TBY talks to Zafer E. Chaoui, Chairman & CEO of Château Ksara, on milestones of the company, export markets, and further investment plans.

Zafer E. Chaoui
Zafer E. Chaoui graduated from St. Joseph’s University, Beirut, in 1972 with a degree in Economics. He has had a long and distinguished career working in a number of different fields. Currently, Chaoui is Chairman & CEO of Château Ksara, Sicomo, Omnipap, Omnipharma, and Omnilab. He is also a Member of the Board of Electronic Business Forms and the Audit Committee of Banque Libano. In 1990, he became the Consul of Finland, and since 1996 he has been the Consul General.

What have been the milestones for Ksara in the past two years?

Château Ksara has substantially increased its production to 3 million bottles per annum since 2010. Our restaurant has also become a real masterpiece after its expansion and now attracts a huge number of visitors. The worldwide economic crisis and the war in Syria have affected the wine sector as with most other sectors of the economy. The decline in the number of tourists coming to Lebanon has reduced local consumption. Château Ksara had foremost focused on the local market before expanding to exports; however, both markets are complementary. The world is big and Lebanon's production is small, yet it is excellent. We have great potential for growth and excellent opportunities lie ahead of us.

Which countries do you mainly export to, and what new markets are you looking into?

Our regional exports are to Jordan, the UAE, and Syria, which was an important market for us. However, with the current situation there, our sales have dropped considerably. Europe is another of our traditional markets, particularly France, the UK, Germany, Switzerland, and Scandinavia. We also have small sales in Russia and Belarus. In the Far East, we are targeting China, Japan, and possibly India soon.

How are Lebanese wines perceived abroad?

Our wines enjoy an excellent reputation abroad with, in my view, one of the best qualities for value in the world. We do not have high-end wines with price tags over €1,000 per bottle. Our prices range from €6 to €40, and at these price levels our wines are highly appreciated.

What do you believe needs to be done to further boost and develop the wine sector in Lebanon?

The Ministry of Agriculture and the Chamber of Commerce and Industry and Agriculture are aware of the importance of the wine sector. Although their financial assistance is limited, they are doing their best to help. The Ministry of Agriculture financed the Lebanese Wine Day in Paris on May 14, 2013 and will do the same for the Lebanese Wine Day in Berlin in 2014. We are currently negotiating with the Chamber of Commerce for a contribution to the participation costs in the ProWein International Wine Fair exhibition in Düsseldorf. The Managing Director of the International Organization of Vine and Wine (OIV) has been officially invited to Lebanon with a delegation to seal the relationship between the OIV and our country, while the Director General of the Ministry of Agriculture, Louis Lahoud, has been appointed Representative of Lebanon to the OIV and Vice-President of the Economy and Law Commission.

What investment plans do you have in mind for 2014?

We will be signing an agreement shortly for the commissioning of a new warehouse facility of 2,600 sqm. This will be our main investment for 2014. We invest in pallets and oak barrels on an annual basis and renew our equipment whenever needed. Our winery is located in the heart of the Bekaa Valley. The name of the location is Ksara, situated 45 kilometers east of Beirut. Our main offices and warehouses are located in Beirut. Our warehouses are supplied on a daily basis with a buffer stock to protect us from any shortages due to road closures in the winter because of snow or other unexpected accidents. Needless to say, the majority of restaurants and supermarkets are located in the outer Beirut area, which makes it necessary for a company of our size to cover distribution in Beirut as well.

What plans do you have to further consolidate your strong position as a key player in the wine sector?

In Lebanon, we are privileged by a reputation and a market size that put us at the top of the wine producers list. To maintain this privilege, we need to permanently invest in our equipment, in our storage facilities, and in the quantity and quality of our grapes. We will continue to do so and we will remain the market leaders in Lebanon.