Furniture Made in Georgia to Head to Sunny Spain

Outdoor Furniture, one of the many companies under the Produce in Georgia program, is planning to enter the European market.

The company will send its furniture to Spain from January, with a collection having already been selected and to appear in Spanish stores from spring.

The company is also in negotiations with Armenia and Azerbaijan.

“We are sending only straw furniture which is seasonal for spring, summer and autumn,” said Shota Bukhaidze, Director of Outdoor Georgia. “We couldn’t produce enough for export before but now we are actively working in this direction. We will export chairs, deck chairs, sofas, tables and swings.”

Outdoor Furniture does not pay custom tax which enables it to access the market of the EU member country. The Deep and Comprehensive Free Trade Agreement (DCFTA) between Georgia and the EU came into force on September 1st, 2014. This provides preferential trade relations between Georgia and the EU, in particular, it repeals import and export taxes on products in trade.

Under the DCFTA, the customs tax will be abolished which is mandatory for third countries. The tariff established by the EU is 5.6% of the value of this type of furniture.

Before the DCFTA, preferential trade was possible with GSP+ according to which such products were also released from tax but temporally. Outdoor Furniture company has DCFTA on a permanent basis.

Expansion and re-equipment of the furniture company was carried out under the program Invest in Georgia. VTB bank provided a USD 150,000 loan to the company. Enterprise Georgia will co-finance 10% from a 13% total loan interest for two years.

Outdoor Furniture bought new equipment, expanded and improved the production process with the loan. According to the director, the company is now manufacturing wooden straw furniture with the new equipment. The number of employees has also increased from 20 to 40.

Ana Akhalaia

28 December 2015 20:27