Page 55 - GEORptNov19
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9.1.10 Utilities sector news
Georgia's finance minister Ivan Machavariani on October 6 signed loan agreements with German and French financial institutions for €120mn dedicated to energy sector reform in the second phase of a broader programme and €60mn for water infrastructure in Batumi, Business media reported.
The German Bank for Reconstruction Credit (KfW) will provide Georgia with a €120mn loan. Of that, €60mn will go into the energy sector reform and €60mn into the water infrastructure project. It is also providing a grant of up to €2mn to be used for improving the energy efficiency of buildings. French Development Agency (AFD) has extended €60mn for energy sector reform.
As reported by the Ministry of Finance of Georgia, within the framework of the visit of the President of the Federal Republic of Germany Frank Walter Steinmeier, Minister of Finance of Georgia Ivan Machavariani and director of the Europe and Asia Division of KfW, Stefan Opitz, signed loan and grant agreements.
Separately, the Ambassador of France to Georgia Diego Colas and the new regional director of the French Development Agency (AFD) for Eastern Europe, Caucasus and Central Asia Cecil Copier signed a €60mn loan agreement for energy sector reform with Georgia’s finance minister. AFD and KfW are partners in financing energy sector reforms in Georgia.
9.1.11 Other sector news
Gross revenues generated by Georgia’s gambling industry hit Georgian lari (GEL) 13.8bn (€5bn, and equivalent to one third of the country’s GDP) in 2018, more than double the sum recorded the year before, according to Business Media and BusinessPress. The publications cited data from national statistics office Geostat. Independent estimates put actual turnover at GEL20bn, given that the companies involved in the sector are subject to mild supervision.
The gambling industry’s turnover in Georgia has increased almost 200-fold in the past 10 years.
Most generated profits are sent to offshore companies that operate casino and other betting and gaming enterprises in Georgia.
Most brick and mortar casinos operating in the small nation are located in Batumi, known as “The Las Vegas of the Black Sea”, and half an hour from the border with populous Turkey. That fact points to how Georgia’s gambling industry evolved: it started with casinos dedicated to Muslim customers in neighbouring countries who lack such attractions at home. They served as a platform for promoting online operations, creating loyal customers.
Loose advertising regulations in Georgia then made it possible for a broad expansion of online casinos throughout the country. The high poverty rates in the nation have also helped drive the spread of gambling, with negative social effects.
A large part of Georgia’s gambling industry is accounted for by online operations. The country’s most visited websites are Adjara (a portal for gambling sites and sports news), adjarabet.com and crystalbet.com. The trio are among the 10 global websites most visited by Georgians (they show up in the rankings besides websites such as youtube.com and facebook.com). Georgia’s ruling party Georgian Dream has avoided regulating the gambling industry and the opposition accuses the party leadership of deriving illegal revenues from the owners of betting businesses in
55 GEORGIA Country Report November 2019 www.intellinews.com
