On 10 Years of The
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Issue no: 1150/180 • MAY 14 - 16, 2019 • PUBLISHED TWICE WEEKLY PRICE: GEL 2.50 In this week’s issue... Weekly Entrepreneurial News @entrepreneur.ge NEWS PAGE 2 Georgian Economy Strong, Infl ation Low, Short-term FOCUS Consumer Credit Declines ON 10 YEARS ISET PAGE 4 On the Success of the OF THE EAP ‘Georgia - Homeland of The PM heads to Brussels to celebrate Georgia's Wine’ Exhibition in Tokyo progress as one of the Eastern BUSINESS PAGE 7 Partnership six PAGE 5 Image source: neweasterneurope.eu Georgian Women’s Path Justice Minister: There Is No More Ill-Treatment of Prisoners to Leadership BY THEA MORRISON eorgia’s Minister of Justice, Thea Tsulukiani, has said that the ill- treatment of people in the coun- try’s penitentiary institutions is now “something of the past.” The BUSINESS PAGE 10 GMinister made the statement after the European Committee for the Prevention of Torture and Handling Frozen Confl icts: Inhuman or Degrading Treatment (CPT), an anti-torture committee of the Council of Europe, the Economic Angle published a positive report on Georgia. The Minister stated at a special press-confer- BUSINESS PAGE 12 ence that the legislative changes that have been implemented under the current government are Mtatsminda Elections: A positively evaluated in the report, which is based on the CPT delegation’s visit to the country on Look beyond the Numbers September 10-21, 2018. Continued on page 15 Image source: Shutterlock POLITICS PAGE 14 Charlie Chaplin in Tbilisi CULTURE PAGE 15 Prepared for Georgia Today Business by Markets Asof10ͲMayͲ2019 STOCKS Price w/w m/m BONDS Price w/w m/m BankofGeorgia(BGEOLN) GBP17.00 Ͳ0,2% Ͳ2,1% GEOROG04/21 103.67(YTM4.75%) +0,0% +0,1% GeorgiaCapital(CGEOLN) GBP9.99 Ͳ0,5% Ͳ7,3% GEORG04/21 106.07(YTM3.56%) Ͳ0,0% +0,1% GHG(GHGLN) GBP2.22 +0,9% +8,8% GRAIL07/22 107.45(YTM5.16%) Ͳ0,1% Ͳ0,2% TBCBankGroup(TBCGLN) GBP17.00 +5,1% +7,5% GEBGG07/23 101.86(YTM5.50%) Ͳ0,1% Ͳ0,0% COMMODITIES Price w/w m/m CURRENCIES Price w/w m/m CrudeOil,Brent(US$/bbl) 70,62 Ͳ0,3% Ͳ1,5% GEL/USD 2,7432 +1,4% +1,8% GoldSpot(US$/OZ) 1286,05 +0,5% Ͳ1,7% GEL/EUR 3,0801 +1,8% +1,4% GEL/GBP 3,5654 +0,1% +1,1% INDICES Price w/w m/m GEL/CHF 2,7112 +2,1% +0,9% FTSE100 7203,29 Ͳ2,4% Ͳ2,9% GEL/RUB 0,0420 +1,0% +0,2% FTSE250 19366,80 Ͳ1,7% Ͳ0,6% GEL/TRY 0,4582 +1,0% Ͳ3,4% DAX 12059,83 Ͳ2,8% +1,3% GEL/AZN 1,6163 +1,4% +1,8% DOWJONES 25942,37 Ͳ2,1% Ͳ0,8% GEL/AMD 0,0057 +1,8% +3,6% NASDAQ 7916,94 Ͳ3,0% Ͳ0,6% GEL/UAH 0,1048 +2,4% +4,6% MSCIEMEE 162,95 Ͳ3,6% Ͳ5,8% EUR/USD 0,8902 Ͳ0,3% +0,4% MSCIEM 1033,44 Ͳ4,6% Ͳ5,7% GBP/USD 0,7691 +1,3% +0,7% SP500 2881,40 Ͳ2,2% Ͳ0,2% CHF/USD 1,0118 Ͳ0,5% +0,9% MSCIFM 2665,12 Ͳ1,6% Ͳ3,1% RUB/USD 65,2248 +0,2% +1,5% GTIndex(GEL) 1582,68 ͲͲTRY/USD 5,9827 +0,3% +5,3% GTIndex(USD) 1208,13 ͲͲAZN/USD 1,6993 +0,3% Ͳ0,0% GEORGIA TODAY 2 NEWS MAY 14 - 16, 2019 Georgia to Get around @entrepreneur.ge Gamarjoba! I’m the Editor-in-Chief of the Georgian edition of $40 mln from the IMF Entrepreneur magazine and I’m here to share the top weekly Entrepreneurial news with you: Georgian honey is moving beyond the borders of the local market. Jani (ჯანი) is a brand offering fruit and dried fruit dipped in honey, a pioneer Georgian brand in overcoming export issues related to the East. The 100% natural product was launched in Kutaisi by Kristefore Darchishvili along with his uncle and friends, and rapidly obtained popularity on the Georgian market. After active communications with Chinese companies, the brand introduced its products at an exhibition in the Biltmore Hotel and caught the eye of exporters. The product is certifi ed and has received positive results in every regard. A novelty on the Georgian beer market, the alcohol-free rose canina fruit beer from Shengeli Tokhosashvili is soon to be introduced. A traditional drink for Kists, production was catalyzed by a desire to give wider audiences the chance to try it. The factory in Pankisi is already ready, supported by a grant received within the scope of ‘Enterprise Georgia’. Non-fi ltered beer under the ‘Kisturi’ brand name will be sold in Pankisi, followed by Kakheti and Tbilisi. The enterprise is to start operating at the end of May. GWS Company, one of the fi rst wineries in pleting the fourth review of the ongoing ani, National Bank Head Koba Gvenetadze BY THEA MORRISON Georgia to offer bottled wine, has program in Georgia," she said. "This agree- and the Prime Minister of Georgia, introduced the premium-quality TAMADA ment needs to be approved by the Board Mamuka Bakhtadze. wine