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Business Owners Tricked as Election Ploy in Adjara

October 15, 2008

“Low interest rate loan was the government’s pre-election promise aiming at gaining more votes later turned out to be another politically-based lie.”  

Maka Malakmadze, Batumi

The Adjarian government started a large scaled campaign of issuing low interest rate loans during the pre-election period for seats in the parliamentary assembly of the Adjaran Autonomous Republic (AAR) Most of business persons working in Adjara took part in this campaign. Some business owners were even filmed by TV Company Rustavi 2 and aired during a business news program entitled Business Kurieri. They were described as the movers and shakers of various business projects in the TV news. However, the business persons who participated in the program that was aimed at allocating 5 million GELS for business related activities were actually deceived by the government.

Business Company Tiskara-2000 participated in the government’s project in order to be granted the low interest loan. “We planned to create a business plan related to animal nutrition.  Protein is essential raising livestock and poultry.  Protein is now imported from Turkey. I had even produced a test batch of protein. Our product was better than what was being imported from Turkey. Our protein was higher. We were planning to sell the protein supplement at a very reasonable and competitive price,” states Tedoradze, the drafter of the business plan.

The business project to produce protein was approved by Levan Varshalomidze, head of Adjarian government. “Many meetings were held with business persons. On one of the meetings Levan Varshalomidze took my project into his hands, presented me to other business persons and said that my project was the best. This meeting was attended by the Minister of Economic Development of Georgia. According to my project 150 families would be employed in Keda district. There are 87 trout farms in this district. We were planning to provide the farmers with our meal at a much lower price than what they are now buying. We planned to support these 87 fish farms. We had made an agreement with the meat company Nikora on buying the fish from the Keda fish farms. Consequently, the farmers would be employed and our business would develop. We have invested more than 300 000 GEL and requested 317 000 GEL from the government within in the low interest loan program.”

Rustavi 2 even prepared a news program about Tedoradze’s project. “When a news program was prepared on our project there were no doubts left that my project would receive a loan from the government. However, it turned out to be a lie,” states Tedoradze.

Mikheil Beridze, a farmer applied for a governmental loan for enlarging milk processing factory in the village of Erge “We were told on the government’s meeting that our project was funded. It was also publicized through Business Kurieri, TV Company Rustavi2‘s business news program that our manufacture received funding. In fact everything turned out to be a lie. I have received nothing of the promised loan.”

Beridze made only this comment because he “does not want to have any problems.” He hopes he will “receive a loan…”

Sulkhan Jortmenadze, deputy Minister of Finance and Economics of AAR states that the special commission within the Ministry of Economic Development of Georgia selected the projects for low interest rate loan program. “There were some procedures to follow. The businesspersons had to present the business property certificates and put up some money as collateral. We cannot tell you how the projects were chosen,” stated Sulkhan Jortmenadze.

The Human Rights Center (HRIDC) contacted Giorgi Nanobashvili, head of the Department for Economical Analysis and Politics of the Ministry of Economical Development of Georgia. The HRIDC asked Nanobashvili to make comment on the issue. However, Nanobashvili refused to provide comments and advised us to address the Press Department of the Ministry of Economic Development. One week has passed after this and the Press Department is still unable to arrange our requested interview with Nanobashvili.

Levan Varshalomidze spoke about the unemployment problem in Adjara during the Adjarian government’s meeting during the pre-election period and accused the central government of impeding locals from taking various positions within the autonomous republic’s state bodies. This served as the reason for allocating 5 million GELS solely to Adjara from the government’s loan program. Eka Sharashidze, Minister of Economical Development of Georgia designated 5 million GELS to Adjara for granting low interest rate loans and creating additional job places. Sulkhan Jortmenadze, Deputy Minister of Finance and Economics of AAR states that 4 million 200 thousand GELS have been allocated to fund a total of 14 project to the present time.

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