22 Dec Boutique hotel “Chateau Schuchmann” expands with the World Bank support to the public-private investment under the Kakheti Regional Development Project
Qisiskhevi, Kakheti. October 23, 2015 – Boutique hotel “Chateau Schuchmann” has opened today its expanded rooms and services by the “Schuchmann” company that provided additional investment in Kakheti region within the framework of the Government of Georgia’s Regional Development Project (RDP) supported by the World Bank. Expanding hotel rooms and tourism facilities were made possible thanks to the Public-Private Investment (PPI) component of the Project.
The World Bank’s financing in the amount of US$ 1. 5 million under the PPI component supported the rehabilitation of the old road, storm water drainage and relevant infrastructure for the hotel and the entire Qisiskhevi village. The project was carried out through the municipal construction of the road and relevant infrastructure for the new hotel. The project was implemented by the Municipal Development Fund of Georgia.
“The inauguration of Schuchmann boutique hotel today marks an important milestone of achievements made under the Kakheti Regional Development Project. It is the first completed private sector investment, which benefited from provision of public infrastructure under the World Bank and Government of Georgia US$75 million financed project. The boutique hotel and expanded production of beverage create jobs to the Kakheti population and increase FDI to Georgia”, said Ahmed Eiweida, Program Leader for the Sustainable Development programs in the South Caucasus.
The Public-Private Investment component of the Kakheti RDP is innovative in many ways. It was the first time to be piloted in Georgia. The objective of this component was to provide public infrastructure to attract private investments in the regions. It supported eleven private sector entities in the Kakheti, including Schuchmann that demonstrated interest and capacity to invest in tourism or agribusiness. The Project provided complementary public infrastructure that was necessary to ensure the viability of the private investments (e.g., public facilities within the vicinity of the investments, road/sidewalk, water/sanitation, communications, etc.). All private sector investment proposals were subject to screening by the Municipal Development Fund (MDF) selection committee, required to meet specified criteria and were approved by the MDF Supervisory Board. Some investments also received line of credit/equity sharing from IFC. Based on the success of this component in Kakheti, it is now scaled up nationwide under the Second Regional and Municipal Development Project (RMIDP II) and will soon be replicated in the Mtskheta-Mtianeti and Samtskhe-Javakheti regions under the Third Regional Development Project.
As a result, the company committed itself to expand the existing hotel infrastructure; a new hotel building was opened and additional infrastructure attracting the tourists was developed. Fifty local residents have been employed by the hotel in addition to the existing staff.
The company’ employs 200 people, 90% of them being local residents. The additional investment within the project is US$ 2 million.
The opening ceremony was attended by Mr. Burkhard Schuchmann, a German philanthropist, the management of the company and the representatives from the World Bank and the Government of Georgia.
