02/2018
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66 Geo r g i a Agriculture Bulletin Entrepreneurship Development Agency supports 5,313 projects Agricultural cooperatives invested GEL 32.2 million in 2017 Milk producers take study tours to Italy, U.S. Chinese to invest USD 140 million in agro park project
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Contents State Initiatives ........................................................................................................... 2 1) 2) 3) 4) 5)
Entrepreneurship Development Agency supports 5,313 projects .................................................. 2 New amendments for increased phytosanitary control ................................................................. 2 Georgia working to harmonize legislation with DCFTA ................................................................... 2 Agency to be created to run agricultural insurance program ......................................................... 2 Agricultural cooperatives invested GEL 32.2 million in 2017 .......................................................... 3
Foreign Aid ................................................................................................................. 3 6) 7) 8) 9) 10)
Workshop on challenges of agricultural cooperatives held ............................................................ 3 Vago LLC builds cool storage facility in Samegrelo.......................................................................... 4 Company finds success with hydroponic farming ........................................................................... 4 Milk producers take study tours to Italy, U.S. ................................................................................. 4 New aquaculture survey underway................................................................................................. 5
Private Sector.............................................................................................................. 5 11) 12) 13) 14) 15)
Chinese to invest USD 140 million in agro park project .................................................................. 5 Nut exports expected to rebound this year .................................................................................... 5 Georgia prepares for battle against stink bug ................................................................................. 5 Poultry producers urge reconsideration of policies ........................................................................ 6 Organic production becoming increasingly popular ....................................................................... 6
Note: The Georgia Agriculture Bulletin presents a monthly roundup of headlines and news stories related to Georgia’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 Georgia. Read more » BFC Max-Högger-Strasse 6 CH-8048 Zurich, Switzerland
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BFC Agriculture Bulletin
State Initiatives 1)
Entrepreneurship Development Agency supports 5,313 projects
February 5th, 2018, http://cbw.ge/business/supporting-smes-program-promotes-activation-regional-population/
The Entrepreneurship Development Agency, charged with facilitating private sector (in particular SME) development, has supported 5,313 projects with co-financing amounting to GEL 38 million, benefitting a total of 8,412 Georgian entrepreneurs. The Agency helps entrepreneurs develop their business by providing co-financing as well as by supporting them with consultancy on effective business practices. The Agency operates as part of the ‘Produce in Georgia’ program, which aims to increase the incomes of inhabitants within economically disadvantaged regions.
2)
New amendments for increased phytosanitary control
February 14th, 2018, http://eugeorgia.info/en/latestarticle/419/1-martidan-fitosanitariuli
In order to protect Georgia's consumer market and imported food safety standards, amendments to two regulations have been adopted and go into effect in March 2018. The first amended regulation will mean that goods subject to "the rule of veterinary border-quarantine control" will no longer be allowed to freely circulate in the country while laboratory analysis is being conducted, as was previously the case. This will affect live animals, meat and meat products, aquaculture products, dairy products and cereals intended for animal feed, among others. The second amended regulation will increase controls efforts against diseases such as salmonella and listeria by means of a system designed to notify authorities in the importing country regarding enterprises in their country that have tested positive for diseases.
3)
Georgia working to harmonize legislation with DCFTA
February 21st, 2018, http://www.sarke.com/cgi/search/news.asp?Code=10053260
The government of Georgia and the relevant bodies of the European Union (EU) have been working together to compile a list of acts that Georgia needs to adopt in the spheres of food safety, veterinary control and plant protection as it relates to Georgia’s Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU. In total, there were 102 legal acts needing to be adopted in respect to food safety, 85 acts regarding plant protection and 84 acts regarding veterinary measures. In 2015-2017, ten EU directives were adopted in Georgia, with their effects scheduled to come into force between 2018 and 2026. Additionally, three more directives were adopted in December 2017. In 2018, Georgia is scheduled to introduce into legislation another nine directives as well as to complete the construction of a new border inspection point.
4)
Agency to be created to run agricultural insurance program
February 26th, 2018, http://www.bm.ge/en/business-inner/agrodazgvevaze-pasuxismgebeli-uwyeba-iqmneba/183/
The Ministry of Agriculture has made changes to the agricultural insurance program that will create a specific agency to be responsible for the program going forward. The Ministry believes that transitioning control to a specific agency will enable the program to work in a much more systematic way.
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The agricultural insurance program began in 2014. Since that time, the Agriculture Projects Management Agency (APMA) reports that GEL 29.38 million has been used to help provide insurance coverage on nearly 60,000 hectares of agricultural land. In total, more than 68,000 policies have been issued, insuring GEL 465.57 million worth of crops.
