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  • They In Armenia Cleaning Diaspora Out While Government Keeps Silence

    THEY IN ARMENIA CLEANING DIASPORA OUT WHILE GOVERNMENT KEEPS SILENCE
    Elita Babayan

    ArmInfo
    27. 09. 2010

    ArmInfo's exclusive interview with Christian Gelici, German-Armenian
    WKS Armenia Director General

    WKS Armenia - is the Armenian subsidiary of German WKS Textile
    Solutions, part of German Huniel Group

    Mr. Gelici, the Armenian Economy Ministry told ArmInfo that WKS Armenia
    is expected to open a new textile factory on the basis of the old
    plant "Electron" in Vanadzor. As far as we know, reconstruction of
    the factory should have been launched already.

    If opening of the new textile factory on the basis of the former
    "Electron" plant in Vanadzor depended mostly on WKS Armenia, the
    factory would have been put into operation already, I assure you. It
    would become one of the biggest factories and not only in the region
    and would employ over two thousands of people in the country. However,
    after privatization 51% of the factory's shares were distributed among
    privates and the remaining 49% was owed by the government. We had an
    arrangement with the government for trust management of the 51% stake.

    Thanks to the government's efforts, we achieved an agreement with
    the director of the "Electron" factory who promised to acquire all
    the 51% shares and transfer them to us. Of course, we paid both for
    the services of the director and the whole process of the factory's
    liquidation. At the very beginning of the negotiations the factory was
    more or less subject to modernization, whereas now it has been fully
    ruined, more precisely, devastated by the shareholders and is no longer
    subject to reconstruction. Only the walls are still standing there.

    Have you applied to the government for resolution of this problem?

    In October 2009 we applied to the government for suspension of the
    factory's demolition and the German party even threatened to freeze
    the project. The government demanded that demolition is stopped but
    the process is still continued. The government as the holder of the
    49% stake in the factory could ban illegal actions by the privates,
    but didn't! The leadership of the German WKS Textile Solutions has
    decided to freeze this project and it is not known when it will be
    resumed. After it all, Economy Minister of Armenia Nerses Yeritsyan
    took the liberty to call me and our German company unserious partners.

    I have brought you all the facts. Choose for yourself who is unserious
    our company or the Economy Ministry of Armenia.

    I have no right to blame the government for this situation. I do not
    blame the president either. He has the same problems as any other
    businessman in Armenia. I employ hundreds of people and there are
    irresponsible employees among them who constantly violate the labor
    discipline. Our president and prime minister face the same problem
    and many of their people just do not deserve their positions.

    What is the way out of the situation? How to settle the problem?

    I welcome Prime Minister Tigran Sargsyan's position who has repeatedly
    tried to submit a bill on the state property privatization program
    to the parliament saying that the enterprises privatized in early
    90s must be returned to the government if not used. Yet 15 years
    ago I asked for one of such plants for temporary use and not for
    privatization by our company, but my request was rejected. No one
    needs these plants today and no one is going to launch production at
    these plants for lack of sales markets. However, sales markets can
    be found if desired. But there is no desire, unfortunately, because
    it is much easier to devastate than create something new. Besides me,
    many other foreign businessmen Armenians by origin repeatedly tried to
    develop the light industry sector in Armenia, but all they left. Why?

    They were deceived and even cleaned out.

    A few months ago we planed to set up an Association of Armenian
    Diaspora Representatives in Armenia. The association could become
    a peculiar bridge linking two extremely different wings of the
    Armenian people: the Armenians of Armenia and Diaspora. If we want
    our Motherland to prosper and it we want to introduce our production
    in the global market and be competitive, our people should, first of
    all, unite around these goals. The problems of our country will not be
    finally resolved by Russia, America or through opening of the border
    with Turkey. Armenians worldwide must unite to settle these problems.

    We planned also to create an Association in the sphere of light
    industry to unite entrepreneurs engaged or willing to be engaged in
    the sphere and develop it.

    Did you give up your plans to unite into associations?

    There are several reasons. First, this plan must be coordinated with
    the government and local businessmen, which will take rather long
    time. There is another serious problem: local industrial enterprises
    lack infrastructure meeting the requirements of foreign businessmen. I
    mean the state of industrial equipment and buildings. In addition,
    local businessmen lack the culture of business communication so far.

    Perhaps, this is the most serious problem.

    An exhibition had been recently held in Yerevan under slogan "Support
    Local Producers". Our company also participated in the event and in
    the Roundtable organized on sidelines of the exhibition. I voiced the
    problems of local businessmen and the necesity of infrastructures for
    doing business. For their turn, representatives of the economy ministry
    of our country offered a program of light industry development and
    the project of free economic zone in Gyumri has become one of this
    program's components. I visited Gyumri and made sure that nothing
    specific has been done under the given project yet, whereas at the
    exhibition the economic power representatives were speaking of the
    final stage of that program. I do not think that industry is developed
    by empty rhetoric.

    As far as we know you are going to implement a number of big investment
    projects in the sphere of light industry and machine building.

    German Huniel Group having 27 billion US dollars annual turnover is
    making big investments in textile industry and in motor-car industry.

    I offered some businessmen engaged in German automobile industry to
    move their production to Armenia and have achieved certain serious
    arrangements with several of them. I will not name those businessmen
    but I can say that they are going to make big investments in Armenia
    if the Association of Diaspora Representatives is established to
    control over financial flows.

    WKS Armenia is a tolling operation company. Why the company's
    production has not been introduced in the local market yet?

    The company is producing uniforms made of expensive raw-materials
    imported from Germany. In fact, the production is too expensive for
    the local market. However, in 2011 we are likely to open the first
    WKS Armenia brand fashion shop. We plan regional expansion in future.

    Clothes are imported in Armenia mostly from Turkey, China, and Dubai
    which is, to put it mildly, far behind fashion trends. We want to
    offer our citizens high quality cloths and follow the global fashion
    trends. WKS Armenia shops will offer products made in Armenia. I hope
    we will activate the factory in Amasia besides the one in Yerevan.

    Would you please tell a little more about that factory? How many jobs
    will it open?

    The new textile factory in Amasya will allow opening nearly 150 jobs.

    It is the largest factory in the region of Shirak. Head of the State
    Revenue Committee Gagik Khachatryan provided us with the premises
    for the factory. But we did not avoid problems there either. We were
    seriously short of human resources. Gyumri Employment Center could not
    help us settle that problem. It has turned out that in the country with
    so big number of the unemployed few people want to work. Most of the
    unemployed prefer being on the dole in the amount of 18,000 drams and
    earn a bit on the side. People working at almost all the enterprises
    in the region are not registered officially, which is violation of
    the law and the State Employment Center is well aware of that.

    Have you settled the problem with human resources after all?

    Yes, and we did that independently without support of the state
    structures. If a foreign businessman has a problem with any state
    structure in Armenia, he has to apply to the prime minister to settle
    it. The prime minister, for his part, charges relevant department
    to settle the problem. But, even in this case one cannot be sure in
    settlement of the problem.

    Back to the new project of factory, how much have you invested in
    this project? What production volumes do you plan for the first year
    of activity?

    We plan monthly production capacity of nearly 18,000 units of garment.

    In two-three years we will double this figure. Within the first months
    the factory will make men's shirts. In future, we will produce other
    garments for men and women. I'd like to say to our government, in
    particular, Economy Minister Nerses Yeritsyan that we are a serious
    company that will not rest on its laurels. The next step will be
    acquisition or construction of a factory in Charentsavan.




    From: A. Papazian
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