Giorgi Kvirikashvili met with EBRD President Suma Chakrabarti
The EBRD will continue close cooperation with Georgia in the future. The volume of investment and financial aid will be increased in 2016 - respective information was provided by the President of the EBRD, Suma Chakrabarti to Giorgi Kvirikashvili. Their meeting took place within the frames of Davos World Economic Forum.
The parties discussed prospects of growth of investments, stimulating private sector and developing business environment in Georgia.
The President of EBRD congratulated the Prime Minister on his appointment and wished him success in his future endeavors.
Giorgi Kvirikashvili thanked Sir Suma Chakrabarti for his declaration of trust to Georgia and for the investments executed by the EBRD in the country.
DETAILS RELEASED OF GEORGIAN GOVERNMENT’S CAMPAIGN TO STRANGLE ANAKLIA PORT PROJECT
Ruling Georgian Dream Party Reversed its Support for Vital Project,
Wiping Out Economic Benefits for Georgia
TBILISI, GEORGIA, 9 September, 2020 – The Anaklia Development Consortium (ADC), the company originally selected by the Government of Georgia to develop the strategic Anaklia Port Project, today shared additional details of the Government’s campaign, directed by the ruling Georgian Dream party, to undermine the project by dissuading potential project investors, lenders, contractors and suppliers from joining the project in order to kill it.
The following statement is issued on behalf of the ADC Supervisory Board:
“All infrastructure projects of such scale require government support; namely the encouragement of lenders and investors, the assistance in permitting, regulatory approvals and a favorable tax regime, and providing any ancillary support; in this instance, the provision of land and the construction of road and rail infrastructure. For a government to actually oppose an infrastructure project that it had itself approved is highly unusual in the global economy.
“The Georgian Government’s campaign to strangle ADC’s ability to develop the Anaklia Port Project represents a self-inflicted wound for itself and considerable injury to Georgia’s economy and its role in the region.
“Taken together, the Georgian Government's specific actions are part of a deliberate and well-orchestrated campaign to destroy a project which the Government itself originally sponsored and endorsed, but subsequently chose to destroy as a result of what appear to be the political and economic self-interests of the Georgian Dream Party and its principals.
“The Government manufactured all sorts of excuses for not wanting to see various investors, lenders and partners involved in the project, but the Government really only had one purpose: to choke the project to death by scaring away everybody who might have an interest in supporting it.
“Also, is it beyond coincidence that government ministers – including two Prime Ministers -- who voiced support for the project or otherwise expressed concern about the growing controversy with the project were tendering their resignations shortly after such comments were made?
“The damage to Georgia caused by the Government goes well beyond the potential loss of the Anaklia Port and the associated Special Economic Zone. The conduct of the Government is scaring away investors at a time when Georgia cannot afford to lose any more foreign investment. According to the National Statistics Office of Georgia, the amount of foreign direct investment in Georgia has fallen from nearly US$ 2 billion in 2017 to just over US$ 1.3 billion in 2019, and in the first quarter of 2020, stood at only US$ 171.8 million - a catastrophic decrease even before the Covid crisis began to take effect. As Retired U.S. Lt. Gen. Ben Hodges of the Center for European Policy Analysis said, ‘the government only has itself to blame.’”
Some examples of the Government’s efforts to strangle ADC and the Anaklia Port Project include:
- Georgian Dream party leader Bidzina Ivanishvili requested to meet with ADC to discuss the Anaklia Port Project and asserted that the expansion of Poti Port could achieve the same objectives of the Anaklia Port at a far lower cost.
- During a June 12 meeting of the Georgian Dream party, attended by more than 100 party officials, Party Leader Bidzina Ivanishvili personally blamed Prime Minister Giorgi Kvirikashvili for his actions in support of the Anaklia project and for having close ties to ADC investor Mamuka Khazaradze. Mr. Kvirikashvili resigned the day after that meeting.
- In February 2019 ADC learned that during an October 2018 meeting with senior U.S. State Department officials in Tbilisi, Mr. Giorgi Gakharia (then Minister of Interior) advised the U.S. officials that the Anaklia Port project was not in Georgia’s interests.
