President of the Georgian Swiss Business Association (GSBA), Nona Mamulashvili, says that Switzerland and Georgia are developing their economic and trade relations and the trend seems to be increasing annually.
“Currently, up to 40 Swiss companies operate in Georgia, though we see increasing interest from Swiss investors to expand their businesses in Georgia. In order to attract further Swiss investments, the government of Georgia must ensure that we have a predictable and business-friendly atmosphere, accompanied by sound legal framework,” said Mamulashvili.
Mamulashvili added that Switzerland’s chief exports to Georgia are currently pharmaceutical products (53%), watches (15%), optical and medical instruments (7%), and paper (4%), among other products, while the country’s major imports from Georgia are gold materials, textiles and wine.
Mamulashvili highlighted the free trade agreement between the European Free Trade Association (EFTA) states – Iceland, Liechtenstein, Norway and Switzerland – and Georgia, signed in June 2016 and entered into force for Georgia, Iceland and Norway on September 1, 2017 and for Switzerland and Liechtenstein on May 1, 2018, and said that Georgian exports receive “preferential treatment” that leads to an increase in trade volume in terms of goods and services, as well as to an improvement of the quality of exchanged products.
“The FTA between Georgia and EFTA countries creates a unique opportunity for Georgian entrepreneurs to export their goods to a market that covers an additional 14 million customers with high purchasing power without tariff and non-tariff barriers. From our point of view, we need close cooperation with the private sector to educate them about EFTA-Georgia FTA and share with them the practical tools on how to export products to EFTA markets,” Mamulashvili said.
How favourable is Georgia’s business environment in general and especially for Swiss business society?
During recent years, Georgia has undertaken a number of institutional reforms aimed at modernizing the economy and improving the business environment. By implementing extensive reforms to offer investors a liberal tax system and a more business friendly environment, Georgia has illustrated its commitment to opening its doors to the international investor community.
Today, stable economic development; liberal and free market oriented economic policy; only six flat taxes and reduced tax rates; significantly decreased number of licenses and permissions; significantly simplified administrative procedures; preferential trade regimes with foreign countries including the EFTA states and the EU; advantageous geographic location; and a well-developed, skilled and competitive workforce presents a solid ground for successful business in Georgia.
It is worth noting that Georgia has to take further steps to develop its low-cost, low-corruption business and investment atmosphere and to ensure political stability, the rule of law, pro-business legislation and labour flexibility, all of which are vital for attracting foreign investors.
This year the Association marked its 14th anniversary. Can you briefly summarize the 14 years of activities, and which have been the biggest achievements?
The GSBA is an association aiming to promote the development of commercial relations between Georgia and Switzerland. The GSBA promotes its goals by establishing relations with key policymakers and relevant governmental institutions in both Georgia and Switzerland on subjects of interest to its members and most importantly, provides an ongoing platform for members of the Swiss business community to gather to share knowledge, experiences, problems and solutions.
We had an extremely productive year. I will highlight two major projects implemented by GSBA in 2018: On 7 June, 2018, GSBA in cooperation with the EFTA Secretariat and the Embassy of Switzerland in Georgia organized the ‘EFTA-Georgia: Trade Promotion Seminar’.
The Seminar covered key and practical issues, including: a general overview of the EFTA- Georgia Free Trade Agreement and its benefits; Customs issues - Rules of origin; Verification /enforcement procedures; Non-tariff measures: Technical standards (TBT); Sanitary and phytosanitary measures (SPS); and Trade in agricultural products in the EFTA states and treatment in EFTA Free Trade Agreements. The EFTA Secretariat’s experts guided the attendees on how to export to EFTA countries. The Seminar also included a panel discussion, where private sector representatives had a chance to get acquainted with examples of successful Georgian businesses on the Swiss market.
EXPOVINA – By the initiative of the Georgia-Switzerland Business Association, in November 2018, Swiss city Zurich hosted the 65th Festival of EXPOVINA, the largest wine exhibition of Europe. For the first time in the history of EXPOVINA, Georgia participated in the festival. Moreover, Georgia was presented as one of the most popular and honoured guests. Up to 25 wine companies participated in EXPOVINA.
Results: On 1-15 November, 16,654 bottles of wine were sold at EXPOVINA (it is worth emphasising that during the last 11 months of 2018 19,700 bottles of wine were exported from Georgia to Switzerland). According to the given statistical data, the most popular wines were the following: Qvevri Wines – Saperavi, Mukuzani, and Rkatsiteli. A discovery of EXPOVINA’s was Qvevri biodynamic and natural/bio wines. It is important to highlight that orders for Georgian wines were made by importers, representatives of restaurants and hotels, as well as individual customers.
Two interested Swiss importers were identified, who visited Georgia two months ago and signed contracts with qvevri wine producers.
It is worth noting that according to the official statistics information provided by the National Wine Agency, in 2018 Georgian wine export to Switzerland was increased by 378% compared to 2017.
Switzerland is one of the highest purchasing power consumer markets. Approximately 70% of wines in Switzerland are imported. Therefore, we can conclude that Switzerland is definitely a priority market for Georgian wine and we should continue to support Georgian wine export to the Swiss market through various activities.
This year your cooperation once again supported the Golden Brand awards. What is your impression about this year’s Business Brand Awards ceremony? And how important is it for business in Georgia to have such awards?
GSBA is honoured to be a partner of the Golden Brand Awards, as we believe that such awards are vital for Georgian entrepreneurs. Promoting successful Georgian companies and sharing their experiences with the wider business community, supports the expansion of companies’ operations and strengthens their performances, which itself creates a positive impact for the Georgian economy.