Georgia has many opportunities for investment across various sectors of its economy. It offers a business friendly environment with low taxes and a stable banking sector. Key sectors of opportunity include hydroelectric power, tourism, and manufacturing. Georgia has significant untapped hydroelectric potential and is well positioned to export power to neighboring countries facing energy deficits. The tourism industry is growing rapidly as visitor numbers increase yearly. Georgia also has potential for import substitution and export of manufactured goods due to its strategic location and trade agreements.
Gulf Cooperation Council - B2C e-Commerce Overview 2011Melih ÖZCANLI
Prepared by IMRG International
Commissioned by Visa Middle East
London - October 2011
The study focuses in particular to the member countries of the Gulf Cooperation Council (GCC): Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates.
Presentation on regional connectivity of asiaMilton Kumar
This presentation describes the regional connectivity that connects Bangladesh with China,India and Myanmar. This was anciently known as silk road. This connectivity of course improves the economic growth in this territories.
Infrastructural Development Financing Strategy for Nigeria. World Bank Group's Unlocking Financing for Development in Emerging and Developing Economies (EMDEs) Assignment via edX.
Gulf Cooperation Council - B2C e-Commerce Overview 2011Melih ÖZCANLI
Prepared by IMRG International
Commissioned by Visa Middle East
London - October 2011
The study focuses in particular to the member countries of the Gulf Cooperation Council (GCC): Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates.
Presentation on regional connectivity of asiaMilton Kumar
This presentation describes the regional connectivity that connects Bangladesh with China,India and Myanmar. This was anciently known as silk road. This connectivity of course improves the economic growth in this territories.
Infrastructural Development Financing Strategy for Nigeria. World Bank Group's Unlocking Financing for Development in Emerging and Developing Economies (EMDEs) Assignment via edX.
Грузия позиционирует себя как страна, максимально комфортная для ведения игорного бизнеса. Глава Georgian National Investment Agency Гиорги Пертая назвал основные факторы ее инвестиционной привлекательности. Государство с низким уровнем коррупции может предложить гибкую и прозрачную налоговую систему, солидную емкость рынка и благоприятный климат для предпринимателей.
Jordan-U.S. Investment and Trade Forum: Washington DC, April 19 • New York, A...Bayan Waleed Shadaideh
Under the Patronage of His Majesty King Abdullah II, the Economic and Commerce Bureau of the Embassy
of the Hashemite Kingdom of Jordan and The Jordan Investment Board in cooperation with the U.S.–Jordan
Business Alliance and in strategic partnership with Business Council for International Understanding are
organizing the Jordan–U.S. Investment and Trade Forum road show that will commence in Washington DC on
April 19th, stop in New York on April 21st and conclude in San Francisco on April 23rd, 2010.
The OECD Investment Policy Review of Georgia takes stock of recent achievements in improving the investment climate and assesses areas for the government to consider in strengthening its reform efforts to attract FDI that can have a positive impact on inclusive, sustainable growth. Find out more at http://www.oecd.org/investment/oecd-investment-policy-reviews-georgia-0d33d7b7-en.htm
Fiscal Decentralization and poverty reduction in Nigeriaafonomics1
The study was aimed at understanding the impart of revenue sharing formula between the federal government and the sub-national government on Poverty reduction in Nigeria. It is meant for government and policy makers to look critically at the reason why fiscal decentralization has a negative relationship with poverty reduction in developing countries unlike the positive imparts it has in some countries such as OECD Countries.
Грузия позиционирует себя как страна, максимально комфортная для ведения игорного бизнеса. Глава Georgian National Investment Agency Гиорги Пертая назвал основные факторы ее инвестиционной привлекательности. Государство с низким уровнем коррупции может предложить гибкую и прозрачную налоговую систему, солидную емкость рынка и благоприятный климат для предпринимателей.
