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IMI: Kazakstan - Consumer Expo'96


28 MAY 96
FM AMEMBASSY ALMATY

1. THE SECOND INTERNATIONAL CONSUMER GOODS FAIR IN ALMATY, KAZAKSTAN WAS HELD AT THE ATAKENT INTERNATIONAL EXHIBITION CENTER (A TAX FREE ZONE), APRIL 23-26, 1996. THE FAIR WAS ORGANIZED AND SPONSORED BY TNT PRODUCTIONS, INC. (USA), AND ATAKENT JOINT STOCK COMPANY (KAZAKSTAN).

2. CONSUMER EXP0'96 WAS DESIGNED TO ATTRACT REPRESENTATIVES OF TRADE COMPANIES AND ASSOCIATIONS ACROSS KAZAKSTAN, AS WELL AS GOVERNMENT OFFICIALS WHO ARE
INVOLVED IN PROMOTION OF FOREIGN TRADE RELATIONS BETWEEN KAZAKSTAN AND OTHER COUNTRIES. THE EVENT WAS ALSO AIMED TO INTRODUCE FOREIGN CONSUMER GOODS MANUFACTURERS TO KAZAKSTAN TO CREATE A MORE COMPETITIVE MARKET.

3. JUSTIN WEBB, PRESIDENT, TNT PRODUCTIONS, INC., BAURZHAN ALIKHANOV, PRESIDENT, ATAKENT JOINT STOCK COMPANY, AND OLEG OSTROVIDOV, EXECUTIVE DIRECTOR, BOBEK CHARITY FOUNDATION FOR CHILDREN OF KAZAKSTAN, TOOK PART IN THE OFFICIAL OPENING CEREMONY OF THE SHOW ON APRIL 23.

4. AUDIO/VIDEO AND OTHER CONSUMER ELECTRONICS, FABRICS, KNITTING MACHINE NEEDLES, CHANDELIERS AND DECORATIVE LAMPSHADES, LAMPS AND LIGHTING FIXTURES, STATIONERY AND OFFICE EQUIPMENT, WALL COVERINGS AND CARPETS, APPAREL AND FOOTWEAR, FOOD AND BEVERAGES, CONFECTIONERY, HEALTH AND BEAUTY AIDS, PERFUMES AND COSMETICS, TOYS AND SPORTS EQUIPMENT, BALL POINT AND INK PENS, AND MANY OTHER DIFFERENT CONSUMER GOODS WERE DISPLAYED BY 150 COMPANIES FROM MORE THAN 20 COUNTRIES, INCLUDING THE USA, AND THOSE FROM EUROPE, ASIA AND THE CIS. THE FOLLOWING AMERICAN COMPANIES PARTICIPATED IN CONSUMER EXP0'96: ASTANA FOOD STUFFS/WRIGLEY'S (USA) ALMATY DISTRIBUTOR-CONFECTIONERY AND CHEWING GUM; CPC FOODS COMPANY LTD. (USA) MOSCOW OFFICE-FOODSTUFFS; A.T. CROSS (USA) FRENCH DIVISION-FINE WRITING INSTRUMENTS; GENERAL ELECTRIC LIGHTING (USA) MOSCOW OFFICE-LAMPS AND LIGHTING FIXTURES; GULF PACIFIC RICE CO INC. (USA) FROM HOUSTON, TEXAS-RICE EXPORTER; R.J. REYNOLDS TOBACCO KAZAKSTAN AND/SHYMKENT CONFECTIONERY KABISKO (USA)-CIGARETTES, CONFECTIONERY; SHEFFIELD LABORATORIES, DIVISION OF FARIA LTD. (USA) FROM NEW LONDON, CONNECTICUT-HIGH QUALITY TOOTHPASTES, CREAMS AND OINTMENTS; PHILIP MORRIS/ALMATY TOBACCO COMPANY (USA),CIGARETTES; AND TELEDYNE WATER PIK (USA)/BULAK DISTRIBUTION COMPANY, KARAGANDA-WATER FILTERS.

