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by Paul Trustfull:
Leading Georgia to a Better Tomorrow
An Interview with President Saakashvili and Minister Kobalia
By Paul Trustfull
Pictures of foreign leaders and celebrities line the walls of President Mikheil Saakashvili’s office in Tbilisi, including photos with Presidents Obama, Clinton and Bush.
“The culture and attitude of the United States is very meaningful to me,” he says. “As a friend of the West, Georgia continues to learn how to improve and lead the region into the future.” He further explains how the current and past presidents of the United States have provided Georgia a great deal of support with a true understanding of what the Saakashvili administration wants to do for the citizens of Georgia.
Serving as a hub for Asia and Europe, Georgia plays an important role not only for business but also in geopolitical stability. Trade with members of the European Union increased by 40% last year to $293 million. At the same time, NATO fully supports the inclusion of Georgia within the organization. Acknowledging that things are going in the right direction, President Saakashvili notes, “It’s not a matter of if we join NATO, it’s simply a question of how soon.”
With Georgia’s young population full of exuberance and diverse talents, it is not surprising to see where Saakashvili’s optimism comes from. Donald Trump’s recent multimillion-dollar investment to create luxury residential and hotel properties is seen as a stamp of international recognition and approval. Even so, the president is still not completely satisfied. He speaks of more foreign investments and infrastructure growth.
The push for sustainable expansion via clean energy and “green” growth is a matter of national pride. Georgia aims to serve as a model to the world in promoting market-based sustainable development. Georgia is encouraging environmentalism by launching electric cars throughout the country, and is making progress in hydroelectric energy. Georgia recently attained financing from the European Investment Bank to upgrade two major plants.
In the eyes of Vera Kobalia, Minister of the Economy and Sustainable Development, infrastructure is key to Georgia’s future. The Minister speaks of projects that will fuel growth throughout the region. A new high-speed train, for example, will open in 2013, connecting the capital Tbilisi with the seaside city of Batumi. The train will serve as a gateway to Turkey and European nations by transporting travelers in a matter of hours.
“Our model for efficiency is rivaling that of Dubai and Singapore,” she explains as she shows me models of the new airport in Svaneti designed to service low-cost airlines and private jets. Foreign investment in resort properties along the sea in Batumi is growing. The tourism sector, especially in the tropical zones, will play a central role in Georgia’s growth, notes Minister Kobalia.
With diverse investments in a variety of sectors and global regions, including China, India, Brazil and the UAE, Georgia also stands to benefit from the rise of these new superpowers.
Another important goal for Minister Kobalia is to boost tourism throughout the country. She has set an ambitious goal of 3 million visitors in 2011, compared to 2 million visitors in 2010, and plans to promote a Free Tourist Zone in the Black Sea coastal town of Anaklia. Investors already include Ritz-Carlton, Kempinski Hotels and Radisson.
Looking forward, both President Saakashvili and Minister Kobalia envision Georgia becoming the epicenter of Central Asian commerce and tourism. Armed with strong values of capitalism and business transparency, Georgian society will undoubtedly become an international destination for business excellence. Saakashvili is ready to show the world a success story like none other.
Guiding Georgia to Prosperity
Prime Minister Nika Gilauri has many reasons to be proud of the progress Georgia has made and its reemergence on the world stage. After surviving the debilitating global financial crisis and recent bouts of Russian aggression, Georgia has become stronger, and all the metrics reflect a bright future. Its economy grew 6.7% in 2010, and partnerships with the European Union, China, the United States and Turkey offer new opportunities. Georgia is well on its way to becoming the economic powerhouse of Central Asia.
“Our country has come a long way,” notes Prime Minister Gilauri. “We as a country have learned important lessons from the trying times of the past few years. Today, we emerge as a more resilient and healthy country.”
In this year alone, unemployment has decreased from a 2009 high of 16.4% and exports have increased by 20.1% from 2010 figures. Georgia is thriving in key sectors, leading the region in agriculture, telecommunications, clean energy and tourism. Even the wine industry, one of the oldest in the world, has been booming, with 14 million bottles exported around the world, earning revenues of $60 million.
