"In the past few years, the EU has contributed €69 million under EU4Business in Georgia, triggering €882 million worth of loans to Georgian companies, supporting almost 40,000 enterprises and creating more than 10,000 new jobs. Funded by the EU and implemented by GIZ, the ‘SME Development and DCFTA in Georgia’ project helps small and medium-sized Georgian enterprises (SMEs) become more competitive and adapt to the new regulatory environment created under the DCFTA. It lays the ground for strengthening of the SME sector to ensure a broad-based growth. The project is part of the EU4Business initiative, which brings together all EU programmes assisting SME and private sector development in Georgia."

In the past few years, the EU has contributed €69 million under EU4Business in Georgia, triggering €882 million worth of loans to Georgian companies, supporting almost 40,000 enterprises and creating more than 10,000 new jobs. Funded by the EU and implemented by GIZ, the ‘SME Development and DCFTA in Georgia’ project helps small and medium-sized Georgian enterprises (SMEs) become more competitive and adapt to the new regulatory environment created under the DCFTA. It lays the ground for strengthening of the SME sector to ensure a broad-based growth. The project is part of the EU4Business initiative, which brings together all EU programmes assisting SME and private sector development in Georgia. It enables the private sector to take advantage of the opportunities offered by the EU Deep and Comprehensive Free Trade Agreement, which gives Georgia access to a common market of 500 million consumers.

As Rati Anjaparidze, Project Expert, ‘SME Development and DCFTA in Georgia’ says, enterprises that have been successfully audited under the amfori BSCI system will be able to diversify their export markets and client base more. There are cases when apparel producers have one or two clients, which is a high risk. In case the client’s interest change or if for any other reason the client stops buying, the supplier company is left without a client on the European market. Therefore, a high ranking for amfori BSCI enables you to establish more stable contacts with European clients and become a reliable partner in their eyes.

In line with this, it is important for EU companies to have partnerships with enterprises where employers assume responsibility to protect their employees’ labour rights, they are also interested in having reliable suppliers. In the EU, industry players also assume social and other responsibilities and establish relevant standards both for local, European producers, as well as the global supplier chains.

The EU and GIZ project is also cooperating with three more companies in preparing them for the amfori BSCI audit – Elselema, Eurotex and Materia Fashion House. The elaboration of a National Strategy for Apparel Sector Development is also planned with EU and GIZ assistance, which should encourage diversification and exports of goods produced in Georgia.

Success story

One of the most successful companies in Georgia, MPT Georgia has been producing apparel products for Danish multi-brand fashion group DK Company, a leading fashion company in Europe, for the last three years. The labels of various brands that are part of the group – Coop Denmark, Denim Hunter, B-Young, Fransa – read ‘Made in Georgia’ in nine languages. The Danish company sells MPT Georgia-made clothing in Germany, the UK, Norway and Canada. MPT Georgia upgraded its manufacturing facilities in 2015 thanks to €100,000 of Danish investment. DK Company is MPT Georgia’s main and constant client; however, the Georgian manufacturer has also cooperated with other Danish companies in the past, such as Kompagniet and Qiero. Mikheil Getia, head, MPT Georgia, stated that the rating recently received as a result of undergoing an ‘amfori BSCI (Business Social Compliance Initiative) audit’ – will help the company find other clients in the future. However, in order to do that, MPT Georgia will have to increase its production, as current production capacity is fully utilised at this stage.

Georgia’s advantage on that market is that Georgian company can produce and export small amounts of apparel products in a short period of time. According to Getia, the Georgian apparel business is barely represented internationally. However, Georgia can attract new clients through introducing European standards in manufacturing. Additionally, our country has one advantage, ability to produce and export relatively small amounts of goods to the relevant destinations in a very short period of time.