AGP Executive Report

Energy Trade: Georgia will buy electricity from Azerbaijan directly, cutting out intermediaries and saving the state several million lari a year, Prime Minister Irakli Kobakhidze said. Six power plants are also expected to add 300 MW of capacity by year-end. Business Finance: The Black Sea Trade and Development Bank signed a €25 million facility with Basisbank to support Georgian small and medium-sized businesses. Growth Outlook: The World Bank raised its 2026 growth forecast for Georgia to 7%, up two percentage points. Trade and Infrastructure: Design is complete for an 18-kilometre rail link to Anaklia port, with a tender expected by month-end. Carlsberg is also expanding its PepsiCo bottling partnership in Georgia and Armenia. Black Sea Risks: Drone attacks on merchant ships off Bulgaria have renewed concern over the security of routes central to the Middle Corridor connecting Asia and Europe.

Growth Outlook: The World Bank raised its 2026 growth forecast for Georgia to 7%, putting it well above the average for EU candidate countries. Government: Economy Minister Mariam Kvrivishvili was appointed vice prime minister. Beverages: Carlsberg agreed to buy PepsiCo bottlers in Georgia and Armenia, building a South Caucasus platform alongside its existing Azerbaijan business. SME Finance: Credo Bank and the Asian Development Bank signed a GEL 120 million facility to support Georgian small and medium-sized businesses. New Market Entry: General Motors and local partner Lynx Motors announced Cadillac’s entry into Georgia’s premium car market. Hospitality: Tbilisi craft brewery and beer garden Ishvi is set to open on October 9, with annual production capacity of up to 365,000 litres.

World Bank Update: Georgia’s 2026 growth forecast was lifted to 7% (up from 5% in June), with the Prime Minister citing positive momentum and noting it is 2.6 times the average for other EU candidate countries. Government Reshuffle: Economy Minister Mariam Kvrivishvili was appointed Vice Prime Minister, tasked with further strengthening the economic portfolio. Energy & Transport Costs: Georgia moved ahead with red-dyed diesel tax relief, waiving state penalties for highway use through Nov. 5, while the broader federal framework is framed as a deferral, not a permanent cancellation. Business & Finance: Transparency International Georgia alleges Iberoil bought state land at auction and, days later, its co-owners donated 160,000 GEL to Georgian Dream—raising fresh questions about state assets and political influence. Regional Connectivity: Azerbaijan and the Netherlands discussed Middle Corridor cooperation, while Georgia’s wider corridor role continues to draw attention from international partners. Environment & Agriculture: Kyrgyzstan and Georgia held talks on green finance, biodiversity protection, and climate project cooperation.

Automotive Investment: GM and Lynx Motors officially announce Cadillac’s entry into Georgia, with a new showroom planned on Tbilisi’s University Street and Lynx set to run local operations, aiming to boost premium-luxury jobs and services. SME Finance: BSTDB signs an EUR 25 million SME facility with Basisbank to support Georgian businesses. Diplomacy & Trade Links: Azerbaijan’s FM Jeyhun Bayramov meets Georgia’s ambassador-designate Giorgi Zakarashvili, highlighting cooperation on energy, transport (including the Middle Corridor), and regional stability. Public Spending Scrutiny: Reports say state-owned “Starring Georgia” received 42.6 million lari subsidy ahead of Kanye West’s Tbilisi show, raising questions about transparency around artist payments and procurement exemptions. Regional Connectivity Watch: A World Bank-backed assessment says the Middle Corridor could quadruple Asia-Europe freight by 2040, but warns border delays and fragmented systems still block full gains. Health & Safety: Russia reports no confirmed plague cases after a lab worker’s death in Siberia, while international agencies say there’s no sign of sustained person-to-person spread.

Banking & SME Finance: Credo Bank and the Asian Development Bank signed a GEL 120m loan agreement to expand financing for micro, small and medium enterprises across Georgia’s regions, including women-owned businesses. Consumer & Industry Expansion: Carlsberg is extending its PepsiCo tie-up by acquiring PepsiCo bottling businesses in Georgia and Armenia, aiming to build a larger South Caucasus beverage platform; the Armenia deal still needs regulatory approval. Regional Investment & Reforms: Reuters reports that Uzbekistan’s reforms are drawing investors back to banking, with TBC Bank’s Uzbekistan unit considering an IPO as digital payments and market access improve. Labor Mobility Policy: Israel will stop private recruitment of Sri Lankan and Indian construction workers from Jan 1, 2027, while keeping a list of approved countries that includes Georgia. Political Risk & Business Climate: Georgian Dream has asked the Constitutional Court to ban five opposition parties, a move that could add uncertainty for the investment and policy environment ahead of elections. Trade & Connectivity: The World Bank says the Middle Corridor needs $55bn+ by 2040 to meet demand, underscoring the stakes for Georgia’s logistics role.