Prime Minister Gilauri attributes the many successes to the friendly business environment that Georgia offers. He explains that a market-driven economy, based upon the capitalism structure observed in countries like the United States, is the basis for the Georgian economic approach. This philosophy, combined with strong individual freedoms and property rights, provides the ideal environment for international businesses. Transparency International recently named Georgia the most transparent and accountable country in Eastern Europe and post-Soviet Union countries.
“Our country enjoys many freedoms and modern philosophies that are the essential ingredients in creating a base for healthy investments,” says Prime Minister Gilauri.
The World Bank and the International Finance Corporation recently named Georgia one of the top countries in their annual Ease of Doing Business report. Georgia ranked 12th out of 183 economies in this report and leads the region in attaining credit and protecting investors. Institutional reforms and recent foreign investments have sparked a new type of interest in Georgia, one seen very rarely in Central Asia. Recently, the government issued $500 million in government-backed Eurobonds on the international credit markets. With demand five times higher than initially expected, the bonds were an instant success and demonstrated both the interest of foreign investors and their renewed confidence in the resurgent Georgian economy.
As the economy continues to expand and foreign investment pours in, Georgia is in a position to serve as a role model for struggling economies around the world and to share lessons learned. The current trajectory of progress promises to be only the beginning of Georgia’s renaissance.
The Silk Road Group
Defining Success in the Caucasus
The Radisson Blu Iveria Tbilisi is an award-winning five-star hotel in the heart of Georgia. This sleek, cosmopolitan glass tower rises high above the Mtkvari River and offers panoramic views of the capital city. In more ways than one, the hotel, which is one of the many properties owned by the Silk Road Group, represents the future of the Caucasus.
The country of Georgia has much to be proud of: an excellent business environment, positive growth prospects and leadership that ranks as one of the most transparent in the world. The Silk Road Group, led by Chairman George Ramishvili, aims to help Georgia achieve prosperity. Mr. Ramishvili speaks enthusiastically of the future of the Silk Road region where his company is active.
Named for the historic Silk Road, which was the most important trade route linking the East and the West, the Silk Road Group is developing new business partnerships that reflect the region’s rich tradition of international commerce. This multifaceted company leads the region in transport, infrastructure, real estate, banking, telecommunications and even sports. The Silk Road Group employs some 7,000 people with a turnover of $400 million. It comes as no surprise, then, that Donald Trump, the internationally renowned real estate magnate, chose Silk Road as a partner to undertake a $300 million Trump Tower residential project in the resort town of Batumi.
When asked what Donald Trump’s partnership with his company represents, Mr. Ramishvili says: “Donald Trump is the brand of success. There is no doubt about it. His investments, and those of other foreign investors, show the world that Georgia is serious about being the leader of growth with the best possible environment for business.”
Over the past few years, Georgia, like the rest of the world, has suffered due to the ramifications of the global financial crisis, but it has come back stronger, determined to exceed expectations. According to Mr. Ramishvili, Georgia’s potential has been vastly underestimated, and only time will reveal the full capabilities of this driven nation.
“I am looking forward to being at the Batumi ribbon-cutting ceremony in the near future, and I feel President
Saakashvili is doing a terrific job for his people.”
“Silk Road’s decision to bank on Georgia has paid off generously,” he explains. “Now we are prepared to work with leading Western investors like Mr. Trump to forge strategic partnerships in key business areas.”
Presenting Georgia’s attributes as a tourist destination is one of the main goals of both the government and the Silk Road Group. World-renowned alpine skier Alberto Tomba was recently seen in the beautiful mountains of Georgia, where the Silk Road Group invited him to consult on a project to construct a ski resort rivaling those of the Alps.
The overwhelming optimism of Georgian business leaders is unparalleled in these times of financial uncertainty around the world. As the economy grows and prosperity spreads, global investors are beginning to take a closer look at Georgia, where the Silk Road Group is a force to be reckoned with in the rapidly developing private sector.
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