Georgian gov’t ready for arbitration with Anaklia Development Consortium, welcomes potential European, American investors
The Government of Georgia canceled the agreement with the Anaklia Development Consortium to build the Anaklia Deep Sea Port on January 9, 2020. Photo: Anaklia Port.
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The Georgian government says that the Anaklia Development Consortium (ADC) has the right to start arbitration but that the government is not going to renew the agreement with the ADC to build the Anaklia Deep Sea Port.
The Anaklia Development Consortium has not fulfilled the obligations it had based on the agreement with the government...and the government had no other way out but to cancel the agreement,” said Minister of Economy Natia Turnava earlier today.
Turnava noted that the construction of the Anaklia Deep Sea Port is still a priority for the Georgian government and they welcome European or American investors to get involved in the project.
We are preparing a new tender. We want this tender to be at a very high level, so we want the consultants of the international financial institutions to be involved in it,” said Turnava.
Turnava noted that negotiations are underway with the European Bank for Reconstruction and Development (EBRD). She also noted that the government might talk to the World Bank and International Finance Corporation (IFC) and other financial institutions that have experience helping countries hold a tender to attract investors.
Regrettably the government of Georgia has not yet engaged in any meaningful way in discussions with ADC and has not taken any constructive steps to avoid arbitration”, Anaklia Development Consortium said on February 12 adding that, therefore, it “will be left with no choice but to arbitrate its dispute with the government of Georgia.”
The Government of Georgia canceled the agreement with the Anaklia Development Consortium to build the Anaklia Deep Sea Port on January 9, 2020.
The consortium has been unable to obtain the needed $400 million in loans from international financial institutions and $120 million from potential investors by the official expiration of the term limits at the end of 2019.
The Anaklia Development Consortium won a state tender to construct the port and signed a deal with the government in 2016 with TBC Holding as its principal partner, but has faced problems in attracting the $2.5 billion in funds needed to construct the port.
Construction of Anaklia Deep Sea Port started in 2017.
Anaklia Development Consortium is going to appeal to the International Court of Justice in response to the Georgian government’s cancellation of the investment agreement with the consortium to build the Anaklia Deep Sea Port.
The Georgian government will begin procedures to cancel the investment agreement signed with the Anaklia Development Consortium on October 3, 2016 to build the Anaklia Deep Sea Port. The consortium has been unable to obtain the needed $400 million in loans from international financial institutions and $120 million from potential investors by the official expiration of the term limits at the end of 2019.
The Anaklia Development Consortium, which has been overseeing the Anaklia deep sea port since 2016, announced yesterday that it “remains committed to finding a way forward for the future success of the project” and hopes that it may be possible to resolve its dispute with the Government of Georgia amicably.
The Georgian government will discuss the investment agreement signed with Anaklia Development Consortium to build the Anaklia Deep Sea Port as the consortium was unable to obtain the needed $400 million in loans from international financial institutions and $120 million from potential investors by the official expiration of the term limits at the end of 2019.
US congressman Adam Kinzinger says that he believes in the government of Georgia when they say the Anaklia deep sea port project is important for them, and has thus urged the government to allow American investments into the port project as soon as possible during an interview with the Georgian bureau of Voice of America.
The Anaklia Development Consortium and major foreign investor Bob Meyer have filed independent arbitration claims against Georgia on July 29 over their infringed rights in the Anaklia Port project.
Georgian Economy Minister Natia Turnava has commented on the Anaklia Development Consortium’s decision to file arbitration claim against Georgia and said that the consortium is trying to politicise the issue and prevent the government from finding a new investor.
The Anaklia Development Consortium (ADC), the company originally selected by the government of Georgia to develop the Anaklia Port project, has released a statement today which claims the government ran a campaign ‘to undermine the project by dissuading potential project investors, lenders, contractors and suppliers from joining the project in order to kill it'.
Neqsol Holding, a shareholder of Georgian internet provider Caucasus Online, is going to sue the Georgian government in the International Court of Arbitration for appointing a special manager to the board of Caucasus Online, who has been given the authority, amongst other things, to dismiss directors, members of the supervisory board and employees of the company, and suspend or restrict its right to distribute.
The Anaklia Development Consortium (ADC) says that the Georgian government admits that a new tender to build Anaklia Port is likely to fail as there is a risk that an investor may not be found due to the potential arbitration dispute between the Georgian government and the ADC.
The Georgian government will start the process of selecting a new potential investor for the Anaklia Deep Sea Port project in the near future, Georgian Prime Minister Irakli Garibashvili announced earlier today.