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June 24, 2019 - www.cbw.ge
#288
WEEK
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How TBC develops Digital Ecosystems
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Successful 5 Months for Exports
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Why does Georgia fail to make use of Valuable DCFTA Opportunities?
15 000 Farmers united to save Georgian Hazelnut
Agriculture in Figures – Georgia and the World
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CBW's Announcement Regarding Repulsive Fact that took Place at Georgian Parliament Regarding the speech of the Russian MP in the Parliament of Georgia, CBW expresses its deep concern and condemns the visit of the Russian Duma representative to the occupant state and any statements made by the Parliamentary Speaker! We believe the leadership of parliament and the organizers of the assembly should take responsibility for this repulsive fact.
Pacers chooses Goga Bitadze with 18th Pick in the NBA Draft Goga Bitadze is headed to the Indiana Pacers after being taken with the 18th pick in the NBA draft. The good news is the Indiana Pacers took one of the best players available in Goga Bitadze. The other news is Indiana now has three centers on their roster worthy of playing time.
Natia Turnava: 85% of Families will be switched to Natural Gas Supply System We have been implementing a large-scale gasification program, including in the villages, which will receive natural gas for the first time, Minister of Economy Natia Turnava told PalitraNews TV company.
German Ambassador: Georgia cannot Valuably employ DSFTA Opportunities According to Hubert Knirsch, German Ambassador to Georgia, Georgia cannot valuably employ DCFTA opportunities.
Partnership Fund to repay 139 million GEL to CREDIT SUISSE In September 2019 state-owned Partnership Fund must repay 139 million GEL to Swiss bank Credit Suisse, including the principal sum of 117.5 million GEL and 21.5 million GEL interest rate and commission fee.
Georgia attracts â‚Ź90 million in World Bank Funds to finance Education The World Bank will allocate 90 million euros ($101 million) to Georgia to finance the country's education system.
TBC partners with Global Climate Partnership Fund (GCPF) to co-finance HPP Projects in Georgia TBC and The Global Climate Partnership Fund (GCPF), which is managed by responsAbility Investments AG, are starting a new stage of their cooperation, as evidenced by the GCPF shareholder meeting attended by the Directorate of the Fund and the Investment Committee, being held earlier this month at TBC Bank.
Cbonds to award Galt & Taggart as the Best Investment Bank in Georgia 2019 Cbonds XVI CIS, Baltic States and Caucasus Bond Congress was held in Batumi on June 13-14, 2019. A congress is an annual event, in which Ukraine, Baltic States and Caucasus participants and market professionals take part.
Eka Tikaradze to take Davit Sergeenko's Position of Minister of Health Prime Minister Mamuka Bakhtadze officially present Eka Tikaradze, the new Minister of Heath to the government administration. Speaking at the press conference, the Prime Minister said that upgrade and additions to the team are priority for them. However, he said Davit Sergeenko is and will be a committed and successful member of the ruling team.
Number of Foreign Visitors increased by 37% in Protected Areas The interest of visitors to the protected areas increases. In May, compared to the same period last year, the number of visitors increased by 14% and amounted to 225 596.
The Editorial Board Follows Press Freedom Principles Publisher: LLC Caucasian Business Week - CBW Director: Levan Beglarishvili WWW.CBW.GE Address: Aleksidze Street 1 Sales: Mob: +995 591 01 39 36 Email: caucasianbusiness@gmail.com Editor: Nutsa Galumashvili. Mobile phone: 595 380382 Copy Editor: Ellie Rambo Reporters: Nina Gomarteli; Mariam Kopaliani; Merab Janiashvili, Economic columnist: Andria Gvidiani; Technical Assistant: Giorgi Kheladze;
German Company to conduct Prefeasibility Study on Development of Batumi International Airport International consulting company TH Airport Consulting will assist United Airports of Georgia to conduct a feasibility study on the development of Batumi airport over the next 10 years. CEO of the United Airports of Georgia Giorgi Chogovadze and managing director of TH Airport Consulting Torsten Hentschel signed an agreement to launch the feasibility study today, announces the United Airports of Georgia. ‘’We are very happy to be here in Georgia to do
an assessment. It’s about prefeasibility, study to realize if there are relocation needs of this airport and to find out how far the airport at the existing location can be expended in the future”, said Hentschel. Under the research airport Infrastructure will be studied in detail to develop short-term and long-term development plans. Batumi International Airport was opened on May 26, 2007. This will be the first renovation work for the airport since then. The international
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Council of Airports (ACI Europe) named Batumi airport as leading airport across Europe in terms of the growth of passenger flow together with Kutaisi airport in its data for February this year. Kutaisi is in first place with 111.3% growth
while it is followed by Batumi with an 87.3% increase. The latest data from the United Airports of Georgia showed that Batumi airport served 135,939 passengers (+24%) in five months of 2019.