Jordan-U.S. Investment and Trade Forum: Washington DC, April 19 • New York, A...Bayan Waleed Shadaideh
Under the Patronage of His Majesty King Abdullah II, the Economic and Commerce Bureau of the Embassy
of the Hashemite Kingdom of Jordan and The Jordan Investment Board in cooperation with the U.S.–Jordan
Business Alliance and in strategic partnership with Business Council for International Understanding are
organizing the Jordan–U.S. Investment and Trade Forum road show that will commence in Washington DC on
April 19th, stop in New York on April 21st and conclude in San Francisco on April 23rd, 2010.
The OECD Investment Policy Review of Georgia takes stock of recent achievements in improving the investment climate and assesses areas for the government to consider in strengthening its reform efforts to attract FDI that can have a positive impact on inclusive, sustainable growth. Find out more at http://www.oecd.org/investment/oecd-investment-policy-reviews-georgia-0d33d7b7-en.htm
Fiscal Decentralization and poverty reduction in Nigeriaafonomics1
The study was aimed at understanding the impart of revenue sharing formula between the federal government and the sub-national government on Poverty reduction in Nigeria. It is meant for government and policy makers to look critically at the reason why fiscal decentralization has a negative relationship with poverty reduction in developing countries unlike the positive imparts it has in some countries such as OECD Countries.
Impact of general agreements on trade in services on the balance of payment o...
Investment Climate & Opportunities in Georgia
1. INVEST
N
IN GIA
N
G
GEORGIA
INV E S TMEN T CLIMATE
INVESTM ENT CLIM ATE &
OPPOR TUNITIES
OPPORTU NITIES IN GEORGI A
Georgian National Investment Agency 2013
2. www.investingeorgia.org 1
ADVANTAGES OF GEORGIA
» Business friendly environment with low levels of taxation, simple and fair tax administration
VEST
» Efficient, pro-business and corruption-free government
» Enlargement of market size by Free Trade Agreements
» Solid sovereign balance sheet
» Stable and conservatively managed banking sector
» Multi-modal maritime, land and air access infrastructure for trade, logistics and manufacturing
» Stable and competitively priced energy supply
» Flexible labor legislation
» Very low crime rate
ORGIA
№1 REFORMER IN THE WORLD OVER THE PAST 5 YEARS – WORLD BANK
GEORGIA - SOVEREIGN CREDIT RATINGS
BB- Stable (Upgraded BB- Stable Ba3 Stable
from B+ Positive in (Upgraded from B+ Positive (Affirmed in August
November 2011) in December 2011) 2012)
3. DOING BUSINESS IN GEORGIA
Country’s impressive progress in improving business climate has
IN
been well documented in a number of international indices.
EASE OF DOING BUSINESS INDEX OF ECONOMIC FREEDOM
IN GEO
N
Up from 112 in 2005 Up from 99 in 2005
Source: World Bank, 2013 Source: The Heritage Foundation, 2013
(Rank out of 183 countries) (Rank out of 183 countries)
www.investingeorgia.org 2
4. www.investingeorgia.org 3
CORRUPTION FREE COUNTRY
Georgia today is essentially a corruption-free investment
VEST
S
destination where rule of law have been given the right way
GLOBAL CORRUPTION BAROMETER
Percentage of users
paying a bribe from in
ORGIA
RGIA
the past 12 months
GEORGIA SOUTHEAEST EUROPE+TURKEY EU
Source: Transparency International’s Global Corruption
Barometer , 2011 (Rank out of 176 countries)
5. ECONOMIC STRUCTURE AND TRENDS
GDP: STRONG REBOUND IN 2010 AFTER RAPIDLY GROWING GDP
A RELATIVELY SMALL CONTRACTION IN PER CAPITA
IN
2009, ROBUST GROWTH POTENTIAL
4,000
3,000
2,000
1,000
0
