German Business Association as a link between German and Armenian businesses

ArmInfo. On 12th April, the office of the German Business Association (DWV - Deutsche Wirtschaftsvereinigung) was founded in Yerevan. At the opening ceremony, the German Ambassador in Armenia, Matthias Kiesler, pointed out, that thereby the German side demonstrates the importance of Armenia as a partner for Germany, especially in trade and economic relations. During the interview with ArmInfo, the executive director of DWV, Inga Markwart, talked about tasks and objectives of DWV in Armenian, as well as about plans of German companies entering the Armenian market and their search of potential partner.

The German Business Association has been operating in Armenia since 2013, however, as part of the German Business Association in Georgia. What was the motivation to found a full-fledged representative office in Armenia?

DWV Georgia has worked very successfully in Armenia for more than 2 years. However, to enhance the scope of business, the decision was taken in Georgia and Armenia to open a full-fledged representation of the organization in Armenia. The DWV in Armenia provides extensive information on the Armenian market and economic perspectives to the German entrepreneurs and informs Armenian entrepreneurs about the market entry possibilities in Germany. I would like to mention that already at the founding event of the DWV in Armenia on 12 April, 27 German-Armenian and purely Armenian companies declared their willingness to become DWV member. Presently there are 700 companies in Armenia, operating in cooperation with German companies. This is not a small number, which also justifies the decision to raise the status of our presence in Armenia.

Besides, I would like to highlight that the registration of Yerevan office does not mean that we will work autonomously from the Georgian DWV office. Our organization considers the Armenian market in strong synergies with the Georgian market. It is reasonable, taking into account the scale of the market on the one hand, and on the other hand the organization of the visits of German delegations, during which we simultaneously present the potential both of the Armenian and Georgian markets.

How can Armenia, as an economic partner, interest the German business?

German Business Association connects German companies with potential Armenian partners. In this context, Armenia can interest Germany in various fields. This is proofed not only by the numerous requests coming from German companies. Today our portfolio of successful business ideas already includes examples of implemented projects in the sphere of construction, agriculture, consulting, banking and IT sector. Since our activities are not aimed at specific economic sectors, we offer our services to all interested companies. There is already well-established cooperation between Armenian and German companies in the ​​textile industry. And a couple of years ago an Armenian companys started to produce components for the German boilers.

One of the world's leading chemical holdings, BASF, found local partners for production of fertilizers with the help of DWV. Recently, a contract was signed for export of 60 tons of apricot puree to South Tyrol. In cooperation with our organization, an Armenian delegation went to Germany to again experience in the sphere of  agriculture. Local farmers were delegated to Germany to study the experience of onion cultivation technologies. However, the sectors IT,  energy and engineering are considered to be the most promising.

How does the process of cooperation with your customers work?

We are a partner of a very large network of foreign chambers of commerce. We are the first one to contact for German companies planning to enter the Armenian market. They send us their specific requests and we give them information on potential partners in the local market and give advice on legislative regulation of the market. At the same time, we tell our clients that we can just give advices, but not provide legal advice. But we can help our members to find a reliable lawyer or accountant.

We receive very different requests. Usually the German clients have already done some market research before contacting us and ask for specific information. Sometimes they plan tender participation. 

What kind of  challenges do the companies face entering the Armenian market, compared to the entrance of the Georgian market?

Georgian market offers German companies numerous opportunities. It is easier in terms of working with customs authorities. There are reduced requirements concerning documents for non-residents. In terms of the Armenian legislation, it is not easy for organizations such as ours. There are many restrictions, for example  concerning membership requirements or management procedures. At the moment the Armenian parliament works on a new law concerning the work of non-commercial organizations. Armenia has a large untapped potential, especially in the sectors mentioned above. Moreover, Armenia offers very good human resources. As praxis shows, as soon as a company has found its niche, it works successfully on the local market. Representatives of German companies tell that working with Armenians is quite easy, which is also important.

From my experience, German companies carefully calculate risks of investment. More than entrepreneurs of other countries, they avoid bad foreseeable risks. Therefore, they usually start with small projects which then turn to large-scale projects.