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Successful 5 Months for Exports Georgia’s Negative Trade Turnover shrinks to 40% In January-May 2019, Georgia’s foreign trade turnover (excluding undeclared trade) made up 4,959.4 million USD, up 1.1% compared to the same period of 2018. This constituted 1,466.7 million USD, up 14.2%, and imports totaled 3,492.8 million USD, down 3.6%. Georgia’s negative trade balance in JanuaryMay 2019 was marked at 2,026.1 million USD, which is 40.9% in external trade turnover. In the same period, exports without re-exports rose by 4.7% year on year and constituted 938.6 million USD. It should be noted that copper ore and concentrate rank first in Georgia’s major exports items. The export of these products in JanuaryMay constituted 261,129,300 USD. Automobiles ranked second with 207,780.9 thousand USD exports;
ferroalloys rank third with 136,715,000 GEL; and the 4th and 5th positions are occupied by prepackaged medications and organic wine. In January-May 2019, the ratio of top ten exports countries in Georgia’s total exports constituted 72.9%. The top three export markets are as follows: Russia (218.7 million USD), Azerbaijan (168.8 million USD) and Bulgaria (119.1 million USD). As for the top 5 imports items, oil and oil products rank first with 277,894,400 USD; automobiles rank second with 248,378,400 USD and copper ores and concentrates rank third with 236,034,100 USD. Petrochemicals and packed medications share the 4th and 5th positions. In January-May 2019, the ratio of the top 10 importer countries in as a share of Georgia’s total imports made up 66.2%, including Turkey at 595.7 million USD, Russia at 349.6 million USD and
China at 347.9 million USD. “The foreign trade turnover deficit has seen the bottom since 2005. The figure made up 38.4% in May 2019. The highest monthly deficit was recorded in December of 2007 and 2008, with 70% and 74.1%, respectively”, economic expert Vakhtang Charaia said. According to him, the same situation is reported for January-May indicators, under which the 2019 indicator accounts for 40.9%. According to this expert, over the past years this indicator has systematically shrunk, and over the past 15 years the highest indicator was recorded~in 2007, 2008 and 2009 and the figure exceeded 60%. Vakhtang Charaia also noted that Georgia’s exports in May 2019 reached a historic maximum – 334.3 million USD. As for JanuaryMay exports, the figure constituted 1.47 billion USD, while the figure stood at
303.6 million USD in 2005, 611.5 million in 2010 and 882.5 million USD in 2015. According to this expert, Georgia’s foreign trade has not been diversified in either exports or imports and according to the 2019 January-May report, Georgia’s first three trade partners hold a 1/3 share, and top first five partners a share of 50% or more. It is important to diversity trade partners and trade products, create new export products (for example, electric cars, solar panels and so on), and reduce traditional imports items (for example, the ratio of oil products) and to replace them with a mechanized production process that should reduce imports and grow exports, Vakhtang Charaia said. By Merab Janiashvili
day. Consequently, we hold many offline5 and online assets. TBCPAY Junemaintains 24, 2019a#288 position in the self-service sector for those who prefer to pay with cash. We offer similar services online. We plan to introduce online ecosystems in this segment as well, so we can offer an integrated chain to our users. In terms of ecosystem development, TBC Bank has made bold statements regarding the VENDOO e-commerce platform. This is a Georgian Amazon, you said. The platform has already been launched. What has been the response from consumers? We decided to develop the VENDOO platform after a simple analysis. Georgian consumers mainly use foreign e-commerce platforms to buy things. Therefore, a lot of money is leaving Georgia. At the same time, it takes a lot of time to receive things they purchase, and it is almost impossible to return things. We want our clients to receive the same services in Georgia, and for their money to remain in Georgia. This platform is useful for the national currency and all the users of these services, and are very happy with it. The platform offers new products every day. We plan to replace foreign e-commerce and allow Georgian consumers to conduct their online shopping in Georgia. TBC Group has entered foreign markets, too. The bank has bought Payme, the leading payment system of Uzbekistan, and you said it was the bank’s strategy to develop new banking ecosystems in the retail and corporate sectors of Uzbekistan. What are your plans for the development of Payme?
