Georgian Government Triumphs in Arbitration Over Anaklia Port Project
In a significant legal victory for the Georgian government, the International Court of Arbitration of the International Chamber of Commerce (ICC) in Paris has ruled against the Anaklia Development Consortium (ADC) concerning the construction of the country's first deep-sea port on its Black Sea coast. The ruling, issued on July 29, comes as the ADC sought to reclaim its investment following the termination of its contract by the Georgian government in 2020. This decision lifts a major legal hurdle from the ambitious Anaklia port project, an initiative viewed as crucial for enhancing Georgia's trade capabilities and infrastructure.
The decision to award the project to a consortium of Chinese state-owned entities was announced by Georgia's Minister of Economy and Sustainable Development, Levan Davitashvili, in late May, signaling a revival of the deep-sea port initiative. This move, however, was met with disappointment from the ADC, which argued in its statement that the Georgian government had acted inappropriately and undermined the port project to the detriment of the Georgian people. The ADC had initially partnered with prominent investors, including Mamuka Khazaradze and Badri Japaridze, co-founders of Georgia's TBC Bank, alongside investors from the Netherlands, the United States, Britain, and Bulgaria.
The events leading to the ICC ruling have raised questions about political pressure on the consortium’s leadership. Following the government's termination of the contract, Khazaradze and Japaridze faced various charges, which international observers and rights groups indicated could be indicative of a politically motivated campaign. In stark contrast, the Georgian government maintained that its actions were justified and lawful. Justice Minister Rati Bregadze expressed that the arbitration confirmed the government acted within its legal rights when it terminated the investment agreement with the ADC.
Following the annulment of the ADC's contract, the Georgian state has committed to constructing the Anaklia port predominantly with its own funds, announcing a new bidding process wherein the state would hold a 51% stake while an external investor would retain 49% control. This new arrangement aims to rejuvenate progress on the port, which is considered a strategic asset capable of accommodating larger vessels and facilitating improved logistics and trade routes within the region.
While the ICC's ruling effectively resolves the ADC's primary legal challenge, the situation remains fluid, as a Dutch investor associated with the consortium has initiated a separate claim in a different court, which is still pending. Details regarding the agreement with the newly appointed Chinese consortium remain sparse, but the project is linked to broader infrastructure goals endorsed by both the European Union and China, aiming to enhance regional and global trade networks.
The future of the Anaklia deep-sea port holds immense potential not only for logistical advancements but also for bolstering Georgia's position as a critical player in international trade dynamics. As preparations advance under the new consortium, stakeholders and policymakers will be keenly observing the developments surrounding this pivotal project.
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