The AGBC hosted its first 'Georgia and Evolving Dynamics of the Silk Road' regional forum at the offices of Baker & McKenzie in Washington, DC.
AGBC President Mamuka Tsereteli gives a Farewell Toast to departing Georgian Ambassador Archil Gegeshidze
A key note address and update on Georgia's monetary policy was provided by the President of the National Bank of Georgia, Mr. Koba Gvenetadze. He noted the strength of Georgia's banks in withstanding the currency devaluation and the continued support and confidence by citizens of Georgia in their banking system (which at above 70% is among the highest in the world).
The strong turnout for the event was a signal of the interest by stakeholders from the US, EU, China, Central Asian sovereign actors, and private enterprise in the success of the New Silk Road.
The Honorable Enders Wimbush, Founder of the AGBC, Dr. Fred Starr of the Central Asian Caucuses Institute at John Hopkins University, and Ambassador Richard Norland participated in a panel discussion on the evolving geopolitical situation in the silk-road.
Mr. Wimbush articulated the opportunities and threats presented by Russia's economic, political and cultural decline. He noted the enhanced threat from Russia's posture to its neighbors based upon its dependency on its military as the last competent and competitive institution for achieving State objectives.
Dr. Starr suggested that new trade routes - driven by China's population decline and Pakistan, Bangladesh and India's population explosion into the mid century - will provide opportunities for not only an East - West trade, but also a North - South trade on the Silk Road.
Dr. Starr noted that Iran represents a direct competitor as a transit route to Georgia and that Georgia cannot afford to make any missteps in developing both its hard and soft infrastructure.
From left to right: Hon. Enders Wimbush, Ambassador Richard Norland, and Dr. Fred Starr
The second panel focused on improvements and opportunities in development of hard infrastructure. The panel was moderated by Mr. Kenneth Angell of the US OverSeas Private Investment Corporation (OPIC).
Mr. Greg Saunders of BP spoke about the new natural gas pipeline system connecting Azerbaijan to Europe via Georgia and Turkey. He explained the improvements made to the upgraded South Caucasus Pipeline (SCP), and the new Trans-Anatolian pipeline (TANAP) and Trans-Adriatic pipeline (TAP) which will connect Shah-Deniz field in Azerbaijan to consumers in Italy and other European countries. The project is bringing the largets foreign direct investments to Georgia in the amount of $2 billion USD. Mr. Saunders also emphasized the fact that Georgia is already a transit country for million barrels of oil not only from Azerbaijan, but also from Turkmenistan.
Mr. Joseph Dolidze, the principal of the Pace Group, one of the region' largest cargo handlers, terminal operators and freight forwarders, spoke about the increased capacity for handling of dry and bulk cargoes at Poti Port. Mr. Dolidze discussed development of the new deep water port terminal facility in Poti, with additional storage facilities servicing clients in Central Asia and Caucasus. He thanked Mr. Kenneth Angel and OPIC team for their financial support of the expansion project of the new terminal, with investments from Pace and OPIC totaling $95 million.
From Left to Right: Randee Day, Greg Saunders, Kenneth Angell, Joseph Dolidze
Ms. Randee Day, a Maritime expert of the boutique consultancy firm Day & Partners, spoke about Georgia's potential role as a Maritime hub. She noted that Georgia has a historical role in providing excellent and well regarded sea-farers and officers and that this could provide a useful future source of employment in the country. Additionally, she added that the expansion of the Poti Port and the development of the deep-water container port at Anaklia would be game changers for the countries capacity to take larger vessels which would have tangential effects in creating further wealth and job growth in ancillary industries (accounting, hospitality, cargo handling, inland infrastructure and logistics).
Ms. Day noted that Georgia's three major challenges to developing a world-class shipping destination such as Oslo, Hamburg, Dubai, or Singapore were: lack of local bank financing available for shipping, the lack of programs to attract vessel management companies and ship owners to become residents or relocate their businesses in Georgia, and the lack of both suitable capital markets infrastructure (the Oslo and Singapore exchanges are major hubs for the registration of medium size publicly listed shipping companies) and ease of access from other international shipping destinations (there are no direct links to Georgia from London, New York, Singapore, Hamburg, or Oslo).
The evening ended with a farewell toast and candid remarks from Ambassador Archil Gegeshidze while the crowd enjoyed Georgian wine and a view of the White House.
The AGBC would like to again give a special thanks to Baker & McKenzie for providing the venue for the event.