When speaking about ecosystems, whether we want to or not, we start thinking about environmental protection and ecological conditions. Today, in the age of digital development, the meaning of this word has expanded. A business ecosystem shapes the integrity of suppliers, distributors, consumers, competitors, government offices. This represents a digital platform to connect parties engaged in purchasing space, products and services. Each party creates its value, and the consumer gets the benefits.
is a huge challenge, and developing this space has become a key part of TBC Bank’s strategy. We understand that it is vitally important to adapt to the new environment, and that this transformation has changed the environment. Taking the pulse of our consumers is a key component of our digital strategy. Transformation and digitalization removes borders, bringing growth and radically changing our consumers, in particular their demands and needs. Diverse services increase awareness and change their perception.
Vendoo.ge, livo.ge, tpay.ge are exceptional examples of a digital ecosystem that exists on the Georgian market, and all of them are connected to the TBC Group. If you have not joined this ecosystems, but you wish to buy or sell an apartment, or purchase home furnishings and make payments through innovative platforms, we expect that tomorrow, or the day after tomorrow you will definitely join this ecosystem, because today it is almost impossible to live without digital technologies. TBC Bank understands that the current fundamental transformation of the industry has developed this ecosystem. The words such as "transformation," "team transformation," "business transformation" are becoming very popular … and these words mean progress. Two key factors are driving the global, fundamental transformation—the digitalization and the expansion of so-called connectivity that has become an accelerator of globalism removing all barriers. Every person and company now has the opportunity to offer and provide services to anyone, anywhere in the world, without leaving home. And this new reality radically changes the mechanisms that shape values. Wealth production business models also change.
It is necessary to create and provide endto-end services transparently, without barriers. TBC Bank is a financial institution, but, as I have noted, barriers between industries are disappearing, and we are to provide good, diverse, simple and transparent services to our consumers —what we call the End-ToEnd Customer Journey.
Tornike Gogichaishvili, TBC Bank Deputy Director General, speaks about the benefits of the digital system and the company's plans: Unlike traditional companies, new digital companies have been growing at a fast pace. This process brings global challenges, because the boundaries between industries and businesses are disappearing, and social media players are entering the payments business. For example, Apple is represented in the payments system and Apple Pay provides services in a lot of countries. This
We will stand side by side with our consumers to improve their lives. This strategy has inspired us to expand our digital assets to foreign countries, too. Our current strategy foresees that, by 2022, the number of people using our digital ecosystem will grow to 10 million. You have already started developing a real estate digital ecosystem. Livo.ge recently appeared on the market, and has already attracted a lot of interest. What does this platform offer, and why is it important? The real estate ecosystem calls for collecting providers and consumers of all services related to the sector on one unique platform, which allows these parties to shape new values. Naturally, the real estate marketplace has been somehow developed, but in a very fragmented way. Market players (sellers, buyers, developers, banks) were not tightly interconnected. Similar ecosystems are already working successfully in Europe, the USA. We decided to develop a platform that allows all the actors to get access to all relevant information or services on the same platform. The platform enables the sellers to introduce their properties in a more interesting and complex way. Transparency and simplicity create real value and, therefore, we offer our assistance to brokers to open interesting real estate listings. Despite the fact that TBC Bank is a major institution, other banks and users