in refreshed packaging. The new-look of Executive Directors of the IMF, which Matchavariani said at the joint press- wine will be available for consumers from eorgia will get around $40 discusses Georgia's issue in June of the conference that Georgia's economic June. The premium line collection: Grand million from the Interna- current year. Successful completion of this growth projection for the current year Reserve and Qvevri were introduced two tional Monetary Fund review will result in giving Georgia 30 is 4.6%, adding it is remarkably high for years ago. The majority of TAMADA (IMF). million SDRs (about $41.6 million)." the region and reaffi rms the effective- vineyards are 15 years old, while others are The statement was made She noted that in the framework of the ness of the reforms carried out by the 25. Since 2015, TAMADA has won 59 Gon May 13 by the IMF delegation head "Enhanced Financing Mechanism", the Georgian authorities. medals, 7 double golds among them. in Georgia, Mercedes Vera-Martin. total reimbursement for Georgia will “I believe this trend will continue on Follow the Entrepreneur Georgia Instagram page to get the latest updates from "As a result of productive discussions, reach $207.9 million. the basis of the ongoing program and Georgian Entrepreneurs. For doing business with Georgian Entrepreneurs, write us on the Georgian government and the IMF The IMF mission has already met the the economic dynamics of our country,” [email protected] mission reached an agreement on com- Minister of Finance, Ivane Matchavari- the Minister said. GEORGIA TODAY 4 BUSINESS MAY 14 - 16, 2019 Georgian Economy Strong, Infl ation Low, Short-term Consumer Credit Declines The fi rst set of variables that have had a BY DAVIT KESHELAVA REAL AND NOMINAL signifi cant positive effect on our forecast AND YASYA BABYCH EXCHANGE RATES EXPERIENCED relate to national currency deposits in MODERATE DEPRECIATION commercial banks. In March, all types of The real effective exchange rate (REER) national currency deposits, from the most depreciated by 0.3% relative to April, and SET-PI has updated its forecast of liquid - currency in circulation (up by by 0.1% relative to the same month of the Georgia’s real GDP growth rate for 18.9% yearly) - to the least liquid - time previous year. The depreciation of the the second quarter of 2019. Here deposits with a maturity of more than 12 REER is typically associated with reduced are the highlights of this month’s months (up by 31.9% yearly) - experienced value of the domestic export in the very release: double-digit growth in annual terms. The short-run period and gaining competi- I largest yearly increase was again observed tiveness of export production in the for- HIGHLIGHTS for national currency time deposits with eign markets later. Notably, the lari real • Geostat has released its GDP growth a maturity of less than 3 months, which exchange rate appreciated with respect estimate for the fi rst quarter of 2019. The increased by 53.1%, relative to the same to the national currencies of two major Q1 growth stands at 4.7% , which is only month of the previous year (but decreased trading partners – Turkey and Russia. 0.4 percentage points above the recent by 4.4% monthly). Overall, national cur- The GEL/TRY and GEL/RUB real ISET-PI forecast. rency total deposits increased by more exchange rates appreciated compared to • ISET-PI’s forecast of real GDP growth than 19.3% yearly. National currency the same month of the previous year by for the second quarter of 2019 stands at deposit-related variables had a positive rency, which is created by commercial petroleum and petroleum gases (declined 10.9% (appreciated by 2.6% monthly) and 4.7% - up from 4.6% in April. contribution to our GDP growth projec- banks - banks accumulate the savings of by 37.0%). The great majority of the other 2.3% (depreciated by 1.5% monthly) • Based on March data, we expect annual tion. individuals, fi rms and government enti- main product categories experienced respectively. In contrast, the lari real growth in 2019 to be 4.6% in the worst- Furthermore, the total volume of foreign ties, and provide funds for investment notable yearly increase, but still not enough exchange rate experienced a slight depre- case or “no growth” scenario, and 5.6% currency deposits went up by 15.6% com- projects and consumption that contribute to outweigh reduced import of the petro- ciation against the US dollar and the euro in the best-case or “average long-term pared to the same month of the previous to higher GDP growth.