BROAD-BASED AND DIVERSIFIED
NOMINAL GDP STRUCTURE 2011
IN GEO STEEPER THAN EXPECTED
GROWTH TRAJECTORY
Initially planned at 6%, Georgia’s GDP real
growth in three quarters of 2012, equaled to
7.5%
2011 OUTCOMES:
» Tax collection increased 26% y-o-y
» VAT turnover increased 26% y-o-y
» Commercial bank lending to the real sector
increased 24% y-o-y
» Trade turnover increased 36% y-o-y
www.investingeorgia.org 4
6. www.investingeorgia.org 5
LIBERAL TRADE REGIMES
PREFERENTIAL TRADE REGIMES: CUSTOMS
» FTA with CIS countries: Ukraine, Belarus, Azerbaijan, Armenia, Russia, » Very simple and service
VEST
Moldova, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, Turkmenistan oriented customs policy and
» FTA with Turkey administration
» DCFTA with EU will be signed next year » Almost no custom duty - 90
» Negotiation on FTA with USA is in progress percent of goods free from
import tariffs
» GSP+ with EU - 7200 products to the EU market duty free or with lower tariffs
» No quantitative restrictions
» GSP with USA, Norway, Switzerland, Canada, Japan - lower tariffs are applied on
3400 goods exported from Georgia to these countries
» Member of WTO
OPPORTUNITY - MARKET SIZE
KET
ORGIA
A
Population of Georgia - 4,5 million
Existing FTA +350 million
DCFTA + 0,5billion
TOTAL ~ 0.9 BILLION
orgi
Ge
a
Georgia: 4,5 million population
lation
Access to the 0,9 billion market
7. TAXATION IS SIMPLE, LOW, EFFICIENT AND FAIR
IN
IN GEO
O
» No payroll tax or social insurance tax
» No capital gains tax
» No wealth tax and inheritance tax
» Foreign-source income of individuals fully exempted
» Accelerated depreciation on capital assets
» Loss carry forward for corporate profit tax purposes (10 years)
» No restrictions on currency convertibility or repatriation of capital & profit
» Double taxation avoidance treaties with 40 countries
www.investingeorgia.org 6
8. www.investingeorgia.org 7
LEADER IN FORBES RATING (TAX MISERY & REFORM INDEX)
According to 2009 Tax Misery & Reform Index, released by Forbes
VEST
Business & Financial News, Georgia is the fourth least tax burden
country after Qatar, UAE and Hong Kong
OR
ORGIA
9. LABOR AVAILABILITY
» Young labor – 50% of unemployed population are aged between 20-34
IN
» Average monthly salary in 2011 – 377 USD
» Vocational Education Training Centers around Georgia provide professional courses in
different types of practical subjects and most of the course’s fees are financed by the
Government of Georgia.
GEORGIA - ONE OF THE MOST LIBERAL LABOR ENVIRONMENTS (3RD BEST
GLOBALLY), ACCORDING TO THE HERITAGE FOUNDATION, 2012
IN GEO
GEO
GREATER LABOR FREEDOM
GEORGIA
FRONTIER MARKETS AVG
Source: MOF and Heritage Foundation, 2012
www.investingeorgia.org 8
10. www.investingeorgia.org 9
FOREIGN DIRECT INVESTMENT
» Strong and Rising FDI Stimulates Economic Prosperity
VEST
» Key Industries Benefit from FDI
» Reinvestment 30% (2011)
» Georgia has bilateral treaties on investment promotion and protection with the 32 countries
(negotiations launched with 24 countries)
FDI BREAKDOWN BY SECTORS 2011 FAVORABLE FDI/GDP RATIO
ORGIA
RGIA
GIA
A
11. INVESTMENT OPPORTUNITIES IN GEORGIA
IN
HYDRO POWER HUB
TOURISM
MANUFACTURING
IN GEO
AGRICULTURE
REGIONAL LOGISTICS CORRIDOR
REGIONAL SERVICE HUB
www.investingeorgia.org 10
12. www.investingeorgia.org 11
HYDRO POWER HUB
SIGNIFICANT HYDRO POWER POTENTIAL
» Installed capacity of > 2,700 MW
VEST
» Additional potential > 4,500 MW
Generation cost (0.06 USD) among the lowest in the region,
~50% lower than target market Turkey
EXPORT CAPACITY