will not face restricted access to information about market conditions on the platform. Moreover, any user can make use of property assessments services for nominal prices. Some users may struggle to use these platforms, however, since it is rather new in Georgia. How are you educating your clients about the platforms? How do you attract new users? The key objective of the ecosystem’s development is to ensure co-creation, because the ecosystem works when other participants engage in it. And our objective is to assist any service provider to contribute to data management, get information and, based on this information, to create and shape business models. We offer services to all participants, be it a broker, developer, or ordinary user, to assist them in generating ideas. This platform simplifies the sale and purchase of desirable items, property location or construction type. The ecosystem generates value through the joint participation of all users and, as the end result, benefits are equally distributed to all users – this is the whole philosophy. So cooperation and synergy is important between the users and the platform? What is your position on the payment system? Our strategy is to simplify the process and provide end-to-end services. We plan to add public services to this system. In this respect, we actively cooperate with the Public Registry. We implemented a new payment business with new models. This is an inseparable component of a commercial bank, but we have decided to make this a strategic priority and define it as a separate segment. It is an independent business objective, with independent vertical (management), and we have assembled all payment systems. We will further develop this, and transform it into an ecosystem; for example, NFC technology, QR payment. This means that the bank offers all payment opportunities. We want to keep a finger on the pulse of our users, and participate in all payment components. We focus on our clients, to satisfy their demands and requirements through simple and transparent services. For example, we own part of TKT.GE and we participate in the event payment process. Our objective is to know our users' needs throughout the entire
In general, we are very cautious when entering foreign markets, because there are a lot of examples when similar decisions brought undesirable outcomes. Therefore, we use serious caution in this respect. Uzbekistan is home to 33 million people, and we plan to launch a commercial bank there in the future. We are also cooperating with Nikoil Bank in Azerbaijan. As for our strategy for Payme, we aim to expand the client base and diversify its services. In 2020, we plan to offer LIVO.Ge, which is analogue to the housing system. How much money do you invest in developing ecosystems? How extensive are your investments? Ecosystem development does not require much investment, especially in our case since we had all components necessary to develop this platform. In order to develop the housing ecosystem, we bought a 90% stake in the well-developed and well positioned platform allproperty.ge, which is managed by Giorgi Chumashvili, the founder. We do not interfere in the management process. We have not invested a lot of money, but the whole value matters for ecosystem development, which is created by the quantity of participants: the more participants, the higher the value. The key objective is not how much profit the ecosystem generates (although of course we monitor that), the main thing is the type of value it creates for the consumer. On June 6 TBC Bank hosted an Investors’ Day event in London. The bank’s management has paid a lot of attention to the ecosystems development strategy. How did the investors react? The strategy of our ecosystems was very positively appraised on Investors’ Day. We will continue our ecosystems expansion plan in Georgia, Azerbaijan and Uzbekistan. Consequently, the number of users and the value of the ecosystems will continue to grow.
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Why does Georgia fail to make use of Valuable DCFTA Opportunities? Georgia fails to take advantage of valuable DCFTA opportunities, the German Ambassador to Georgia, Hubert Knirsch, noted. To boost the potential of production and exports, first of all, businesses should determine a targeted direction for production, make an appraisal of the relevant segments, and appraise the results. ‘At the same time, the Government should determine priority sectors, and take efforts to develop these sectors and eradicate the current obstacles. This refers to the transportation and logistics sectors in general, seaports and sea freights with the EU, as well as the infrastructure for laboratory examination of products and exports”, the German Ambassador noted. As reported, the DCFTA provides multilateral commercial opportunities with the agreement’s member countries and exempts companies from customs tax, and offers the same conditions for domestic commercial organizations. Despite this, Georgian businesses fails to make progress. This may be the result of a lack of information about DCFTA opportunities, and on the other hand, complicated regulations. These complications should be overcome to actively penetrate the EU market. The Caucasus Business Week has inquired whether Georgian entrepreneurs agree with the German ambassador, and how simple it is to manufacture exports
