Issue 3, 2018. June-July

   

INVESTMENT NEWS

Georgian Economy Grows By Over Five Percent
The Georgian economy grew by 5.2 percent in the first quarter of 2018, according to official statistics, agenda.ge reported on April 30.
The government has forecast 4.5 percent growth this year, the report said.
It noted that international financial institutes have also predicted positive growth for the Georgian economy: the World Bank forecast 4.2 percent growth; the European Bank for Reconstruction and Development (EBRD) predicted 4.5 percent growth, as did the Asian Development Bank.
The International Monetary Fund has increased its estimate for Georgia's economic performance this year, predicting the country will grow by 4.5 percent this year and 4.8 percent in 2019.
"According to the International Monetary Fund forecasts, Georgia will have one of the highest economic growth rates among the countries of Eastern Europe and Central Asia in 2018-2023," the Georgian Economy Ministry said in a press release published on April 23.
"Growth in 2018 is expected to remain strong [. . .] The current account deficit is expected to widen slightly due to higher oil prices and public investment. Over the medium term, the sustained implementation of Georgia's economic reform program is expected to support higher and more inclusive growth by fostering private investment, productivity, and competitiveness."

Georgia, European Free Trade Association Sign Deal
The Georgian government and the European Free Trade Association's trade agreement went into effect on May 1, economy.ge reported the same day.
The European Free Trade Association (EFTA) is comprised of four countries: Iceland, Liechtenstein, Norway, and Switzerland. The deal gives Georgian producers access to a market of 14 million consumers.

$93-Million Dollar Airplane Parts Factory Opens
A factory set to manufacture civil aircraft parts for Boeing, Airbus and Bombardier passenger planes opened in Tbilisi on May 10, agenda.ge reported the same day.
The first production lines will start working by 2020, the report said.
The factory was built by a joint Israeli-Georgian venture company, Aerostructure Technologies Cyclone (ATC). An estimated 300 locals will be hired and will receive specialized training.

Firefighting Vehicles to be Produced in Georgia
An Austrian company plans to start building firefighting vehicles in Georgia, agenda.ge reported on April 26, citing information provided by the Emergency Management Service of Georgia.
The plant will be built at Delta, Georgia's State Military Scientific Technical Center.
"The time has come when it is necessary to fully re-equip the firefighting apparatus in Georgia. We have chosen [the] company Rosenbauer and together we will manage to achieve this goal. I have great expectations of fruitful cooperation with Rosenbauer," agenda.ge quoted Giorgi Mgebrishvili, the head of the Emergency Management Service of Georgia, as saying.

New Sewing Factory Opens in Kutaisi
A new factory opened in Kutaisi on May 16 as part of the government's Produce in Georgia program, agenda.ge reported on May 17.
The factory, MGMtex, will produce clothing for H&M stores and is projected to employ as many as 400 people.
There are currently 130 people working at the factory, which was built with a Georgian-Romanian investment of 7 million lari (about $2.81 million), the report said.

Georgian Tourism Agency Launches YouTube adverts
The Georgian National Tourism Administration will be targeting European and Middle East tourists with a series of YouTube advertisements this summer, agenda.ge reported on May 17.
The three-month campaign will start on May 29. It is estimated that the clips will be viewed over 21 million times.

Top Swiss Tourism School Opens in Georgia
Le Roche, one of the top three hospitality schools in the world, has announced it will start operations in Georgia, gov.ge website reported on May 18.
Prime Minister Giorgi Kvirikashvili attended the presentation, the report said.
"There comes a time when Georgia must place special emphasis on service quality. It is at this time of such rapid growth that the issue of preparing high-level managers in our country is becoming especially urgent.
This is why we are eager to welcome Les Roches, one of the world's top three hospitality schools, entering Georgia to operate at the University of Business and Technologies and to start training high-level managers. We certainly welcome this fact," Kvirikashvili said.

Over Half a Million Tourists Visit Mountain Resorts
Over half a million tourists visited Georgia's mountain resorts during the 2017-2018 winter season, a 25 percent increase from last year, agenda.ge reported on April 27.
Goderdzi, located in Adjara, saw the biggest increase in visitors, the report said.
There was a 129 percent increase in the number of people who traveled to Goderdzi, compared to a 122 percent increase at Tetnuldi, 119 percent increase in Tatsvali and a 25 percent increase in Gudauri.

Asian Development Bank to Fund Renovations at Gudauri
The Asian Development Bank will fund the second phase of work on water supply, sanitation and wastewater treatment systems at Gudauri ski resort, agenda.ge has reported.
The bank is also helping to fund the development of Georgia's transit system and its tourism sector, including the construction of a 24-km-long section of the road leading from Mtskheta to the Larsi checkpoint at the Georgia-Russia border.
The Asian Development Bank has invested over $2 billion in Georgia over the past 10 years, the report said.

European Investment Bank to Offer €250 million for Georgian Roads
The European Investment Bank (EIB) is proposing €250 million to help improve regional connectivity and road transport efficiency in Georgia, agenda.ge has reported. The bank has already financed over €500 million within the Georgian Transport Communication Project. The project includes the construction of a 14-km section of the Grigoleti-Choloki road, as well as rehabilitation work on other international and secondary roads in the country, the report said.

Austrian Logistics Company Expands in Georgia
The Austrian Gebruder Weiss transportation and logistics company will invest €2 million in Georgia to expand its logistics terminal, agenda.ge reported on April 19.
"We entered Georgia about five years ago and are satisfied with our investments. We have attracted a number of businesses [. . .] We intend to invest €2 million to enlarge our logistics terminal in Georgia," Wolfram Senger-Weiss, a member of the Gebruder Weiss Management Board, told Prime Minister Giorgi Kvirikashvili.
Gebrüder Weiss has invested €10 million in Georgia, establishing one of the largest premium logistics terminals in the South Caucasus region.
Gebrüder Weiss includes 150 branches in 28 countries and employs more than 7,000 people.

Georgia Plans Financing Reform
Georgian Finance Minister Mamuka Bakhtadze has pledged to make it easier for start-ups to receive funding, agenda.ge reported on April 12, quoting the Minister's remarks to journalists.
"Today our budget is dependent on about 300 companies, which is a bad tendency. This means that we have such sectors in the economy where a high risk of monopolization has occurred. This makes our economy less sustainable," he said.
"At the same time, we see high interest rates, which do not allow the chance to start businesses. The banking system should not be a brake for economic development, but its driving force."
"Taking into account these circumstances, we decided to start a large-scale reform in our economy, which aims to provide young start-ups with zero-interest-rate capital," said Bakhtadze.

Georgian Post Starts E-Commerce Platform
Georgian Post has created a platform to help small- and medium-sized businesses sell their goods in Georgia and abroad, Economy Minister Dimitry Kumsishvili announced on May 16.
The new service is called 'Georgian Products to the World' and aims to strengthen the e-commerce industry of Georgia, agenda.ge reported on May 17.