- SSA Marine, which was selected as the Anaklia Port operator and was a potential investor, alerted ADC of its concerns about what seemed to be the Government’s support of an expansion of the Poti Port. (Following detailed studies sponsored by the Government back in 2013-14, it had been determined that Poti Port could never meet Georgia’s needs for a Deepwater Port, which is why the government itself selected Anaklia for development at that time. The Government’s subsequent expressions of support for expansion at Poti was a clear signal to the lending and investment community that the Government was no longer supportive of Anaklia.)
- A sovereign European development bank advised ADC that it had decided against supporting the project because of the negative actions of the Georgian Government, and the possible shift of support to the Poti Port.
- Another sovereign European development bank advised ADC that it was withdrawing its support because one of its counterparts had just done so (above) due to the state’s apparent shift of support from Anaklia to Poti.
- It has been reported that Infrastructure Minister Maya Tskitishvili, in ministerial hearings before Parliament, undermined SSA Marine as a potential investor and as the port operator, claiming the company lacked experience and financial capacity. These assertions were not true. In the process of her speech, the minister also breached legal obligations of confidentiality that were associated with the investment agreement.
- SSA Marine advised ADC that it was suspending its activities related to the Anaklia Port project.
- Mr. Giorgi Kobulia, Minister of Economy and Sustainable Development, told “Forbes Week” that the negative public discussions and media reports of the Anaklia project were having a negative impact on the business climate within Georgia. He subsequently resigned within days of the interview.
- A major U.S. private equity firm which was in advanced negotiations with ADC to join the project revealed to ADC that Government officials warned the firm to stay away from the project.
- Prime Minister Mamuka Bakhtadze, in a trade visit to the U.S., met separately with SSA Marine, the leadership of the U.S. private equity firm that were interested in investing in the project, and with U.S. Secretary of State Mike Pompeo in Washington, D.C. Secretary Pompeo expressed support for the Anaklia project with the prime minister standing next to him, saying it would “strengthen Georgia’s ties with free economies and not allow Georgia to be under the economic influence of Russia or China.” Upon his return to Georgia, Mr. Bakhtadze resigned, and this again put the project in unchartered waters.
- At a meeting in Tbilisi, a large Hong Kong-based private equity group with significant Central Asian transportation synergies that was considering joining the project was told bluntly by Infrastructure Minister Tskitishvili that the Government did not desire their participation in the project. At this same meeting Ms. Tskitishvili reaffirmed the Government’s seeming opposition to SSA Marine’s involvement in the project.
- Giorgi Volski, Vice Speaker of Parliament, falsely claimed that the Hong Kong private equity group mentioned above is a “Russian” company, with the intention either of disparaging it or sowing further confusion about the government's position in respect of the project.
- In a meeting between Prime Minister Gakharia and an Anaklia Supervisory Board member, Mr. Gakharia stated that “things had to get quiet” before he could reassure the major potential U.S. investor of the state’s support for the Anaklia Project, which the board member understood to be a condition that ADC and Mr. Khazaradze stop criticizing the government publicly on its opposition to the Anaklia Project, and the government would stop criticizing ADC.
- Also, the Supervisory Board was promised a letter of support to a U.S. investor from the highest levels of the Government, but this never materialized, even though ADC did comply with the Government’s request.
- A delegation from the U.S. (in Tbilisi to participate in the 5th annual Tbilisi International Conference sponsored by the McCain Institute) met with new Prime Minister Giorgi Gakharia, and subsequently with Mamuka Khazaradze. Representatives of the delegation told Mr. Khazaradze that Prime Minister Gakharia told them the Anaklia project was not commercially viable when this was patently not the case.
- Fadi Asly, chairman of the International Chamber of Commerce in Georgia, is quoted in the media saying, “No one will invest in Anaklia project as long as Bidzina Ivanishvili wants to destroy it.”
Taken together, these are only a selection of the instances where the Government of Georgia actively undermined the project in an effort to prevent ADC from developing the project. ADC intends to present evidence during the upcoming arbitration proceedings to demonstrate the degree to which the Government took such steps.
Further details of the Anaklia Port project and ADC can be found at http://anakliadevelopment.com
EBRD to finance modern municipal infrastructure in Bakuriani, Georgia
The population of Bakuriani, a city in the Borjomi municipality of Georgia, will benefit from improved public transport and services thanks to a €5 million loan provided by the European Bank for Reconstruction and Development (EBRD).
The financing will help to acquire special vehicles for street cleaning, snow removal and waste collection, as well as to purchase multi-purpose trucks, and 10 modern buses for passenger transport.
