Issue 2, 2019. April-May

   

INVESTMENT NEWS

Investor.ge provides a brief update on investments and changes in government policy that could impact the business environment. The information in this issue was taken from agenda.ge, a government- supported website, and other sources.

Elene Tabagari

Azerbaijan Largest Source of FDIs in Georgia in 2018
Azerbaijan (19.5%), the United Kingdom (16.5%) and the Netherlands (13.6%) topped the list of sources of foreign direct investments (FDIs) in Georgia in 2018. The total amount of FDIs in Georgia was $1.23 billion in 2018, a decrease from 2017, GeoStat reported in early March.
The three sectors receiving the highest volumes of FDs were: finance ($277.9 million), transportation ($209.9 million) and energy ($157.2 million), agenda.ge reported.

Students Create First Canned Georgian Wine
Two Georgian students have created a canned wine product - a first for the country, commersant.ge reported in February.
Inventor Saba Sakhvadze said he and his partner George Machavariani were inspired by the words of Albert Einstein: "Everything should be as simple as it can be." The two students decided to create canned wine - called Mivino - when they had trouble opening a bottle of wine. Sakhvadze told commersant.ge he wants their wine to be as popular and accessible in Georgia as beer. He also says they plan to export Mivino worldwide. Mivino's Rkatsiteli and Saperavi wines are currently available in a limited number of shops.
The students plan to eventually offer canned sparkling wine, semi-sweet wine and rose wine. Mivino will soon be available at local supermarkets, Sakhvadze added.

Georgian Factory Produces Parts for Boeing Aircraft
Boeing has purchased its first order of aircraft parts from Aerostructure Technologies Cyclone, a Tbilisi-based factory. The factory produces parts for civil aircraft, including doors and control panels. ATC will produce parts for Boeing and other large aircraft companies including Airbus and Bombardier.
ATC is a joint venture between Israeli Elbit Cyclone and the Georgian state-owned Partnership Fund. It opened in 2018 and has already received ISO certification.

Georgia Increases Blueberry Plantations
The agriculture cooperative Agrotema has received state funding worth 100,000 lari to create a six hectare blueberry plantation in western Georgia, agenda.ge reported on March 19.
The funding comes from the state-run Plant the Future program, which aims to boost agriculture in rural areas. The plantation is planned for Samegrelo-Zemo Svaneti. Reportedly 50 people will be employed on site. Georgian blueberries are currently exported to the Middle East and Europe.

$32 Million to Prevent Natural Disasters in Georgia
Georgia is launching a $32 million, seven-year project to prevent natural disasters. The project's first step is to design special geological maps which will be used to determine the best places to install early detection systems.
Early warning systems have already been built in the River Vere in the capital of Tbilisi and in the Devdoraki Gorge in northern Georgia.
The Green Climate Fund is investing $27 million and the Swiss government is contributing $5 million to the project. Deputy Minister of Environment Protection and Agriculture Nino Tandilashvili noted this is the first time such a large project has been launched to target environmental threats in the country.
OPIC Invests $50 million in poti port
The U.S. Overseas Private Investment Corporation (OPIC) has loaned Pace Group $50 million to develop a multi-functional marine terminal at Poti Port. Total investment in the project is reportedly $120 million; the terminal is scheduled to be completed in 2019.

Georgian Hotel Fees Increase in 2018
The index of Georgian hotel prices has risen 2.6 percent over the past year, according to PMCG. The cost of a hotel room has increased in several regions, including Adjara and Samtskhe-Javakheti.
In Batumi, Adjara, for instance, the cost for rooms in four- and five-star hotels has increased up to 34 percent, while family-style hotel costs have increased by 0.3 percent, PMCG found.
Hotels also reported higher prices in the region of Racha. Hotels in the center of capital Tbilisi cost 4.2 percent less than last year, according to the report.

$60 Million Investment Planned for Georgia's Shovi Resort
A realty company called Symmetry has begun work to renovate the Soviet-era Shovi resort in upper Racha.
The Chairman of Symmetry Giorgi Jakhutashvili told bm.ge the company will invest $60 million in the project.
Jakhutashvili said the resort will have the capacity to host 56,000 visitors a year.

Georgia to invest 25 percent of budget in education
The Georgian government will spend 25 percent of the budget on education by 2022. PM Mamuka Bakhtadze noted the reforms will also encourage more private investment in the education sector. The plan includes higher teacher salaries and more modern methodology.