to local tastes and internationally recognised brands, Ben Cook of Dominion Funds preferences.” He points to US electrical which can allow them to charge focuses on other forms of “luxury” goods retailer Best Buy. It pulled out higher prices and sell products as spending - casinos in Macao, private of China this year after fi nding Chinese status symbols, now make the ideal education in China, and demand among consumers are less likely to value its shareholding. the Chinese for expensive mountain customer service and warranties. “Brand value is often very bikes. But not all successful brands It is not all one-way traffi c, though. intangible - it is driven by how it are in the luxury sector. Paint and Fund managers are also trying to spot makes consumers feel, or how they toothpaste attract loyal consumers, too, quality local brands with the potential want to be perceived, and that is according to Vaight. to go global. For example, Snow Beer, something you want to maintain and He has invested in Finnish paint a Chinese brand, is now the largest grow,” says Matthew Vaight, head of company Tikkurila, which operates in beer company in the world by volume, global equities at M&G. “The power eastern Europe and recently met Indian while Samsung is the second largest of the brand is such that people pay a distributors Berger Paints - both have handset maker after Nokia. According premium for it.” large domestic market shares due to to Kirkman, most of China’s other Some fund managers believe that their consistent quality and marketing. domestic brands are yet to realise their western brands are a better choice Colgate is also now a global brand, potential.

AUG.-SEP. 2011 31 Investor.ge

Winter Olympics: Sochi boosts infrastructure to prepare for the Games

the city is being replaced with highways, Following the closing ceremony, roadways and roundabouts, while high- Russia must prove it can orchestrate an speed train lines will connect Sochi to event of that size again with the Fifa neighbouring cities in the Krasnodar World Cup in 2018, and replicate the suc- region and facilitate transport between cessful aspects of Sochi’s infrastructure the coast and the mountains where the overhaul across the entire country. Olympic skiing and snowboarding events “There are so many things hap- COURTNEY WEAVER will be held. pening, not only in the region, but on With fewer than 1,000 days to go the national level ... that would never hen Sochi won its bid to host before the Games begin, Russia is scram- happen if Sochi didn’t host the games,” the 2014 Winter Olympics bling to pull off what even the president says Dmitry Chernyshenko, president Wfour years ago, Alexei Khra- of the Olympics organising committee and chief executive of Sochi 2014, the ban, the city’s deputy mayor, likened the concedes is one of the most ambitious Games’ organising committee. night to a new birthday for the city; and projects in the world. “The state leaders consider the big so in a sense it was. Sceptics will be watching to see social and sport events as catalysts to Once a Soviet-era resort with little whether the country can host the Games accelerate the process of redevelop- infrastructure, Sochi is now in the pro- on time, on budget and without too much ing the country’s environment and the cess of being transformed into what the evidence of corruption. economy,” says Mr Chernyshenko. Kremlin views as a 21st-century city. But the legacy of the Games will be Sochi, he adds, is meant to be a “model A single road running the length of just as big a test. city” for Russia.

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The task of getting Sochi ready for he says. “But all the remaining problems: preparation for the World Cup, high- the Olympics is not a small one. The the trash, the polluted sea, won’t be speed train connections will be built for second-longest urban area in the world solved. And they won’t be resolved, be- the majority of cities with 1m people or after Los Angeles, until recently it had cause the cost of fi xing them could be as more. That’s the most tangible legacy just one road running the length of it, much as the cost of the entire Olympics.” of the Fifa cup: it will bring our regions causing traffi c jams when trucks trans- Mr Chernyshenko admits that en- closer to each other,” he says. porting construction materials began to vironmental standards for the project For residents of Sochi, however, it clog up the street. were not at the highest global level, is sometimes hard to believe the legacy By the end of the year, the commit- mainly because the standards in Russia of both events will actually be worth it, tee hopes to complete the partially open had been so low. “We had to create our especially given the number of corrup- Adler ring road, a freeway that will own standards,” he says. Now, thanks tion allegations surrounding construction provide an additional route for travelling to foreign consultants, the situation has tenders, and the cost of certain projects. from the airport to the city centre. much improved, he insists. “Things are Alik Le, a local activist, says he has Sochi residents say they are excited really getting better.” been disappointed by the disregard for about the new road opening but bemoan He believes the Games will provide people’s livelihoods in the course of the traffi c conditions they have endured the impetus to raise environmental preparations. He is one of dozens of over the past three years, with some standards across the country, while si- residents who have been moved from complaining that their average commute multaneously providing residents with their homes to make way for the Games, times have increased from 20 minutes to better infrastructure and higher living and, by his account, not properly com- an hour and a half. conditions. pensated. Dmitry Kaptsov, a local resident and “We are redeveloping the entire “The government names its price vice-co-ordinator for Environmental region. This is not just infrastructure for and you don’t have the right to dispute Watch in the North Caucasus, an advo- the competition. This is roads, power it,” he says. cacy group, says he knows the traffi c stations, sewage works. It will mean a While he wants to believe that the problem is only temporary, but that he better living standard for the people who Winter Olympics will provide the type and neighbours worry about what the city live there,” he says. of legacy Mr Chernyshenko describes, will become after the Olympics. Meanwhile, the World Cup will ex- he has his doubts. “It is so much money,” “The traffi c problem they’ll fi x fi rst, tend what is happening at Sochi to the he says. “And then in a matter of days because of its effect on the Olympic site,” national level, he says. “Thanks to the it is all over.”

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34 AUG.-SEP. 2011 Investor.ge

tide of Euroscepticism, which has with ceremony and symbolism: the Poland accompanied a debt crisis that has European anthem played in parliament, threatened the single currency and where Bronislaw Komorowski, the shaken the bloc’s confi dence. president, noted that Poland takes over begins “I think we should fi ght that and exactly 20 years after the dissolution of argue against that,” Mr Tusk told the Warsaw Pact, marking the end of reporters in Warsaw. “I think it’s quite its time as a Soviet satellite. term as EU an exciting task to persuade others that “The Polish presidency is a good the EU is a great thing - that it’s the time to consider how much the EU best place on earth where you can be has given Europe, and how much president born and live your life.” we Europeans can join in its further Although the institution is less development,” said Mr Komorowski. powerful than before the passage Although Poland is hoping to of the Lisbon treaty, Poland’s turn push priorities such as improving at the head of the bloc’s six-month the EU’s ties with former Soviet rotating presidency is an opportunity to countries such as Ukraine, opening highlight an EU success story at a time membership talks with Serbia and of general gloom. fi nalising Croatia’s accession to the “There are large expectations for Union, Mr Tusk recognises that the the Polish presidency,” said Jerzy Greek crisis is likely to dominate the Buzek, the Polish head of the European country’s presidency, and repeated a Parliament. “There is a feeling that we call for fellow leaders to resist populist can breathe in a new spirit, something pressures and support Athens. that today’s Europe really needs.” “We cannot cheat ourselves: if we With €67bn in structural funds provide assistance, let’s say to Greeks, during the current seven-year budget under the conditions that will cause cycle, Poland is the largest benefi ciary them not to be able to pay back the of EU largesse. The money has gone loan, it’s not assistance at all,” Mr Tusk for a nationwide effort to catch up said. to western Europe after decades of He also urged a “quick conclusion” backwardness caused by the war and to troubled negotiations between communist dictatorship. Flying into member states and the European Warsaw from the west, one sees a Parliament on a package of fi scal rules JAN CIENSKI AND JOSHUA CHAFFIN remarkable sight of an earthen slash intended to prevent the debt build-ups IN WARSAW cutting across the green countryside that precipitated the crisis. Another big - the location of a future east-west priority for the Poles will be leading oland began its fi rst European highway paid for in part by the EU. discussion on a nearly €1,000bn budget Union presidency with a Those funds, as well as billions plan that the European Commission, Ppromise from Donald Tusk, more spent on Polish farmers, have the EU’s executive arm, published this prime minister, to lead a “no taboos” made the EU enormously popular in week. Poland, as the largest recipient, discussion about the bloc’s next long- Poland, which joined the EU in 2004, has an enormous stake in a generous term budget. and are a factor in the country’s strong budget, but will have to tread delicately Mr Tusk, noting the EU’s economic growth - expected to come in with net payers such as Germany and overwhelming popularity in his nation, at more than 4 per cent this year. the UK. also pledged to confront a rising Poland’s presidency began (c) 2011 The Financial Times Ltd.

