To avoid the effects of the world economic crisis, one of Vanadzor’s manufacturing giants, Prometey-Chimprom LLC chemical plant, is planning to change its production line.
The company (Lori province) having suspended its operations 2 months ago, instead of locking the doors and releasing its employees, suggested an anti-crisis plan to the RA government. The plan promises to put the factory back on track by producing inorganic and organic fertilizers instead of carbide.
“I think it’s a realistic plan which would allow us to survive the crisis,” says company director Alexander Snegiryov.
Despite his optimism, carbide and artificial stone production stopped as a result of the crisis, nullifying the company’s $5 million investment.
According to Snegiryov, the prices for carbide have seen a 50 percent decrease: 1 ton has dropped from $800 (244,000 drams) to $400. (Carbide is used in the chemical industry for producing various kinds of products, rubber for example.)
Under the given circumstances it is more profitable to produce fertilizers than sell carbide for low prices.
During the past 2 years the chemical factory exported 30,000 tons of carbide and about 10 tons of artificial “rubies” to southeastern countries, namely, India, Thailand, and Hong Kong.
Because of the crisis the exporting company will now turn to the local market. Snegiryov is planning to produce 60,000 tons per year of fertilizers to meet the country’s agricultural demand. (During Soviet times there was fertilizer production department at the plant which the management is planning to restore.)
“One production line will be producing potassium and phosphorus fertilizers, the other nitrogen,” he says, adding that both the raw materials and the market will be local. The machinery and equipment required for producing fertilizers will be ready soon.
A preliminary refinement workshop has been built in Petrovka village in the Tashir region of Lori province, and Chimprom is finishing assembling the technological circuits.
The company doesn’t promise but reassures that in 2 months they will be employed again.
The company management released 30 percent of its employees in November without annulling their contracts and kept paying about 65 percent of their salaries. The other 70 percent of employees received their full salaries.
It is even possible to employ 1,000 people in fertilizer production instead of the current 800, the director says.
Jemma Manukyan, 59, with 29 years of working experience as artificial stone production operator at the chemical plant is among those given a compulsory leave. Her last working month was November. Since the production was suspended she has been on a compulsory “holiday” with partial payment. She lives alone with 60,000 drams ($198) salary and 17,000 drams ($56) medical benefit.
“I have no idea how I can live on the benefit only,” she says. Like Snegiryov, the factory employees are hopeful that their forced holiday won’t last long.
Her contract expires at the end of January. If the anti-crisis plan developed by the management is not implemented Manukyan and half of the factory employees will become unemployed sharing the same fate as the employees of Vanadzor’s other major enterprise.
Avtogen-M LLC ceased its operations in November, 2008, being unable to realize their product- gas welders. The company did not offer its employees an alternative production plan instead asked its 350 employees to submit resignation letters. It promised to pay them their 4-month salaries when the Russian partner has money and can pay back its 100 million dram ($330,000) debt to the company.
“We hope, that after March the money will be transferred,” says company director Artak Ghazaryan.
Within the same time period 161 employees of Alaverdi-based Armenian Copper Program (ACP) LLC copper smelting plant lost their jobs: their contracts were not extended.
The company’s press service says that the company’s production volume hasn’t been seriously affected by the world crisis. The plant has to inevitably suspend its operations for a number of other reasons. Some of which are: the ore mining volumes in Armenia, which cannot ensure profitable production, the expected increase in the prices of energy-carriers as well as other internal factors.
They are 700 people currently employed at the factory. In case of suspending the operations, contracts of the majority of employees will not be extended.
“My only hope is my son, who can help me, but he has lost his job too,” says Manukyan, from Prometey plant. Her son is one of the ACP employees now out of work.