5. OTHER WELL-KNOWN EXHIBITORS INCLUDED: BIC (FRANCE)- BALL PENS, LIGHTERS, SHAVERS; CHUPA CHUPS (SPAIN)- CONFECTIONERY; DAVIS AND DANN LTD. (UK)-PERFUMES; KRAUS AND CO (AUSTRIA)-FOOTWEAR; LEGO TRADING (DENMARK)- BUILDING TOYS; PRECIOSA A.S. (CZECH REPUBLIC)-CRYSTAL CHANDELIERS; STEILMANN (GERMANY)-LADIES AND MENS WEAR; AND VERRERIE CRISTALLERIE D'ARQUES JG DURAND AND CIE (FRANCE)-GLASS PRODUCTS.

6. THE FOREIGN COMMERCIAL SERVICE (FCS), ALMATY WAS OFFERED BY TNT PRODUCTIONS, INC. A FREE BOOTH FOR THE SHOW PERIOD. FCS STAFF DESIGNED THE BOOTH TO FEATURE THE USDOC EMBLEM, THE NATIONAL FLAG OF THE USA, COLORFUL BROCHURES AND FLYERS. WE REPRESENTED THE FOLLOWING TWO AMERICAN CONSUMER COMPANIES BY GIVING OUT TO INTERESTED VISITORS PUBLICITY MATERIALS, BROCHURES AND PRICE LISTS, WHICH WERE BROUGHT BY KEVIN LYONS, BISNIS SPECIALIST, WHO ALSO TOOK PART IN THE EXHIBITION: SERTA MATTRESS COMPANY/DIVISION OF SLEEP MASTER L.L.C. (PERFECT SLEEPER MATTRESSES), AND INTERNATIONAL SALES AND FINANCE INC. (USED BLUE JEANS). KAZAKSTANI OFFICIALS AS WELL AS REPRESENTATIVES OF PRIVATE COMPANIES AND MEDICAL ASSOCIATIONS WERE INTERESTED IN PROFILES OF THE AMERICAN CONSUMER COMPANIES, GUIDANCE PROVIDED IN THE U.S. GOVERNMENT PUBLICATION TRADE WITH AMERICA, AND THE BISNIS PROGRAM. FCS STAFF AND CONTRACTOR ANSWERED VISITORS' QUESTIONS REGARDING THE FOREIGN COMMERCIAL SERVICE'S FUNCTIONS IN KAZAKSTAN, AND AMERICAN COMPANIES.

7. FOLLOWING UP THE APRIL MEETING IN ALMATY BETWEEN SCO AND TELEDYNE COMPANY REPRESENTATIVES FROM MOSCOW, FCS DECIDED TO INVITE TELEDYNE WATER PIK STAFF TO PARTICIPATE IN CONSUMER EXP0'96. THEREFORE, MR. VLADIMIR KOVALEV, AREA MANAGER, CIS, TELEDYNE WATER PIK, MOSCOW OFFICE, AND MR. VITALY LYASHENKO, DIRECTOR, BULAK COMPANY, A DISTRIBUTOR OF TELEDYNE WATER FILTERS AND WATER PIKS IN KARAGANDA, HAD AN OPPORTUNITY TO MARKET TELEDYNE PRODUCTS
THEMSELVES. FCS STAFF SHARED THE BOOTH WITH TELEDYNE REPS WHO DISPLAYED WATER FILTERS(THREE TYPES)-13 PIECES, WATER PIKS-1 PIECE, AND SHOWER MASSAGES-2 PIECES SPECIALLY BROUGHT TO THE SHOW, WHICH WERE SOLD SUCCESSFULLY TO KAZAKSTANIS. THE INTEREST IN TELEDYNE PRODUCTS WAS SHOWN BY COMPANIES AND VISITORS FROM THE FOLLOWING KAZAKSTANI CITIES: SHYMKENT, ZHAMBYL, UST- KAMENOGORSK, URALSK, DZHEZKAZGAN, PAVLODAR, TALDY-KURGAN,
KUSTANAY, ATYRAU, AND AKMOLA. APPROXIMATELY 8 OBLASTS (REGIONS) EXPRESSED THEIR DESIRE TO WORK WITH THE TELEDYNE DISTRIBUTOR BULAK KARAGANDA COMPANY. MR. KOVALEV AND MR. LYASHENKO SAID THAT THE SHOW WAS ORGANIZED ON A PROFESSIONAL LEVEL, EXHIBITED PRODUCTS WERE KEPT IN SAFE CONDITIONS DUE TO THE ORGANIZED GUARD SYSTEM. THE SHOW WAS HELPFUL IN ADVERTISING TELEDYNE PRODUCTS ACROSS KAZAKSTAN AND AMONG KYRGYZSTANI VISITORS
AS WELL. BULAK COMPANY FOUND A FEW POTENTIAL DISTRIBUTORS AND CONSUMERS DURING THE EXHIBITION, AND RECEIVED RELEVANT CALLS AND COMMERCIAL OFFERS BACK IN KARAGANDA AS A RESULT OF THE SHOW.

