02/2017
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21 A rm e n i a Agriculture Bulletin USD 120 million for agricultural development in 2017 Armenian farmers to attend dairy congress in Tbilisi EUR 5 million grant for agricultural insurance pilot Armenian investment opportunities presented in France
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Contents State Initiatives ........................................................................................................... 2 1) 2) 3) 4) 5)
Tavush province investment programs ........................................................................................... 2 Meeting held to discuss Kotayk development programs ................................................................ 2 90% of processing company debts to be repaid by June ................................................................ 2 USD 120 million for agricultural development in 2017 ................................................................... 3 Minister Arakelyan meets with Dutch PUM representative ........................................................... 3
Foreign Aid ................................................................................................................. 3 6) 7) 8) 9) 10) 11) 12)
Yerevan hosts ‘Test the Value Chain’ workshop ............................................................................. 3 Armenian farmers to attend dairy congress in Tbilisi ..................................................................... 4 FAO to provide assistance for resource saving in Armenia ............................................................. 4 FAO prepares ‘plowless’ tillage program for Armenia .................................................................... 4 Armenian innovation featured in new project proposal ................................................................. 5 EUR 5 million grant for agricultural insurance pilot ........................................................................ 5 28 farms receive support for organic development ........................................................................ 5
Private Sector.............................................................................................................. 6 13) Armenian investment opportunities presented in France .............................................................. 6 14) Armenian companies take part in ProdExpo 2017 .......................................................................... 6 15) Armenia wine exports increase 24.74% in 2016 ............................................................................. 6
Note: The Agriculture Bulletin presents a monthly roundup of headlines and news stories related to Armenia’s agricultural sector. This bulletin is prepared by Business & Finance Consulting—a Swiss-based development finance consulting company with a long history of working in Eastern Europe, Central, South and South East Asia and North Africa. Currently, BFC is implementing the “Financing the Agriculture Sector in Armenia” project for KfW. Read more »
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BFC Agriculture Bulletin
State Initiatives 1)
Tavush province investment programs
February 21st, 2017, https://armenpress.am/eng/news/879560/tavush-province-investment-programs-ready-to-go;-ropewayconstruction-agricultural-businesses-and.html
Projects aimed at improving life in the Tavush province have been elaborated and are underway. The projects are planned for improving the agricultural and tourism sectors as well as overall infrastructure in the province. As with previous years, state resources will help provide villages in Tavush with nitrogen, potassium, phosphate fertilizers and diesel fuel at affordable prices. In addition, the Armenian-French Foundation will invest approximately AMD 400 million in the province to establish small farms and improve water drainage systems. The Regional Development Foundation is also carrying out several programs to improve the water supply system in the province. There are still investment opportunities in the region. In particular, Gandzakar village has proposed a project on harvesting, processing and marketing herbs; Haghtanak village is looking for funding for a program on olive and vegetable oil production; and Koghb village has put forth information regarding their greenhouse program. In addition, Navur village has proposed investments for meat processing and slaughterhouses while Verin Karmir wants to begin their program of homemade wine bottling and Ptghavan is looking to develop its gardening program. For some villages, funding appears to be on the way as one Argentine-Armenian investors has expressed interest in providing financing for business programs on herbs and meat production, stating that he was ready to provide funds without interest rates to help locals launch their businesses.
2)
Meeting held to discuss Kotayk development programs
February 20th, 2017, http://finport.am/full_news.php?id=28517&lang=3
The Ministry of Agriculture held a meeting to discuss investment programs for the development of the Kotayk region. At the meeting, five investment programs were reviewed which seek to establish and enhance greenhouse production, leather processing and milk processing as well as organize a company to produce anti-hail products and another to produce insulin and pectin from apple earth. As a result of the meeting, four programs will be presented for further discussion by the Armenian government while another program will be altered slightly before its presentation to the government for potential funding.
3)
90% of processing company debts to be repaid by June
February 16th, 2017, http://arka.am/en/news/business/minister_90_percent_of_debts_for_purchased_fruits_and_vegetables_to_be_paid_by_june/
Agriculture Minister Ignati Arakelyan announced that 90% of the AMD 1.47 billion debt that Armenian processing companies owe to farmers for purchased fruits and vegetables will be paid by June 2017. After meeting with processing companies, the Ministry announced that AMD 586 million would be repaid in February 2017, AMD 415 million in March 2017, AMD 160 million in April 2017 and AMD 218 million in May 2017.
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BFC Agriculture Bulletin
The Minister also announced that debts against the Vinar company have resulted in the issue being brought before the prosecutor’s office and the State Revenue Committee sealing Vinar storehouses, where 12,000 deciliters of product are kept. Vinar was given some days to sell the spirits and repay the AMD 100 million debt owed to farmers.
