AGP Executive Report

Energy & Infrastructure: BP has transferred operatorship of the Baku–Tbilisi–Ceyhan (BTC) oil pipeline to Azerbaijan’s SOCAR, effective July 1, with SOCAR Midstream Operations taking over all three transit sections across Azerbaijan, Georgia and Türkiye; the handover keeps the BTC Co shareholding unchanged, while BP retains operatorship of the Sangachal terminal land complex. Transport Planning: Tbilisi has launched an international tender to study the feasibility of a new railway corridor linking the capital with Mtskheta, Rustavi, the airport and eastern districts. Ports & Trade: InterpressNews visited Batumi Oil Terminal and Batumi Seaport, highlighting their role in connecting the Caspian region and Central Asia to Black Sea and European markets via the Middle Corridor, with 619,000 tons of liquid cargo handled in Jan–May 2026. Regional Business: Georgia and Uzbekistan are set to deepen economic ties at a business forum ahead of President Mirziyoyev’s visit, with a one-year roadmap on trade, transport, logistics, hospitality and investment. US-Georgia Partnership: Georgian PM Kobakhidze marked the US Independence Day reception by calling for a relaunch of the strategic partnership with a concrete roadmap.

Real Estate Watch: Galt & Taggart says Tbilisi’s primary market demand stayed broadly flat in May 2026, while secondary sales jumped 12.4% y/y to 1,924 apartments; total sales hit 3,748 units and prices show partial stabilization. External Accounts: Georgia’s current account deficit narrowed to $348.1m in 1Q26 (3.8% of GDP), with services surplus rising and computer/information services exports up 65.7% y/y. Education & Procurement: The Education Ministry plans a full overhaul of school textbooks by Sept 15, 2028 and a phased rollout of mandatory uniforms starting with grades 1–6 this year. Transport & Cities: Tbilisi City Hall launched an ADB-style tender for a technical and economic feasibility study of a city railway corridor linking the capital with Mtskheta, Rustavi and the airport. Energy & Infrastructure: BP transferred operatorship of the Baku–Tbilisi–Ceyhan pipeline to SOCAR Midstream Operations from July 1, covering all three transit sections. Business & Finance: Freedom Holding says Turkish regulators approved its planned acquisition of 99.32% of Turkish Bank A.Ş., a key step toward its Turkey expansion. Agribusiness: Analysts flag shifting stone-fruit trade conditions in 2026, with Georgia’s peach/nectarine window still ahead but Armenia facing disruptions from Russian restrictions. Cyber & Media: Studio Monitori reports a coordinated cyberattack after publishing an investigation tied to alleged online casino networks and “Trump Tower” in Tbilisi. Diplomacy for Trade: Uzbekistan’s President Mirziyoyev will visit Georgia July 2–3, with talks focused on investment, manufacturing, pharma, agriculture, tourism, energy and transport corridors.

Digital Marketing Expansion: Google appointed Coob Ads as its official Google Ads sales representative across Armenia, Azerbaijan, Uzbekistan, Georgia and Moldova from July 1, aiming to boost localized support for advertisers. Trade & Connectivity: A Georgia–Uzbekistan Business Forum is underway in Tbilisi with about 70 Uzbek firms and 250 Georgian companies, featuring investment pitches and B2B meetings. Seafood Trade: Russia imported a record $1.3m of frozen fish from Georgia in May, up 18.2% month-on-month, signaling a sharp rise in bilateral seafood flows. Legal & Business Risk: Two founders of Kinderly Georgia were sentenced to 10 years each for embezzling over GEL 2.06m from surrogate and biological parents. Agri-Food Cooperation: Georgia’s agriculture and environment leadership signed an MoU with Tajikistan on agricultural cooperation and also advanced a 2026–2030 FAO Country Programming Framework for a more competitive, climate-resilient agri-food sector. Tourism & Hospitality: Rotana signed to enter Georgia’s ski market with Gudauri Ski Resort, while a castle-inspired Sky Castle luxury hotel near the Turkish border is planned to open in 2031. Regional Diplomacy: Georgian PM Irakli Kobakhidze signed a strategic partnership agreement with Kazakhstan’s Tokayev, with new memorandums spanning culture, IT and tourism.