Retail Expansion: Japanese discount chain Daiso plans to enter Georgia, with first stores slated for Tbilisi’s Gldani City Mall in late Nov/early Dec and Tbilisi Central by end-December, aiming for about seven outlets by 2027. Banking & SME Support: Credo Bank and the Asian Development Bank signed a GEL 120m agreement to back MSMEs in Georgia. Trade & Logistics: A World Bank report says the Middle Corridor needs over $55bn by 2040 to boost freight volumes and cut travel times, stressing that reforms at borders and ports matter as much as infrastructure. EU Relations: Tbilisi Mayor Kakha Kaladze said Georgia wants “friendly, partnership-based” EU ties and rejected calls for sanctions, arguing the country did not join sanctions and harmed no economy. Energy & Industry: Hema Energy is pursuing EPC projects in Oman with Azerbaijan’s BBG Energy, targeting small-to-medium tenders and 90–120 jobs. Public Finance: Georgia extended state healthcare and monthly socio-economic support for Ukrainian nationals and residents in Georgia through 1 Jan 2027. Sports & Culture: The 75th Savannah Greek Festival runs Oct 8–10, while Shaki hosts its 5th international theatre festival Oct 1–5.

EU Relations: Tbilisi Mayor Kakha Kaladze said Georgia wants “friendly, partnership-based” ties with Europe and rejected calls for sanctions over non-participation in EU sanctions, arguing the stance is hostile toward Georgians. Ukrainian Aid: Georgia extended state-funded healthcare and monthly socio-economic support for Ukrainians in the country through 1 Jan 2027. Trade & Logistics: Georgia, Kazakhstan and Azerbaijan rolled out the Digital Trade Corridor platform on the TITR, cutting customs transit clearance from 8 hours to 30 minutes and lowering cargo delivery times from 38 days to 13–17, targeting 10–12 days. Middle Corridor/Connectivity: PM Irakli Kobakhidze said Armenia’s TRIPP route is meant to complement Georgia’s Middle Corridor, not compete with it, as regional freight demand rises. Azerbaijan Pharma Investment: Azerbaijan opened a $113.9m Gen Pharma facility in Pirallahi Industrial Park to boost local pharmaceutical production and reduce import dependence. Tbilisoba Honors: Kakha Kaladze named 32 citizens honorary citizens of Tbilisi. Public Safety: Georgia’s Justice Ministry confirmed a prisoner died in Rustavi prison No. 17; an investigation is underway amid relatives’ doubts.

Transport & Trade Strategy: Georgian PM Irakli Kobakhidze said Armenia’s TRIPP route is meant to complement Georgia’s Middle Corridor, not compete with it, citing a sevenfold rise in Middle Corridor cargo turnover since 2020 and arguing the region needs more capacity as freight grows. Diplomacy & Regional Tensions: Georgia summoned Iran’s ambassador over remarks about Queen Ketevan, with the Foreign Ministry saying the comments went beyond diplomatic norms and affected public sentiment. Media & Governance: Parliament Speaker Shalva Papuashvili urged Brussels to condemn last year’s storming of the presidential palace, saying court verdicts have been delivered and organizers are serving sentences. Prison System Claims: Georgian Dream’s Kakha Kaladze rejected prisoner Giorgi Davitadze’s allegations of sexual assault by guards, calling it a routine, orchestrated process. Germany-Georgia Relations: Germany’s ambassador warned that German-backed academic and political foundation activities in Georgia have been disrupted, with Ilia State University and foundation offices affected. Black Sea Security: Romania reported 161 naval mines neutralized in the Black Sea since Russia’s invasion, with Georgia and Russia each neutralizing one.

Parliament & EU Relations: Shalva Papuashvili marked one year since the Oct 4, 2025 storming of the presidential palace, urging Brussels to condemn the assault, stop backing “radical groups,” and repeal resolutions he says infringe on Georgia’s sovereignty. Prison & Human Rights: Kakha Kaladze said prisoner Giorgi Davitadze’s claims of sexual assault are part of an “orchestrated process,” arguing Georgia’s prison conditions have improved since 2012. Civil Society & Funding: The Friedrich Naumann Foundation closed its Tbilisi office, citing Georgia’s grant-law restrictions after its permission application was rejected. Regional Connectivity & Trade: Coverage highlights the US push for Eurasian routes, with TRIPP and Trans-Caspian plans framed as moving from concept to commercial preparation, while Armenia’s Pashinyan stresses removing barriers to exports and transit within the EAEU. Adjara Infrastructure: Adjara officials discussed ongoing and planned transport, school and municipal projects with the central infrastructure ministry, stressing coordination for timely delivery.

