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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
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