» The only net electricity exporter in the region, with rapidly growing consumption rates
» Construction of 400 kV power transmission line from Georgia to Turkey to be
completed in 2013
ORGIA
OPPORTUNITIES
» Several large scale projects (> 100 MW)
» ~ 70 small/medium projects (< 100 MW)
13. OVERVIEW OF GEORGIA’S (HYDRO-) POWER SECTOR
IN
• Domestic: Demand growth and increasing share of renewables
requires an extension of hydropower generation by around 65%
STRONG DEMAND until 2020
GROWTH PROSPECTS
• Export: Georgia is surrounded by countries with a projected
structural power deficit (e.g. Turkey, Russia South) or expensive
power generation, opening up attractive export opportunities
IMPORTANCE OF • Power generation accounts for 3% of GDP and ~ 1% of
THE SECTOR LOW IN employment but is of high strategic importance to Georgia
TERMS OF GDP AND
• ~ 10% of power production are exported, but Georgia still needs to
EMPLOYMENT
IN GEO
import power during winter
• Georgia boosts significant and economically viable HPP potential –
POWER SECTOR WITH already today 75% of power generated via HPP (2,700 MW) – 25%
STRONG FOCUS ON via thermal (mainly gas)
COST COMPETITIVE HPP • All new HPPs operate in a liberalized market
• Cost of hydropower generation is very competitive in the region
• FDI inflows amounted to USD 200 million in 2011 and are growing
LARGE PROJECTS HAVE
• 65% of economically viable potential not yet exploited
BEEN PLACED AND
PIPELINE IS FILLED • Projects of up to USD 750 million have been concessioned to
investors from e.g. India, Turkey, Czech Republic and other counties.
• Pipeline well filled with several large scale projects (100-702 MW)
as well as 70+ smaller projects
www.investingeorgia.org 12
14. www.investingeorgia.org 13
GEORGIA SURROUNDED BY COUNTRIES WITH A STRUCTURAL
POWER DEFICIT OR EXPENSIVE POWER GENERATION
V
VEST • Turkey expected to
have deficit of up
to 80-120 TWh by
2020, with seasonality of
its demand matching
Georgia’s supply
ORGIA
R
• Russia’s Southern districts
will also experience a
structural deficit of up to
40 TWh by 20201
• In other markets,
Georgia’s hydropower
is very cost-competitive
compared to local tariffs2
1 Assuming current consumption and supply pattern
2 This does not even include countries with heavily subsidized
electricity generation (e.g. Azerbaijan, Kazakhstan)
STRUCTURAL DEFICIT BY 2020 NO DEFICIT, BUT CURRENT TARIFFS >
AD HOC DEFICITS PROJECTED GEORGIA’S GENERATION COST
NO DEFICIT, BUT SUBSIDIZED TARIFFS
15. HYDROPOWER PIPELINE BOOSTS SEVERAL NEW MEGAPROJECTS
ABOVE 100 MW CAPACITY THAT ARE CURRENTLY OPEN FOR INVESTMENT
IN
N
PROJECT CAPACITY FORECAST INVEST. READY TO
VOLUME INVEST?
USD MILLIONS
• NAMAKHVANI CASCADE 450 MW 926
• KHAISHI HPP 400 MW 620
IN GEO
O
• ONI CASCADE 270 MW 599
• NENSKRA HPP 210 MW 491
• TOBARI HPP 200 MW 310
• FARI HPP 180 MW 297
• LENTEKHI HPP 120 MW 189
• HYDROPOWER PIPELINE ALSO BOOSTS ~70 SMALL/MEDIUM
PROJECTS (<100 MW CAPACITY) THAT ARE CURRENTLY OPEN
FOR INVESTMENT
www.investingeorgia.org 14
16. www.investingeorgia.org 15
TOURISM
FAST GROWING SECTOR
• Tourism contributes 6.7 % of GDP
VEST
• Number of visitors increased 38% in 2011 reaching 2.8 million and 56% in 2012 reaching 4.4 million
• Majority of visitors come from : Turkey (34.9%), Azerbaijan (21.2%), Armenia (20.5%), Russia (11.6%)
Europe (9.4 %)
• Average duration of stay - 9 days, the median visitor stays - 2days / Average spend of USD 330
• Overall capacity of < 15,110 rooms
• Already operating international brand hotels - Sheraton, Radisson, Marriot, Holliday Inn, (under construction -
Kempinski, Hillton) etc.