AUG.-SEP. 2011 35 Investor.ge

Emerging market investors cast wider net

at Advance Emerging Capital, which market, trades at a trailing price/earnings invests 80 per cent of the $850m assets ratio of 7.5 times. “Yet these countries do under management in emerging markets not get the positive coverage that China and the rest in frontiers. “The emerging or Asia get”, he adds. In comparison the market story is not just about China, Asia MSCI World index is a trailing price/ or Brics but about an investable universe earnings ration of 14.5 times. of roughly 25 countries - deemed emerg- Mr Feriani believes the risk/reward RUTH SULLIVAN ing by index providers - and another 50 trade off in Nigeria, Qatar, Russia and countries called frontier markets,” he Turkey is “worth it at this stage”. At cur- merging markets have become adds. rent levels of valuation a signifi cant part such a strong focus for fund While China has “taken the spotlight of the risk is priced in. This is particularly Emanagers that the topic enjoyed and put emerging markets on the global visible in the case of Russia, he adds. a whole day to itself at the recent Fund map over the past decade”, he believes Mark Mobius, chairman of Temple- Forum conference in Monaco. Those at- the best investment opportunities are cur- ton’s Emerging Markets Group, is also tending heard that interest has widened, rently in countries benefi ting from China keen on Russia. It offers the cheapest both in geographical and asset class and Asian growth such as resource rich prices as “people are so negative on terms, but were warned not to expect countries like Brazil, Russia and Africa, the country that stocks are cheap,” he outsized returns. particularly Nigeria, and parts of the says. Unlike many investors who worry Investors are increasingly pinning Middle East such as Qatar. about political risk, governance and their hopes on emerging markets as Cheap valuations are attractive, say the country’s heavy reliance on natural developed countries grapple with debt asset managers. Mr Feriani maintains resources, he believes Russia is “going problems and fl at economies. But they frontier markets offer “compelling value the right way”. are looking beyond the Brics (Brazil, and are among the cheapest global asset He also has large exposure to China Russia, India and China classes”. They are under researched and where he likes local telecommunication Unlike earlier years they are broaden- lacking in aggregate data which provides companies and consumer stocks when ing their horizons, no longer focusing on “plenty of valuation anomalies to exploit the price is right but is keen to broaden just a handful of large emerging markets for those doing their homework”, he the gamete of Templeton’s Frontier Mar- such as Brazil, Russia, India and China points out. ket Fund, which has $1bn of assets under [Brics], but diversifying to a wider mix Qatar is trading at a trailing price/ management. He is currently looking at of smaller countries, including frontier earnings ratio of 13.5 times and Nigeria markets such as Laos, Cambodia and markets, according to the industry at the a trailing 13.7 times, says Mr Feriani. Vietnam, which he believes are “feeling Fund Forum conference in Monaco two He also believes valuations in Turkey, their way towards a market economy”. weeks ago. a trailing 10.9 times price/earnings are More exotic frontier markets such “Diversifi cation is crucial in emerg- compelling, particularly as the country as Mongolia are moving into the frame. ing markets,” says Slim Feriani, chief has good fundamentals. He also likes Hong Kong based Quam Asset Manage- executive and chief investment offi cer Russia which, although not a frontier ment, recently launched the Silkroad

36 AUG.-SEP. 2011 Investor.ge

AUG.-SEP. 2011 37 Investor.ge

Mongolia Fund, focusing on the coun- your countries carefully and on the credit much further emerging markets will try’s commodity-driven growth and local side look at companies with good balance go before blowing up continues to be currency. sheets and solid management. Look at a concern. Opinions vary. Mr Mobius Factors such as rapid economic the fundamentals,” says Zin Bekkali, discounts a bubble in the short term growth, driven by the rise of middle chief executive of Silk Invest, an emerg- because new money in initial public of- class consumers, and lower debt levels ing market specialist. ferings in Asia is boosting the region. In than those in developed economies are According to EPFR Global, the fund 2010, $450bn poured into the region’s also catching investor interest. Public data provider, local currency emerging companies, surpassing the US, effec- and private sector debt levels compared market bond funds have attracted twice tively banishing any spectre of a bubble to reserves in regions such as the Middle as much new money as their dollar for now, he says. East and Africa are far healthier than in counterparts in the second quarter of China is leading the recovery of the Europe or the US, according to the IMF. the year. While emerging markets dollar global economy, says Linda Yueh, an Asset managers recommend an early bond funds took in a net $3.63bn, local economist and director of the China entry into a range of smaller emerging currency ones attracted more than $8bn. Growth Centre at Oxford University but markets, while prices are cheap but in- Accumulative monthly institutional if it wants “to sustain its place and secure vestors could be in for a long wait before fl ows for emerging market local currency another golden era of growth it will have they reap any gains. The MSCI Frontier bond funds from the end of 2005 to the to open its economy,” she adds. Market index has underperformed the year to date are $30bn. So what accounts She is cautious on the risks of invest- MSCI Bric index by more than 70 per for the interest? ing in a country “where so much reform cent since March 2009, when global “EM local currency debt offers is needed. “Go in a bit at at time,” she equities rallied after the fi nancial crisis. something for the yield hungry, a hedge says. Traditionally investors have gained against long-term dollar weakness and, if Rick Lacaille, global chief invest- exposure to emerging markets largely you believe emerging markets are largely ment offi cer at State Street Global Advi- through equities but are looking at other on top of infl ation and interest rates will sors is equally cautious about the wider asset classes such as currency and local start to come down in the fi rst half of emerging market scene. “Don’t expect currency debt. next year, it still offers some value,” too much and have overblown expecta- “If you go into countries like Ghana says Cameron Brandt, research director tions of returns but there is still a case for and Nigeria you can get double digit re- at EPFR. emerging market currencies, such as ren- turns in local currency terms. But choose However the question of just how minbi denominated products,” he says.

38 AUG.-SEP. 2011 Investor.ge

Georgia’s Quest for Modern Hospitals, One Bed at a Time

Private investment in new hospitals is spurring the government’s plans to modernize the country’s crumbling medical infrastructure.

