Economic Press Monitor April 16 - 22, 2017	Days:  08 15 22 29 06

economic & politics

BANKEBI DA FINANSEBI: “PROFIT TAX DOES NOT EXIST ANYMORE, AS WE HAVE TAX ON EXPENDITURE, IN FACT”

April 21, 2017 - Auditor Irakli Shavishvili estimates that exemption of reinvested profit from tax “is good initiative”.

At the same time, “The government announced that it reduces profit tax by half a billion, but in fact, reduction makes up 300 million and in exchange, excise has been increased by 600 million, while income tax has increased by almost half a billion”, Shavishvili points.




TABULA: “BY DRAFT CONSTITUTION, ACCESS TO INTERNET IS RECOGNIZED AS CIVIL RIGHT”

April 21, 2017 - According to draft constitution, “Everyone has right to have access to internet and use it freely”.

Legislation recognizes access to interest as the right, for instance, in Finland, where internet speed is also regulated by law, Tabula points, noting that “we see no notation regarding interest speed in case of Georgia”.




NETGAZETI.GE: “ENFORCEMENT PROBLEM OF LAW ON SMOKING”

April 21, 2017 - According to the current law on smoking, tobacco smoking is banned in administrative facilities, except special smoking areas, but this ban is not observed, the newspaper says.

For instance, “There are several such areas in the Parliament building in Kutaisi, but MPs arrange such places near the assembly hall by their own, and if they are shoot during process of smoking, they express discontent”, the article points.




NETGAZETI.GE: “SCHOOL TEXTBOOKS WITHIN BUSINESS INTEREST OF VICE PREMIER’S FAMILY”

April 20, 2017 - According to new regulation, published on February 17, Education and Science Minister is entitled to apply special code to series of schoolbook without any classification stages, needing the government’s confirmation for this end.

Education policy expert Simon Janashia estimates that “Such decision could be influenced by the very political goals: if there is influential group, which is able to exert influence on the government, it will be able to receive approval for own book, bypassing any classification”.




BANKEBI DA FINANSEBI: “GAKHARIA: TOBACCO BRANCH HAS QUITE SERIOUS BUDGETARY CONTRIBUTIONS”

April 19, 2017 - Economy and Sustainable Development Minister Giorgi Gakharia declares that “tobacco branch has quite serious budgetary contributions”. “However, this does not mean that we should not uphold those adopted regulations, which are acting in Europe first of all”, he points.




NETGAZETI.GE: “BUSINESS OMBUDSMAN OPPOSES SOME CHANGES IN TOBACCO CONTROL”

April 19, 2017 - Acting business ombudsman Zurab Dznelashvili criticized some points of draft bill on tobacco control.

At this stage, the Parliament is considering in second reading the draft, which envisages ban on smoking in any kind of buildings, as well as advertisement of tobacco products.

macroeconomics & budget

FORBES GEORGIA: “MONETARY FUND DECREASED FORECAST OF GEORGIA’S ECONOMIC GROWTH DOWN TO 3.5%”

April 20, 2017 - IMF reduced forecast of Georgia’s economic growth for 2017 from 5.2% to 3.5%.

In 2016, growth rate of 2.4% placed Georgia on 98^th place worldwide.




TABULA: “DAVID SAGANELIDZE: EXPORT CREDITING AGENCY’S BUDGET WILL AMOUNT TO 20M”

April 20, 2017 - Head of the Partnership Fund David Saganelidze declared that the Parliament will consider draft bill on Export Crediting Agency in near future. At the starting stage, budget of the Agency will amount to 20 million lari, he said.




TABULA: “IMF URGES THE GOVERNMENT TO STRENGTHEN FINANCIAL DISCIPLINE OF PARTNERSHIP FUND”

April 19, 2017 - In its report, IMF points that “Georgian government should restrict and oversee balance of Partnership Fund”. The Fund should continue implementation of commercial goals only and restrict its cash deficit or issuance of any kind of guarantees, the document states.

energy, oil & gas

TABULA: “THE GOVERNMENT MAY TAKE “KHUDONHES” PROJECT AWAY FROM INVESTOR AND IMPLEMENT IT BY OWN”

April 20, 2017 - In connection with KhudonHES project, Energy Minister Kakha Kaladze declared that “we are holding negotiations with investor, we have offer that the state will take the project”. Hydroelectric station “should be built, this is very important for the country’s economic development”, he pointed.

transport & communications

LIBERALI: “INTERIOR MINISTRY: COMPARED WITH 2014, NUMBER OF CARS IN THE COUNTRY HAS INCREASED BY 16.8%”

April 21, 2017 - Interior Ministry reported that rate of vehicle fleet growth in Georgia made up 8% in 2016. In comparison with 2014, number of vehicles has increased by 16.8%.




EUGEORGIA.INFO: “FOLLOWING TOURISM RECOVERY, INTERNETIZATION OF TUSHETI IS TAKING START”

April 18, 2017 - Within two months, mountainous area Tusheti (north of Kakheti region) will be connected to Internet, Eugeorgia.Info reports. The project is implemented by Association of Small and Medium Telecom Operators in cooperation with Tusheti Development Fund.




REZONANSI: “PEOPLE IS SEEKING FOR ECONOMICAL AND HYBRID CARS”

April 18, 2017 - “Increased cost of customs clearance reduced cars’ realization”, head of Georgian Transport and Road Association David Meskhishvili states.

“The state cut cost of customs clearance for hybrid cars [i.e. ones, having hybrid petrol-electric engines] by 60%, however their cost has increased”, Meskhishvili points.

finances & banking

EUGEORGIA.INFO: “INSURANCE MARKET IS GETTING PREPARED FOR DRASTIC CHANGES”

April 20, 2017 - Georgia-EU Association Agreement envisages introduction of compulsory Motor Third Party Liability (MTPL) insurance in Georgia.

Head of the State Service for Insurance Supervision Kote Sulamanidze says that according to the EU directive (2009/103/EC), MTPL insurance will be compulsory initially for transit vehicle owners.




FORBES GEORGIA: “FORMAL AND INFORMAL “ANATOMY” OF BANKS’ NON-CORE ACTIVITY”

April 19, 2017 - Formally, non-core activity of banks is almost maximally limited in Georgia, the magazine says.

However, the problem was “regulated” by written order, sent by president of National Bank of Georgia to banks, and this was the only taken action, the article notes.




KVIRIS PALITRA: “PYRAMID OF BANKS’ REFINANCING SINKS ECONOMY?”

April 18, 2017 - In his interview with the newspaper, doctor of economics David Aslanishvili points that economic growth makes up 4%, while lari supply has increased by 20-22% in a year.

Lari rate had strengthened to 2.1 GEL/USD last year too, but National Bank of Georgia (NBG) decided later to issue refinancing loans without limitations, Aslanishvili declares.

agriculture & food

BANKEBI DA FINANSEBI: “AGROINSURANCE IS TO BE SIMPLIFIED”

April 19, 2017 - From this year, the state co-financing within agricultural insurance program will make up 70% for all crops, while 50% in case of vine. The government already approved the draft.




REZONANSI: “THERE IS BOOM OF SMALL FARMS AT TBILISI SURROUNDINGS”

April 18, 2017 - “As far as I know, poultry farming is mostly well-developed at Tbilisi surroundings”, head of organization Farmer of Future Mikheil Chichakua says.

According to Chichakua, “Over the past 4-5 years, farmers in this field are quite successful”.