products and sell them. The Glebner company, which runs a refrigerator complex in Kareli, faces problems with the export of frozen fruits. The company owner, Rafael Maghalashvili, says that it is impossible to carry out valuable laboratory analysis of fruits and therefore, laboratory tests are made in Israel, and then further exported products to the USA. Therefore, the company has to take huge expenses, Maghalashvili said. Glebner receives orders from Switzerland, Romania, Israel and the USA for frozen strawberries, raspberries and blackberries, but the company cannot launch exports without food safety documents. The company also faces problems with buying natural and highquality products in Georgia, and the company has to import the required products from neighboring countries, he said. “In 2018, I prepared products worth 600,000 EUR, but failed to export them. At this stage, I am importing 30 shipments of strawberries from Turkey, because it is impossible to buy high-quality products in Georgia. Domestic strawberry production does not fit in either Kakehti or Marneui, nowhere. The tests shows that a human should not eat Georgian strawberries. I bought 18 tons of domestic strawberries earlier, and I had to throw away 5 tons. We have problems with tests, too. They issue certificates, but these documents are not to international standards. Each test takes 2-3 weeks, and eventually, even these tests are carried out erroneously. I have
to spend money and send plans to Israel. It is impossible to start exports without tests. Products are examined by the Health Ministry in all normal countries. There are serious problems with product quality control. Therefore, the due certificates are strictly required”, Maghalashvili said. Giorgi Kepashvili, Head of the Board of the Beekeepers’ Guild, noted Georgia really does fails to make use of valuable DCFTA opportunities. The country assumed obligations as part of the association agreement to cope with problems related to food products examination. Kepashvili explains that, to promote exports, accredited international laboratories are required that would examine honey exports with professionalism and relevant qualifications. Georgian honey meets all exports standards in terms of quality. However, Georgian honey is still sent to Riga to check for pesticide waste and antibiotic waste. And we have to pay extra expenses. This problem has been around for many years, and the Breti honey production company had to suspend operation, he said. “I have no idea why this problem is not resolved, but the authorities have all the necessary mechanisms to tackle this issue. They may allocate a grant and attract additional funds. The private sector cannot do this, because expensive equipment is required”, Kepashvili said.
World News
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BSTDB issues a New Bond to support Portfolio Growth The Black Sea Trade & Development Bank (BSTDB) has raised USD 400 million with a new bond issued under its EUR 1 billion Medium-Term Note Programme. The bond has a five year maturity and a fixed coupon of 3.5% payable semi-annually.
Foreign Tourists’ Passports won’t be stamped in Iran
New logistics centers to be created in Azerbaijan
In accordance with the instruction of Iran’s President Hassan Rouhani, foreign tourists will be able to travel to Iran without having a stamp or record in their passports, Iranian Government Spokesman Ali Rabei told reporters after a meeting of the Cabinet of Ministers, Trend reports with reference to ISNA.
The new logistics centers are planned to be created in Azerbaijan’s Ganja city and at the "Red Bridge" customs checkpoint on the Azerbaijani-Georgian border, Secretary of Azerbaijani Coordinating Council on Transit Freight Rufat Bayramov said.
Facebook will launch a Cryptocurrency called Libra in 2020 Facebook annouced that its in-development global cryptocurrency, called Libra, will launch next year alongside the underlying blockchain-based network that will support it.
Gas from Azerbaijan's Shah Deniz field reaches Greek border
IMF approves Stand-by Arrangement for Armenia
Gas extracted in the Azerbaijani section of the Caspian Sea by international consortium led by BP as part of the Shah Deniz Stage 2 project has reached, along the Trans-Anatolian Natural Gas Pipeline (TANAP), the borders of Turkey with Greece,Trendreports with reference to the official page of Azerbaijan's state oil company SOCAR on Facebook.
The executive board of the International Monetary Fund (IMF) has approved a standby arrangement (SBA) of 248.2 million US dollars for Armenia to improve its business climate and support the structural reforms of the government.
Chernobyl sees 30% Increase in Tourism after HBO Series The real Chernobyl is seeing a 30% increase in visitors following HBO's popular series about the 1986 nuclear disaster.
Qatar Airways named as World's Best Airline for the Fifth Time Airline leaders and top airline management from across the globe today attended the 2019 World Airline Awards held at Paris Air Show to receive their accolades voted for by customers.
