HAS THE GEORGIAN GOVERNMENT REVEALED ITS TRUE INTENTIONS REGARDING ANAKLIA PORT?

Published in Economics
Tuesday, 27 October 2020 11:44

Government Actions and Words Appear to Show Its Support for Poti at the Expense of Anaklia and Raise Questions About Whether it has been Misleading Georgian Public as well as International Communities

TBILISI, GEORGIA, 27 October, 2020 – Recent actions and comments by the Georgian Government appear to have exposed its true intentions to promote Poti and to turn its back on Anaklia as the location of a future world-class seaport.  In the process, the Government has damaged its reputation in the global investment community by misleading investors and diplomats who were led to believe that the Government is still committed to a project at Anaklia.  By every measure, it appears the Government has no interest in such a project at Anaklia.

Government Puts Its Support Behind Poti at the Expense of Anaklia

As reported in the media on 18 October, Georgian Prime Minister Giorgi Gakharia said at a political event sponsored by Georgian Dream, "We have to agree and be honest with each other that there are many problems in Poti, but nevertheless, I want to tell you that the next 4 years will be the years of Poti reconstruction, specifically the years of Poti reconstruction. Because that is what necessary not only for Poti but the entire country.[1]

Separately, Davit Ebralidze, Chief Executive Officer of Poti Free Industrial Zone (FIZ) said in an interview with Georgia Today “Initially when thinking about location of new FIZ, the most significant location was chosen strategically, not only in Georgia but in the Black Sea and Caucasus Region. Poti FIZ is located in the centre of the Silk Road and international transport and logistics corridors. Its location is one of the distinctive advantages over other free industrial zones in the country…  The Poti Free Industrial Zone is one of the most strategic and successful companies within Smart Capital Group.”[2]  

Taken together, these comments suggest that the Government are now committing themselves to Poti as the future home of the long-anticipated deepwater seaport, contradicting prior statements from the Government.

The 23 October announcement by APM Terminals Poti (APMT) and Poti New Terminals Corporation (PNTC) that they have signed an agreement for the joint development of a new bulk cargo facility on the northern side of the Poti Sea Port reinforces the belief that the Government has been telling two conflicting stories: One that it is still committed to Anaklia; the second that it is focused solely in Poti.  PNTC’s website suggests their intent is to see “a new deep-water harbor (greenfield) for dry bulk and container handling north to the existing Poti Port.”[3]  In other words, an alternative to Anaklia.

The interests of Georgian Dream Supporters Intersect with those of Poti FIZ

Based on public records, there appears to be close financial interests between Poti FIZ and high-level people connected to Georgian Dream:

 

  • Poti Free Industrial Zone is managed by Euro-Asian Management Group, which is jointly owned by a subsidiary of the Chinese company CEFC and Eurasian Invest LLC. 
  • Both David Ebralidze and Ivane Chkhartishvili are on the Supervisory Board of Eurasian Invest, which itself is owned by two companies registered in the British Virgin Islands, where laws make it difficult to track who owns them.
  • Davit Ebralidze was previously Head of Administration for Georgian Co-Investment Fund, a fund set up by Georgian Dream leader and former Prime Minister Bidzina Ivanishvili to manage some of his personal investments.
  • Chkhartishvili is also co-chairman of Euro-Asian Management Group and owns Smart Capital Group which, as noted above, is involved with Poti FIZ.[4]  Chkhartishvili “has been connected to several corruption cases” according to Democracy and Freedom Watch[5]
  • George Bachiashvili, who served on the board of directors of Eurasian Invest and appears to be the sole director of one of the BVI companies behind Eurasian Invest. He previously served as CEO of Georgian Co-Investment Fund and has long been connected to Bidzina Ivanishvili as a financial advisor.