ORGIA
POTENTIAL
• Youth Olympics in 2015
• Free tourism zones – summer resorts
• Availability of gambling business – gaming is partially or completely banned in Russia, Ukraine, Azerbaijan,
Kazakhstan,Turkey, Israel, Iran, Iraq
• 8 national parks
• 2400 springs of mineral waters
17. GEORGIA IS EXPECTING SIGNIFICANT GROWTH
TRAJECTORY IN TOURIST ARRIVALS
IN
INTERNATIONAL ARRIVALS HAVE SEEN ~40% YEAR-ON-YEAR GROWTH
TOTAL INTERNATIONAL TOURIST ARRIVALS
NUMBER OF ARRIVALS INTO GEORGIA
IN GEO
5.5
4.4
2.8
2.0
1.3 1.5
1.0 1.1
0.6
www.investingeorgia.org 16
18. www.investingeorgia.org 17
INTERNATIONAL LUXURY HOTEL CHAINS DOING WELL:
MORE ARE COMING TO THE MARKET
VERBATIMS OF INTERNATIONAL HOTEL BRANDS IN GEORGIA
VEST
UPCOMING
INTERNATIONAL HOTEL
HOTEL CHAIN HOTELIER’S ASSESSMENT OF PERFORMANCE BRANDS BEFORE 2015
“We have seen significant increases in occupancy
rate and financials since 2010. This year [2012] high
LOCATION
season has seen a very promising start. We have
advance reservations booked for almost the whole
summer”
– Omer Subasi BATUMI
General Manager
ORGIA
“ We are very optimistic as demand has been
increasing rapidly. Hotel occupancy hovers around
TBILISI
85%. Our guests come from all around the world
representing various sectors including business,
sportmen and tourists”
– Oto Berishvili
Sales & Marketing Manager
BATUMI
“We have seen 7-8% more guests in our hotels
every year. Business and leisure travelers are our
two biggest client group and they come from all
over the world. Best occupancy period is summer TBILISI
from May to September” BATUMI
– Alexander Kvaratskhelia
Marketing Manager
TBILISI
19. INVESTMENT OPPORTUNITIES IN TOURISM SECTOR
“SUN-BEACH” WINTER SKI SUMMER SPA RESORTS REGIONAL
RESORTS RESORTS MOUNTAINS CASINO CITY
IN
RESORTS
DESCRIPTION
Expansion of Master development Four season resort Development of Spa Development of
summer ”sun and of winter resorts value preposition Resorts large-scale
beach” franchise with unique profile integrated casino
focusing on high- equivalent to the complex to Serve
end segment Alps regional markets.
IN GEO
• All inclusive • Government is • Majestic • Include hotels, • Include hotels,
summer resorts fully committed landscapes Different casino
• New master resort to provision allowing types of Clinics, entertainment,
POTENTIAL LOCATION
development of basic for a wide range fitness,Outdoor family Services
infrastructure of summer activities and shopping
tourism activities • Fiscal incentives
such as trekking, available
horse riding, bird
watching and river
racing
• Batumi • Mestia • Mestia • Tskaltubo • Batumi
• Anaklia • Gudauri • Gudauri • Akhtala • Tbilisi
• Kobuleti • Bakuriani • Bakuriani • Other locations • Other locations
• Other Black Sea • Goderdzi • Goderdzi
locations • Kazbegi
• Other locations
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20. www.investingeorgia.org 19
MANUFACTURING SECTOR
OVERVIEW: OPPORTUNITIES:
VEST
• Manufacturing and industries account for around 14% • Large import overhang in goods that are usually
of GDP and ~ 5% of employment not traded extensively provides regional import
• Largest industries are food and beverages (3% of total substitution potential in food processing, construction
GDP) and metal products (2.5%) materials, household gods etc
• Advantage to process goods - competitive cost of • Georgia’s current advantages in terms of handling
