2022-12-12
Anaklia Port will be built with co-participation of the State, whereby 51% will be owned by the State by our decision, while the rest will be tendered internationally and partners, partner companies will be selected. This is significant news, which I want to share with our society. It was stated by Irakli Garibashvili, Prime Minister of Georgia at the Executive Government Meeting today.
The Head of Government of Georgia spoke about the current situation at Anaklia Port and noted that since signing an agreement with an investor in 2016, no commitment was honored by the latter and the port never got built, which is a classic example of larceny.
"Second agenda item, which I wish the general public to know about, is related to Anaklia Port. Back in 2016 we made a decision to build the port. You all witnessed that. Prior to that, during my first tenure in the capacity of the Prime Minister of Georgia, we openly spoke about this topic everywhere. Every rostrum and platform was used, including that of the UN HQ to make our expressed interest and priority known in building the port and agreement was signed in 2016, investor was selected and you are all aware who is this so-called investor, who failed to deliver his commitment, i.e. he failed to build this port. Though, in line with the assumed commitment, we should have admitted first vessels in 2020, if I am not mistaken. Government deferred the deadlines for the commitment several times - 3 or 4 times, if I am not wrong. Nevertheless, the investor failed to attract further investments. Messrs. Khazaradze and Japaridze have in between them as partners spent 3 MLN USD. To my knowledge, the rest has been raised from investors - about 20 or 25 MLN USD. In return, they were seeking assurances from the Government on guaranteed cargo volumes. Land was our and we were requested to hand it over. We did. Roads and railways were built to the site. Hundreds of millions were to be spent by the Government to receive nothing in return. In real terms, this was expected to be a gift to Mr. Khazaradze. After dropping this project and failing to implement it for 4-5 years, these individuals decided to rob our country and why do we have this assumption? They sued against the country and took the case further to the court of arbitrage. They are currently claiming 1.5 BLN USD. Imagine what is happening? These individuals failed to deliver on their commitment, failed the project, could not build the port and are now demanding 1.5 BLN USD from our country and people. This is a classic scheme of Larsen and we all know it, of course. No genuine, sincere or honest goal or intention was ever backing this port construction and it was simply a way to make them rich through theft.
That is why, we are now - and you may well remember about it - working actively towards this end, as I instructed the Ministry of Economy several months ago and we are preparing a new tender - a competitive selection - but the main news is that we decided to build the Anaklia Port with co-participation of the state, whereby 51% will be owned by the state and international contest will be announced on the rest. We will select partners - partner companies. This is the significant news, which I wanted to share with our public. The site itself is abandoned and derelict. You may well be aware of what is happening now in Anaklia. Site has turned into a bowl of dust. It is categorically unacceptable and we need to select the international partner companies now and we also need to start investing in this project. It will be implemented with our co-participation. State will carry out this endeavor in partnership with foreign or other companies. It is our decision" added the Prime Minister of Georgia.
The Head of Government of Georgia also spoke about the Poti Port, the current process of its upgrade and extension. As the Prime Minister of Georgia noted, development of the port infrastructure is the key priority of the Government.
"Development of ports is our main priority. You may well be aware that Batumi Port is managed by foreign companies. Additional investments will also need to be made in Poti Port. Meanwhile, a Georgian company - PACE - made an investment of 100 MLN USD in building new terminals and it may be said in real terms that it is now a small new port. Idea of upgrading and extending the existing port of Poti has been around for a long time. I met the executives and owners of the port facilities in Poti a few days ago together with the Minister of Economy. I wish to publicly reassure them in my full support. Our desire is to have Poti Port extended as well. Additional investments need to be made in Batumi too and a new port of Anaklia should also be built. Interest has been growing day by day towards our corridor in recent period and volume of cargo shipped from Asian countries is huge. Desire is great to get them shipped from China, Japan and other countries. We should be ready in every direction. It is our declared aim and goal. I wish to express full support to every investor that will make injections in port facilities. As for the port of Anaklia, the state should have the main leverage here and thus 51% will be owned by our country" noted the Prime Minister of Georgia.
The Head of Government of Georgia spoke about the construction of power plants and creation of additional capacities. According to the Prime Minister of Georgia, construction of a thermal power plant is also planned and it will generate 600 megawatts of additional capacity. In total, it translates into an investment of 3-4 BLN USD during 2-3 years.