 

Government Admits That Anaklia is Unlikely

As further evidence that the Government has no interest in seeing a port developed at Anaklia, it included language in its proposed 2021 budget that would be certain to scare away any potential investors.  On pages 517-518 of the proposed budget is the following passage regarding the intended new tender for an Anaklia Port Project:  “Potential risks – as it currently stands, due to the potential arbitration dispute, an investor of high reputation and experience may not be selected. Also, other unforeseen circumstances.”[6]

Government Abandons Anaklia Site and Creates Health and Environmental Risks

The Government has also abandoned the site of the proposed Anaklia project after it unlawfully seized the land from ADC in February 2020.  While ADC had invested considerable resources to begin site preparation work, including clearing 110-hectare area where soil was removed and cleared of waste, the Government’s failure to maintain the site has led to significant and chronic circulation of dust and particulate emissions, causing damage to the environment as well as threatening nearby residents with potentially serious respiratory health problems. 

ADC had advised the Government of the need and means to mitigate these risks.  However, the Government has ignored this, causing problems for the people of the region and signaling its lack of any further interest in the site.

Statement from Anaklia Development Consortium

“The current Government has misled the people of Georgia and the international community about its intentions for Anaklia port. Since unlawfully terminating the investment agreement with ADC in January 2020, Government ministers have said multiple times that the Government will issue a new tender for a port project at Anaklia. Based on its actions, however, it seems the  Government has chosen to promote Poti and the related Free Industrial Zone, at the expense of the Anaklia Port. 

“Most troubling is the Government’s duplicity, which will only serve to discourage foreign investors who feel they cannot trust the Government, and Georgian citizens who fear that the scourge of corruption will once again tarnish Georgia’s reputation and undermine their trust in the Government.  One has to question whether the Government is acting in the best interests of the people of Georgia.  Regardless of its motives, however, it certainly appears the Government is not being honest about its intentions with Anaklia.”

Why Poti Cannot be an Adequate Alternative to Anaklia

The Government’s initial decision to develop Anaklia was taken in 2013 after the Government hired a consortium of international consultants to compare and contrast the options in Georgia for a deep sea port. Anaklia was chosen because it held a number of advantages over every other location in Georgia, including the geo-technical conditions of the site, its financial feasibility and most importantly, the significant economic, social and geopolitical impact the project would have both on the Abkhazia region and the wider country.

The consultants’ report clearly outlined that the existing ports in Georgia (including Poti) are limited in their capacities and hinterland connections, and any expansion would have only short-term impact for the national maritime sector. The consultants advised the Government of Georgia to consider the development of the greenfield and large-scale deep sea port at Anaklia to ensure long term advantages for the country and phased capacity developments to serve Georgia’s needs in long-term perspective.

The existing port in Poti has numerous disadvantages and is not suitable for expansion, and the proposed new site at Poti is equally flawed, as explained by ADC.[7]

Further details of the Anaklia Port project and ADC can be found at http://anakliadevelopment.com



[1] http://newsreport.ge/შემდგომი-4-წელი-იქნება-კონ/?fbclid=IwAR1AtLz_0LUPH6-rpI6mL3jDqulgERnq9WyNFyosCQYlUZalo0uIqyrsHQ0

[2] http://georgiatoday.ge/news/22687/Poti-FIZ-CEO-on-the-Benefits-of-World-Free-Zone-Organization-Membership

[3] https://pntc.ge

[4] http://smartcapital.ge

[6] The full set of documents submitted by the Government to the Parliament of Georgia together with the draft Law on 2021 State Budget are available at:

http://parliament.ge/ge/ajax/downloadFile/142460/07-2.525_ბიუჯეტი_2021

[7] http://anakliadevelopment.com/news/port-of-poti-is-an-inadequate-substitute-for-anaklia-deep-sea-port/

Georgian construction company Prime Concrete starts building a new Pace Terminal Project in Poti

Published in Economics
Sunday, 20 October 2019 16:27

Georgian construction company Prime Concrete starts building a new Pace Terminal Project in Poti co-financed by the U.S. Overseas Private Investment Corporation (OPIC).

