World’s leading media giant Financial Times publishes an article about SMEs in emerging economies and names Georgian private company as a example of how these SMEs struggle to secure finance for growth and outlines the fact that manufacturer of tomato paste, pickles and sauces, seed capital came from a Swiss tourist.
Writer tells the whole history of Marneuli Factory and describes how foreign investor could gather locals to create a holding company that today owns four companies
It happened in 1997 when Thomas Diem, a psychiatrist with an interest in Georgian folk music, visited the rundown facilities of a Soviet-era mineral water producer. Inspired, the company story goes, to do something to help revive a region struggling to shake off the legacy of its Soviet past, he put up $40,000 to get the company back on its feet.
Few businesses have such luck and Irina Gaprindashvili, director of MFF, says small Georgian businesses struggle to raise finance, in spite of pro-business reforms enacted since the “Rose Revolution” of 2003.
Director of MFF says in her interview with Jonathan Wheatley that Practical state support for small businesses includes help drafting business plans and training in company administration. But actual financial support is limited: the government provides funding of up to 5,000 lari ($2,065) per small or micro business entrepreneur.
“When we were looking for options to expand, the offers we got from the banks were at such high interest rates that we struggled to expand and to be competitive on export markets, Today, a small company that wants to become large has to do it very gradually.”
Read the whole article HERE