Investor.ge is starting a new MONICA ELLENA provision of higher quality services. series of sector overviews Today his plans are slowly becoming a to provide background, ust as Rome wasn’t built in a day, reality as private companies invest in summaries and analysis of the transition of healthcare from the government’s hospital privatization priority industries for investors the cradle-to-grave assistance of in the Georgian economy. J program. This is the final article in a Soviet times into a private business has As the private insurance program series dedicated to the health taken Georgia well over a decade. is well under the way, increasing the industry. For more information In 2006 the then State Reform effi ciency of the hospital network please contact Molly Corso - Minister Kakha Bendukidze said remains another challenge the [email protected]. that turning the healthcare industry government faces. over to the private sector would lead According to offi cial data, between to increased competition, increased 2000 and 2009 the number of hospitals patient choice and ultimately the increased from 229 to 241, but the

AUG.-SEP. 2011 39 Investor.ge

number of beds decreased sharply from system to the vast privatization to improve effi ciency; establishing 21,200 to 13,600. Of these, only 30% program. training schools for nurses; introducing are in use and in addition most of the However, not all has gone new technology for clinical quality facilities are in dire need of renovation according to plan. First the fi nancial management like telemedicine for and technological upgrade. crisis and then the war with Russia the network of hospitals and digital The process of outsourcing the job led original investors to default imaging so remote locations can to the private sector will bring around on promises and in mid-2010 the improve the quality of diagnostics. 8,000 beds into private hands: so far government revised the plan. “What we need the most is know- investors have completed 1,600 and a Private insurance companies are how.” further 5,600 are expected by the end now engaged in hospital reconstruction of 2013. The task is to improve the and rehabilitation. Going private effi ciency of bed-use: not more beds, Currently 114 hospitals with Investors have seen the potential but beds more utilized. It is believed 5,235 beds are being constructed or of a market to be built almost from the number of beds will actually rehabilitated – 23 with state budget, scratch. Modern facilities with state- decline further, to around 10,000. 91 with private investment. The latter of-the-art medical technology have The policy has also helped improve includes both insurance companies been built across the region. As the access to healthcare, noted Patricio such as GPI, Imedi International 100 hospitals program fell through, Marquez (Washington-based) Lead and Aldagi BCI and non-insurance the government modifi ed and invited Health Specialist for Europe and investors such as Block Georgia and insurance companies to bid to Central Asia region for the World Ihope. build additional medical facilities. Bank. “Hospitals are scheduled to open Georgian Prime Minister Nika Gilauri, The government’s cooperation towards the end of 2013,” explains illustrating the process in a Parliament with insurance companies has helped director of the Curatio International hearing explained for example that to insure over one million families, he Foundation Dr. Giorgi Gotsadze, having IMEDI win the tender in Telavi, noted – now the focus should be on “my assessment is that the project is Akhmeta and Kvareli regions, the access to healthcare facilities. currently on track and being closely company would insure all vulnerable “Efforts are needed in the future monitored, almost on a weekly basis, people living there and, at the same to improve the stewardship capacity by the Ministry of Health. It seems time, it would be responsible for of the government in the healthcare promising although the fi nal outcome building a 70-bed hospital in Telavi, a sector, particularly to ensure that yet remains to be seen.” 15-bed one in Akhmeta and a 15-bed people enrolled under health insurance Putting the development of the hospital in Kvareli. arrangements receive quality health hospital sector in private hands International organizations have services, and to facilitate access to defi nitely seems to be the way forward also been ready to support the sector’s quality essential drugs,” Marquez to alleviate pressure on the state modernization. The World Bank’s wrote in an email interview. budget. Still, money is not the only Health Sector Development Project, problem. due to end in December 2011, has 100 New Hospitals; maybe “Georgia spends 10% of its GDP been injecting $28 million into the more. on healthcare, a high fi gure relative to system to improve the coverage, Early in 2007 the government its economic development,” explains the use and the quality of healthcare launched a nationwide ‘100 New Gotsadze. “The issue is the ineffi ciency facilities, along with strengthening the Hospitals’ program to transfer in the system due to weak and outdated government’s stewardship function in ownership of hospital sector hospitals and their management, the system. The results are tangible: restructuring; the fi nal goal: transfer of along with oversupply of doctors and 103 primary healthcare facilities in ownership of all state-owned, privately undersupply of nurses.” mountain areas of Imereti, Adjara and administered hospitals in the country Opportunities for investors Shida Kartli have been rehabilitated, to the private sector by means of direct are multiple: bringing in Western- equipped and staffed with trained sale. That is, adding the healthcare style management and know-how personnel; 30% of the population are

40 AUG.-SEP. 2011 Investor.ge

now covered with re-trained family IFC, part of the World Bank Group, “Health insurance is not the only medicine providers (compared to 0.6% announced its fi rst-ever fi nancing of a area investors can look at,” explains at the beginning of the project); 72% health insurance program: a $3 million Lubeck. “Establishing clinics is of the rural population has access investment in equity in Archimedes another. In addition, facilities need to to a primary health clinic within 30 Health Developments to help expand be managed and that requires highly minutes of transportation/walking access to health insurance and health skilled competencies. Management is and the immunization rate of DPT3 services in Georgia and other emerging another possible area.” (three doses of diphtheria, pertussis markets in Eastern Europe and Central Examples are out there. In March, and tetanus, which the World Health Asia. IFC’s investment, along with the Washington-based American Organization uses as a common $2 million additional fi nancing from Hospital Management Company measure of the availability of health Archimedes Global will enable the (AHMC) announced it will manage the services) increased by 20% to reach new company to establish health Tbilisi State Medical University High 98% in 2009. clinics (two are currently being built in Technology Medical Center. George “Possibilities for investors are Tsoniri and Lagodekhi). Cyprus-based Ingorokva, the facility’s principal vast,” says Thomas Lubeck, Director of Yaron Inbar, AG’s Managing Director, investor, stated that the highly trained the International Finance Corporation declined to comment on the agreement staff needed “a new philosophy and (IFC) for the South Caucasus. In June to Investor.ge. new management model”.

ADVERTISEMENT Investor.ge

Zviad Tsikolia: Georgian industrial designer crafts images for international brands

Georgian industrial designer ents – foreign or local – has never been keting in Europe and the United States Zviad Tsikolia has left his mark on a problem. – is still not prioritized in Georgia, designs for Bugatti, Castel beer, He has found success at home, as Tsikolia noted. Khvanchkara wine and Georgia’s well. During this year’s May 26 Inde- Designs for labeling, bottling and latest military hardware. Investor. ge spoke to him about his work and pendence Day parade; the military un- packaging Georgia products are starting how it feels to see his impact on veiled its new Didgori armored vehicle, to take off, but industrial design is lag- cars, planes and other consumer designed by Tsikolia. ging behind, he added. goods. The vehicle is named after a pivotal “The development of industrial de- battle in the 12th century when Davit the sign is associated with industrial devel- Builder recaptured Tbilisi and made the opment, which is still a new process here. MAIA EDILASHVILI city the royal capital. But his real passion Since we have wine and soft drinks, however, is packaging. packaging design – labels, postcards, etc. ver the past 21 years, Zviad Tsikolia Design R&D Ltd. has been are necessary and thus the graphic design Tsikolia’s signature designs credited for revolutionizing glass bottle has succeeded more or less.” have left his mark on consumer O design in Georgia. He has designed “If our businessmen were aware items on everything from luxury cars and bottles for 3D beer, Herzog beer, Castel of how important design is to the com- watches to hot dog stands and military beer, Argo beer, Khvanchkara wine and pany’s profits… Georgia’s industrial hardware. Likani mineral water, among others. design would not be so archaic looking,” His signature style was immortal- Packaging – a second skin for mar- Tsikolia noted. ized in 2006, when a Bugatti car he designed was displayed at the Concorso d’Eleganza Villa d’Este, a prestigious motor industry competition. Once a senior designer with Design Club International - a Japanese company, Tsikolia has also exhibited his work at motor shows in Frankfurt and Geneva. A graduate of Tbilisi State Academy of Fine Arts, Tsikolia said fi nding cli-

42 AUG.-SEP. 2011 Investor.ge

AUG.-SEP. 2011 43 Investor.ge

The first large scale Tbilisi Charity Gala Burns Supper raised enough funds to equip a small computer room, provide internet connectivity and maintenance funding to get the IT education ball rolling for the small multipurpose youth activity center in Shaumiani founded by CHCA (Charity Humanitarian Centre “Abkhazeti”). The program has made a difference in the children’s lives but more work is needed to make it sustainable.