4)
USD 120 million for agricultural development in 2017
February 10th, 2017, http://minagro.am/en/2017/02/over-120-million-usd-will-be-invested-in-agricultural-sector/
The Ministry of Agriculture is expected to invest USD 120 million in projects designed to help the agricultural sector in 2017. Investments will be made to build canning factories and slaughterhouses, expand greenhouse farms and increase brandy production as well as provide financing for regional development projects.
5)
Minister Arakelyan meets with Dutch PUM representative
February 9th, 2017, http://finport.am/full_news.php?id=28366&lang=3
Agriculture Minister Ignati Arakelyan met with Albert Westerings, coordinator in Armenia for PUM Netherlands Senior Experts. The two discussed the need for highly qualified personnel for the further growth and development of agriculture in Armenia. The two also discussed increasing representation of Armenian products in foreign markets, the prospects for raising the competitiveness of local products and successful marketing. Minister Arakelyan hopes the organization will support efforts to retrain Armenian specialists, and Mr. Westerings noted his organization’s readiness to support the organization of seminars. PUM Netherlands Senior Experts is an organization funded by the government of the Netherlands and has been facilitating experience and knowledge exchanges between businessmen around the world for more than 30 years.
Foreign Aid 6)
Yerevan hosts ‘Test the Value Chain’ workshop
February 24th, 2017, http://finport.am/full_news.php?id=28579&lang=3
A three-day workshop entitle ‘Test the Value Chain’ was held in Yerevan in February by Deutsche Gesellschaft fur Internationale Zusammenarbeit (GIZ) and the National Metrology Institute of Germany (PTB). The workshop was attended by representatives of state and non-state institutions, infrastructure organizers and representatives from the wine, dried fruit, natural juice and fishing sectors as well as representatives from international organizations. Speaking at the workshop, Deputy Minister of Economy Emil Tarasyan stressed the importance of such workshops for further development in Armenia. Wilhelm Hugo, team leader of the GIZ ‘Private Sector Development South Caucasus’ program also spoke, presenting the activities of his program in the past three years and outlining the next three-year phase the program is entering. Other speakers including Moritz Ackermann, a PTB project coordinator who presented on PTB activities in the South Caucasus, and Dr. Christine Froese, a PTB expert who spoke about European experiences in the fishing, dried fruit and natural juice sectors.
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BFC Agriculture Bulletin
7)
Armenian farmers to attend dairy congress in Tbilisi
February 24th, 2017, http://finport.am/full_news.php?id=28576&lang=3
The European Bank for Reconstruction and Development (EBRD) and the Food and Agriculture Organization (FAO) of the United Nations are working together with the Milk Producers Association of Ukraine to organize the ‘First Caucasus Dairy Congress’ in March in Tbilisi, Georgia. The event will explore modern technological and business approaches in dairy development based on real cases and experiences from farmers in the region. Managers and specialists of the most successful farms from Georgia, Armenia, Ukraine, Azerbaijan and other countries will speak about how they found success in the sector, and participants will also have an opportunity visit commercial dairy farms in Georgia which have already successfully implemented advanced technologies. The event is expected to draw more than 200 participants, including commercial dairy farmers and processors from Georgia, Armenia, Azerbaijan and Ukraine as well as potential investors, international organizations and government representatives. The Caucasian International Dairy Congress also plans to set up a platform for sharing knowledge and technologies for farmers and other entities interesting in developing modern dairy businesses.
8)
FAO to provide assistance for resource saving in Armenia
February 23rd, 2017, http://arka.am/en/news/business/fao_to_provide_technical_assistance_to_armenia_for_resources_saving_agriculture_develo pment_/
The Food and Agriculture Organization (FAO) of the United Nations is working within a European Neighborhood Program for Agriculture and Rural Development (ENPARD) project to help Armenia develop resource-saving agricultural techniques. One of the largest problems for agricultural development in Armenia is a shortage of specialized machinery. To help combat this, training centers are being opened in six provinces to train farmers on the use of specialized machinery which help conserve resources. FAO is also working to conduct a study to gauge the impact of climate change on the soil degradation process, and proposals have already been submitted to help preserve land in Armenia. The two-year, EUR 2 million ENPARD program was launched in 2015 and aims to lessen natural disaster risks, enhance Armenia’s ability to adapt to natural disasters, maintain soil fertility and ensure proper management of land resources.