Regional Connectivity: A new wave of US-backed connectivity planning is putting Armenia’s “TRIPP” rail link and the wider Middle Corridor into sharper focus, with US officials framing it as a commercial shift toward Caspian-to-Europe trade. South Caucasus Strategy: Russia is also pushing “Putin’s Route,” reviving talk of rail/road links via Abkhazia and Georgia to keep leverage over regional transit flows. Georgia–Germany Relations: Germany’s ambassador says German political foundations and Ilia State University support are under strain after Tbilisi actions; the Friedrich Naumann Foundation has closed its Tbilisi office after a rejected grant application. Local Economy & Infrastructure: Adjara officials met Georgia’s infrastructure ministry to coordinate highways, schools and Batumi urban projects, stressing central-local execution. Business & Trade Signals: Georgia’s mandatory travel insurance rule for foreign visitors in 2026 is highlighted, alongside broader regional logistics and shipping risk concerns around the Black Sea.

NGO & Governance: Friedrich Naumann Foundation has shut its Tbilisi office, saying Georgia’s grant law and government actions made it impossible to keep operating, after its permission request was rejected in July. Local Economy & Tourism: Tbilisoba returns Oct 3-4 with food, music and cultural events across multiple city venues, plus masterclasses and tastings. Energy & Transport Costs: Diesel price pressure is squeezing truckers, with drivers reporting fill-ups topping $1,000 and many struggling to stay afloat. Regional Connectivity: Armenia’s PM Nikol Pashinyan said EAEU trade remains blocked by “administrative barriers,” calling for removal of obstacles to Armenian exports and transit, while also pushing TRIPP rail links. Infrastructure in Adjara: Adjara officials discussed major road, school and municipal projects with the national infrastructure ministry, stressing tight central-local coordination. Trade Enforcement: Georgia’s Revenue Service says it stopped illegal cigarette and medicine shipments from Georgia to Azerbaijan worth over 1.06 mln GEL. Business & Investment: Thailand’s CP Group met Georgian officials about potential participation in Anaklia port and Vaziani airport projects, alongside energy and “green” cooperation.

Energy & Trade Connectivity: Türkiye’s defence minister Yasar Guler said Caucasus security is inseparable from Türkiye, Azerbaijan and Georgia, pointing to trilateral cooperation and shared responsibility for energy and transport projects. Regional Transport & Logistics: Armenia’s PM Nikol Pashinyan pushed TRIPP under the “Crossroads of Peace” plan, calling for removal of EAEU export and transit barriers; the project aims to link Armenia and Azerbaijan by rail and connect the Persian Gulf to the Black Sea. Georgia Business & Environment Policy: The environmental ministry met businesses on amendments to the Environmental Assessment Code and the Law on Industrial Emissions, aiming to improve standards while speeding procedures and adjusting service fees. Agriculture Exports: Georgia exported $28.1m of peaches and nectarines from May 1 to Sept 13, with 22,800 tonnes shipped and quality/variety upgrades flagged for the next push. Public Finance & Inflation: Georgia’s diesel prices jumped 54% year-on-year in September while overall inflation stayed at 5.6%, with fuel contributing 2.2 percentage points. Governance & Media: ComCom fined Formula TV 10,000 GEL for alleged impartiality violations, the fourth sanction since April, with the broadcaster vowing to appeal. Cross-border Enforcement: Georgia’s Revenue Service said it stopped illegal cigarette and medicine shipments from Georgia to Azerbaijan worth over 1.06m GEL. Foreign Funding Pressure: German political foundations Konrad Adenauer Stiftung and Friedrich-Naumann-Stiftung closed Tbilisi offices after grant applications were rejected under Georgia’s new Law on Grants.