8. KEVIN LYONS, BISNIS OFFICE, USDOC, SAID THAT SUCH AN EXHIBITION IS A GREAT POSSIBILITY FOR FINDING AGENTS OR DISTRIBUTORS IN THE KAZAKSTANI MARKET. MOREOVER, LYONS NOTED THAT U.S. COMPANIES NEED TO FIGURE OUT A WAY TO BRING IN MORE U.S. PRODUCTS, IN ORDER TO COMPETE BETTER WITH EUROPEAN COMPANIES. U.S. COMPANIES COULD SUPPLY FROM FACTORIES AND/OR WAREHOUSES IN EUROPE. LYONS WISHES TO SEE AT SUCH SHOWS NOT ONLY U.S. FOODSTUFFS AND HOME CARE PRODUCTS COMPANIES, BUT ALSO FURNITURE AND OTHER LIGHT INDUSTRY PRODUCTS MANUFACTURERS. LYONS ENJOYED MEETING THE U.S. COMPANIES AT THE EXHIBITION, RECAUSE THEY SHOWED AN INTEREST IN KAZAKSTAN.

9. MS. NANCY FARIA SMITH, VICE PRESIDENT, OF SHEFFIELD LABORATORIES (SL), A DIVISION OF FARIA LTD., SAID THAT THE FIRST THREE DAYS OF THE SHOW SHOULD BE OPEN ONLY TO DISTRIBUTORS AND BUSINESS PEOPLE, AND THEN THE LAST DAY OTHER VISITORS COULD BE ADMITTED. SHEFFIELD LABORATORIES PEOPLE WERE PLEASED TO BE AT THE SHOW AND ON TV, WHICH HELPED KAZAKSTANIS TO RECOGNIZE THEIR PRODUCTS. NANCY SMITH FELT THE SHOW WAS SUCCESSFUL IN FACILITATING CONTACTS WITH BUSINESS PEOPLE AS WELL AS WITH GOVERNMENT OFFICIALS FOR FURTHER COOPERATION.

10. MR. CALVIN SPENCER, CONSULTANT FOR CPC INTERNATIONAL, HEADQUARTERED IN NEW JERSEY, REMARKED THAT IT WAS HIS FIRST VISIT TO KAZAKSTAN AND HE WAS PLEASED WITH TNT'S HOTEL ARRANGEMENTS AND TRANSPORTATION ASSISTANCE. SPENCER STRESSED THAT TNT STAFF WAS RESPONSIVE WHEN NEEDED. CPC EXHIBITORS WERE PLEASED WITH THE CROWD OF CONSUMERS AND DISTRIBUTORS AT THE SHOW, WHERE CONSUMERS WERE HUNGRY FOR PRODUCTS AND DISTRIBUTORS
FOR BUSINESS. AS A RESULT OF THE SHOW, SPENCER SAID CPC SIGNED THREE CONTRACTS INCLUDING ONE FOR USD ONE MILLION WITH THE KAZAKSTANI COMPANY GREEN HOUSE. HE SAID NEXT YEAR, HE WOULD PARTICIPATE IN THE SHOW AGAIN, EVEN WITH HIS DISTRIBUTOR OPERATING IN KAZAKSTAN, IN ORDER TO ATTRACT MORE CONSUMER ATTENTION TO CPC PRODUCTS AND THEIR QUALITY.