October 10, 2019. Poti. The Georgian construction company Prime Concrete has been commissioned to build a new Pace Terminal Project in Poti with a total value of construction work of US$ 20 million. The project is co-financed by the U.S. Overseas Private Investment Corporation (OPIC). An official ceremony to mark the beginning of construction was held in Poti on October 1, 2019 and was attended by the Deputy Prime Minister of Georgia Maia Tskitishvili, the Minister of Economy of Georgia Natia Turnava, the Managing Director of OPIC Kenneth Angel, the Pace Terminal’s Director David Nadirashvili and the Founder of Prime Concrete Alexander Sokolowsky. Other high-ranking members of the Georgian government and parliament as well as diplomats and foreign guests were also present.

For a Georgian company to build such an important terminal is a unique opportunity. Prime Concrete managed to successfully qualify for the tender in a highly competitive process with dozens of international contractors. Its competitive advantages lay in its distinctive means and capabilities, its experience and know-how, and its truly local presence. Prime Concrete also partnered with the Dutch companies Royal HaskoningDHV, which developed the most efficient design for berth and pier construction, and Vanthek, a leading international piling contractor.

Prime Concrete is a well-established Georgian construction company that has successfully implemented numerous large-scale projects, acquiring exceptional competence and invaluable expertise in the fields of port, water, road and other civil and industrial infrastructure projects. Its portfolio includes maritime projects such as the rehabilitation of berth no. 7 and the construction of an inland container terminal in Poti; public works such as wastewater treatment plants in Anaklia, Ureki, Zugdidi and Gardabani; extending Tbilisi’s 2nd metro line (to University Station); and building and rehabilitating several municipal roads in western Georgia (Samegrelo).

Prime Concrete CEO Alexander Sokolowsky underlined the importance of the Georgian company winning the tender: “We are extremely glad to engage in the construction of this strategic facility. It is an exceptional occasion when a Georgian company under an EPC contract takes full responsibility for the construction of such a complex and large-scale project. We use local capabilities, bring our decades-long experience and expertise, hire local workers, and use local construction materials, which is beneficial for local communities and the entire country. We will make sure with our partners from Pace Group, Royal HaskoningDHV and Vanthek, that the new terminal is built in a high-quality, safe and environmentally friendly manner, increasing Georgia’s transit capabilities to new high levels.”

The new terminal will occupy 25 hectares of the New Port Zone in Poti’s former shipyard. The total length of the berthing facilities will be 650 meters, with a water depth of 12 m. This will be the first modern facility in Georgia to handle deep-water vessels by 2020. The total cargo turnover of the terminal will be 5 million tons. The total project cost is US$ 93 million, of which US$ 50 million will be allocated by OPIC and the remaining US$ 43 million by Pace Group as an equity contribution. This is OPIC’s single biggest engagement in Georgia. The terminal will increase the country’s strategic importance as a hub between East and West and as an integral part of the Belt and Road Initiative. OPIC’s decision to finance the project is also a form of recognition from the U.S. and other international stakeholders of the terminal’s significance for Georgia and the wider region.

$600 ml investment can be implemented in industrial zone of Poti

Published in Economics
Wednesday, 12 October 2016 14:05

600 ml dollars investment can be implemented in industrial zone of Poti. According to the First-Vice Prime Minister and Minister of Economy and Sustainable Development of Georgia, this is an answer of reports about instead of Arabian company Rakia-Georgia the state will control this industrial zone.
As Dimitri Kumsishvili said, Georgia has best relations with Rakia Georgia Company. “This is a group which has most important actives in Georgia today. For example: Hotel Sheratoni, Tbilisi Mall and others,”-Dimitri Kumsishvili said.