The Head of Government of Georgia noted that Memorandums will be launched for the remaining stock of 800 megawatts. A tender will be announced at the end of the year on 1500 megawatts, while additional capacity - both hydro, wind and solar power plants - will be tendered in 2023.
"We made a very vital decision in the recent period in relation to power plants. They were put on hold for the last 5 years, if I am not mistaken. We have been having rather intensive negotiations since 2017 with the International Monetary Fund (IMF) and reached the following outcome - about 800 megawatts of remaining stock in terms of projects and memoranda will be launched. Power Purchase Agreements (PPA) were originally signed, but suspended by the Government - prior to my term. These projects will be launched to build a power plant of 800 megawatts. Presumably, over a billion will be spent and we will also be tendering our 1500 megawatts. It is a direct investment of 2.5 BLN USD. In total, 1500 megawatts will be generated separately, in line with the newly approved scheme, which has already been considered and approved at the Executive Government Meeting. Second one is 800 megawatts. This is the minimum that will be approved now. Next year, in 2023 we will be tendering our other megawatts of hydro energy. Main focus will be on hydro. Wind and solar power plants will develop as well. We are working on the creation of additional capacities and plan to build thermal power plants in addition. We wish to announce these tenders as well. In total 600, i.e. additional 400 and 200 megawatts are within the interest of investors. Thermal power plant is intended. Overall, it will translate into an investment of some 3-4 BLN USD in the coming 2-3 years" noted Irakli Garibashvili.
According to the Head of Government of Georgia, authorities expect investments in the value of 400-500 MLN USD in Tbilisi and Batumi airports.
As the Prime Minister of Georgia noted, the Government has already started work towards this end and announcements will follow shortly.
"We had a discussion at the Economic Council Meeting about airports. Let us say straight that the current airport of Tbilisi fails to meet international standards. We need a modern, strong, well-functioning infrastructure with cargo terminals and business aviation. We wish to have new terminals built and have already started active work towards this end. We will be making announcements shortly, but overall expect investments in the value of 400-500 MLN USD in Tbilisi and Batumi airports. Also, we have a vision about Kutaisi airport. Dimension of cargo may be developed there and will end-up being significant investments" noted the Prime Minister of Georgia.
According to Irakli Garibashvili, creation of a new IT Hub is intended at the premises of the parliament building in Kutaisi.
"You may well be aware that the building of the Parliament of Georgia in Kutaisi is practically dysfunctional. It is our intention to promote the development of the IT industry there. We are currently working with one of Israeli companies, which is interested in creating a new IT Hub at the premises of the parliament building in Kutaisi. It will not only be for technology, but will attract and employ the youth in the sector. Georgian students and youth will get jobs and development prospects. Here also, dozens of MLN USD will be invested. Of course, I need to refer to Kutaisi University as well. It is a very vital factor and may act as a rather serious partner within this project" added the Prime Minister of Georgia.
We plan to offer large development projects to investors and are preparing one in Gonio. We have several potential expressions of interest and this process continues" noted the Prime Minister of Georgia at the Executive Government Meeting today.
The Head of Government of Georgia noted that authorities wish to have a new settlement developed in Gonio to potentially turn into a Financial Hub.
"We wish to have a genuinely new city built in Gonio. It may even turn into a Financial Hub with Golf courses, mansions and a very substantial new community may come into existence in Gonio. We are working on 2-3 new projects in Tbilisi with the Mayor's Office and will be sharing the news with the public about it in a matter of a few weeks" added the Prime Minister of Georgia.
According to the Head of Government of Georgia, active work is pursued on a Nation-Wide Master Plan, to avoid having a chaotic urban development. Prominent European companies will also engage in this process.
Also, according to him, the Ministry of Economy and Sustainable Development is actively working towards this end and it is one of the most important matters.
"We are developing a Master Plan for every city. Levan Davitashvili and his institution [Ministry of Economy and Sustainable Development] is actively working towards this end. We wish to invite prominent, the most successful, foreign, European companies that will engage in the process together with their Georgian peers and a Nation-Wide Urban Development Plan will be created once and for all. It is one of the most vital topics" stated the Prime Minister of Georgia.
According to Irakli Garibashvili, the country has made significant progress in every direction, which has been conditioned by a double-digit economic growth.
As noted by the Prime Minister of Georgia, this rate of development will need to be maintained and greater action is expected from the coming year.
