Greece is helping to solve the unemployment problem in upstate New York.
When you see a small white container of Fage Greek yogurt (pronounced fa-yeh), instead try to picture a 220,000 square foot U.S. production facility, close to 200 jobs and lots of busy cows (every pound of yogurt uses 3 times as much milk). In addition, yogurt waste creates methane gas that creates electricity and reduces local taxes.
Fage is an Athens based multinational that started in 1926 as a small dairy store. After expanding in Greece, they started exporting to Europe during the 1980s and to the U.S. in 1998. Their first U.S. plant opened in Johnstown, N.Y. in 2008. Chobani, #1 in Greek-style yogurt sales, is also located in the area.
All of these yogurt facts were in the news recently because Fage’s proposal to build a new multi-million dollar whey treatment plant was blocked by local bureaucracy until New York’s Governor Cuomo intervened.
Our bottom line: Fage Yogurt is a good example of foreign direct investment.
The Economic Lesson
So often true with the market system, people respond to the profit motive with behavior that is not readily evident but amazingly productive. The Fage story involves jobs, innovation, the environment, international trade and a ripple of industrial development.
An economic question: Specifically, how does Fage add to the U.S. GDP?