The Government of Georgia has decided to introduce a price index system for infrastructure companies participating in state tenders. The new system will apply to those companies, which are participating in the tender from April 1, while the tenders must be announced before May 1.
Zviad Toidze, director of the construction company "Insi", says that the introduction of a price index against the background of expensive construction materials is very important to be able to retain the workforce in the sector.
" All companies, which were interested in receiving money within the frame of the new decree, they should apply to their customers within 40 days. To my knowledge, several companies have already approached the customers. This index will not be available until October. The price index will cover only 7% of the project as a whole. We have some remarks, but unfortunately this has not been taken into account at this stage. 7% is too small. This index includes three components: materials, fuel prices and wages. Therefore, Geostat needs some time to develop it,” said a company representative.
According to him, the remarks of the construction sector are already submitted to the Ministry of Economy.
"This index should not be one-time, because this business needs reform and it is one of the parts of the reform. Worker outflow rates are up in the construction sector, which will lead to bad results. Maybe it is the same with other companies, but in the example of our company, it is the case that the increase of salaries in line with the increase of inflation is not possible. When employees are unable to earn a living here, they move to different countries in Eastern Europe. That is why we say that this reform is not just for us. It will be very good for the economy as a whole,” said Zviad Toidze.