The new low-floor buses will considerably reduce emissions in this popular mountain and ski resort and offer more comfortable journeys. The EBRD is also providing technical cooperation funding aimed at training and promoting women for bus-driver roles.
Bakuriani is a small town in the central part of the country. It is one of the most-visited mountain and ski resorts in Georgia and famous for its climate and natural environment.
The technical cooperation will make recommendations for safe, accessible and inclusive transport that integrates the needs of passengers into urban transport services. Additional technical assistance funded by the donors of the Early Transition Countries Fund (Canada, Finland, Germany, Ireland, Japan, South Korea, Luxembourg, the Netherlands, Norway, Spain, Sweden, Switzerland, Taipei China and the United Kingdom) will help the company improve its corporate development.
“This project will help to improve the quality of municipal services and safety measures in an important resort town. Improving Georgia’s municipal infrastructure, especially in the regions, is of paramount importance for the EBRD. The project will also help promote gender equality across the workforce,” said Catarina Bjorlin Hansen, EBRD Regional Director for the Caucasus.
The EBRD is a leading institutional investor in Georgia. Since the start of its operations in the country, the Bank has invested over €3.8 billion in 252 projects there, in the financial, corporate, infrastructure and energy sectors, with 89 per cent of these investments in the private sector.
EU4Energy: Georgia adopts two key energy efficiency laws
On 21 May, the Parliament of Georgia adopted key energy efficiency legal acts: the Law on Energy Efficiency and the Law on Energy Performance of Buildings, which transpose the EU Directives in this field. Georgia has continued to implement electricity by-laws according to schedule, even during the COVID-19 pandemic.
By adopting the two laws, the Government of Georgia is given the opportunity to receive significant investments in public building renovation programmes, amounting to €80 million from the European Bank for Reconstruction and Development (EBRD) and German Bank KfW, €26 million in investment grants and €8.5 million in technical assistance from the EU. Georgia will get an additional €150 million in a policy-based loan tranche from KfW and the French Agency for Development (AFD) for the implementation of reforms.
"The new framework will not only make Georgia's building industry more competitive, but also its households better supplied with energy services, and its building stock better insulated. It will boost the usage of greener energy sources for heating, cooling and lighting," said Violeta Kogalniceanu, Head of the Energy Efficiency Unit at the Secretariat.
The laws were developed under the coordination of the Ministry of Economy and Sustainable Development of Georgia in close cooperation with the Secretariat, and with technical assistance provided by the EU supported project EU4Energy for the Buildings Law and by the EBRD for the Energy Efficiency Law.
Presidents of EBRD and ADB Confirm Readiness To Help Georgia Return to High Rate of Economic Development in Video Conference With Giorgi Gakharia
Prime Minister of Georgia Giorgi Gakharia held a video conference with the presidents of the European Bank for Reconstruction and Development (EBRD) and the Asian Development Bank (ADB) regarding the possible assistance and financial resources to be allocated to Georgia due to the challenges associated with the global pandemic.
Economic problems caused by the global spread of COVID-19 were emphasized during the video conference. Funding allocated by EBRD and ADB to the Georgian private sector, Georgian banks, and other business entities was noted in particular.
The sides also discussed post-crisis measures and the assistance that Georgia might receive from the financial institutions, which would enable the government to continue the state funding programs that are being implemented today to support citizens and private businesses.
It was noted that the government team is actively working with the local representatives, as well as the head offices of both EBRD and ADB to jointly develop a package of measures that will focus on overcoming the ongoing challenges.
According to the assessment of the presidents of the financial institutions, the fact that Georgia is successfully coping with the crisis constitutes sufficient grounds to say that the country will very quickly regain the rate and positions of economic development that it possessed at the beginning of 2020. Suma Chakrabarti and Masatsugu Asakawa confirmed their readiness to actively support Georgia in this area.
The Georgian side stressed that EBRD and ADB are very strong and serious partners for Georgia. It was noted that the European Bank for Reconstruction and Development and the Asian Development Bank have financed extremely important projects worth hundreds of millions of dollars in Georgia, including in the area of infrastructure. It was noted that all major systemic infrastructural projects funded by them are still in the active phase of implementation today, despite the ongoing crisis.
The head of government thanked EBRD and ADB for their active cooperation and their support of Georgia.
Deputy Prime Minister and Minister of Regional Development and Infrastructure Maia Tskitishvili and Minister of Finance Ivane Machavariani participated in the video conference.