11. MR. PHILIPPE DE MONTBRON, REGIONAL MARKETING AND SALES MANAGER FOR EUROPE AND FRENCH-SPEAKING AFRICA, AT A.T. CROSS COMPANY, WAS PLEASED THAT THE SHOW ATTRACTED A
LOT OF PEOPLE, LIKE THE STATIONERY COMPANY ASEM. THE KAZAKSTANI COMPANY ASKO-A (STATIONERY AND OFFICE EQUIPMENT) BOUGHT ALL THE PRODUCTS FROM THE CROSS STAND. DE MONTBRON ADDED THAT WHILE THE MARKET DOES NOT LOOK VERY BIG, IT IS NONETHELESS A PLATFORM TO APPROACH THE NEIGHBORING STATES OF UZBEKISTAN AND KYRGYZSTAN. HE WAS EAGER TO KNOW MORE ABOUT KAZAKSTANI COMPANIES WHICH COULD
FORM A DISTRIBUTION NETWORK. CROSS AND ASEM ARE NEGOTIATING NOW ON JULY DELIVERY OF CROSS PRODUCTS TO ALMATY.

12. MR. FRIEDRICH BRENCKMANN, PRESIDENT OF GULF PACIFIC RICE CO., INC. FROM HOUSTON, NOTED THAT UNFORTUNATELY, THEY COULDN'T GET A CONTAINER FROM CUSTOMS IN TIME; IT WAS FINALLY RECEIVED AT THE END OF THE SHOW. THE SHOW WAS, HOWEVER, BENEFICIAL IN INTRODUCING GULF PACIFIC RICE TO KAZAKSTANI AS WELL AS TO KYRGYZSTANI VISITORS. AS A RESULT OF THE SHOW, HE MADE PROFESSIONAL CONTACTS WITH PARTNERS FROM SOUTHERN KAZAKSTAN AND WITH THE BIG ALMATY
COMPANY SONAR, WHICH EXPRESSED A DESIRE TO COOPERATE WITH GULF PACIFIC RICE IN THE NEAR FUTURE.

13. MR. JUSTIN WEBB, PRESIDENT OF TNT PRODUCTIONS, INC. AND SHOW ORGANIZER, POINTED OUT THAT IN COMPARISON WITH CONSUMER EXP0'95, THIS EXHIBITION ATTRACTED MAINLY BIGGER COMPANIES, INCLUDING WELL KNOWN ONES FROM EUROPE. THE SHOW WAS A LOT LARGER - 44 PCT INCREASE IN AREA THAN IT WAS LAST YEAR. MR. WEBB REMARKED THAT SINCE THE SHOW WAS AN EVIDENT SUCCESS, MOST COMPANIES WOULD LIKELY COME TO CONSUMER EXP0'97 IN KAZAKSTAN.

13. FCS CONSIDERS CONSUMER EXP0'96 A VERY SUCCESSFUL EVENT AND BELIEVES THAT TNT STAFF PROVED THEMSELVES TO BE HIGHLY PROFESSIONAL.IN ORGANIZING SUCH SHOWS IN KAZAKSTAN. FCS RECOMMENDS CERTIFICATION OF CONSUMER EXPO FOR 1997. .

14. QUESTIONS MAY BE ADDRESSED TO:
KALAMKAS TULESHOVA
FCS-ALMATY
FAX: (2)(327)581-1576
PHONE: (7)(322)633603/636809
--------------------------------------------------------------------------------------- 28 MAY 96
FM AMEMBASSY ALMATY

THE COCA-COLA BUSINESS IN KAZAKSTAN.