power, labor and strategic location large transshipment flows, business stability, low
• 2 Free Industrial Zones - In FIZ, businesses are cost of power generation and existing raw materials/
exempted from all tax charges except Personal intermediate products provide opportunities for
Income Tax large industrial bets, like production of iron and steel
products, aluminum etc
ORGIA Black
Sea
Kulevi
Poti
FIZ
Mestia
FIZ
Kutaisi
Russia
Tbilisi
Batumi
Turkey
MRN
Azerbaijan
Railway
Armenia
21. TRADE BALANCE IN GEORGIA AND IN THE REGION
IMPORT OVERHANG, USD mln, 2011
mln, TRANSPORTATION
IN
COST
IN GEO
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22. www.investingeorgia.org 21
SEVERAL HIGHLY ATTRACTIVE IMPORT
SUBSTITUTION OPPORTUNITIES
SECTOR PRODUCT GROUP PRODUCTS
VEST
• Articles of cement and steel • Prefabs
Construction • Ready-mix concrete
- Building • Bricks
materials
• Finished articles of steel
• Articles of wood • Plywood and laminated wood
• Tiles
Construction • Ceramic products • Sanitary ware
ORGIA
- Finishing • Windows
elements • Glass & glassware
• Glassware
• Furniture • Doors
• Living furniture
• Beverages and spirits • Bottling
Food
processing • Fruit juices
• Preparations of fruits and vegetables • Jams
• Vegetable oils
• Dairy and eggs
• Milk
• Cheese
• Butter
• Yogurt
• Meat • Poultry/Beef/Pork/Lamb
Packaging • Plastic packaging
• Paper packaging
23. SEVERAL OPPORTUNITIES ARISING FROM GEORGIA’S
TRANS-SHIPMENT FLOWS AND RESOURCES
OPPORTUNITY CURRENT ADVANTAGES TO BE LEVERAGED POTENTIAL FOR GEORGIA
IN
ALUMINIUM
INDUSTRY • Large transshipment flows of raw • Value chain integration
materials/input (Bauxite) and aluminium - Production of aluminium
cross Georgia to/from Tajikistan (largest - Production of aluminium
aluminium plant in Central Asia) products (fabricated or end
• A lot of water recourses and large products)
hydropower plants in the pipeline
IRON AND STEEL • Vertical integration of value chain
• Georgia mines Manganese ore
PRODUCTION by adding production of iron and
• Georgia produces ferro alloys, largely for
export (USD ~250 mn) steel and related end products
IN GEO
• Large imports of iron and steel products to • Regional import substitution
Georgia (USD ~300 mn) and neighboring
countries
COPPER
• Georgia and Armenia export copper ores, • Production of copper alloys
copper waste and scrap and end products (regional import
• Import overhang of copper products substitution)
(alloys and final products e.g. wire, tubes,
pipes) amounts to USD ~200 mn in
the region
POLYMERS &
• Import overhang of plastic products • Plastics and petrochemicals
OTHER PLASTICS
amounts to 230 mn in Georgia and 8 bln in production (regional import
the region substitution for plastics/rubber)
• Georgia transships large flows of
petroleum products
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24. www.investingeorgia.org 23
AGRICULTURE
OVERVIEW:
VEST
• Over 21 micro-climates - a wide range of grain, vegetables, hard and
soft fruits, meat and dairy could be farmed
• Agriculture accounts for 9% of GDP. It contributes ~53% of
employment mostly in subsistence farming (average farm size of 1.22 ha)
• Traditionally Georgia has strengths in wine, nuts, fruits which account
for more than 60% of agriculture exports
• The average gross monthly salary in the agricultural sector in Georgia