44 AUG.-SEP. 2011 Investor.ge

Success in Shaumiani: Funds from Burns Supper Finance IT Education for IDPs

JEFFERSON SOMMERS II, AN by UNICEF – and use the funds raised the classes I taught included: keyboard- EDUCATION PEACE CORPS at the event to purchase other equipment ing, basic navigation of MS Windows VOLUNTEER (2009-2011) WORKING for the children to use. Operating System, word processing IN MARNEULI Together with the know-how and through MS Word, creating presentations equipment installation by staff from through PowerPoint and an introduction or children ripped from their KPMG Georgia, and working with local to the writing process. However, through homes and relocated following community members a computer room, the IT classes I also tried to help build Fthe 2008 August conflict, the complete with Internet access, was set self-esteem and develop critical think- Shaumiani CHCA center is a safe haven up. Finally, Fiona Coxshall, organizer ing skills. for activities like computer classes. of the annual Burns Supper, recruited With a starting total of thirty youth Demand for these classes comes from me to teach the IT course. from ages 10 to 25, the highest impact the community. IDPs in Shaumiani, like Through observation I found that was observed in the 10 – 17 age group. those in other IDP communities, have most of the students at the settlement Aside from the handful of students who diffi culties reconnecting with their roots, are in an education gap, unable to were comfortable with mouse-controlled fi nding jobs and in general adapting to demonstrate educational competencies computer games, most of the children their situation. This stems from the psy- expected and exhibited in traditional had little to no familiarity with computers chological impact of confl ict and reloca- Georgian schools. or how they function. tion, geographical isolation, a general In addition, Shaumiani is historically But after three months, students made lack of, or disconnect from resources an ethnically Armenian village, making amazing progress and 11 were awarded and fi nancial instability. The settlement’s it diffi cult for students to interact with certifi cates and a fl ash drive. Being held youth loiter on the streets and when the local community. The relocated to objective standards, students were asked what their goals and aspirations town citizens also have to deal with stretched beyond their comfort zones: are, some of them don’t know – or tell numerous other basic needs issues like some of the introverted youngsters you honestly that they don’t have any. poor water quality/access, intermittent opened up and every one of the students With cooperation and teamwork, a electricity supply, unemployment and walked away with a better comprehen- dedicated team from the Burns Supper poor nutrition. sion of computers – some were able to was able to secure computers – donated The primary fundamental elements of go from knowing nothing at all about computers to writing page-long compo- sitions or creating detailed and coherent PowerPoint presentations. In order for this project to be sustain- able, the work needs to continue. It may not be the easiest path to take, but the youth really thrive from interactive les- sons where they can learn and practice something new together with a patient teacher. This year Peace Corps celebrates their 50th anniversary internationally and their 10th anniversary working in Georgia.

AUG.-SEP. 2011 45 CONTENT

Welcome, John Ashworth

47 Batu Kutelia: Untapped 49 IT and Telecom Committee Met 52 Member Directory potential for trade between Ministry IT Department Head 54 Social: Holiday Inn Pool Party US and Georgia 49 Thomas De Waal Presents 54 Social: Wine trip 47 The Economist Tbilisi Latest Book Conference: Tourism 56 Social: AmCham Georgia 49 A Farewell to Deputy Chief of Annual July 4 Picnic 47 MobiPay Invests: Preview of Mission at the US Embassy October IT report Kent Logsdon

48 Regular Meetings with 50 Member Profile Deloitte Revenue Service Improve Customs Climate 51 New Members, Resource page

49 New Finance Minister Dimitri Gvindadaze Meets Members

46 AUG.-SEP. 2011 Batu Kutelia: Untapped potential The Economist’s Conference In Tbilisi: for trade between US and Georgia “Georgia Has Very Strong Potential…In Tourism “ the US and Georgia. Ambassador Bass spoke about the latest round of talks for The Economist’s Conference in the US-Georgia Security Charter, as well Tbilisi panelist Arild Hovland, the as the recent arrest of four photographers senior vice president of business on espionage charges. The ambassador development at Rezidor believes also introduced John Ashworth, new Georgia’s tourism sector will be Deputy Chief of Political & Economic “a major factor” for the economy. Affairs at the embassy. Radisson Blu Iveria and Radis- Allen Gilstrap, MobiPay Chief Ex- son Blu Batumi are part of the Rezidor Hotel Group. Hovland Trade talks between Washington and ecutive Offi cer, OpenRevolution Georgia said the group was eager to “get a Tbilisi can be a good “mechanism” for JSC, spoke about MobiPay’s expansion foothold” in the Georgian market. strengthening business ties between the in Georgia and internationally. Currently, He will be speaking about op- two countries, noted Georgia’s former 15 percent of Tbilisians are MobiPay cli- portunities and challenges in the Ambassador to the US Batu Kutelia. ents - taking advantage of ability to pay Georgian tourism sector during the Kutelia addressed AmCham mem- bills, pay for goods and transfer phone November 17 conference in Tbilisi. bers following the traditional briefi ng credit using a mobile phone. The number of tourists coming by US Ambassador in Georgia John R The company plans to double its to Georgia has increased from two Bass at Sheraton Metechi Palace hotel staff to 300 by the end of the year, and million in 2009 to three million on July 27. Kutelia, now serving as the is expanding Georgian operations to the last year. deputy head of the National Security regions, including Telavi and Batumi. It “Tourism will be a major fac- Council of Georgia, said sector-specifi c is also expanding to Poland and Ukraine. tor for Georgia but it also needs to business summits, company database and Other announcements included develop other trade and business,” more education on fi nancing mechanisms SEACOR Response, which introduced Hovland said, noting that the hos- could bolster business relations between its new name.. pitality business is “operating in a tough competitive environment,” MobiPay Invests: Preview of October IT report but there is expectation for contin- ued growth. “For the medium and long term Over the course of seven months, ment, employable population and strong our outlook is very positive as MobiPay has become one of the fast- mobile networks all contributed to their Georgia has very strong potential est growing payment platforms in the decision to choose Georgia as their re- especially in tourism having such country. Using software developed in gional headquarters. a rich & unique culture.” Georgia, the company has created a “mo- “[The] complete absence of business bile wallet” that over 110 thousand cus- corruption, fervency of the government tomers, and 1800 merchants where the to promote foreign investment – Georgia Welcome John Ashworth system is used. Allen Gilstrap, MobiPay has a fantastic future in front of it,” he and new Political/Economic Chief Executive Offi cer at OpenRevolu- said, noting that MobiPay’s success is an Team! tion Georgia, believes Georgia is an ideal example for other IT companies. AmCham Georgia welcomes location to headquarter an IT business. “[W]e are a poster child for what we the U.S. Embassy’s new staff in In 2009, when the company decided think they wanted to do.” the Political and Economic Depart- to come to Georgia, they selected the For more information on IT invest- ment. A brief interview with John country from a list of over 50 possible ment – and a longer interview with Mr. Ashworth will be published in the destinations. The pro-business environ- Gilstrap, please read the October issue. October issue of Investor.ge.

