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Georgian Grain Growers Require Protection of the Local Market

Georgian Grain Growers Require Protection of the Local Market

Grain market of Georgia, in contrast to other countries – is completely unprotected – Levan Silagava, Chairman  of the Grain Growers Association, states.

According to him, in  the world grain production for both domestic consumption and for export is encouraged by the state – for example, in Turkey or Russia, which are the major producers of grain.

“For example, in Turkey the government is actively promoting the export of flour  and  gives special licenses that allow exporters to buy grain from the grain growers union  at the price lower than market. In addition, they are exempt from VAT when it comes to exports,” he says.

In his words, Russia is more concerned about domestic consumption – for example, from February 1 export duty on grain was introduced, which is 15% of the price per ton  that  enables the country to provide itself with sufficient grain, enhance local processing companies, and accordingly, stimulate flour export.

Levan Silagava notes that  90% of the grain in the Georgian market is imported from  Russia.

“If this trend continues, then even the small local production will be forced to leave the market that will cause damage to the budget and additional jobs will be lost. Because of dumping prices offered by  many importers, some Georgian companies were forced to close, while others are working at  half capacity,” he notes.

He sees a way out of this situation in the enactment  of two laws – we are talking about anti-dumping legislation and measures to protect local production.

Work on anti-dumping legislation has been going on for several months. In December 2014 the head of the Parliamentary Committee on Sector Economy Zurab Tkemaladze said that the law would be submitted to Parliament  in the spring of 2015, but now is  already November, but the project has not been made public.