Georgia to privatise Gori wind Farm Natia Turnava, Georgia’s economy minister, has announced that the government plans to privatise the Gori wind energy plant, which will take place within the next 90 days.
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Tiko Ratiani: "Marketing helps you make New Discoveries" Interview with Head of Marketing and Salesfor “Jikia House’’, Tiko Ratiani. Tell us about how you got into the field of marketing, and what factors played an important role in choosing this profession? I've been in this field for many years. During the last 6 years, I've been the head of marketing and sales. It is a very interesting field, where you are constantly searching for new directions, and face new challenges. This profession gives you the opportunity to constantly make new discoveries. This is all interesting to me. In regards to technological changes, what challenges do you face as the head of a marketing service? Today it is much more interesting to work in this field, preparing new, interesting products or projects. It is much easier to reach the targeted segment with the right channels, to give it your take. However, this is also a challenge, because active communication through social media or other means is available for more companies. Therefore, it is important that you are outstanding on the market, and our project is a good example. What has changed in the field in the last 5 years, and what changes are expected? Many things have changed over the last few years, as digital marketing is at a higher level, social networks have evolved, the user has changed their behavior as well as the attitude of the company towards the user. Most companies have been oriented towards the customer. Companies realize that their reputation depends on the opinion of the user, and therefore, we listen to them, and acting on their preferences. And the users are, in fact, more aware, and they demand a much higher standard from us than it was years ago. In addition, new approaches to communicating with users were created, and new channels have appeared. If we compare with previous years, many channels used earlier are no longer active today. Even today, a small budget is enough to make interesting and effective marketing campaigns. It is important to keep up with developments on a daily basis, in order to keep a favorable position in the market. What important features should a marketing manager focus on, and what are their roles in an organization? I think marketers should be ready for
novelties, and should not be afraid of new challenges or making mistakes. One needs to listen to users, as a customer plays one of the most important roles in a company’s development. If we listen to them and observe their behavior and demands, then we analyse it, and it will definitely help us to grow, establish a better product, and achieve the desired result. What steps do you take as an organisation to keep up with new trends? Everything develops dynamically, and it’s important to receive new information and process it. We need to keep up with new tendencies, and be ready for new challenges. We try to constantly search for novelties. What’s your organization's business model? Today, the real estate market is quite saturated, and many companies operate here. In order for you to be outstanding, it is important to think of a different product that is competitive. We try to be an outstanding and user-oriented company. Of course, we listen to customers, and
take their tips, wishes and recommendations into consideration as best as we can in order to fit them in, and offer them an interesting product. In addition, we try to offer customers a different product from others, which distinguishes us from our competitors. One word that describes your work. Interesting. The most useful advice you’ve ever received in your life? Never be afraid of difficulties, and never make decisions in the heat of the moment. Think of a person who inspires you, professionally. It’s hard to name a specific person. My inspiration can be a successful project, or a goal that you are working towards with a team in order to achieve a desired result.
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Business News
Georgian Insurance Companies earned 8,3 Million GEL in 3 months of 2019
The quality level of Georgian wine is higher compared to the previous years. The only master of wine in Japan, Kenichi Ohashi, talked about it after the Georgian wine tasting held in Tbilisi.
In the first quarter of 2019, the volume of premiums raised by Georgian insurance companies amounted to GEL 179, 9 million which is 15.6 million more than in the same period of 2018.
Georgian Shilda Winery announced Winner of the EU Sustainable Energy Award for EaP The European Union has announced the winner of the EU Sustainable Energy Award for the Eastern partnership at the Awards Ceremony in Brussels on 18 June. The winner of the first edition of the Award is the energy efficient Shilda winery from Georgia. Chini - The First Georgian Luggage Cover Chini is a Georgian word for 26th Georgian alphabet letter. The world also connotes the rank, eye pupil, which is enlarged by happiness and Malaysian lake - filled with numerous lotus flower.
Ireland is among the Top Investors in Georgia According to Geostat, Ireland was the largest investor in Georgia’s economy in the first quarter of 2019 which poured $ 133, 2 million into the country.
