A number of Georgian mills were forced to halt operations due to the lari devaluation and dumped prices offered by new companies in the market, some of them are operating at half capacity. CBW was told by Levan Silagava, Chairman of Grain Growers Association.
He says that before the new year price of one bag of flour was 37 GEL, but today a bag of flour costs 43-44 GEL, the price difference is a result of the devaluation. However, Silagava notes that the price of flour has not increased in direct proportion to the devaluation that affected the mills. In his words, if the price was set in direct proportion to the devaluation, a bag of flour would cost 49 GEL.
“We’ve managed to keep the price at the expense of supplies, prices in Russia have also reduced. We were able to bring in supplies during these 2 months that allowed to stabilize the price and gave us some benefits. All mills could not do it, some are working at half capacity, some have stopped”, Silagava explains.
According to him, Tbilisi and Barzo mills as well as the Tibiti group factory have halted operations. Levan Silagava says that some of the mills are working at a loss in order not to lose clients.
The second major problem, in Silagava’s words, is the Russian flour import at dumped price. Based on the above, Silagava demands to impose the anti-dumping duties. According to him, the law has been submitted to Parliament and deputies even promised to discuss it in September. Antidumping law work has been going on for several months. Last December, the Economic Policy Committee Zurab Tkemaladze said that the law would be discussed at the spring session, however, the legislature still has not discussed it.
Zurab Tkemaladze, Chairman of the Sector Economy and Economic Policy Committee told CBW in May that they were waiting a response from the Ministry.
Minister of Economy George Kvirikashvili stated in January that the aim of the law is to protect the local industry from unfair competition. Deputy Prime Minister said that the legislation would not be acceptable to everyone, and may be inappropriate for importers but significant for local manufacturers.