AUG.-SEP. 2011 47 Regular Meetings with Revenue Service Improve Customs Climate

Better communication with the Rev- committee has been trying to get this is focusing on providing their members enue Service (RS) is helping businesses result for years,” he said. “With the new direct contacts with the legislation mak- tackle customs issues. AmCham’sTrade head of the Revenue Service [Ebanoidze] ers and give direct comments on new and Transportation Committee has taken and the appointment of a business om- changes before they are even imple- the lead in utilizing the new relationship budsman, the change is obvious: it is mented in regulation. between business and government as a very clear that government heard the Most importantly these meetings platform for helping member companies businesses’ requests for more attention.” are the opportunity for each Amcham work better. The Chamber’s Trade and Transpor- member who has an issue with the cus- Monthly meetings with department tation Committee has initiated discus- toms department to join (max. 3 persons heads at the Revenue Service (RS) – sions with decision makers at the service per meetings). Also a very important and bi-monthly meetings with Jaba on a variety of obstacles that have hurt project that was agreed on -- but has not Ebanoidze, the head of the service – are businesses involved with customs and yet started – is the opportunity for any producing concrete results for AmCham- trade in Georgia. Topping the list has business involved in transport/customs members. been basic improvements, like allowing brokerage to send a request to AmCham The RS’s willingness to discuss – and AmCham to review planned changes for customs department training on site deal – with problems and concerns is a to the tax/customs code before they are at the company. real change that is welcome for busi- submitted to the ministry and parliament. This is a win-win situation for both ness, noted John Braeckeveldt, the head In addition, there are plans to launch a business and the RS: business can show of AmCham’s Trade and Transportation email dialogue platform with a guaran- firsthand what is not working on the committee. teed quick response. scene and RS can advise business how “AmCham trade and transportation With this new approach AmCham they can work better. AmCham Georgia, RS: A Successful Partnership

Sample/gifts in shipments regulations to the RS website which would direct readers to A decision was made to free samples from customs clearance specifi c procedures. A small booklet was published. if not for sale. Concerning VAT on international transports Household goods of investors/ demand for AmCham will send new draft suggestions for scales for customs store house changes to the law and the RS will review There’s a demand of the scales for the customs store house. them If the good is meant for transit, re export, the clearance of the A new law about the tax exemption of the cargo customs ser- household goods will be streamlined. A new nomenclature code vices is being reviewed in the Parliament of Georgia. The RS regarding these goods is planned. noted that when such goods cross the border, a special com- modity operation is determined. RS recommended creating a Official confirmation that all new regulations/ list of the services. Also execution operations connected with changes to tax/customs code will be available import now can be conducted via e-declaration. before RS/MOF send this to minister or parliament Phytosanitary paper at the border RS agreed to send all the new amendments and changes/news AmCham raised the issue related to obtaining the Phytosanitary to AmCham fi rst and give a period of one week for the revision paper at the border. It was proposed by RS that from now every- and comments. In case of need, the meeting with the RS Chair one can fi ll the sheet to get receive a phytosanitary certifi cate and or with the Minister or Prime Minister is Possible. online by using www.rs.ge.

Customs to prepare easy how to booklets for Mobile Payment options for customs duties customs operations Import payments conducted by Cell Phone is a fi nance opera- Due to the size of the document, a decision was made to link tion, which according to the tax code is free of VAT.

48 AUG.-SEP. 2011 New Finance Minister Dimitri Thomas Gvindadze Meets Members De Waal

Newly appointed Minister of Finance tors Service, Georgia’s reform-driven Presents of Georgia Dimitri Gvindadze gave an economy has a positive development insightful overview of the Georgian outlook. Despite serious challenges the Latest economy during the monthly member country received from the war and the luncheon on July 15. global crisis, the economy has shown Book According to the rating evaluation resilience with favorable public debt of such organizations as the Standard & situation. For details please visit: On June 30, AmCham Poor, Fitch Ratings, and Moody’s Inves- www.amcham.ge members met with Thomas De Waal, author of the recent “Georgia’s Choices” book at IT and Telecom Committee Met Ministry IT Betsy’s Hotel. Department Head De Waal is an acknowledged expert on the unresolved confl icts of the South Caucasus: On July 8, Wouter Metz, facilitated presentation about the Governmental Abkhazia, Nagorny Karabakh, the discussion about the status of the plans and actions for the improvement of and South Ossetia. From action points and presented the sheet the Broadband capacity in Georgia; the 2002 to 2009 he worked as an of Preliminary Consolidation of IT Power Point presentation was posted on analyst and project manager Skill Demand Inventory. The Head of AmCham web site shortly. If any Am- on the confl icts in the South IT and Innovations Department from Cham member wishes to join the monthly Caucasus for the London- the Ministry of Economy and Sustain- committee meetings, please contact Gigi based NGOs Conciliation able Development of Georgia made a Liluashvli at the AmCham offi ce. Resources and the Institute for War and Peace Reporting. He A Farewell to Deputy Chief of Mission at is author of the authoritative the US Embassy Kent Logsdon book on the Karabakh confl ict, Black Garden: Armenia and On June 22, AmCham members Kent shared memories of his time Azerbaijan Through Peace and gathered at the Tbilisi Marriott Hotel to in Georgia, the he updated members War, which has been translated hear from Deputy Chief of Mission of on upcoming Embassy functions, and into Armenian, Azeri, and the US Embassy Kent Logsdon whose briefed about recent developments in Russian. His latest book is The term is expiring and who left Georgia a the country. At the end of his briefi ng, Caucasus: An Introduction few days ago. Kent answered questions from the fl oor. (Oxford University Press, 2010).

AUG.-SEP. 2011 49 Club Prestige Platinum and Club Prestige Gold for the Euro 2012

UEFA EURO 2012 – is the last How can this help you with marketing and advertising European football championship with relations? 16 teams playing in the fi nal round. An effective business tool for creating, strengthening and developing Ukraine and Poland will host the strong relations with business partners, clients, suppliers, management and tournament from 8 June until 1 July shareholders, this will take the relationship with your business partners to a 2012. It will be the third tournament new level and give you the chance to shine during Europe’s most important in the history of the European national sports event. It is also an effective way of enhancing employee loyalty. football championships with two Club Prestige gives business representatives the right to attend the most countries acting as the hosts. exclusive and prestigious football matches. Deloitte will endeavor to assist The UEFA EURO 2012 Club companies and organizations as they take advantage of the opportunity that Prestige Program has been drawn up EURO 2012 opens up to them by joining Club Prestige. for representatives from top companies to provide them with the exclusive Why Deloitte? opportunity to join the most prestigious Deloitte, an international consulting fi rm, has been appointed as au- football events. thorized sales consultant and will assist UEFA with the worldwide sale There are two types of product of EURO 2012 Club Prestige packages. According to the agreement with – Club Prestige Platinum and Club UEFA, Deloitte will provide consulting services regarding the purchase of Prestige Gold. The Club Prestige the hospitality packages. Platinum provides a prime location, Deloitte places special emphasis on sports business services, serving privacy and an exclusive experience for clubs, leagues, regulating authorities and companies that build sporting your guests. Club Prestige Gold gives facilities as well as sporting event organizers. an access to a shared business lounge, with a combination of top-quality seats The costs and benefits and luxurious hospitality services. All The cost of the Golden Package varies between 2, 900 euros for the group corporate hospitality packages are also matches (admission to three matches) and 10, 950 euros for the fi nal matches offered in the Stadium Series, Country in Kyiv and Warsaw (admission to three group matches, the quarter-fi nal Series and Knockout Series. and the fi nal). It is also possible to buy a package that includes admission to all matches in one of the hosting countries, including the fi nal in Ukraine, totaling 23, 900 euros. The cost of the Club Prestige Platinum Package varies between 5, 200 euros and 18, 900 euros. Companies will receive top-category seats for their employees and partners, excellent food, special entertainment programs before and after matches and many more exciting offers.

50 AUG.-SEP. 2011 HBSS CH2M IOLI Gvinadze & LPA Legal Partners Corporate A Supermarket Ltd Partners LLC Associated LLC

Corporate B Member MEMBERS

Hall Booth Smith & As a global leader Established in February Gvinadze & Partners is Legal Partners Slover is a full-service in consulting, 2009, Ioli is one of a Georgian business law Associated - LPA LLC and diverse law fi rm with design, design-build, the leading Georgian fi rm. With its predecessor is a full-service law fi rm NEW eight regional offi ces in operations, and program retail trade companies fi rms – Georgian providing legal advice Georgia, Tennessee and management, CH2M that is growing very Consulting Group (GCG and counseling in broad South Carolina. HBSS HILL has the human and quickly. Coverage area Law Offi ce), Ernst & aspects of business and is engaged in advising technical resources, the so far is Tbilisi only but Young Legal (EY Law fi nancial transactions, and facilitating foreign international footprint, in the near future the Georgia), Gvinadze & corporate, civil and investment in Georgia, as and the depth of know- company is planning to Partners and then most administrative law. well as providing legal how and experience increase its retail chain recently DLA Piper www.lpa.ge services to Georgian to help clients achieve up to 25 stores, to attract Gvinadze & Partners, and US companies success in any corner of additional investments it has over 15 years of concerning legal matters the world. for developing the retail successful history of within the jurisdiction of www.ch2m.com chain and a central serving and promoting the US. warehouse. inward investment in www.hbss.net www.gastronomia.ge Georgia. www.gvinadzeandpartners.ge

GOVERNMENT ADDRESSES

Investor.ge is publishing a list of government addresses and contacts as a reference. If there are other government agencies or state organizations you are looking for and cannot find, please let us know: [email protected].