International Forum on Supporting Local Agribusiness and Promoting Rural Development took Place in Bolnisi
Saguramo SKYE Club - recycling to support Local Community
Bolnisi Municipality hosted 1st Bolnisi International Forum, an event bringing together rural development actors from Georgia and other countries of the Eastern Partnership.
In May, a youth club set up as part of the EU4Youth programme collected 950 kg of paper waste to support the local library in the Georgian mountain village of Saguramo, to the north of the country’s capital of Tbilisi. Kenichi Ohashi: The Quality of Georgian Wine has absolutely increased Entrepreneurship School Graduates meet Local Businesses in Georgia To mark the successful completion of the Entrepreneurship School in Samegrelo, Georgia, set up as part of the EU4Youth programme, 19 graduates of the school were joined by the EU Ambassador to Georgia and the Danish Refugee Council Country Director on a study visit to various businesses in Kutaisi on 8 June. Bay Leaf Processing Plant opened in Chkhorotsku Bay leaf processing plant was opened in the village of Chkhorotsku by Jumity-2014. The company will process about 90 tons of bay leaf annually.
TechnoPark Construction works underway in Gurjaani Building machines launched construction works on the territory of the 4th Public Gymnasium in Gurjaani. The project calls for building TechnoPark on the mentioned territory.
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15 000 Farmers united to save Georgian Hazelnut The only effective way to transform Georgian hazelnut producers and other farmers into modern and competitive players of today’s market is to offer them practical consultations and joint monitoring system. This kind of support will make it possible for Georgian agriculture to overcome the obstacles it is facing at the moment. According to different studies, farmers who receive only general information and guidance still lack a considerable amount of data. This, in turn, deprives them of opportunities to develop their production and get financial profit. As a result, such missteps reduce our chances to reach stable and prestigious EU market. Temur Vartagava is a Georgian hazelnut producer from the village “October” (the Municipality of Zugdidi). He has been cooperating with the Georgian Hazelnut Growers Association (GHGA) for four years now, and in this framework, he gets practical support from an association agronomist on a daily basis. “If we notice even a small problem in our gardens, we call them immediately and receive appropriate advice from them right away. Such consultations take place regularly between our monthly gatherings that are held in our houses.” These meetings have a unique format, and the project is carried out by GHGA.
The new practice, which was introduced to Georgia by the Georgian Hazelnut Growers Association, is known as the CREA method. In partnership with Argentinian experts, GHGA has created CREA groups in Georgia. CREA group consists of Regional Consortia for Agricultural Experimentation and the Argentinian Association of Regional Consortia for Agricultural Experimentation (AACREA). , and their goal is to promote the development of technology and to coordinate tasks among each other more efficiently. Working in a group allows farmers to share their experience and coordinate joint actions for improving local hazelnut production. According to Rodolfo Tkachuk, an expert from AACREA, Argentinians have been using the CREA method for more than 60 years. It is worth mentioning this Argentina is one of the best developed agricultural countries in the world with its tech-savvy farmers. “We are glad that we made it possible to adapt this method to Georgia and share our experience with Georgian Hazelnut Growers Association. According to this method, 10-12 farmers create a group and set out a plan which serves as a guideline for their future steps. They gather in each other’s houses (in turn), and this makes the integration process more comfortable. At every meeting, the host farmers present to the group members their garden, and during this process, they discuss all the problems and ways of achieving desired results. This makes it possible for the other group members to be familiar with the situation in a particular farmer’s garden and give them appropriate advice. Host farmers receive useful information in a written form. “It is worth mentioning that technical knowledge is easily shared among them. If they need any further assistance, we are always there to take the necessary actions. However, farmers find it more convenient to learn from their group mates, and this is why they manage their development themselves” – tells us Rodolfo during the meeting with Georgian farmers. “In our CREA groups, hazelnut producers not only are the receivers of information but also very often they are the contributors. The effect of a successful example allows us to attract other farmers. As a result, we have established new groups, and the Association has grown significantly. What is more important, farmers are involved in every stage of producing high-quality Georgian hazelnut. This year we have more than 15 000 farmers engaged in the program which aims to save Georgian hazelnut, farmers are following our plan and instructions, developed by Agro Consultants from Ferrero. We are confident and sure to have many successful farmers this year, which will enable Georgia to regain its position on
