Tag Archives: transit

Renovations begin under the Poti port’s new owner

courtesy of wikicommons

In this month’s issue of Investor.ge I reported on a couple of bits of news — first, the transfer in owner ship of Georgia’s main cargo port, Poti.

Flipping the Poti port has been one of the government’s major development goals, and is a key to increasing Georgia’s potential as a logistics and transit hub for East-West goods trade. APM Terminals, a subsidiary of the Maersk Group bought the port earlier this year and it says it has already begun to assess its renovation plans aimed at increasing its safety, efficiency and cargo capacity.

All good news, but they have a long way go to. Read more below.

Since acquiring an 80 percent share of the Poti port earlier this year, APM Terminals now plans to invest $100 million on upgrading the port facilities, and is eyeing additional investment projects in the region, company officials said.

APM Terminals, part of the Moller-Maersk Group, announced that it had acquired an 80 percent share of the Poti Sea Port in April, and officially took over from UAE-based RAKIA, in May.

APM Terminals’ Senior Vice President and Head of New Terminals, Peder Sondergaard, said APM intends to “add value” to the port, meeting the demand for a “high-quality port infrastructure in the Black Sea.” In the same press release, he also said APM would be investing $100 million in the port facilities over the next five years.

RAKIA continues to operate the Poti Free Trade Zone (FTZ), which occupies about 100 hectares adjacent to the port. RAKIA, which bought the zone in 2008, hopes to develop it into a major logistics and industrial center, pledging a $200 million investment.

APM Terminals’ Vice President for Business Development, Hans-Ole Madsen said in an interview with Investor.ge that the first stage of APM’s development plan has already begun, with engineers surveying the port’s existing equipment and determining which terminal cranes will be updated and which will be scrapped.

To continue reading, click here.

Georgia, Russia move to open border, resume direct flights

It’s still unclear when this will happen or what the exact conditions of the arrangement will be. The only thing that is certain is that both sides have decided it is mutually beneficial to reopen the Zemo Larsi border checkpoint and resume direct flights between the two countries, and therefore they will likely make the move official relatively soon (I’ve been hearing the 25th will be the magic date).

The devil will be in the details. Whether or not Russia will allow Georgian products to be sold in Russia after a three-year embargo is the biggest issue at stake.

Although Russian President Dmitri Medvedev indicated that Georgian products should be allowed to ”legally” enter Russia, this distinction seems to allow Russia to maintain bans on Georgian goods, which were originally embargoed citing impurities and counterfeiting concerns. Previously, Russia was Georgia’s biggest trading partner.

Below is my article in the Washington Times on the various issues surrounding the border reopening. Why it has more to do with supplies to Armenia than peace with Georgia, and why many Georgians fear it could expand the one of the nation’s long-standing ethnic conflicts.

TBILISI | Georgia and Russia appear about to reopen their border and end a four-year trade blockade – a step welcomed by many in the region, but one that some fear could lead to new ethnic clashes nearly a year and a half after a brief war.

Russia cut off all transit with Georgia in 2006, amid souring relations between the Kremlin and Georgia’s pro-Western government. On Dec. 10, however, Russian President Dmitri Medvedev announced in Moscow that he saw “no obstacles” to reopening the Zemo Larsi checkpoint and resuming direct flights between the two countries. The next day, a spokesman for Georgian President Mikhail Saakashvili welcomed the move.

The checkpoint is the only legal land passage through the Caucasus Mountains. Before the embargo, it coursed with trade and transit. But, in the ethnically mixed region that surrounds the checkpoint, fears have spread that reopening the border could tip demographic balances and expand one of the area’s long-standing ethnic conflicts.

The Zemo Larsi checkpoint lies on the highway from Tbilisi to Vladikavkaz, capital of Russia’s Autonomous Republic of North Ossetia. On the Georgian side, much of the highway runs just a few miles from the de facto border of South Ossetia. The breakaway former Georgian enclave first declared independence in 1992 and voted for independence in a referendum in 2006, but remained unrecognized as such until the August 2008 war. Since then, Russia, Nicaragua and Venezuela have recognized South Ossetia.

To read the rest of the article click here.