"I told you at the previous Executive Government Meeting that 200 MLN GEL will be allocated for tourism. At this point in time, 8-10 locations have been selected with the following principle: highest in demand and popularity are Borjomi, Bakuriani, Kazbegi, Batumi, Tbilisi and others. We wish to start the comprehensive urban renovation and rehabilitation projects. We intend to do so in Tskaltubo as well and a detailed plan will be presented shortly.
We have significant plans toward production and manufacturing. We will continue promoting small and medium enterprises (SME). It is very important that the profit of commercial banks is tremendously increased. They have a profit of 2 BLN GEL. This year they will be gaining around 2 BLN GEL. Same profit was generated last year. Thus, it is our great desire to channel this money for the development of the economy of the country. It will further boost the economic development of Georgia. Investments are pursued in the infrastructure, construction of roads and highways. We are carrying out significant investments in agriculture as well. Overall, we expect substantial progress and need to maintain high economic growth. Last year we achieved double-digit economic growth. Same applies to the current year. It enabled us to generate revenues of several billion in addition, which will finance the increased salaries and wages, pension and project initiatives. Housing is provided for internally displaced persons (IDP), police and army, schools as well. We are building and rehabilitating 800 schools. We are also launching a rehabilitation of kindergartens, sports infrastructure and game fields. We have made significant progress in every direction. It was conditioned by the double-digit economic growth. What is most important, Gross Domestic Product (GDP) grew by almost 30 BLN GEL in the past 2-3 years. Next year it will reach 80 BLN GEL. Per Capita GDP will be almost 7500 USD. So, it is a substantial progress. Let me repeat, we do not reproach anyone, but everyone should know - especially those extremists, who were planning to get the country engaged in the war, the war and death party, as I call them. They wanted to open another frontline of the war here to get the country destroyed and turned into a warzone, but witnessed a double-digit economic growth instead - that for the second year in a row we are having progress, which I spoke about. To cut the long story short, this rate of advancement needs to be maintained and more active work is needed from the coming year. Ministers - we all - are motivated to make sure that every project and promise gets delivered. We need to do more than we promised to people" stated the Prime Minister of Georgia.
As the Head of Government of Georgia noted, significant investments are made in the regions of the country.
"We are implementing significant investments in regions. We are rehabilitating and upgrading infrastructure, building roads, advancing water supply projects and urban development programs. Now we want to launch a Nation-Wide Green Surface Program in municipalities and it is essential to stream/line the urban transportation. I instructed Larry Barnabishvili and he scrutinized the matter as a curator of regions. We will be purchasing 250 buses and garbage collection trucks for regions and they will get new buses and waste management vehicles as a result. Their current fleet was outdated. This advancement and progress should be continuously reaching the regions" noted the Prime Minister of Georgia.
According to the Head of Government of Georgia, a 4-Year Strategy of SOE Reform has been approved, on the grounds of which state-owned enterprises have been selected for reform.
The Prime Minister of Georgia also spoke about the program branded as Enterprise Georgia and noted that it will be extended and branched out in regions, so that local residents gain access to the program and its benefits.
"Levan Davitashvili and Lasha Khutsishvili are jointly working on the SOE Reform Strategy. We approved a 4-Year Strategy Paper and identified those state-owned enterprises that will get reformed. This initiative is intended to establish a relevant corporate governance system at these corporations. Reference is made here to such large ones as GSE, Georgian Railway JSC, Airport Amalgamation, Gas Transportation Company, etc.
And last agenda item: you may well be aware that Enterprise Georgia turned out to be quite a successful program. We launched it during my term as Prime Minister of Georgia. It currently has over 20 000 beneficiaries, who are engaged in the entrepreneurship program. Billions of GEL have been invested. Dozens of thousand new jobs were created and maximum support has been provided to local enterprises in recent years. Therefore, we now wish to make these marvelous opportunities to be more accessible in the regions. They have no luxury or comfort of gaining access to these services and programs on the spot. That is why, Ministry of Economy will be branching out Enterprise Georgia in regions. We will be extending this program in regions to make sure that it brings an immediate benefit to local residents. It is our aim. Thus, everything will be very well; we will maintain peace, stability and development. It is the way forward to the unification of our country!" concluded the Prime Minister of Georgia.
Press Service of the Government Administration