ORGIA
is USD 220
OPPORTUNITIES:
• Import substitution opportunities - meat, dairy products, onions,
potatoes etc
• Export opportunities - traditional strong sub-sectors, like wine,
walnuts, hazelnuts, sheep meat, etc
• Productivity gain opportunities – tomatoes, apples, cucumbers, stone
fruits, citrus etc
25. 14 POTENTIAL PRIORITIES CROPS/LIVESTOCK
TO FOCUS DEVELOPMENT EFFORTS
HIGH POTENTIAL PROJECTS GEORGIA’S COMPETITIVENESS
IN
▪
▪
▪
▪
▪
▪
IN GEO
▪
▪
▪
▪
▪
▪
▪
▪
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26. www.investingeorgia.org 25
REGIONAL COMPETITIVENESS AND POTENTIALS MAP
VEST
C O O
CROP POTENTIALS BY REGION
S GO
ORGIA
BASED ON REGIONAL SPECIALIZATION (NATURAL ENDOWMENTS,
CULTIVATION HISTORY), PRODUCTIVITY AND SEASONALITY
27. REGIONAL LOGISTICS CORRIDOR
IN
TRANS-CAUCASIAN ROUTE
• Latent gateway between Europe and Central Asia
• Around 80% of port cargo and 60% of freight rail are transits
TRANSPORT INFRASTRUCTURE
• Rapidly developing road infrastructure
IN GEO
• Ports are cost-competitive vs. alternative routes
• FDI inflows in the logistics sector have primarily targeted
transport infrastructure
OPPORTUNITIES
• Deep-sea port with PanaMax vessel
• Containerization and logistical centers
• Direct connection with European and Central Asian
railway networks
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28. www.investingeorgia.org 27
GEORGIA’S TRANSPORT INFRASTRUCTURE
MODE OF TRANSPORT EXISTING INFRASTRUCTURE UPGRADES
AND FLOWS
VEST
RAIL RAIL
• 1,500 km (90% electrified) • BTK connection to Turkey
Road/Rail
• ~7,000 rolling stock, 180 locos • Modernization
ROAD • Tbilisi bypass
• 1,500 km international road • ~2500 new rolling stock
+ 20,000 km internal and local roads ROAD
• East-West highway upgrade
POTI SEAPORT POTI SEAPORT
ORGIA
RGIA
• 13 berths, 8-10m depth • New container berth (2014)
• Container and bulk (210k TEU)
• Owned/operated by Maersk/RAKIA DEEP-SEA PORT
Maritime
BATUMI SEAPORT • Min. 2 berth of 20m depth
• 5 berths, 1 offshore mooring, 11m depth (PanaMax)
• 90% petroleum/oil, 10% containers (44k • First phase: Dry bulk (10m tons)
TEU) and containers (200k TEU)
• Operated by JSC KazTransOil • USD 200 mn investment
KUHLEVI SEAPORT volume
• Crude oil, petroleum, and lubricants
• Owned/operated by State Oil Company
Azerbaijan
TBILISI INTERNATIONAL AIRPORT KUTAISI INTERNATIONAL
AIRPORT
Air
• ~1 mn passengers (capacity: 3 mn)
• Serving 28 destinations • Passenger, incl. low-cost
BATUMI INTERNATIONAL AIRPORT airlines
• 100,000 passengers • Currently under construction
29. CARGO TURNOVER
TRANSIT FLOWS THROUGH THE CORRIDOR CENTRAL ASIA
(MILLION TONS PER YEAR) Kazakhstan
IN
Uzbekistan
Tajikistan
Kirgizstan
Turkmenistan
CAUCASUS:
Azerbaijan
Armenia
APPROXIMATELY 80% ARE TRANSIT FLOWS
Europe+Turkey
Sender - 2.6
IN GEO
Destination - 4.1
Total - 6.7
Central Asia+Caucasus
Sender - 9.6
Destination - 4.7
Total - 14.3
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30. www.investingeorgia.org 29
ANNUAL CARGO FLOW OF CAUCASUS & CENTRAL ASIA
EXPORT
VEST
EU 22%
IMPORT
ORGIA
A
EU 1
U 15%
Other Regions 78%
Other Regions 85%
8
Export I
Import
t G dT t l
Grand Total
TOTAL 255 ml. ton 68 ml. ton 323 ml. ton
EU 56 ml. ton 10 ml. ton 66 ml. ton *Source : IGC TRACECA
31. GEORGIA SERVES AS THE ENTRY GATE TO A LANDLOCKED
REGION BOOSTING SIGNIFICANT RESOURCE RESERVES