5)
Agricultural cooperatives invested GEL 32.2 million in 2017
February 28th, 2018, http://www.bm.ge/en/business-inner/kooperativebma-gasul-wels-322-milioni-laris-kapitali-moizides/181/
According to the Agricultural Cooperative Development Agency, 1,270 agricultural cooperatives were registered in Georgia in 2017, attracting 11,664 agricultural producers. In total, these producers mobilized an area of 16,941 hectares and helped attract GEL 32.2 million in capital for cooperatives to invest. The Agency is currently using GEL 1.1 million to finance ten agricultural cooperatives under the framework of the ‘State Program for Supporting Agricultural Cooperatives’. Last year, three agricultural cooperatives were financed with GEL 1.2 million within the state program for viticulture cooperatives. Additionally, 67 cooperatives have received GEL 423,719 to support apiculture efforts, and 29 cooperatives have been financed with GEL 1.6 million under the state program for the rational use of state-owned meadows in mountainous regions.
Foreign Aid 6)
Workshop on challenges of agricultural cooperatives held
February 2nd, 2018, http://enpard.ge/en/enpard-partners-discussed-challeges-effective-management-value-additionagricultural-cooperatives-georgia/
Oxfam and Elkana Biological Farming Association organized the ‘Challenges of Effective Management and Value Addition in Agricultural Cooperatives in Georgia’ workshop as part of the lessons learned workshop series under the European Neighborhood Program for Agriculture and Rural Development (ENPARD) and the European Union (EU)-funded ‘Supporting Agricultural Cooperation In Georgia’ project. Within the aforementioned projects, 15 agricultural cooperatives were supported with GEL 1.23 million in investments, and 52 agricultural cooperatives were supported in branding and introducing food safety requirements. Workshop organizers outlined the importance of creating a supportive environment for the development of agricultural cooperatives and also spoke about the practical problems and solutions related to the legal and regulatory framework regarding agricultural cooperative. Participants also discussed the problems and prospects of introducing food safety standards as well as production line and product branding issues in agricultural cooperatives and other small-scale enterprises. Representatives of the Ministry of Agriculture, the Agricultural Cooperative Development Agency, other governmental and international organizations, civil society, donor and partner organizations, agricultural cooperatives and specialists in different fields of agriculture attended the workshop.
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BFC Agriculture Bulletin
7)
Vago LLC builds cool storage facility in Samegrelo
February 5th, 2018, http://www.sarke.com/cgi/search/news.asp?Code=10053087
Within the Unified Agroproject, Vago LLC has built a 100-square meter cool storage facility for fruits and vegetables in the Ingiri village (Samegrelo region). Investments in the cool storage amounted to GEL 34,300, including a grant of GEL 13,720. Vago has also been the beneficiary of the preferential agrilending program, through which the company built a hazelnut-processing enterprise. The project is financed by the International Fund for Agriculture Development (IFAD) and the Global Environment Facility (GEF). Within the project, the Agricultural Projects Management Agency (APMA) provides co-financing for up to 40% of the cost of a project. In total, the Unified Agroproject has helped support 125 beneficiaries with GEL 2.5 million in co-financing.
8)
Company finds success with hydroponic farming
February 8th, 2018, http://www.euneighbours.eu/en/east/stay-informed/news/green-shoots-growth-georgia-hydroponicfarming-eu-support
Imereti Greenery has been receiving European Union (EU) support to employ the latest European technologies for hydroponic farming and is seeing production and profits soar as a result. The company now operates on two hectares in the city of Samtredia (Western Georgia), growing lettuce and cucumbers and supplying them to supermarket chains and high-class hotels. The company was supported by the EU4Business initiative as well as the European Bank for Reconstruction and Development (EBRD). Following this support, production grew 75%; profits rose 380%, and the number of staff grew 129%.
9)
Milk producers take study tours to Italy, U.S.
February 14th, 2018, http://www.fao.org/georgia/news/detail-events/en/c/1103047/
The dairy industry in Georgia is dominated by small-scale farms and a lack of coordination between producers, making milk collection more costly and the upgrading of safety and quality standards more difficult. In recent years, however, the recently established Georgian Milk Producers Association has worked with the European Bank for Reconstruction and Development (EBRD) and the Food and Agriculture Organization of the United Nations (FAO) to improve safety, hygiene and efficiency standards in the country’s dairy industry as well as support the country’s producers in remaining competitive. More specifically, they helped a delegation of Georgian producers embark on study tours to Italy’s Emilia-Romagna region and Des Moines, Iowa (United States) to learn how to increase the value of their products and to become familiar with new milk production technologies. The group also learned how groups in both countries develop and exploit opportunities offered by niche markets, such as organic production. The focus of EBRD and FAO efforts will now turn to building the capacity of the Georgian Milk Producers Association, promoting cooperation in the sector, facilitating dialogue between the private sector and the government and strengthening the dairy value chain by developing geographic indications, which give products a high market potential both locally and internationally.