1. ON MAY 7, AMBASSADOR ELIZABETH JONES, SUSAN WEIDNER, SCO AND FCS STAFFER KALAMKAS TULESHOVA TOOK PART IN THE OFFICIAL OPENING CEREMONY OF THE FIRST COCA-COLA BOTTLING PLANT IN ALMATY. IT IS ONE OF THREE NEW PLANTS THAT WERE OPENED THE WEEK OF MAY 6. THE SECOND, A USD 16 MILLION INVESTMENT PLANT WAS OPENED IN BISHKEK, KYRGYZSTAN AND THE THIRD, A USD 10 MILLION INVESTMENT PLANT WAS OPENED IN TASHKENT, UZBEKISTAN.

2. MR. ZHANIBEK KARIBZHANOV, DEPUTY PRIME MINISTER, MR. GARRI SHTOYK, MINISTER OF INDUSTRY AND TRADE, AND MR. SHALBAY KULMAKHANOV, MAYOR OF ALMATY, TOOK PART IN THE OFFICIAL OPENING CEREMONY HELD AT THE PLANT.

3. THE ALMATY PLANT IS OWNED AND OPERATED BY COCA-COLA ALMATY BOTTLERS (CCAB), A JOINT VENTURE ESTABLISHED IN OCTOBER 1994 BETWEEN THE ANADOLU GROUP, A MAJOR INDUSTRIAL COMPANY IN TURKEY, AND A LOCAL BOTTLING COMPANY, TONUS. THE PLANT IS PART OF A USD 15 MILLION INVESTMENT BY CCAB TO ESTABLISH AN INTEGRATED COCA-COLA PRODUCTION AND DISTRIBUTION SYSTEM IN KAZAKSTAN IN ORDER TO SERVE 17 MILLION CONSUMERS IN THE COUNTRY. AT PRESENT CCAB IS LOOKING FOR AN OPPORTUNITY TO BUILD ADDITIONAL PRODUCTION CAPACITY, RAISING THE TOTAL INVESTMENT IN KAZAKSTAN TO USD 50 MILLION BY THE END OF 1997.

4. THE RENOVATION OF THE EXISTING BUILDING AND THE INSTALLATION OF THE NEW BOTTLING LINE IN THE ALMATY PLANT WAS FINISHED IN FIVE MONTHS. FOR THE FIRST TIME IN CENTRAL ASIA THE PLANT WILL PRODUCE COCA-COLA AND FANTA DRINKS IN ONE LITER PLASTIC BOTTLES. THE CAPACITY IS 12 THOUSAND BOTTLES PER HOUR FOR DISTRIBUTION THROUGHOUT THE COUNTRY. DIRECT DELIVERY OF COCA-COLA, COCA-COLA LIGHT, SPRITE, AND FANTA TO MORE THAN 300 RETAILERS ACROSS THE ALMATY AREA, WITH THE HELP OF TEN RED COCA-COLA TRUCKS, IS PROOF OF PLANS FOR CONTINUOUS PROVISION OF COCA-COLA PRODUCTS TO THE LOCAL MARKET. COCA-COLA IS THE SOFT DRINK LEADER IN KAZAKSTAN. COMPANY PRODUCTS REPRESENT AN ESTIMATED 90% OF INTERNATIONAL PREMIUM SOFT DRINK SALES IN THE COUNTRY. SO FAR, COCA-COLA IN KAZAKSTAN EMPLOYS 134 PEOPLE.

5. THE COCA-COLA COMPANY IS CURRENTLY THE SOFT DRINK LEADER IN SIX COUNTRIES IN THE CAUCASUS AND CENTRAL ASIA REGION: ARMENIA, AZERBAYJIAN, GEORGIA, KAZAKSTAN, KYRGYZSTAN AND UZBEKISTAN. trailers/mainfp.trailer 3-June-1996