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
The Government of Georgia thanks Liberty Bank for a very timely and correct decision, given the current situation in the country
The Government of Georgia thanks Liberty Bank for a very timely and correct decision, given the current situation in the country.
The Government of Georgia - in cooperation with Liberty Bank - decided to provide pension recipients of all ages without exception with pension payments for the month of April in advance, in order to prevent the spread of the coronavirus in the country. The government has already allocated the relevant funds from the state budget.
Pensions will also be issued using different regulations in order to prevent the spread of the virus. Specifically, receiving pension payments in cash will only be possible in accordance with the schedule that was announced by Liberty Bank in advance. However, pensioners will be able to use the funds available on their accounts at retail outlets - pharmacies or stores, as well as for the payment of utility bills, as soon as the funds are transferred, i.e., from 28 March.
Citizens should visit www.myliberty.ge or call the relevant phone number (032 208 from a cell phone, or 208 from a landline) to view the schedule for the payment of pensions in cash.
The Government of Georgia is urging pensioners to take care of their health and avoid standing in line at the bank to make cash withdrawals as today, plastic cards can be used to pay for virtually all services. And if they wish to receive their pensions in cash, it is essential that they maintain social distance while standing in line.
Several days ago, Liberty Bank allocated 100 million GEL to provide pensioners over the age of 70 with pensions for the month of April in advance, and it did so on its own initiative and using its own resources. The purpose of the initiative was to protect people in the highest risk group - those over the age of 70 - from the increased threat posed by the virus, in particular by reducing their need to go to the bank and maximizing the distribution of the flow of citizens.
Press Service of the Government Administration
As part of coronavirus (COVID-19) preventive measures, the Government of Georgia made a decision to impose restrictions on the entry of foreign nationals. The restrictions will become effective from 18 March 2020, 00:00 and will remain in force for two weeks.
The restrictions will apply to any foreign national except:
- Representatives of diplomatic missions and international organizations accredited to Georgia and their family members;
- Mixed families where one of the spouses or their under-age child is a citizen of Georgia;
- Persons arriving in Georgia as part of humanitarian mission – if trip of such mission (doctors, volunteers) to Georgia becomes a necessity;
- Individuals who have been granted the status of stateless person by respective authorities of Georgia.
- Individuals holding status-neutral travel documents;
- Individuals having a refugee status in Georgia;
- The issue of official delegations will be decided on a case-to-case basis.
Communication Strategy of the Government of Georgia on Georgia’s EU and NATO Membership for 2017-2020
Georgia's membership to the EU and NATO constitutes the top priority for the country's foreign and security policy, which is strongly supported by the majority of the population. It is a firm will of the citizens of Georgia that the country takes its proper place in the European and Euro-Atlantic community, which shares a common civilization and values; that the citizens live in a developed state secured from external threats and which is based on the principles of rule of law and human rights protection.
Pursuant to the Resolution on Foreign Policy of Georgia adopted by the Parliament of Georgia on 29 December 2016, Georgia's EU and NATO membership is of the highest priority, without alternative. Throughout the implementation of the country's foreign policy objectives, special efforts will be directed towards the active management of strategic communications on Georgia's European and Euro-Atlantic integration that will ensure the preservation of high and aware public support for the country's Western orientation.
For the effective implementation of Georgia's foreign policy objectives, as well as in compliance with the Resolution of the Parliament of Georgia, the Government Communication Strategy on Georgia's membership to the EU and NATO has been elaborated. This document prescribes the ways and means necessary to facilitate ensuring public support to the process of Georgia's membership to the EU and NATO, and outlines the role and functions of relevant state agencies responsible for the implementation thereof. Strategic communications on Georgia's membership to the EU and NATO are carried out in accordance with the present strategy and action plan elaborated in compliance thereto.
"Georgia continues its all-inclusive reforms to better comply with to the European Union (EU) norms and standards" said H.E. Giorgi Kvirikashvili, Prime Minister of Georgia to H.E. Donald Tusk, President of the European Council at the meeting held in Brussels today.