Georgia–Kazakhstan Deal: Georgian PM Irakli Kobakhidze says Georgia and Kazakhstan have signed a strategic partnership agreement, aiming to lift ties to a “new level” with a focus on trade and transport connectivity. Parliament Probe Demand: The opposition party “Gakharia For Georgia” has appealed to the Prosecutor’s Office to open an investigation into the June 26 Parliament altercation, alleging an organized, pre-planned act and criticizing the lack of action despite widely shared footage. Surrogacy Case: Tbilisi City Court sentenced two Kinderly Georgia founders to 10 years each for embezzling over GEL 2 million in a surrogacy intermediary scheme. Banking & Investment: Lion Finance Group held Investor Day in Tbilisi with about 100 international investors, highlighting strategy, digital transformation, and Bank of Georgia/Ameriabank performance. Agri-Food & Environment: Georgia’s agriculture and environment officials pushed cooperation with Türkiye via MoUs on irrigation and forestry, while also stressing phytosanitary upgrades and reducing post-harvest losses to strengthen farmers’ incomes. Black Sea Digital Corridor: Vodafone Ukraine outlined plans for an underground data center, tied to the Kardesa submarine cable linking Ukraine, Bulgaria, Georgia and Türkiye. Regional Trade Note: Azerbaijan increased pear exports in early 2026, with Russia the main buyer and shipments also reaching Georgia and other markets.

Court Verdict: Tbilisi City Court sentenced the founders of LLC “Kinderli Georgia” to 10 years each over a surrogacy-related scheme that misappropriated over 2.06 mln GEL from Chinese clients and surrogate mothers. Aviation & Tourism: Flyone launched direct Chisinau–Batumi flights (three times weekly in summer), while Norwegian began Copenhagen–Tbilisi service (twice weekly), boosting Georgia’s European connectivity. Strategic Partnership (Kazakhstan): In Astana, PM Irakli Kobakhidze and Kazakhstan’s leaders signed a strategic partnership framework and memoranda on culture, tourism, and AI/digital development, with talks also covering trade, energy, and the Middle Corridor. Energy & Transit: Kazakhstan said it intends to increase oil transit via the Baku–Tbilisi–Ceyhan pipeline, while both sides discussed expanding cooperation in transport logistics and digitalization. Trade Snapshot: Georgia–Kazakhstan agricultural turnover topped USD 116 mln, and bilateral trade hit USD 184.5 mln in 2025, with 600+ Georgian-capital companies operating in Kazakhstan. Regional Finance: The Eurasian Development Bank approved potential expansion of membership by 11 countries, including Georgia, aiming to broaden its development reach. Local Business Watch: Batumi’s Mtsvane Kontskhi pier rehabilitation spending is raising questions after the pier was reportedly locked again.

Kazakhstan-Georgia Strategic Push: Georgian PM Irakli Kobakhidze met President Kassym-Jomart Tokayev in Astana, with both sides calling the planned Strategic Partnership Agreement a new stage for trade, investment, culture and humanitarian cooperation, and highlighting the Middle Corridor’s growing cargo role. Port & Logistics Investment: APM Terminals Poti will buy a new mobile harbour crane (USD 7.1m) to boost capacity and efficiency, while the U.S. backed a separate Poti berth expansion with a USD 25m DFC loan—aimed at raising bulk cargo handling and supporting Middle Corridor trade. Trade Numbers Watch: Georgian companies listed on the London Stock Exchange ended the week lower, with CGEO down 6.83% and CGEO’s slump alongside BGEO and TBCG declines. Wine Export Pressure: Georgia’s wine imports to the U.S. face an average 7% effective tariff in 2025, with regional comparisons showing higher rates for several EU exporters. Legal & Civil Society: The ECHR has begun substantive review of a case over seizure of bank accounts of five Georgian civil society groups, signaling potential international scrutiny of restrictions on independent NGOs. Aviation Links: Air Astana marked 15 years of direct flights to Georgia, reporting 270,000 passengers in 2025 (+17%) and up to 44 weekly flights in peak season. Tech & Rights Concern: A watchdog alleges Georgian authorities used Russian facial recognition tech to identify protesters, raising fresh questions for public trust and governance.