Prime Minister of Georgia Congratulates Azerbaijanis with 100th Anniversary of First Democratic Republic
"It is my honor to cordially congratulate this most important national holiday of the Republic Day personally to you, Ambassador and to the friendly nation of Azerbaijan. This date has a special significance this year. Our countries celebrate a centenary jubilee from the creation of the first democratic republic. It is symbolic that we have gathered today within the historic walls that served as a venue for our nations to choose their path of progress and prosperity a hundred years ago. Exactly one century ago, on May 28th 1918 National Council of Azerbaijan announced the independence of the First Democratic Republic of Azerbaijan right in this building. Two days prior, National Council of GGiorgieorgia unanimously endorsed the Independence Act in the same building" stated Giorgi Kvirikashvili, Prime Minister of Georgia in his address to the guests gathered at the 100th Anniversary of the First Democratic Republic of Azerbaijan.
Head of Government noted that it is unfortunate that in the beginning of 20th century independence of Georgia and Azerbaijan turned out to be short-lived, though these spells of liberty left an irremovable trace in the history of statehood of both countries.
"Recently, on 26th May we celebrated the Jubilee of our Republic together with Mr. Ogtay Asadov, Speaker of the Parliament of Azerbaijan. Unfortunately, our independence turned out to be short-lived. Democratic Republic of Azerbaijan existed for only 23 months, while Georgian - almost 3 years, though these spells of liberty left an irremovable trace in the history of our statehood. Within these hundred years, our countries overcame many obstacles and challenges. Friendship of our people and kind neighborhood counts many hundreds of years. Today we are building a better region with shared efforts to create more peace, stability and prosperity for all. Peaceful and stable region is the primary aim of all of us nowadays" noted the Head of Government in his address.
According to Giorgi Kvirikashvili, peaceful and stable region is most important for the strategic projects that are jointly implemented by Georgia and Azerbaijan. Prime Minister focused on the Baku-Tbilisi-Kars Railway project and Trans-Anatolian Gas Pipeline (TANAP). According to him, relationship between the two countries is an outstanding example of the kind neighborhood.
"Azerbaijan is one of the largest investors and trade partners of Georgia. This trend is constantly rising. Close economic and cultural links further solidify the foundation of our cooperation. Today our countries are working together on implementing large scale and ambitious transit and energy projects, which will completely change the dynamics in the region and its international significance. We officially launched the Baku-Tbilisi-Kars Railway last August in Baku. Trans-Anatolian Gas Pipeline (TANAP) will be launched in June this year, which also evidences our regional cooperation this time between Azerbaijan, Georgia and Turkey. Friendship existing between our countries is priceless and we take a special care of it. Azerbaijan was always standing by Georgia, be that during energy challenges over decades, as the Ambassador has mentioned in his address or - massive fire-led natural disaster last year. Georgia will never forget this support. I believe that our links will further strengthen and deepen to serve as a basis of a far wider and successful regional cooperation with the active engagement of other participants and partners" noted the Prime Minister of Georgia.
Head of Government congratulated Ilham Aliyev, President of Azerbaijan and his family, as well as the people of Azerbaijan with 95th Jubilee of late Heidar Aliyev. Giorgi Kvirikashvili wished peace, prosperity and success to Azerbaijan.
"I hope that with shared efforts and engagement we will manage to carry out this greatest mission and leave a peaceful, stable and affluent region to future generations. When we talk about building the state of Azerbaijan, we forget the name of Heydar Aliyev, whose contribution in this mission is tremendous. Recently, 95 years were celebrated from his birth on May 10. I wish to use this opportunity and express my slightly belated, but most cordial congratulations to Ilham Aliyev, President of Azerbaijan, his family and the people of Azerbaijan. I want to wish a much greater success to the President of Azerbaijan in the building of statehood. Once again please accept my congratulations with 100th Anniversary of the First Republic of Azerbaijan and I wish peace, prosperity and success to the people of Azerbaijan" concluded Giorgi Kvirikashvili.
Jubilee reception held at the Youth Palace of Georgia marking the 100th Anniversary of the Democratic Republic of Azerbaijan was attended by the Government Members, representatives of the diplomatic corps and other invitees, who were also addressed by Dursun Hasanov, the Ambassador Extraordinary and Plenipotentiary of the Republic of Azerbaijan to Georgia.
Prime Minister's Press Office