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BFC Agriculture Bulletin
10) New aquaculture survey underway February 23rd, 2018, http://www.fao.org/georgia/news/detail-events/en/c/1104050/
The National Statistics Office of Georgia has started a pilot survey on aquaculture holdings as part of the ‘Strategic Plan for Agricultural, Environmental and Rural Statistics of Georgia 2016-2020’. Data collection for this first-of-its-kind project in Georgia will be carried via android tablets and is being supported by the European Union (EU), the Food and Agriculture Organization of the United Nations (FAO) and the European Neighborhood Program for Agriculture and Rural Development (ENPARD). Staff trainings and field work are scheduled to occur between February 22, 2018 and March 19, 2018. The survey aims to produce official statistics about aquaculture in Georgia and gather information on aquaculture holdings, reservoirs, production of raw fish, fish realization and loss, the nutrition of water organisms and the use of fertilizers and pesticides as well as the technical equipment, employment and expenditures in aquaculture holdings.
Private Sector 11) Chinese to invest USD 140 million in agro park project February 8th, 2018, http://georgiatoday.ge/news/9045/Chinese-to-Invest-%24140-mln
AS Group Investment and the Chinese company China CAMC Engineering Co. Ltd., the largest developer company in the South Caucasus, have signed a memorandum of cooperation. Under the memorandum, the Chinese company will invest USD 140 million in the ‘Absheron Agro Park’ project. The ‘Absheron Agro Park’ project is a large project being implemented in Azerbaijan, Kazakhstan and Georgia that aims to increase modern agricultural production in the three countries.
12) Nut exports expected to rebound this year February 9th, 2018, http://bizzone.info/agriculture/2018/1518224579.php
According to Georgi Todua, the executive director of the Nut Producers Association, nut exports are expected to increase this year. This comes after 2017 saw a substantial (54%) decrease in exports. In 2017, nut exports amounted to USD 83 million and were the eighth most exported good, whereas in 2016, nut exports amounted to USD 179 million and were the second most exported good.
13) Georgia prepares for battle against stink bug February 13th, 2018, https://www.newsgeorgia.ge/v-gruzii-s-priblizheniem-vesny-aktivizirovalis-mramornye-klopy/
With a mild winter and spring approaching, Georgian farmers are bracing themselves for the awakening and attack of the brown marmorated stink bug. Last summer, the pest caused serious damage in rural Western Georgia and destroyed 20% of hazelnut crops. This year, it is expected that the pest could spread to Eastern Georgia. To combat the pest, the government has allocated GEL 49 million, which will be used in three main directions: an active information campaign, full-scale monitoring and chemical spraying. Information campaigns will be held on the principle of one house to another, and the state will monitor the population with more than 100,000 pheromone traps. The state will also use 360 tons of chemicals to treat 1 million hectares. Experts note that it is impossible to completely eradicate the pest and that the goal is to bring the pest under control so that it will not significantly affect the country’s economy. Page 5
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14) Poultry producers urge reconsideration of policies February 21st, 2018, http://www.commersant.ge/?view=post&id=139328&lang_id=en
The development of domestic poultry production was announced as one of the priorities of the government; however, Georgian poultry producers are calling for a reconsideration of government policies that, they argue, are strangling the domestic poultry industry in Georgia. They contend that previously introduced taxes along with the 2017 tax imposed for the sanitary inspection of products has caused producers to have to increase prices and, in some cases, to cease production. Despite high levels of relatively cheap imports, domestic poultry producers believe that most Georgians want to buy local but that local products are being priced out by the amount of taxes being imposed on the industry.
15) Organic production becoming increasingly popular February 26th, 2018, http://www.finchannel.com/opinion/analysis-3/71737-organic-is-the-new-black
Interest in organic production is growing in Georgia, both as a way to return to more traditional agriculture as well as a way to take advantage of the increasing demand for organic products around the world. CaucasCert, the organic production certification authority in Georgia, announced that organic certificates in Georgia have been issued to 28 producers, with 40 more being at the preparation/control stage for receiving organic certification. CaucasCert certificates are recognized in the European Union (EU) and Switzerland.
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