Macroeconomy & Finance: Georgia’s currency reserves hit a record level, exceeding $7 billion, after the National Bank bought a record $633m in May, according to the PM’s parliamentary annual report. Public Finance & Governance: In the same address, Irakli Kobakhidze claimed corruption at the “upper echelons” has been “fundamentally eradicated,” while the Finance Ministry’s Investigation Service reported a major illegal trade case involving psychotropic drugs worth over 53m GEL, with 17 arrests. Water & Infrastructure: The PM also said 31 cities are covered by the United Water Supply Company, reaching 65% coverage, with works in the remaining 17 cities due to finish by end of next year. Health & Social Policy: Adjara launched a “High-risk Women’s Milk Bank Program,” with the first bank to operate at Yashvili’s Batumi Maternity and Children Central Hospital, alongside newborn screening plans. Regional Trade & Connectivity: Kazakhstan, Azerbaijan and Georgia are working on a unified long-term tariff model for the Middle Corridor, while Azerbaijan continues expanding transit flows, including another Russian wheat shipment to Armenia via Azerbaijan and Georgia. Development Finance: Baku will host the BSTDB 28th Annual Meeting and a business forum on July 1–2, focusing on regional connectivity and development finance priorities.

Middle Corridor & Trade Finance: Kazakhstan, Azerbaijan and Georgia are jointly developing a unified long-term tariff model to boost the Trans-Caspian International Transport Route, with plans ranging from Caspian capacity expansion and dredging to Kuryk port upgrades, while MSC’s long-term investment interest was highlighted in Astana. Port Expansion in Georgia: The U.S. DFC signed a second $25m loan with PACE Group to complete a new berth at Poti’s New Sea Port, aiming to add about 1m tonnes of bulk cargo capacity and strengthen Middle Corridor logistics. Regional Grain Flows: A new Russian wheat shipment moved through Azerbaijan to Armenia via Georgia, alongside fuel exports, underscoring how South Caucasus transit corridors are reshaping supply routes. Adjara Health Program: Adjara launched a “high-risk women’s milk bank” program, with Yashvili’s Batumi Maternity and Children Central Hospital set to operate Georgia’s first such facility. Policy & Security Signals: Georgian civil society urged international partners to address Russia’s “gradual annexation” of occupied Abkhazia and Tskhinvali, warning about sovereignty and stability risks.

Port Expansion & Middle Corridor: The U.S. backed a new phase of Poti’s “New Sea Port” with a USD 25m DFC loan to PACE Group, as officials broke ground on a second berth meant to lift bulk cargo capacity by another 1m tonnes. Regional Trade Flows: Azerbaijan shipped a new 770-ton Russian wheat consignment to Armenia via rail through Georgia, adding to tens of thousands of tons of grain and thousands of tons of fertilizers and fuel already moving along the corridor. Energy & Infrastructure Outlook: Georgia’s PM said in parliament that by 2031 all highways will be completed, with road tenders already announced worth 2.8bn GEL and more planned this year. Agribusiness Performance: The PM also reported 2025 agribusiness output up 9% to 19.8bn GEL, with agri-food exports to 110 countries reaching $1.8bn. Maritime Sector: Batumi marked International Day of Sailors with awards for Georgian seafarers and a ceremony at the Batumi International Container Terminal. SME & Finance Support: BSTDB and IDBank signed an EUR 10m package to back SMEs and trade in Armenia, underlining regional financing links. Tech & Governance Debate: A UN Public Service Forum session in Tbilisi discussed how AI can improve public services while keeping transparency and human oversight.

