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Georgian Post to be gradually privatized

By Natalia Kochiashvili
Thursday, February 11
Georgian Post held a presentation on its activities in 2020, where it was noted that the company served 2,524,201 retail customers and up to 3,000 corporate clients.

Compared to 2019, the number of shipments sent from Georgia increased at the expense of overland parcels, and in 2020 the import of overland parcels amounted to 3,000,000 kg and exports to 286,000 kgs.

At the press conference held after the presentation of the Georgian Post 2020 report, the media asked the General Director of the Georgian Post Levan Chikvaidze what the financial performance of the company was and whether the post was affected by the pandemic this year.

Chikvaidze didn’t agree with the opinion that the post office was unprofitable in the past years, because Georgian Post ‘provides universal postal services, the cost of which, according to the audited report, is GEL5 million, thus Georgian Post won this GEL5 million and financed the universal postal service and, in the case of revenue below $ 5 million in total, it may have seemed as a loss.

In 2019, the profit of organisation was GEL1.8 million, and in 2020, operating profit is GEL7 million. “The adjusted financial profit will be known after the audit,” Chikvaidze said.

According to him, the consumption of postal services increased by 40% in 2020 and Georgian Post was able to overcome the existing challenges in the conditions of air restrictions by land delivery.

Georgian Post is a state company. Founded in 1995, the company now supplies postal and parcel items in Georgia. According to the financial statements of 2017, Georgian Post is a loss-making enterprise.

According to Chikvaidze, the privatization of the national postal operator of state property will be done in stages.

“The issue of privatization of the national operator is not an easy issue, but work is underway and Georgia will be one of the successful countries in this regard, which will privatize the national operator.”

He underscored that there is no example of full privatization of the company in the world and the number of fully privatized national postal operators worldwide is only 3. There are many partially privatized facilities in European countries and Georgia will be one of them. As for the deadlines, everyone wants privatization to start as soon as possible, because these investments should improve the activities of the national operator and the Georgian citizens should receive better services.

Chikvaidze believes that the interests in terms of gradual alienation have already been identified both locally and internationally, although he does not specify what part will be alienated in the first stage and adds that "It is too early to talk about it."

According to the government administration, the Prime Minister of Georgia, within the framework of the reform of state enterprises, held another meeting with the working group on the topic of Georgian Post. At the meeting, the government’s administration discussed the current activity of the Georgian Post, as well as possible plans for the reform of state-owned enterprises at the Georgian Post in order to increase its management efficiency and make private investments.

According to the administration, as part of the plan to accelerate the reform and privatization of state-owned enterprises, the Prime Minister continues to hold similar meetings in an intensive mode.

The founder and owner of 100% of "Georgian Post" is a state, it is managed by the National Agency for State Property. According to the consolidated report, the company operates 82 service centers and employs up to 3,000 people.

The information about possible privatization of Georgian Post became known in November 2018 - former Minister of Economy Giorgi Kobulia spoke in an interview with Bloomberg. At the end of 2020, current Economy Minister Natia Turnava announced that the government would return to the issue of postal privatization in 2021.