Beijing-backed bank to finance Chinese firms in Georgia with $1bn of capital

By bne IntelliNews May 19, 2017

China will set up a bank with $1bn of capital to finance Chinese companies doing business in Georgia, according to a bilateral memorandum of understanding signed by the Georgian government and China Energy Company Limited (CEFC) in Beijing on May 15.

The memorandum was signed during a visit to Beijing by Georgian Economy Minister Dimitry Kumsishvili on the same day a free trade agreement  (FTA) between the two countries entered into force.

Tbilisi and Beijing have moved fast to strengthen ties in recent years. Georgia is important to China because it is a key link in the New Silk Road, or One Belt, One Road, trade transport infrastructure scheme that the Asian country is seeking to promote, thanks to Georgia's access to the Black Sea. Meanwhile, China is important to Georgia's efforts to diversify its diplomatic and commercial ties, especially since its 2008 war with Russia undermined relations with Moscow. 

"We asked the Chinese side to launch a new project under the One Belt, One Road initiative to support Chinese private companies that will be represented in Georgia," Kumsishvili said after meeting with Chinese Deputy Prime Minister Wang Yang, according to

According to the agreement, CEFC will set up a free industrial zone at Poti Port in Georgia, becoming the second Chinese company to do so after Hualing Group. In 2015, Hualing Group was the largest foreign investor in Georgia, with investment capital of $600mn. 

Related Articles

European Parliament calls on Baku to release abducted journalist

The European Parliament on June 15 adopted a resolution calling on Azerbaijani authorities to release jailed journalist Afgan Mukhtarli immediately and to drop the "bogus charges" against him. ... more

LSE IPO to value Domino’s Pizza operator in Turkey, Russia at up to €379mn

DP Eurasia, master franchisee of Domino’s Pizza in Turkey, Russia, Azerbaijan and Georgia, announced on June 15 that the price range for its planned initial public offering (IPO) on the London ... more

Sluggish Azerbaijan drags down World Bank South Caucasus growth outlook to 0.1%

The three small economies of the South Caucasus – those of Azerbaijan, Georgia and Armenia – are expected to post growth of just 0.1% this year, the World Bank said in the June edition of its ... more