State Minister for European and Euro-Atlantic Minister of Economic and Sustainable Development Integration, Vice Prime Minister VERA KOBALIA GIORGI BARAMIDZE www.economy.gov.ge www.eu-nato.gov.ge 12 Chanturia Str. Tel: 99 77 77 7 Ingorokva Str. Tel: 93 28 67 Minister of Energy Minister of Regional Development and Infrastructure ALEKSANDRE KHETAGURI RAMAZ NIKOLAISHVILI www.minenergy.gov.ge www.mrdi.gov.ge 2 Baratashvili Str. Tel: 35 78 00 12 Al. Kazbegi Ave. Tel: 51 05 91, 51 06 88 Minister of Justice Minister of Finance ZURAB ADEISHVILI KAKHA BAINDURASHVILI www.justice.gov.ge www.mof.ge 24 Gorgasali Str. Tel: 40 52 02 16 V. Gorgasali Str. Tel: 26 14 44 Minister of Foreign Affairs of Georgia Minister of Education and Science GRIGOL VASHADZE DIMITRI SHASHKIN www.mfa.gov.ge www.mes.gov.ge 4 Sh. Chitadze Str. Tel: 28 47 47 52, D. Uznadze Str. Tel: 43 88 19 Minister of Agriculture Minister of Environmental Protection BAKUR KVEZERELI and Natural Resources www.moa.gov.ge GIORGI KHACHIDZE 6 Marshal Gelovani Str. Tel: 37 80 13, 37 80 09 www.moe.gov.ge Minister of Labour, Health and Social Affairs 6 Gulia Str. Tel: 72 57 00, 72 57 20 ANDRIA URUSHADZE www.moh.gov.ge 144 A. Tsereteli Ave. Tel: 36 90 26

AUG.-SEP. 2011 51 AmCham Company Members as of August 2011

PATRON MEMBERS Caucasia Trading HSBC Bank Georgia JSC Salford Georgia 5/7 Navtlugi St., Offi ce #1 15 Rustaveli Ave. 44 Leselidze St. BP Exploration Georgia Tel: 2277323; Fax: 2277377 Tel: 2177777 Tel: 2505400-03; Fax: 2505406 38 Saburtalo St. www.caucasiatrading.com www.hsbc.com www.salford.com.ge Tel: 2593400; Fax: 2593488 www.bp.com Caucasus University Iberia Refreshments, JSC SEACOR Response 77 Kostava St., Bld.6, 4th fl . Tetri Khevi Hesi District, Orkhevi 9 Khvichia St. 0160 Tel: 2941691; Fax: 2253814 Tel: 2241091; Fax: 2241090 Tel: 2244141, 2382825 Exxon Azerbaijan Ltd www.cu.edu.ge www.pepsi.ge www.seacorresponse.com Landmark Suite 300, 95 Nizami St., Baku, AZ1010 Azerbaijan CH2M Hill Imedi L International SEAF Management LLC Tel: (994-12) 4982460; Fax: (994-12) 5th Floor, GMT Plaza, Freedom 20 Chavchavadze Ave. 7, Niko Nikoladze St. II Floor. 4982472 Square Tel: 2223520; Fax: 2293075 Tel: 2998115; Fax: 2923533 www.exxonmobil.com Tel: 2474040; Fax: 2470210 www.imedi-l.com.ge www.seaf.ge www.ch2m.com KPMG CIS Ltd. Tbilisi Branch Sheraton Metechi Palace Hotel PricewaterhouseCoopers Chartis Europe S.A. Georgia 3rd Floor, Besiki Business Center, 20 Telavi St. 7 Bambis Rigi St., 0105 Branch 4Besiki St., 0108 Tel: 2772020; Fax: 2772120 Tel: 2508050; Fax: 2508060 7 Bambis Rigi St., 0105 Tel: 2935713; Fax: 2982276 www.sheraton.com/tbilisi www.pwc.com/ge Tel: 2439025; www.kpmg.ge T&K Restaurants (McDonald’s Fax: 2439026 Georgia) www.chartisinsurance.com Levon Travel UGT 20 Chavchavadze Ave. 1 Dzmebi Kakabadze St. 17a Chavchavadze Ave., 7th fl oor Chemonics International Tel: 2250010; Fax: 2232399 Tel: 2921246; Fax: 2251422 Tel: 2220211; Fax: 2220206 6a N. Ramishvili St., 0179 www.levontravel.ge www.mcdonalds.ge www.ugt.ge Tel: 2234311; Fax: 2234309 TBC Group www.chemonics.com Maersk Georgia LLC 6 Khetagurov St. 7 Marjanishvili St. Deloitte Tel: 2200800; Fax: 2200815 Tel: 2272727; Fax: 2228503 CORPORATE A MEMBERS 36a, L. Asatiani St., 0105 www.maerskline.com www.tbc.com.ge Tel: 2244566; Fax: 2244569 TBSC Consulting ABRIS Distribution AG. www.deloitte.ge Magticom 6 Marjanishvili St. 21 Liubliana St. 5 Politkovskaya St. Tel: 2959019; Fax: 2420215 Tel: 2527271; Diplomat Georgia Tel: 2171717; Fax: 2171171 www.tbsc.ge www.abrisdc.com 65, Kakheti Highway www.magticom.ge Tel: 2984950 Advanced Engineering www.diplomat.ge Marriott Hotels, Resorts & Suites Associates Georgia 13 Rustaveli Ave. CORPORATE B MEMBERS Apt 3, 20 Kipshidze St., 0162 DLA Piper Georgia LP Tel: 2779200; Fax: 2779210 Tel: 2913892; Fax: 2252762 10 Melikishvili St. www.marriott.com AGV Czech Republic Ltd www.aeai.ge Tel: 2509300; Fax: 2509301 63 Kostava St. www.dlapiper.com Metromedia International Group Tel: 2242559; Fax: 2242549 Alliance Group Holding, JSC 8000 Tower Point Dr., Charlotte, NC www.agv-czech.com 47/57 M. Kostava St., 0179 Ernst & Young 28227 Tel: 2424181; Fax: 2998112 44 Leselidze St. Tel: 2171201; Fax: 2210101 Aliance Georgia Ltd www.agh.ge Tel: 2439375; Fax: 2439376 www.metromedia-group.com www.ge.ey.com 33 Samurzakano St. Tel: 2243773 Microsoft Georgia LLC Avon Cosmetics Georgia LLC www.groupaliance.com Georgian American University 6 Marjanishvili St. 117 Tsereteli Ave.. 21a Chavchavadze Ave., Tel: 2424478 Tel: 2226805; Fax: 2226806 Alioni-99 Holding Company 2d Arch #3 www.microsoft.com www.avon.com Tel: 2915003; Fax: 2915004 12a Kazbegi Ave., 0160. www.gau.ge Mobipay (OpenRevolution Tel: 2922993; Fax: 2389737 F H Bertling Georgia Ltd. Georgia) www.alioni99.ge Georgian Audit & Consulting 9 Tarkhnishvili St. 19 T. Abuladze St. 0162 Company GZ American Academy in Tbilisi Tel: 2443356; Fax: 2443376 Tel: 2235403 47 Kostava St. Suite 29 37a Chavchavadze Ave. www.bertling.com www.mobipay.ge Tel: 2984039; Fax: 2438352 Tel: 2227441; Fax: 2227889 www.aat.ge Betsy’s Hotel / Prosperos Books www.gacc.com.ge MSD (Schering Plough Central 32/34 Makashvili St. / 34 Rustaveli GMT Group East AG) APM Terminals Ave. 4 Freedom Square 44 K. Abkhazi St. 0105 52 D. Aghmashenebeli St., Poti Tel: 2987624, Fax: 2923592 Tel: 2988988; Fax: 2988910 Tel: 2438978 Tel: 493-20660; Fax: 493-20688 www.betsyshotel.com www.gmt.ge www.merck.com www.apmterminals.com

