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Biu-Biu Company: A Lack of Political Stability Hinders Import Substitution

An interview with Revaz Vashakidze, a founder of the Biu- Biu poultry company
What differs your company from the competitors, what is a  volume of your production, and whether your products  go  for export?

We were founded about a year ago, but sales show that we are market leaders and consumers  trust us. We have created a high-tech production, which controls the whole process. Our company’s advantage in comparison with competitors is that we raise chickens on corn and wheat grown in Georgia, and as a result, our products are of a very high quality.

Feed is tested in a special laboratory, meat is processing on the automated line with minimum human involvement, in the end we receive a  perfect product.

We produce about 5 400 tons of chicken, in 2015 we plan to double the scale of production. We sell our products in our own pavilions, where there are persistent queues.

With regard to exports, at this stage we do not consider this issue.

Why did you decide to produce chickens?

One of the reasons why we  started to produce chicken meat was a very large volume of chicken meat imported in the country. Unfortunately,  the  situation on the market has not changed, but nevertheless, we are always trying to master  the market.

Currently, a large number of frozen chicken is imported in Georgia –  chickens, legs and fillets, etc. We have the resources to substitute import, but it takes time and needs political stability.

In addition, we have plans in other sectors – now our company is developing 55 hectares of land where apples and pears will be grown.

Our main goal is  to substitute  import supplies. For this reason we started producing chickens but it is possible that we will start to produce pork and beef.

How would you rate the business climate in the country? Has it improved or worsened after the change of government -?

Doing business primarily needs intelligence and desire. With regard to the business climate, in a country where politicians are always fighting and the situation is unstable, the business climate also cannot be stable.

How would you assess the preferential agro-credit  program,  how is it acceptable and will it contribute to the development of agriculture?

In my opinion, we need to develop medium and large businesses, as small farmers will not be able to compete with  imports. We do not need special big investment, it’s enough to create large companies and promote their development.

Now we need to encourage large companies. Georgia signed an Association Agreement with the EU, and products that can be exported to Europe are  produced  just by  big companies that have advanced technology, knowledge and skills, with which the peasants and small farmers in any case will not be able to compete.

In total 20-30 large enterprises should  exist in Georgia, as in Chile, where they succeeded to develop agriculture.

We use a variety of government lending programs – we took $ 2 million for 7 years without interest – is a good variant.

But it is important to fund competitive companies that can give a boost to the economy.

What would you advise the authorities? What should be done for business  and economy development?

We  need political stability in the country, as the business does not like the tense political situation.

It turns out that on the one hand, the government is trying to attract investors, and on the other,  political instability has a negative effect on the investment climate. Investors and businessmen themselves must come into the country, and for this they should not need a special invitation.