Port Expansion: Georgia’s New Sea Port of Poti is moving ahead with a second berth after a June 25 groundbreaking ceremony, backed by a new USD 25m U.S. DFC loan to PACE Group, aiming to boost bulk cargo capacity by about 1 million tonnes. Maritime Recognition: Batumi marked International Day of Sailors with awards for Georgian seafarers and a ceremony at the Batumi International Container Terminal, highlighting the role of maritime education and professional crews. Infrastructure & Growth Targets: Prime Minister Irakli Kobakhidze told Parliament that by 2031 all highways will be completed, with major road tenders already announced and more planned for 2026. Agribusiness Performance: The PM also reported 2025 agribusiness output up 9% to 19.8bn GEL and agri-food exports reaching $1.8bn to 110 countries. SME Export Push: EU and UNDP support helped 306 Georgian SMEs (73% women-led) improve export readiness, creating 960 jobs and helping 25 firms enter EU markets for the first time. Banking Trend: Georgian banks’ “dirhamization” continues, with dirham deposits rising sharply in April, while the lari still holds strong confidence among depositors.

Public Policy & AI: At the UN Public Service Forum in Tbilisi, civil servants discussed how AI can boost public-sector efficiency while keeping accountability, transparency, inclusion, and meaningful human involvement at the center. Occupied Regions & Security: Georgian civil society sent international partners a message condemning Russia’s “gradual annexation” of Abkhazia and Tskhinvali, citing the May 9 “Deepening Allied Cooperation” deal as a new legal step. Agribusiness & Infrastructure: Georgia’s PM said 2025 agribusiness output rose 9% to 19.8bn GEL and agri-food exports reached $1.8bn (+10%), while road plans target 94+ tenders worth 2.8bn GEL already announced and up to 120 tenders above 3bn GEL by year-end. SME Exports: EU and UNDP support helped 306 Georgian SMEs (73% women-led) improve export readiness, creating 960 jobs and getting 25 firms into EU markets for the first time. Banking & FX: IMF said Georgia’s FX reserves above $7bn are adequate for moderate shocks, supporting lari stability; meanwhile, dirhamization trends show rising dirham deposits in Georgian banks. Middle Corridor Logistics: Kazakhstan, Azerbaijan and Georgia are working on a unified long-term tariff model for the Middle Corridor, alongside port and fleet upgrades.

Middle Corridor Trade: Kazakhstan, Azerbaijan and Georgia are working on a unified long-term tariff model to boost the Middle Corridor’s efficiency, alongside infrastructure steps like Caspian fleet expansion and port modernization. EU Accession Economics: The European Commission is preparing a “membership-lite” approach for candidate countries, offering selected funding and market access while full membership talks drag on—Georgia is listed among official candidates. Georgia Energy & Business: Prime Minister Irakli Kobakhidze says Georgia secured over 2 bcm of natural gas from Azerbaijan at an “optimal” price, while the state Enterprise Georgia programme financed 1,279 entrepreneurs and points to a Kutaisi Technology Hub. Tourism Revenue: Georgia reported record tourism income of $4.7bn in 2025 and 7.8m international travellers, with continued growth into early 2026. Health Sector Probe: Former Deputy Health Minister Irakli Mkheidze was detained/charged in an alleged psychotropic drug trafficking and abuse-of-office case involving dozens of suspects and legal entities. Regional Security Spillover: Russia extended a sulfur export ban through end-2026, with exemptions for EAEU and Georgia’s breakaway regions, while Crimea introduced an emergency amid fuel and logistics strain.

Media Regulation: Georgia’s Communications Commission fined TV Pirveli GEL 2,500 over wording in news coverage, including “prisoners of conscience,” after a similar penalty against Formula TV—raising fresh concerns about the regulator’s expanded content oversight. Transport & Infrastructure: The Asian Development Bank launched a tender to prepare a feasibility study for a regional rail link connecting Tbilisi, Rustavi and Mtskheta (and the future Airport City), with demand forecasts and environmental and social assessments. Ports & Middle Corridor: Georgia is pushing ahead with Poti port expansion as the U.S. DFC signed a second $25m loan to complete a new berth, adding 1m tons/year capacity and supporting Trans-Caspian Corridor trade. Banking & Economy: Commercial banks’ net profit for the first five months reached 1.6bn GEL, with most major lenders profitable despite some sanctioned subsidiaries reporting losses. Business Events: Tbilisi Shopping Festival opens June 27–28 and July 4–5 at Tbilisi Outlet Village, with cashback offers, designer pop-ups and talks. Regional Diplomacy: Azerbaijan and the EU discussed relations and the Armenia peace process, with Baku urging use of existing opportunities to finalize commitments.

