We should follow the path of “Made in Italy”, but now we’re weaker than “Made in Russia”
We cannot compete by price, we should stress premiumization of “Made in Armenia” brand, to say that Armenians’ product is a bit more expensive, but has good quality
Our partners should think it’s okay that Armenians’ production is more expensive, our nerves are more expensive, quality and service of Armenians is good
Interview with Emil Stepanyan, Export Armenia Association co-founder
Which steps are addressed toward export in Armenia, how sufficient are they and are Armenian products competitive in external markets?
The biggest problem of export from Armenia is absence of structure dealing with stressed support for export. There should exist a structure, which either by state or donor assistance directly answers exporters’ question, attempts to find partners, provides consulting on the product’s being ready for export or not. That structure shouldn’t have commercial basis to provide service anyone who gives money. I’m sure Armenia’s number one issue is absence of such a structure.
The Ministry of Economy seems to have such a department.
There is a Foreign Trade Department in the Ministry, but what I say doesn’t fit in its functions. They deal more with strategy, procedures, submitting legislative proposals. For instance, we have a Vine and Wine Foundation in Armenia, which has a state participation share, and is rather active, carries out many events in the field of Armenian winemaking and viticulture. I can dictate 10-12 problems, 20-25 projects, which could have been implemented to raise educational level of exporters, marketing of their product, do nicer and smarter branding, but there is no one to implement it. No one in the Ministry deals with it, and it’s yet a question whether it should deal or not. There is Export Insurance Agency of Armenia, which has several functions. The structure can be enlarged on its bases, and one department can be added to support exporters. Look, I don’t pull the blanket over us and I don’t say let Export Armenia become a body for export assistance. Not at all. Vine and Wine Foundation can also assist for export of alcoholic beverages, fruit vodkas, brandies. Not everyone is Yerevan Brandy Company, one belongs to Pernod Ricard, the other has much money and can organize everything without any additional support. We have a lot of brandy and fruit vodka producers. In this regard, liabilities of the foundation can be increased. We should broaden export insurance, the share will increase, which should reply to the exporters’ questions. If the body exists, its sacred obligation will be inventorying of what I said and developing projects towards its solution. If they occupy themselves by exporters’ support for 8 hours a day, projects will be generated, which will amaze everyone.
Particularly there are fields, where Armenia has moved forward and can be competitive in the world if it’ll be able to properly present its product.
Today state control linked to “Made in Armenia” image is weak, it should strengthen. At least there can be a body, which will also collect complaints abroad on Armenian production and have relevant talks with exporters, as after all, it’s linked with the image of the country. How some inventors resort to various scams for their money? The exporter can also do so, cheat on its client, provide bad-quality product, gain short-term benefit, and be it as it may. This applies to the fishing industry, where antibiotics are used to shorten the cycle, which cannot be used. Projects should be developed, where unscrupulous producers with similar recorded problems shouldn’t be allowed to participate, who lower the quality of “Made in Armenia” brand. We’ve been doing this for 4 years, but to do all this a body is needed and it should be headed not by a white-collar officer, who saw export only in books, but be a devoted professional, who pursues the goal to get Armenia off its knees and help to stand strong on its feet.
So is there a gap in the government strategy in this regard?
The government has presented several strategies for different years, where a lot of smart ideas can be found. Similar good statements have been written in strategies of former authorities as well. When you read them, you want to cry, many smart things can be found toward solution of problems of Verin Lars, export diversification, and etc. If at least a part of it became a reality, we would have had quite a different export. I don’t want to politicize, but the mirror of former leadership is as follows: in fact, if we look to Armenia’s wealthiest businessmen, we all know who they are, we see the production volume of their business, how much trade is there, how much fun is there, how many lottery companies are there and how much the export is. It’s our mirror. Armenia is the reflection of those 10 wealthiest businessmen. When in power they were merged with the authorities, doing their activities in business in 15 directions and no one of them is export. And they used to be part of the authorities. No matter what they’ll write now, if they don’t act, who needs that. Developers of strategy are different, and implementers are different too, and users are quite different.
Can we say that Armenia’s product can’t be competitive abroad under similar conditions existent inside Armenia?
There is production which can be quite competitive, and there is production, one should exert more efforts to make it competitive. I’m talking about the average production. Average Armenian production in competition is expensive and not much, that’s why we need to learn the ways of serving and selling, creating premium points-of-sale with solvent, demanding consumers by packing and branding. Thus, we should stress premiumization of “Made in Armenia” brand. We should set the goal and move towards raising awareness of the brand. Figuratively speaking, we should take the path of “Made in Japan”, “Made in Italy”, “Made in Germany”. It’s another question where we’ll reach to, but today we’re weaker than “Made in Russia”. Although we have pretty good rating in food industry. We’re in rather well positions with canned food. Our canned food is sold 20-30% more expensive than local ones in Russia and other countries, and again with nice serving. In other words, Armenia can have very powerful export if it has professional salesmen, professional marketers and maintains proper partnership relations. Serving the customer is also a serious job, you shouldn’t send the product and forget your customer. Since price isn’t our competitive advantage, we should make sure that we aren’t abandoned due to the price. We have to be such a good partner, that they think never mind, that the product of Armenians is expensive, but their service is very good, they’re very responsive to calls and e-mails, they’re a good partner, they’re quick and provide with qualified product. It’s ok, that it’s more expensive, our nerves are even more expensive. This is the way our partners should think and it works.
Siranuysh Papyan