Prime Minister of Georgia arrived at the venue of the meeting - Head Office of the European Council - together with the other members of the Georgian delegation.
Mr. Tusk congratulated the Head of the Government of Georgia (GOG) with the creditable performance at the general elections held in the country, which is of paramount importance for the democratic development of Georgia.
Significance of the current visit of the Prime Minister of Georgia was also noted as an evidence of Georgia regarding EU as its strategic partner. It was mentioned at the meeting that report published by the EU ascertains that Georgia has achieved a substantial progress in terms of political association and economic integration, inter alia by democratic consolidation and advancement of the degree of independence in the judiciary system, protection of human rights and basic freedoms, economic growth and stability, increased inflow of investments and trade with EU.
Parties focused on the prospects of successful completion of the visa-liberalization process and expressed hopes towards visa-free mobility of Georgian citizens in the near future.
Prime Minister of Georgia and President of the European Council spoke about the Deep and Comprehensive Free Trade Agreement (DCFTA) and referred to the upcoming Summit of Eastern Partnership, which will be held in 2017.
Parties commented on the situation in the region and discussed the current locus of the occupied territories of Georgia. Mr. Tusk noted his concerns about the so called agreement concluded by and between Abkhazia and Russian Federation.
By the close of the meeting Prime Minister of Georgia expressed his gratitude to the President of the European Council for his personal contribution in the EU integration of Georgia.
The Government of Georgia will buy a house to the family of Giga Otkhozoria. According to the Minister of Internally Displaced Persons from the Occupied Territories, Accommodation and Refugees of Georgia Sozar Subari, the government of Georgia offered to five-children family will receive a house. They hire an accommodation now. They prefer a house in Zugdidi then an apartment there.
“We met the family of Giga Otkhozoria. We offered several options and they chose a house in Zugdidi,”-Sozar Subari said.
Prime Minister of Georgia urges civil servants to maximally support the fair and free duration of pre-election process. Respective statement was made by the Prime Minister of Georgia during today's Cabinet Session. Pursuant to him, transparency of the pre-election process is of utmost importance for the Government of Georgia and said is particularly true with regards to the fostering of pre-election campaign of opposition process.
"Few days ago I made a statement concerning the avoidance of abuse of administrative resources and we aim at conducting coming elections in calm environment, with relevant dignity.
Transparency of the process is crucially important to us and hence we will spare no effort to ensure that pre-election process and particularly, pre-election campaign of the opposition parties is fully guaranteed. Of course, pre-election campaign of the ruling party is also very important," - Prime Minister indicated.
Pursuant to him, Giorgi Kvirikashvili and other members of the Cabinet have raised the issue of inclusion maximum number of international observers and observing organizations in the election process. Giorgi Kvirikashvii considers that uninterrupted work of media and inclusion of international organizations is also very important.
"On numerous international platforms, number of Ministers and I have voiced the call and request directed at our international partners to ensure maximum number of observing organizations in Georgia, thus increasing the transparency of the process. Access of media in terms of broadcasting these events and involvement of NGO sector in the process is also crucial. I would like to urge all civil servants to avoid any question mark in terms of transparency of the process. This is the matter of honor of our Government to ensure holding of democratic and transparent elections and provide proper coverage of the process," - Giorgi Kvirikashvili indicated.
The Government of Georgia will establish the institute of Commercial Attachés - relevant amendment to the Law of Georgia on Diplomatic Service will be reviewed today during the Cabinet Session. Pursuant to Prime Minister Giorgi Kvirikashvili, this will be a significant change that will contribute to exports and trade.
"In all countries where the burden in the direction of the trade is high, institute of some special trade representative that lobbies the interests of Georgian exporters will be set up to perform the duty of a direct representative of the Government in terms of aiding companies. Particular emphasis is put on exports, however, imports are equally important in terms of creating jobs in Georgia. We urge you to quickly create this institution in order to strengthen the work in this direction ", - said the Prime Minister.
According to Giorgi Kvirikashvili, it is also important that the Ministry of Economy recently formed specific approach with regard to each country, where individuals are responsible for a particular portfolio reflecting trade dynamics with several countries.