Port Expansion & Middle Corridor: The U.S. DFC signed a second $25m loan with PACE Group to complete the second berth at the new Poti Seaport, adding 1m tons/year of bulk capacity and boosting Trans-Caspian trade efficiency. Transport Policy: Proposed legal changes will let distribution vehicles park in bus lanes and unload cargo at night (01:00–06:00), with conditions set by the Interior Minister. Banking & Supervision: The National Bank sanctioned microfinance firm Rico (94,000 GEL) and several pawnshop/transaction-reporting violations; meanwhile, commercial banks’ net profit for five months reached 1.6bn GEL. Public Finance Oversight: Georgia’s State Audit Service reported 36.5m GEL in 2025 violations, with high-risk cases sent to prosecutors. Tech & Business Events: Global Tech Weekend Tbilisi drew 10,000+ attendees; Tbilisi also hosts a July 1 Uzbekistan-Georgia business forum. Trade & Agriculture: Georgia cut wheat imports 7% (mostly from Russia) and bought 218 tons of Armenian flowers in May, as Armenia’s flower exporters face EU/market access hurdles.

Fuel Crunch in Russia: Reuters reports Russia is in talks with Kazakhstan to import about 50,000 tonnes of AI-92 gasoline after Ukrainian drone attacks forced refinery shutdowns, cutting output by around 25% y/y; Russia is also weighing export limits, higher subsidies and even seaborne imports, while Kazakhstan says it hasn’t received an official request and notes Atyrau refinery maintenance from June 26–July 20. Transport & Cost of Living: Georgia’s Parliament advanced amendments that would let distribution vehicles use bus lanes at night (1:00 a.m.–6:00 a.m.) to unload goods, aiming to ease daytime congestion and lower delivery costs. Real Estate Pulse: In Tbilisi, May apartment transactions rose 13.1% y/y to 3,787 and market size hit $334m (+32.4%); in Batumi, new-build prices climbed 8.7% y/y and total transactions grew, lifting market size 22.2% to $87m. Regional Trade & Connectivity: Kazakhstan, Georgia and Azerbaijan are moving toward a unified long-term tariff model for the Middle Corridor, with port and fleet upgrades discussed. Business & Finance: S&P upgraded several Freedom Holding subsidiaries to “BB-” (stable), citing improved risk management; Georgia’s Ministry of Finance also reported a GEL 53m psychotropic drug trafficking scheme with 17 arrests. EU-facing Politics: Italy’s Deputy FM visited Tbilisi, meeting Georgian Dream and opposition, with talks touching trade, energy, tourism and the Middle Corridor.

Real Estate Watch: Tbilisi apartment transactions rose 13.1% in May to 3,787 units, while the market size jumped 32.4% to $334m, with new and old prices climbing across districts. Coastal Housing: Batumi’s newly built apartment prices rose 8.7% y/y in May to $1,323 per sq m; transactions in the city grew 2.5% to 1,324 units and the market expanded 22.2% to $87m. Food Prices & Retail: The government launched ekalata.gov.ge, a discount-comparison portal covering 12 supermarket chains, after a parliamentary probe pointed to inefficiencies rather than “excessive profits” behind high food costs. Public Finance & Compliance: Georgia’s Finance Ministry investigation uncovered an illegal psychotropic drug trade scheme worth over GEL 53m, with former regulators among the accused and dozens of entities facing charges. Transport & Trade Links: Azerbaijan Railways plans to extend Baku–Tbilisi ticket sales from 30 to 90 days, citing strong demand. Regional Corridor Push: Kazakhstan, Georgia and Azerbaijan are working on a unified long-term tariff model for the Middle Corridor, alongside port and logistics upgrades. Tech & Payments: Eventhub expanded ticketing access for European markets, enabling local buyers and agencies to sell tickets for regional events. Industry Deal: Mexaniki Temir Zavodu in Azerbaijan was appointed distributor for CERATIZIT cutting tools across the Caucasus, targeting faster supply and support for manufacturers in Georgia, Armenia and Azerbaijan.