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Source: Anaklia Development Corporation

Tbilisi, Georgia (PortSEurope) April 3, 2022 – The Anaklia deep sea port project in western Georgia will go head and there is renewed investor interest, according to Levan Davitashvili, head of the Ministry of Economy & Deputy Prime Minister.

In January 2020, the new port project contract with the Anaklia Development Consortium (ADC) was cancelled by the government surrounding concerns around financing and project progress. The deadline for obtaining the funding had been postponed six times, the government claims. In May 2021, the Netherlands’ Maritime & Transport Business Solutions (MTBS) was to update the business model and suggest next steps.

PortSEurope: Anaklia port project thrown into doubt by government cancellation

PortSEurope: Anaklia port business model to be revised by MTBS

The Russian invasion of Ukraine

It might be that the government has been influenced by the Russian invasion of Ukraine. Starting on February 24, 2022, one of the first and almost immediate effects was the closure of all Ukrainian ports on the Black and Azov Seas. This was due to either Russian naval blockades or the port-cities coming under attack by the Russian military.

The worst-case scenario is probably the Ukrainian Azov Sea port of Mariupol. With a population of around 450,000 people, the city has strongly defended itself. The result is that the Russian military, unable to take over the city, has bombed it relentlessly, and to all intents and purposes, has razed the city to the ground. It probably has no functioning port infrastructure.

Depending on the outcome of the invasion, it seems that most of these Ukrainian ports could be out of action for years rather than months. The cargo previously transported via Ukrainian ports needs to find other routes, and Georgia might sense that its Black Sea ports are in a position to take a share of the cargo. One option is to restart the Anaklia deep sea port project.

Other countries are also reacting, looking to Georgian ports to cargo transport their cargo. Georgia’s ports form part of the Trans-Caspian International Transport Route (TITR – Middle Corridor).

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The Anaklia deep sea port project

The Anaklia project was embroiled in both political and economic intrigue. Simply put, a new deep sea port on the Georgia’s Black Sea coast could become a transport hub for cargo moving from Asia to Europe. Cargo would arrive in Anaklia by rail and be transported by sea to ports in the western countries of the Black Sea for onward transport to Europe. This would include Constanta in Romania and the Bulgarian ports of Burgas and Varna. A further option is transporting goods through the Bosphorus Strait onwards to various Mediterranean Sea ports.

Being a deep sea port, Anaklia could handle the newest, largest capacity container ships, a significant advantage over neighbouring ports.

However, there was and is a range of conflicting interests. The various political parties in the government have their own interests, and in some cases linked to specific businesses and maybe even some interests of other countries.

Russia does not want to see a new port to rival its Black Sea port of Novorossiysk, and certainly not a port that may welcome naval vessels for NATO and western countries. Georgia would like to become a member of NATO, a move that the Kremlin will strongly resist.

PortSEurope: Analysis – In a win for Russia, Anaklia deep sea port project descends into chaos

The Port of Poti

Another issue is the southern Georgian port of Poti, controlled by the Maersk’s APM Terminals. In 2011 APM Terminals said that it wanted to develop a deep sea port. Poti, only 35 kilometres south from Anaklia, is currently the largest sea port in Georgia, able to handle 6–6.5 million tons of cargo per year. Its capacity has never been utilised. It presently deals with 85% of the country’s container traffic.

Last April, Anaklia deep sea port was again put in doubt after the announcement of Georgian government support for a rival project in the nearby port of Poti. There was an almost immediate denial by the Economy Minister, claiming that the document for the construction of a deep sea port in Poti has been cancelled.

There have been recent calls for the government to support both Anaklia and Poti, as there would be enough cargo for both ports.

The Future

It’s difficult to see the Anaklia deep sea port project progressing, as the interests which have prevented it up to now are still present and the Georgian government continues to be influenced by Russia. However, the lure of high cargo volumes over a long period of time may drive efforts to restart the project.

PortSEurope: News and Analysis about the Anaklia deep sea port project

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