9)
FAO prepares ‘plowless’ tillage program for Armenia
February 22nd, 2017, https://news.am/eng/news/374894.html
The Food and Agriculture Organization (FAO) of the United Nations has prepared a ‘plowless’ tillage program for Armenia. Such cultivation protects soil from erosion and water evaporation as well as the loss of microflora and the disappearance of useful elements. Depending on the solidity of the soil and the specific crop being grown, soil can be turned only to a minimal depth or, sometimes, not at all. The ‘zero plowing’ method was introduced in northern Kazakhstan in 2001 and nearly 2 million hectares of Kazakh land is currently cultivated using the resource-saving method. The program designed by FAO will offer training to farmers and demonstrative farms in different provinces. The program has an estimated cost of USD 1.7 million; FAO is presenting the program to the government of Armenia and private donors for financing and implementation.
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10) Armenian innovation featured in new project proposal February 17th, 2017, http://finport.am/full_news.php?id=28481&lang=3
Innovations made by Armenian scientists in grape, berry and fruit growing will be included as part of the ‘Technical Platforms’ project of the Eurasian Economic Union (EEU). According to Irina Nam, coordinating secretary of the Eurasian Technological Platform (ETP), Armenian scientists have accumulated the best technologies which could be used in all common EEU projects from Kazakhstan and Russia to Belarus. Ms. Nam hopes that the upcoming submission of the ‘Technical Platforms’ project will help Armenian and other EEU countries overcome their largest struggle in modernizing agricultural sectors with new, innovative techniques: a lack of funding.
11) EUR 5 million grant for agricultural insurance pilot February 4th, 2017, https://news.am/eng/news/371429.html
The German development bank KfW has allocated EUR 5 million to support Armenian agricultural insurance in the form of a grant. The pilot project for Armenian agricultural insurance is set to be implemented from 2018 through 2021. The Armenian government will provide support for the project in cooperation with an international consulting agency charged with giving recommendations for types of risks (hail, drought, etc.), extent of damage and insurance subsidies. Given the high risks in Armenian agriculture and Armenia’s lack of experience in this type of insurance markets, the German government will also provide support in attracting experienced insurances companies to reinsure the risks of domestic insurers.
12) 28 farms receive support for organic development February 3rd, 2017, http://finport.am/full_news.php?id=28264&lang=3
28 small farms have been selected from 130 applications and will each receive EUR 10,000 as part of the ‘Organic Agriculture Support Initiative’, a project aimed at developing organic agriculture and supporting the successful sale of organic products both domestically and internationally. In order to qualify for funding, a farm must have at least three years of experience in agriculture within the territory of Armenia and have organic certification. Organic agriculture has great potential in Armenia and is part of the state’s strategic program for agricultural development. The government of Armenia believes that Armenia can become a competitive player in international organic markets. The ‘Organic Agriculture Support Initiative’ is being implemented by the Austrian Development Agency and has total budget of EUR 3.3 million.
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BFC Agriculture Bulletin
Private Sector 13) Armenian investment opportunities presented in France February 21st, 2017, http://www.panarmenian.net/eng/news/233168/
The Armenian-French Business Development Foundation hosted a series of meetings in Paris, Lyon and Marseilles to encourage French investments in Armenian business projects. Armenian companies engaged in food and agriculture, information technology and engineering, light industry, wine, jewelry, pharmaceuticals, transportation and energy presented their business projects at the meetings to a total of 25 French firms interested in investing in Armenia. The French firms also received presentations on the advantages of entering Eurasian Economic Union (EEU) and Iranian markets through Armenia.
14) Armenian companies take part in ProdExpo 2017 February 2nd, 2017, http://arka.am/en/news/business/over_40_armenian_companies_to_take_part_in_prodexpo_2017_food_fair_in_moscow/
Armenian-made food products were presented in two pavilions as part of the ProdExpo 2017 international food exhibition in Moscow. In total, more than 40 Armenian companies engaged in food, brandy and wine production showcased their products at the event. The exhibition provided an opportunity for Armenian companies to not only showcase their products but also contact and make deals with other, international companies. ProdExpo 2017 featured food products, beverages and raw materials from approximately 2,000 companies from 60 countries.
15) Armenia wine exports increase 24.74% in 2016 February 1st, 2017, https://armenpress.am/eng/news/876966/armenia-wine-exports-increase-by-2474.html
Compared to 2015, the export volumes of Armenian wine exports grew by 24.74%, with the customs value growing 52.02% and amounting to USD 2.52 million. In total, 779.9 million liters of wine were exported from Armenia in 2016.
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Prepared by Business & Finance Consulting (BFC) www.bfconsulting.com In this bulletin, BFC provides extracts from articles that have been published by others and as a result cannot be held responsible for such content. The articles do not necessarily reflect the opinions of BFC, its staff, its associates or its partners. Copyright of articles is retained by their authors.