The FINANCIAL — Asian Development Bank (ADB) plans to acquire a 30% stake in the Poti Sea Port company, owned by the RAK Investment Authority (UAE), RZD-Partner.Ru reported citing a source at the ADB office in Georgia.
The ADB representatives have been currently in negotiations over the deal details with the port owners, UkrAgroConsult news magazine quoted news source.
In 2008 RAK Investment Authority acquired for $155 million a 100-percent government stake in Poti Sea Port, as well as the territory adjacent to the port.
Georgia has been a member of ADB since February 2007. During this period Georgia has received more than $200m of the bank’s loan to support the country’s budget and to fund infrastructures project. In 2010-2011 ADB plans to allocate another $1 billion credit.
The Poti seaport is a cross point of the Trans-Caucasian Corridor/TRACECA, a multinational project which goes through Tashkent – Ashgabat – Türkmenbaşy – Baku and Poti to the Romanian port of Constanţa and Bulgarian port Varna, thus linking the landlocked countries of Central Asia and the Caucasus to Eastern Europe.
Owning Poti Sea Port enables control of strategic links between many countries.
Currently 100% of stake ownership in PSP belongs to RAK Investment Authority. Earlier in 2008 RAK Investment purchased the controlling 51 percent stake in the port from the government for USD 90 million, plus a further 300 hectares of land in its vicinity.
In December of 2008 RAK Investment bought the remaining 49 percent of Poti Sea Port for USD 65 million. The creation of a new FEZ was officially inaugurated by the President of Georgia Mikheil Saakashvili on April 15, 2008.
Georgian government said UAE’s Ras Al Khaimah (RAK) emirate plans to develop a free industrial zone (FIZ) in a 49-year management concession, and to manage a new port terminal.
During August Poti Port was bombed by Russian warplanes. The sum loss that was caused by the Russian occupation of Georgia was approximately GEL 5,000,000 (USD 3,012,048).
“Despite Russian aggression in August, 2008 was successful for the Poti Sea Port (PSP) Corporation. The total throughput in 2008 was increased by 4.3% compared with the previous year’s results and reached 8.08 million tonnes. The Sea Port had an over-fulfilment of a plan by 80,000 tonnes. Container handling increased by 12% in comparison with 2007, making 209 614 TEU,” Eduard Machavariani, PSP, told The FINANCIAL in 2009.
Poti FIZ was expected to generate direct employment of 5,000 to 10,000 people and an inflow of USD 1 billion in the region.
According to the Rakia Georgia website the advantages of the Free Industrial Zone include no taxes in import and export of goods for the companies registered inside the zone and no tax on profits. GSP plus agreement with EU and Turkey enables duty free exports from Georgia on more than 750 categories of goods. Companies registered in Poti FIZ will pay fewer taxes, including flat tax rates on personal income (12%) and corporate profits (20%).
Rakia Georgia Free industrial zone LLC Company was established in June 2008 by RAK Investment Authority. Its own free trade zone consists of three business parks for trading and services, for heavy and SME industries, media activities, IT services and warehousing of raw materials. Established in 2005, the zone has more than 1,500 registered companies with trade turnover of around USD 8 billion within two years.