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Expected Effects of Regulations on Natural Juices and Strong Drinks

Government of Georgia is working on introducing regulations on natural juices and strong drinks. According to Minister of Agriculture Levan Davitashvili, business sector has proposed to regulate the natural juices market and the issue is being arranged by the Ministry.

As to regulations for strong drinks, previously Gin and Whiskey were not produced in Georgia and consequently, there was no necessity of similar regulations, the Minister said.

As reported, introduction of regulations will determine both labeling standards and the rule of game will be regulated between the market players.

The Caucasus Business Week (CBW) has inquired reasons for introduction of technical regulations on juices and strong beverages and the real challenges before the sector.

KAMPA

David Buadze, founder of KAMPA juices manufacturing company, explains that a part of domestic manufacturers produces decoction instead of natural juices and creates unequal conditions for honest companies on the market.

Therefore, it is necessary to regulate natural juices on the market and determine the rule of game on the market and this process will determine what is juice, nectar and beverages containing juice, David Buadze said.

«Unfortunately, some manufacturers indicate on the label that the product is juice, but in reality the product is falsification, for example, decoction. Consumer thinks that all products with the image of fruit and beverages are juices, but this is not reality. Juice is a drink with 100% fruit content. But the drink with less percentage of fruits is a nectar, while if the product contains a very low level of fruit, it is considered to be a drink containing juice. Today there are companies on the Georgian market that assert they produce orange juice, while orange content in the product is only 45%», the KAMPA founder noted and added that in reality consumers buy nectar and this is not indicated on the label.

David Buadze said that for many years they demand to regulate the juices market, like the market of milk and dairy products.

We are involved in natural juices regulation process jointly with Ministry of Agriculture, Buadze said.

KULA

Unlike KAMPA, KULA company has no information about new regulations. The company director Vano Goglidze said that Ministry of Agriculture did not have contact with the company about this issue.

Coca-Cola Bottlers Georgia

«90% of juices on the market are not natural products», businessman Temur Chkonia said and stressed that it is necessary to set regulations on the market of natural juices.

We have been operating on the soft drinks market for 40 years and all advertised products are adulterated products. Therefore, government should interfere in this process and implement changes and control this field.

When company representatives say that their products are made of 100% natural products, this is a fraud. “We always indicate the real structure at our labels, that is we always indicate volume of natural juice. Other companies do not indicate such figures. This is a formula of our success. This is not falsification, this is an ordinary lie and deception of consumers. They misuse human psychology as if they produce healthy product. For example, when they assert that they produce tarragon and peach lemonades of natural juices, this is an absurd. This is catastrophe and this is huge lie. Use of green-colored Tartrazin, for example, is inadmissible. These ingredients are forbidden in many countries”, Chkonia said.

90% of natural juices do not satisfy standards and they are not natural products, he noted.

As reported, Tartrazine (U102 yellow color) makes especially negative impact on children, causes allergy, skin diseases, lowers attention, causes hyperactivity, violates vision and sleeping functions.

In response to the question why Government introduces the mentioned regulation, Chkonia explained that Government seems to have guessed that there are problems in this direction and new regulations should not be introduced for only one day, but a valuable system should be created to receive specific and efficient results.

All efforts should be oriented on real results, Chkonia said.

Sometimes, regulations are of superficial character  and Government may just  introduce technical regulations without real effect, while, real establishment and popularization of these regulations need certain time, the businessman said.

In response to the question whether introduction of technical regulations may eject several manufacturers from the market, Chkonia explained that similar risks absent, because today manufacturers are sure that these regulations will not work in reality.

Georgian Lemonade company

Varaz Aspanidze, head of Georgian Lemonade company, says that along with regulation of natural juices, it is necessary to regulate soft drinks too. The market should be regulated and this should be reflected in protection of consumer rights.

It is a right decision to regulate natural juices and strong drinks market, because the so-called natural juices that are indicated as nectars are not natural products in reality. Market of natural juices needs regulations, however, it is also important to regulate soft drinks market too, in this case lemonades market, he said.

There are problems with quality on soft drinks market. Namely, Tartrazine that is used in lemonade production is a food colorant and it is inadmissible to receive this substance, however, entrepreneurs have to use this substance, the businessman said.

“You will meat products, including lemonades, that are not recommended for consumers. This factor creates unfavorable condition for us and any entrepreneur, who are oriented on quality. As to our lemonades, for example, Tartrazine is in only one variety – tarragon lemonade. We make tarragon lemonade of natural tarragon, we make infusions ourselves, however, we add food colorants later anyway, because the tarragon gives  very light color. Consequently, we cannot sell it in this way. Consumers do not accept similar products. Therefore, we have to add food colorants. This is not venomous substance, however children and nursing mothers should be kept away from this product”, Aspanidze noted.

Georgian Lemonade company uses supplements of natural sugar in all other lemonade products. “Any laboratory in the world can examine Khiliani lemonade and prove that none of them contain Tartrazine, excluding Tarragon lemonade”, Aspanidze noted.

Product labels should indicate if they contain tartrazine and this substance is not recommended for children and nursing mothers, Aspanidze said.

If entrepreneurs replace Tartrazine by food colorants made of marine algae, product prices will rise, Aspanidze added. “I have many taken attempts to use this substance. We made various calculations, but failed to reflect current market prices”, Aspanidze said.

Only labeling cannot resolve these problems, because a major part of consumers does not pay attention to it. Only a small part of consumers read label  in reality, Aspanidze noted.

Consumers should be informed and their awareness should increase, the businessman noted.

“Consumers should be accustomed to reading label indications,= and only after that the situation will be regulated and only after that entrepreneurs will satisfy the regulations, however, product prices will rise on the market and after that consumers will have to decide themselves whether to buy expensive products or pay lower prices for products with Tartrazine”, Aspanidze said and added that it is the interest of honest entrepreneurs to pay due attention to quality standards.