the worlds hazelnut market. GHGA has the support of important stakeholders like USAID, FERRERO, CNFA, Ministry of Agriculture, and the National Food Agency.” – says Giorgi Todua, Executive director of GHGA. “Regular meetings have allowed us to consider each other’s opinion and then plan our future actions as we like. Given our close cooperation, we share more experience with each other, and we have quite good results so far” – Temur Vartagava Georgian Hazelnut Growers Association (GHGA) was founded in 2013 and currently consists of more than 15 000 members. The main goal of the Association is to improve the knowledge of farmers in the field of hazelnut orchard management, help them increase their, and improve the quality of hazelnuts. GHGA members benefit from the following services with discounts: soil analysis, machinery for orchard management, drying, and storage of hazelnuts. GHGA also facilitates access to micro-credits to assist in purchasing fertilizers and others..... To see activities and news by Georgian Hazelnut Growers Association, please visit the website www.ghga.ge
11 June 24, 2019 #288
According to the UN Food and Agriculture Organization (FAO), about 1 billion people are engaged in the agricultural sector, including 20 million persons in the CIS space, 12 million in Aastern and Central Europe, 22 million in highly-developed countries, 450 million in China, and 600 million in Africa. China is a leader in terms of revenues from the agricultural sector. Every year, this country sells agricultural products worth 1.88 trillion USD. India ranks second with 4,134 billion USD; the USA comes third, with 290 billion USD. American exports mainly consists of meat and milk products. Indonesia is mainly specialized in the export of coffee, raw rubber, cacao and species. In terms of revenues from the agricultural sector, Indonesia comes fourth with 127 billion USD. Brazil ranks fifth with 110 billion USD. Considerable revenues from the agriculture sector are reported in Nigeria too – 106 billion USD. Pakistan ranks 7th with 63 billion USD. Turkey ranks with 8th with 62 billion USD. Argentina ranks 9th with 59 billion USD, and Japan is tenth with 51 billion USD. According to FAO experts, organic agriculture shows significant development. According to IFOAM, the market for organic products exceeded 90 billion EUR. The USA is reported as the largest market, with 40 billion USD. Germany ranks second, with 10 billion EUR. France comes third, with 7.9 billion EUR.
Switzerland is a leader in the volume of organic food products – 288 EUR per capita. The figure makes up 278 EUR in Germany and 237 EUR in Sweden. As for Georgia, it should be noted that over the past few years negative trade balance between exports and imports of organic agricultural products is shrinking. According to the 2018 report, the negative trade balance between exports and imports of agricultural products made up 394 million USD, down 0.4% compared to 2017. Considering that the 2012 trade deficit was 753 million USD, then over the past 6 years the negative balance has almost halved. In 2018, Georgia exported products worth 959.2 million USD. According to Geostat, the national statistics service of Georgia, products were exported to 96 countries, and Russia ranks first with a 25% share. Azerbaijan ranks second with 16%. EU is third with 15%. According to official statistics, exports of agricultural products in 2018 increased by 67.3 million
USD compared to 2017, up 9.2% year on year. As for imports, Georgia imported 1.3 billion USD of products to Georgia. Russia remains a leader in terms of the import market, with a 23% ratio. The EU ranks second, with a 22% ratio. Ukraine is third, with 21% and Turkey is fourth with 10%. It is interesting that despite export growth, the ratio of agriculture sector in Georgia’s total GDP is declining, and the ratio made up 7.7% in 2018, down from 8% from 2017. As for the number of agriculture sector workers, about 40% of the workforce in Georgia is employed in the agriculture sector. Based on this figure, Georgia is ranked beside Vietnam, Haiti, India, Kenya, Morocco, Pakistan, Nigeria and Ghana. As to the neighboring countries this indicator made up 37% in Azerbaijan, 33% in Armenia, 19% in Turkey and 8% in the Russian Federation. According to World Bank indicators, in 2018 the average indicator of the agriculture sector employees was 26%. This figure is below 5% in developed countries. By Zurab Khachapuridze
12 June 24, 2019 #288