IN
IN GEO
O
FOR
COMPARISON:
REGION REPRESENTS
ONLY ~1.6% OF
GLOBAL
POPULATION
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32. www.investingeorgia.org 31
GEORGIA IS IN A HIGHLY STRATEGIC
LOCATION FOR TRANSSHIPMENT
VEST
STRATEGIC LOCATION: IT SERVES AS AN ENTRY GATE TO THE CAUCASUS AND
CENTRAL ASIA AS WELL AS A STEPPING STONE TO THE REGION
LEVERAGING ITS LOCATION, GEORGIA’S TRANSPORT ECONOMY CAN BENEFIT
ORGIA
FROM LARGE ADDRESSABLE TRANSIT FLOWS, GROWING ECONOMIES AND
LANDLOCKED RESOURCES
THE SHORTEST ROUTE BETWEEN EUROPE AND CAUCASUS/CENTRAL ASIA
GREAT POTENTIAL OF BETTER INTEGRATION AND DEVELOPMENT
OF THE REGION
33. REGIONAL SERVICES HUB
• Georgia’s service sector achieves leading ranks
IN
among regional economies in terms of value
added and trade
• Services have major share of FDI inflow of 45% in
2011 with USD 500 million:
» Financial services have grown at 19% p.a. since
2009 and is the leading service sub-sector for FDI
attraction with 15% of total inflows in 2011
IN GEO
» Consultancy services attracted 12% of total FDI
inflows in 2011
» Wholesale/retail trade accounts for 40% of
service GDP, and strong FDI inflows rebound
at 48% p.a. since 2009
» FDI inflows in healthcare/social work have
grown at 146% p.a. since 2007
• OPPORTUNITY TO CAPITALIZE:
» Financial services/headquarters
» Retail hub as the destination-of-choice
for shopping
www.investingeorgia.org 32
34. www.investingeorgia.org 33
OPPORTUNITY TO POSITION GEORGIA AS
A REGIONAL RETAIL DESTINATION
VEST
ST
GEORGIA - REGIONAL RETAIL HUB
Vision is to develop mega malls in key locations to transform Georgia - into the regional retail
hub leveraging high traffic of foreign tourists and strategic geography
BATUMI TBILISI
ORGIA
GIA
Benefits of destination mega mall
development
• Complement overall tourism strategy with
solid retail value proposition
• Retail magnet for foreign tourists and
affluent local with longer duration of
Tbilisi and Batumi as most potential locations
• Established tourist destinations with 80%
•
of foreign tourist traffic in Georgia
Accessible with existing international
airports and major transnational highway/
railway
visit (1/2 to 1 day), higher share of wallet, • Solid retail, hospitality and other
and repeated visits supporting services infrastructure
• Presence of flagship brands will drive retail • Integration with other tourism offerings
brand cluster growth e.g. sun & beach, casino
• Easier to drive investments
35. GEORGIAN NATIONAL INVESTMENT AGENCY
IN
• State agency
- Promoting Georgia internationally
- Supporting foreign investments and
investors before, during & after
investment process
• “One-stop-shop” for investors INVESTORS
IN GEO
• Moderator between Investors,
Government and
Local Companies
LOCAL GNIA
COMPANIES
GOVERNMENT
Mission - Attracting Greenfield and M&A Investments
www.investingeorgia.org 34
36. www.investingeorgia.org 35
WHAT YOU CAN GET FROM GNIA
VEST
» INFORMATION
• General data
• Statistics
• Sector Researches
» COMMUNICATION
ORGIA
• Access to Government of Georgia at all levels
• Local partners (Business Associations, private companies)
» ORGANIZATION OF SITE VISITS AND
ACCOMPANYING INVESTORS
» AFTER CARE
• Legal advising
• Supporting services
37. INVEST
IN GEORGIA
GEORGIAN NATIONAL
INVESTMENT AGENCY
www.investingeorgia.org
E-mail: enquiry@investingeorgia.org