Azerbaijan-Georgia-Türkiye Defense Talks: Azerbaijan’s Defense Minister Zakir Hasanov said the trilateral format is key for regional stability, after the 13th meeting with Turkish and Georgian counterparts in a sign of deepening security cooperation. Middle Corridor Momentum: The World Bank Group launched a new “Middle Corridor: Next Stage” connectivity forum, highlighting how better logistics, customs and digital links could boost trade and cut travel times across the Trans-Caspian route. Fuel Price Pressure in Georgia and Abroad: A CNN report says US states are moving to curb diesel and gasoline costs amid Iran-war supply disruptions; Georgia is among those suspending fuel-related rules to ease prices. Georgia-US Protocol Debate: MP Giorgi Sharashidze criticized the government’s Trump handshake photo, arguing no substantive, business-focused meeting took place. Sanctions and Finance: The US Treasury sanctioned Russia-linked A7 Network after FinCEN traced over $17bn in transactions tied to sanctions evasion. Legal Update: Mikhail Timofeyev, sought by Russia, was released on GEL 50,000 bail in Georgia with strict movement and reporting conditions. UK Targets Georgian Disinformation: The UK imposed asset freezes and travel bans on four Georgian nationals tied to pro-Russian propaganda networks.

Middle Corridor Push: The World Bank says Trans-Caspian “Middle Corridor” upgrades could more than triple trade, cut transit times by two-thirds, lift regional GDP by 3.3% and create 2 million jobs by 2040—Georgia’s GDP forecast rises 3.6% by 2040. Logistics Investment: German Rhenus Group plans 14 terminals along the corridor via Uzbekistan, Kazakhstan, Azerbaijan and Türkiye, linking to its Europe network. Energy/Trade Diplomacy: Azerbaijan’s economy minister targets $20bn regional trade with Central Asia and joint production under a “Made in Central Asia” brand. Tbilisi Spending & Services: Georgia’s 2027 consolidated budget is set at GEL 37.531bn; Finance Ministry also confirms public-sector salary hikes from 2027. Media & Sanctions: UK-sanctioned Imedi TV reported 2025 accumulated losses near GEL 500m, with “going concern” doubt flagged by auditors. Legal/Anti-Corruption: Former State Security Service deputy Levan Akhobadze was released on 500,000 GEL bail as prosecutors cited reduced risk of witness influence. Real Estate: Ambassadori Island Batumi signed a UAE partnership with ONE Development for a $200m high-end complex. Public Life: Tbilisoba 2026 runs Oct 3–4 across multiple city venues, with City Hall authorized simplified procurements up to GEL 3.11m.

Tbilisi Metro Modernisation: Tbilisi Mayor Kakha Kaladze says the city will receive 111 new metro cars via a project supported by the Georgian government and the AIIB, with the first modern train expected in 2026 after a 34-year gap. Budget Watch: Georgia’s Finance Ministry released draft 2027 budget parameters: consolidated revenues of GEL 37.531bn, real growth forecast at 5.0%, inflation returning to 3.0%, and a deficit target of 2.5% of GDP. Real Estate & Investment: Ambassadori Island Batumi signed a $200m deal with UAE developer ONE Development at LIVEX 2026 in Abu Dhabi, positioning the project as an AI-integrated, high-end complex. Regional Connectivity: AIIB-related coverage highlights continued push for infrastructure and connectivity financing across the region, including Georgia-focused investment plans. Energy & Trade Context: Reports also point to Black Sea and Middle Corridor logistics as a growing route for fuel and trade flows, with Georgia and neighbors mentioned as potential supply links. Governance & Compliance: Separate reporting notes Georgia’s customs control procedures restored at Kazbegi checkpoint, alongside ongoing scrutiny of cross-border processes.

World Bank & Middle Corridor: A new World Bank report says Trans-Caspian Corridor investments could more than triple trade volumes by 2040, cut transit times in half, add about 2 million jobs, and require over $25bn in infrastructure plus another $30bn for logistics, terminals and digital systems. EU sanctions & Georgia transit: German-Austrian-Belgian investigators say suspects routed 53 passenger cars and six tractor units to Russia via third countries including Georgia, freezing assets worth about €7m. AIIB & regional connectivity: Georgia’s finance officials and partners keep pushing infrastructure finance; Nepal’s finance minister returned from AIIB’s Doha meeting where he was elected vice-chair, underscoring roads, power and communications investment. Tbilisi transport upgrade: Tbilisi Mayor Kakha Kaladze says the metro will be renewed with 111 new railcars, the first major addition in decades. Energy & prices: Dagestan’s fuel shortage and high prices are blamed on refinery shutdowns and supply dependence, while drivers say regulators aren’t doing enough. Politics & economy debate: Ex-PM Irakli Garibashvili and MP Giga Parulava trade accusations over who caused Georgia’s crisis and recovery. Sports & social backlash: A women’s league match in Guria was abandoned after players protested a club linked to an acquitted rape case.