Booz Allen Hamilton, Inc. Greco Group Philip Morris Bagebey City Group 7 Bambis Rigi St., 0105 1 Nutsubidze St. 7 Bambis Rigi Str., 0105 49b Chavchavadze Ave. Tel: 2439072; Fax: 2439059 Tel: 2393138; Fax: 2311107 Tel: 2439001; Fax: 2439005 Tel: 2913152; Fax: 2290169 www.boozallen.com www.greco.ge www.philipmorrisinternational.com www.bagebeycity.com

British American Tobacco GT Group ProCredit Bank Baker Tilly Georgia Ltd. 71 Vazha Pshavela Ave. 48 B. Cholokashvili St. 154 Agmashenebeli Ave. Meidan Palace, 44 Kote Abkhazi St. Tel: 2399103/01/02; Fax: 2399104 Tel: 2740740 Tel: 2202222; Fax: 2202222-2226 Tel: 2505353; Fax: 2505353 www.bat.com www.gtgroup.ge www.procreditbank.ge www.bakertillyinternational.com

Catoni & Co. Georgia Hall, Booth, Smith & Slover, P.C. Radisson BLU Iveria Hotel Bank of Georgia 3 Lesia Ukrainka St. Apt.7 41 Vaja Pshavela Ave. 0177 1 Rose Revolution Sq. 3 Pushkin St. Tel: 2989230; Fax: 2922264 Tel: 2394417, Fax: 1-404-9545020 Tel: 2402200; Fax: 2402201 Tel: 2444134; Fax: 2983269 www.hapag-lloyd.com www.hbss.net www.radissonblu.com www.bog.com.ge

52 AUG.-SEP. 2011 Bank Republic Education and Training Liberty Bank JSC Teliani Valley JSC 2 Gr. Abashidze St. International Ltd. 74 Chavchavadze Ave. 2 Marshal Gelovani Ave. Tel: 2925555; Fax: 2925544 4 Kuchishvili St. Tel: 2555500; Fax: 2912269 Tel: 2313245; Fax: 2313249 www.republic.ge Tel: 2250945; Fax: 2250945 www.libertybank.ge www.telianivalley.com www.educatrain.ge Basis Bank JSC Madneuli JSC VD Capital 1 Ketevan Tsamebuli Ave. Geocell 3/5 Kazbegi Street, 0179 77 Kostava St., 0175 Tel: 2922922; Fax: 2986548 3 Gotua St. Tel: 2474545, ext. 55 Tel: 2363672; Fax: 2364302 www.basisbank.ge Tel: 2770100, ext. 7435; www.madneuli.ge Fax: 2770119 Wimm-Bill-Dann Georgia Ltd Batumi Oil Terminal www.geocell.ge Mgaloblishvili, Kipiani, Village Ponichala, Tbilisi 0165 GMT Plaza, 4 Freedom Sq. Dzidziguri (MKD) Law Firm Tel: 2475290 Tel: 2241818; Fax: 2241817 GeoEngineering LLC 24 Suite, IV Floor, www.wbd.ru www.batumiport.com 15a Tamarashvili St. 71 Vaja-Pshavela Ave. Tel: 2311788; Fax: 2311787 Wings and Freeman Capital Tel: 2973880; Fax: 2973884 Green Building, 6, Marjanishvili St. BDO LLC www.geoengineering.ge www.mkd.ge 42 Kazbegi Ave. Tel: 2940051; Fax: 2940053 Georgian Airways www.wfcapital.ge Tel: 2545845; Fax: 2399204 Mina JSC www.bdo.ge 12 Rustaveli Ave. Tel: 2999730; Fax: 2999660 4 Besiki St. Wissol Georgia www.georgian-airways.com Tel: 2449981/82/83; Fax: 2449980 74b Chavchavadze Ave. BG Capital www.mina.com.ge 23 Chavchavadze Ave, 3rd fl . 0179 Tel: 2915315; Fax: 2915615 Georgian Lottery Company LLC www.wissol.ge Tel: 2444687; Fax: 2235804 34 Chavchavadze Ave. Navigator Ltd Publishing House www.bgcapital.ge Tel: 2649649 34 Anton Katalikosi St. www.georgianlottery.com Tel: 2923615 BGI Advisory Services Georgia NON PROFIT ORGANIZATIONS www.navigator.ge 18 Rustaveli Ave., II fl . Globalink Logistics Group Tel: 2997292; Fax: 2996615 14-A Shartava St, 2nd fl , Suite 7 New School - Int-l House American Friends of Georgia www.bgi.ge Tel: 2253262; Fax: 2439002 35 Tskneti Highway, Bagebi 77 Nutsubidze St. www.globalinkllc.com Tel: 2231728 Tel: 2397174; Fax: 2388495 BLC Law Offi ce www.newschoolgeorgia.com www.afgeorgia.org 4 Gudiashvili Sq. Goodwill 1 Parnavaz Mepe Ave. 0131 American Institutes for Research Tel: 2922491; Fax: 2934526 Orifl ame Georgia Tel: 2243673; Fax: 2243673 Apt 28, 42 Abashidze St. www.blc.ge 57 Uznadze St. www.goodwill.ge Tel: 2290644; Fax: 2290644 Tel: 2911064; Fax: 2911068 Casino Adjara www.vep.org.ge www.orifl ame.ge 1, 26 May Sq. Gosselin Georgia Tel: 2335519; Fax: 2334520 3 M/D, Didi Digomi East West Management Institute, Overall Management Group www.casinoadjara.com Tel: 2596601/02/03; Fax: 2596600 Inc (EWMI) www.gosselingroup.eu (OMG) Inc. 3rd Floor , 5 Marjanishvili St. 12 M. Javakhishvili St. Tel: 2505404; Fax: 2202441 CaucasTransExpress Gvinadze & Partners LLC Tel: 2436052; Fax: 2436052 www.ewmi-gpac.org 10a Tashkent St. 0160 44 Leselidze St, Tbilisi 0155 Tel: 2375715 Tel: 2235683, Fax: 2438971 Publicis Hepta The Eurasia Partnership www.cte.ge www.gvinadzeandpartners.ge 17 V. Jorbenadze St. Foundation 29/31/33 Chavchavadze Ave., Caucasus Online LLC Holiday Inn Tel: 2745672; Fax: 2745671 2nd Floor, 0179 71 Vaja-Pshavela Ave. 1, 26 May Sq., 0171 www.publicishepta.com www.epfound.org Tel: 2480048; Fax: 2480048 Tel: 2300099 Rakeen Development LLC www.caucasus.net www.hi-tbilisi.com 2 Baratashvili St. 0105 Foundation - Centre for Training and Consultancy Château Mukhrani, J.S.C. HRG Georgia “Sky Travel LLC” Tel: 2933393; Fax: 2933993 34 Al. Kazbegi Ave., Plot #3, 0177 III fl oor, Didube Plaza, Meidan palace Business Center, www.rakeen.ge Tel: 2206774 116 Tsereteli Ave. 44 Kote Apkhazi St. www.ctc.org.ge Tel: 2201878; Fax: 2201878; Tel: 2438958 Rentals Ltd. 46 Rustaveli Ave. www.mukhrani.com www.hrgworldwide.com Georgian Wine Association Tel: 2454566 5 Marjanishvili St. IOLI Supermarket www.rentals.ge Citadines Apart’Hotel Tel: 2505456 4 Freedom Sq. 0105 13 Abuseridze-Tbeli St. Tel: 2547030; Fax: 2547040 Tel: 2745053 Rompetrol Georgia Ltd. www.gastronomia.ge International Relief and www.citadines.com/en/georgia/tbilisi/ 39 Navtlugi St. Development Inc. freedom_square.html Intourist Palace Hotel Tel: 2910727; Fax: 2910763 75 Paliashvili St. 11 Ninoshvili St., Batumi www.rompetrol.com Tel: 2250106; Fax: 2224837 Development Solutions LLC Tel: 422-75525, Fax: 422-76606 37 Rustaveli Ave. www.intouristpalace.com Silknet Ltd. International School of Tel: 2241555; Fax: 2241552 95 Tsinamdzgvrishvili St. Economics at TSU www.ds.com.ge Kor-Standard Bank JSC Tel: 2910345; 16 Zandukeli St. 43 Chavchavadze Ave. www.silknet.com Tel: 2507177; Fax: 2984815 Dika Ltd. Tel: 2507700, Fax: 2507707 www.iset.ge 40 Rustaveli Ave. Statoil Azerbaijan AS Tel: 2990994; Fax: 2990994 Kutaisi Free Zone, Georgian QSI International School of Int-l Holding Ltd 96 The Landmark Building, Nizami Georgia Donut Stop Cafe 6 Shio Mgvimeli St. Street, Baku AZ 1010. Village Zurgovani, Tbilisi 10/12 Abashidze St. Tel: 2232997, Fax: 2232997 Tel: +994 (50) 2168981; Fax: +994 Tel: 2537670; Fax: 2322607 Tel: 2251466; Fax: 2999252 (12) 4977 340 www.qsi.org Legal Partners Associated LLC www.statoil.com Dutch Design Garden Offi ce #203, Besiki Business Center, The Salvation Army 20 km, Agmashenebeli Alley 4 Besiki St. 0108 Tbilisi Airport City 16 Ikalto St. Tel: 2530779 Tel: 2200203; Fax: 2250458 7 Bambis Rigi. Tel: 2333786; Fax: 2330227 www.dutchdesigngarden.com www.lpa.ge Tel: 8790-185000; Fax: 2439328 www.salvationarmy.org

