Ministry Of Economy And

Sustainable Development OfGeorgia

Opportunity for developing logisticscenters in Georgia

What Georgia offers

A politically stable investment

destination

Corruption - free and

transparent business

environment

Free Trade Agreements with

2.3 bln market

No corporate profit tax on

reinvested profit

Skilled and competitively

priced labor force

Stable and growing financial

sector

Business Friendly Environment

Georgia is one of the leading countries in the world in terms ofstarting a business, dealing with

bureaucracy and the number of procedures required to launch and operate an enterprise

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Doing Business

Up from #112 in 2005

N 9

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Economic Freedom

Majority of Georgia’s reforms are oriented on the development offree,

open and transparent, private-sector driven

market economy

Up from #99 in 2005

N 13

Corruption Perception

Alongside recognitions as the top reformer in the world, Georgia is the

leader in the widerregion in terms of fighting with corruption. Corruption index is lower than in number of EUstates.

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Up from #130 in 2005

N 44

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Crime Index

Georgia is named asone of the safest place in the world according to the

Crime Index by the Numbeo

World

N 8

2017BB-

StableBa2-

StableBB-

Stable

No Corporate Profit tax on retained profit: From 2017

profit tax is deductible only in case of profit distribution9th Least Tax Burden Country in the World

Import Tax-0%, 5%, 12%

Corporate Profit Tax–

15%

Personal Income Tax–

20%VAT – 18%

Property Tax –up to 1%

Foreign-source income of

individuals fully exempted

No wealth taxNo payroll tax or

social contribution

Only 6 flat taxes today

Double Taxationavoidance with54 countries

Growth Friendly Tax Environment

Excise Tax –depends on

goods

Regional Hub for Doing Business

80% of good free from import tariff

Very simple and service oriented customs policyand

administration

No quantitative restrictions or tariffbarriers

Most FavoredNation (MFN) since2000

CIS - FTA EFTA - FTA

Turkey - FTA EU - DCFTA

China - FTA US, Canada, Japan - GSP

Overview of Georgia’s Logistics Sector

Georgia-Regional LogisticsHub

▪ Leveraging its location, Georgia’s transport economy can benefit from large addressable transit flows, growing

economies and landlocked resources

▪ Ports are cost-competitive vs. alternative routes

▪ Georgia’s existing transport economy is transitbased

▪ Upgrading regional transportinfrastructure

▪ Alternative route through Georgia takes 7-9 days from China to Europe instead of 45 days oftraditional route

Sea Port Roads and Railway International Airports

Poti Sea Port(APMTerminals)

Batumi Sea Port(BIH)

Kulevi Terminal(SOCAR)

Supsa Terminal(BP)

Georgian Railway - TotalLength:

2,083.9 km

Road - Total Length: 20,329 km

Tbilisi International Airport (TAV)

Batumi InternationalAirport(TAV)

Kutaisi International Airport(UAG)

Planned Planned Planned

• New Deep Sea Port-Anaklia • Georgian Railway ModernizationProject

• Tbilisi Railway Bypass• East-west highway• Rehabilitation ofexisting

infrastructure

Tbilisi International Airport• International Cargoterminal

Kutaisi International Airport• Apron extension• Cargo Terminal

• Development of the logisticcenters (Tbilisi and Kutaisi)

✓ Strategic Geographical Location in the Caucasus and along the

Silk Route

✓ Georgia’s Free Trade Agreements (2.3 bln market) offers new

business opportunities

✓ Government’s strong commitment to position Georgia as a

regional logistics hub

✓ Ambitious Transport Infrastructure Improvement Projects

✓ First Logistics Centres in the Caucasus offer first mover

advantages

✓ Excellent access to transport infrastructure and logistics network

Why Logistic center project?

Two Excellent Logistics Centres Locations in Tbilisi and KutaisiRegion

• Project objectives:

✓ development of a modern andstate-of-the-art Logistic centers inGeorgia

✓ Capability logistics Region

to position itself as ahub in South Caucasus

✓Settlement of local and international logistics companies

• Dornier Consulting Internationalcarried out a feasibility study for the creation of logistics centers in Georgia.

• Selecting the locations were selectedbased on multi-criteria analysis atmacro and micro levels.

Logistics Centre Tbilisi - Location

Main Objectives and Key figures

▪ First capable Logistics Hub for East Georgia as well as South Caucasus Region

▪ Area size 64.1 HA

▪ Southeast of Georgia’s capital Tbilisi

▪ The site is well connected to the railway network

▪ Implementation of a Rail-Road Container Terminal (about 8 ha)

▪ Start of operation in 2021

Territory for the logisticcenter

Distances:• Tbilisi center – 25 Km• Tbilisi International Airpot – 20 Km• Armenia – 50 Km• Azerbaijan – 40 Km• Turkey - 245 Km

Conceptual Design: Final Development Stage Land Plot I

Figures: Land Plot I and share on Land Plot II

Attribute Figures

Area Size 52.7 ha

Building Area 133,800 m²

Throughput

Capacity957,600 t/a

CAPEX

80.4

Million USD

Logistics Centre Tbilisi - Final Development Stage

Attribute Figures

Area Size 7.9 ha

Throughput

Capacity59,200 TEU/a

Capex15.2

Million USD

Conceptual Design: Final Development Stage Land Plot II with Container Terminal (CT)

Main Functional Modules

LC Service Centre:LC management, administration, control and communications, gas

station, garage, canteen + restaurant,hotel

Logistics Service Facilities: General warehousing, freight forwarding facilities,

temperature guided warehousing, refrigerated and chilled warehousing, bonded warehouse,

hazardous goodswarehouse

Logistics intensive Industries and Trade: Settlement of logisticsintensive

production or processing facilities

Logistics Centre Kutaisi - Location

Main Objectives and Key figures

First capable Logistics Hub for West Georgia

Area size 46 HA

▪

▪

▪ Excellent location adjacent to Kutaisi International Airport

▪ Optional further implementation of a Rail-Road Container Terminal(about 2.5 ha)

▪ Start of operation in 2020

Territory for the logisticcenter

Country Distances:• Kutaisi center – 30 Km• Kutaisi International Airport– 1 km• Poti Port – 75 Km• Turkey - 210 Km• Armenia – 300 Km• Azerbaijan –315 Km

Conceptual Design: Final Development Stage

Logistics Centre Kutaisi - Final Development Stage

Attribute LC Stage1 LC Stage2 Stage 1+2

Area Size 19.1 ha 27.0 ha 46.1 ha

Building Area 41,800 m² 92,600 m²134,400

m²

Throughput

Capacity 298,000 t/a672,800

t/a

970,800

t/a

CAPEX27.2

Million USD

45.4

Million

USD

72.6

Million

USD

Overview Development Stages 1 + 2: Key Figures Logistics Centre

Main Functional Modules

LC Service Centre: LC management, administration, control and communications, gas station, garage, canteen + restaurant,hotel

Logistics Service Facilities: General warehousing, freight forwarding facilities, temperature guided warehousing, refrigerated and chilled warehousing,

bonded warehouse, hazardous goodswarehouse

Logistics intensive Industries andTrade: Settlement of logistics intensive production or processing facilities (agriculture products and food processing)

How to apply for the Project?

Government of Georgia intends to announce an Expressionof Interest to select investor for the Logistics centersdevelopment

After announcement of Expression of Interest detailedfeasibility Study will be uploaded on the official web-site:www.economy.ge

Ministry Of Economy And

Sustainable Development OfGeorgia

www.economy.ge