New rugby retraining center was established

Published in Sport
Friday, 30 September 2016 10:29

Within the frames of "Cartu Fund Rugby Programme" rugby retraining center was established in Martkopi - Prime Minister of Georgia Giorgi Kvirikashvili attended the opening ceremony of the sixteenth rugby facility countrywide. 
Giorgi Kvirikashvili congratulated rugby players on opening the new center and hoped that the young people would direct their energy into correct path and engage in sport activities and a healthy life style. Prime Minister thanked Cartu Fund for the implemented projects that spent 100 million GEL on construction of the sports facilities. 
"As of today, 16 rugby facilities are established across the country, including those in Tbilisi, Kutaisi, Rustavi, Batumi, Poti, Gori and Aspindza. Cartu Fund has allocated around 100 million GEL to create this important infrastructure, without which speaking of any kind of success would have been completely unrealistic. International Rugby Board (the IRB) awarded Mr. Bidzina Ivanishvili with a special prize for his contribution to the development of rugby in Georgia. It is particularly astonishing that respective efforts have borne relevant fruit. We have heard many times that rugby is a game of braves and this is true. Rugby is a demonstration and an example of teamwork, mutual support and encouragement. For Georgians this is particularly significant, since this game serves as a reminder of the fact that if we join our efforts, any success and victory will become completely attainable," - Giorgi Kvirikashvili noted in his speech.
According to the Prime Minister, rugby development programme continues and stadiums and rugby bases will be built in other cities as well. According to him, unity of famous senior rugby players and younger generations as well as state support and power of charity is a prerequisite of success.
"Cartu Fund development Programme" aims at popularization of sports and a healthy life-style among the young people. The programme envisages construction, equipment and support of modern sport complexes in various towns of Georgia, to ensure that youngsters across the country are able to train and increase their qualification.
Martkopi rugby retraining center is a complex constructed using the modern technologies that joins: natural and artificial grass courts with lighting and irrigation system, tribune with a capacity of 724 seats, showers, gym, conference room; as well as 64-suite hotel with a complete infrastructure and solar-system.
"Cartu Fund Rugby Programme" includes 16 rugby complexes, most of which are finalized and operating. At this stage 100 million GEL is spent on implementation of the project and arranging rugby infrastructure and complex funding Georgian national team.

The teenager died in Poti

Published in Society
Wednesday, 06 July 2016 16:22

14 years old teenager died in Poti, in the sea. According to reports, he was at sea with his friends. As the witnesses say, both of them have been carried away by the water but only one of them could return on the shore.
The rescue and ambulance teams have been working there. 

Realization of Georgia’s transit potential is growing-Prime Minister

Published in Economics
Thursday, 05 May 2016 14:46

Each container shipped via our country means more working places and realization of Georgia's transit function, - Prime Minister addressed construction of the new container warehouse near the Black Sea coast. The project is implemented by the company "Iceberg Poti".\
The Project will be discussed during the meeting of the Cabinet today. Pursuant to the Prime Minister, the volume of shipped containers via the territory of Georgia is growing and the need for such logistic centers increases.
"This is the indication of the fact that Georgia's transit potential is being increasingly utilized. The growth of the transit shipments via the territory of Georgia implies that there are more employed people in Georgia, since there is a close correlation between the number of shipped containers and the prosperity of SMEs," - Prime Minister noted. 400 000 GEL is invested in the implementation of the project.

Disaster Hits Samegrelo too

Published in Society
Wednesday, 26 August 2015 16:49

Heavy rain has caused flooding in the village Chaladidi near Poti, in Samegrelo region. The disaster has damaged the village, treets and yards are under water. 

Population of the village asks for help.

Locals accuse the government of negligence and demand compensation. According to them, the reason for the flood  was malfunction of drainage system.

Heavy Rain flooded Poti

Published in Society
Wednesday, 26 August 2015 11:20

Heavy rain has caused flooding on central streets in the city of Poti, Samegrelo region.

Lightning hit one of the power stations in the city and electricity supply was suspended for several hours.

Due to heavy rain, floodwater has overwhelmed the ground floors of homes and damaged household appliances.

According to the Deputy Mayor of Poti, electricity supply has been fully restored. 

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