AUG.-SEP. 2011 53 SOCIAL PAGE

The 15 member Georgian Wine Tourism Delegation traveled to wineries in the United States from May 30 to June 8. The project was initiated by AmCham’s Betsy Haskell and included the first official wine tasting of fine Georgian wines in New York City at the Baryshnikov Arts Center on June 2.

54 AUG.-SEP. 2011 SOCIAL PAGE

Holiday Inn baptized its pool with a party in August

AUG.-SEP. 2011 55 SOCIAL PAGE

On July 3, AmCham Georgia held its annual American Independence Day Celebration at the U.S. Embassy. A huge thank you to our sponsors! APM Terminals, BBQ Club, Bertling Project Logistics, Besiki Business Center, Betsy’s Hotel, BGI Legal, Booz Allen Hamilton, Borjomi, Caucasia Trading, Courtyard Marriott, Diplomat Georgia, DLA Piper, Goodwill, Gosselin Caucasus & Central Asia, Gvinadze&Partners, Holiday Inn, IMSS, Kor Standard Bank, Maersk Line, Marriott Tbilisi, McDonalds, Natakhtari Beer, Pepsi, ProCredit Bank, Project Finance Advisors, Radisson Blu Iveria, Sheraton Metechi Palace, TBC Bank, Teliani Valley, UGT,Wings & Freeman, and Wissol

56 AUG.-SEP. 2011 SOCIAL PAGE

AUG.-SEP. 2011 57 Board Of Directors 2011

David Lee, PRESIDENT Sarah Williamson, David Lee is the General Director of Magticom, the First Vice-President largest telecommunications operator in Georgia and In Tbilisi since June 1998, Sarah Williamson is took up his position March 2004. David is also the the co-owner and Vice President of United Global Chairman of the Eurasia Partnership Foundation Technologies (UGT), the largest IT company in and is a Chartered Accountant with an MBA from Georgia. Warwick Business School. A Russian speaker, he has worked extensively in the former USSR and served as a Royal Naval Offi cer for 9 years.

R. Michael Cowgill, Irakli Baidashvili, Director Irakli Baidashvili is the Senior Vice President of Vice-President & Treasurer GMT Group. The company is one of the largest US In his 12th. year in Georgia, Michael Cowgill is direct investments in Georgia, the owner of two currently the President and co-founder of Georgian Marriott hotels, production facility SANTE and American University’s business and law schools in several major real estate sites in Tbilisi . Tbilisi, Georgia.

John Braeckeveldt, Director Esben Emborg, Director John Braeckeveldt arrived in Georgia in 2003 Esben Emborg has been in Georgia since 1999. He as the General manager for GOSSELIN in the has worked a General Manager for Caucasus Region Caucasus region. In recent years John also started for Cadbury Schweppes and Nestle until 2008. Now up a customs brokerage company, building new he is working as Principal Partner for an Investment European style warehouse in Tbilisi for freight Fund (SEAF) that is currently managing a 30 mil forwarding/storage solutions and customs bonded USD portfolio of investments all over Georgia. warehousing for diplomatic goods.

Neil Dunn, Director Badri Japaridze, Director Neil Dunn is the general manager of BP Badri Japaridze has been the Deputy Chairman of Georgia since October 2008. He has 30 years of the Supervisory Board of TBC Bank since 1999 experience in the oil and gas industry, having and the Vice-President of various engineering and operations assignments. Georgian Glass and Mineral Water Co. (GG&MW) since 1995.

Steve Johnson, Director Ted Jonas, Director Steve Johnson is the proprietor of Prospero’s Books Ted Jonas is the Managing Partner of DLA Piper’s and the General Manager of The Hotel Betsy. Tbilisi offi ce. He advises clients on international Prospero’s Books and Caliban’s Coffee House is business transactions, energy and infrastructure the leading English language bookstore in Georgia. projects, government relations, and dispute resolution.

Ivo Bakhuijzen, Director John Ashworth, Ex-Officio Member Ivo Bakhuijzen spent 9 years in the military, 5 of John Ashworth is the Deputy Chief of Political which as an offi cer within the airborne infantry; and Economic Affairs and Senior Economic/ with missions in the former Yugoslavia and Commercial Offi cer at the U.S. Embassy. He Afghanistan. worked previously in Uzbekistan, Barbados, and on Ivo has been in Georgia since 2008 as the director the State Department’s India Desk in Washington. of Dutch Design Garden, a sister company of the famous Dutch landscape architect Martin Veltkamp.

Betsy Haskell, Founding Advisor George Welton, Exec. Director Betsy Haskell is an 18 year resident of Georgia George Welton came to Georgia as a university who started four successful businesses, and is lecturer in 2004. Soon after arriving he started currently developing a resort hotel and villas in working as a professional researcher and founded the wine country. For the past 15 years, she has GeoWel Research in 2008. His company conducts been the Georgia Contractor for Metrica, Inc, a US research and analysis for non-profi ts like KfW, Treasury Department sub-contractor. GIZ, UNDP, DfID, CARE International and some private companies.

58 AUG.-SEP. 2011 AUG.-SEP. 2011 59