EU co-operation in the agriculture sector Georgia: ENPARD Juan Echanove February, 2013.

EU co-operation in the agriculture EU co-operation in the agriculture sector Georgia: sector Georgia:

ENPARDENPARD

Juan EchanoveJuan EchanoveFebruary, 2013February, 2013

BackgroundBackground

Profile of the sectorProfile of the sector

The declineThe decline

The potentialThe potential

New trendsNew trends

Sector strategySector strategy

Donor coordination Donor coordination

Agriculture: Agriculture: profile of the sectorprofile of the sector

Agriculture contribution to GDP 9%

Total number of farmers 2.5 million

% of employed population on agriculture sector

55%

Average size of land per farmer 1 ha.

% of farmers producing for self consumption 82%

Share of the MoA in the national budget (2008) 1.3%

% of foodstuff imported (Tbilisi) 80%

Year Sown Area Livestock Employment % of GDP1990 701,900 4,287,000 25.2 29.71995 453,100 2,104,300 30.6 41.7 2000 610,800 2,166,000 52.1 20.22005 539,600 2,539,600 54.3 16.8 2008 329,300 1,735,600 55.3 8.9

Dramatic decline in production…

……and dramatic increaseand dramatic increaseIn the number of peopleIn the number of people in agriculturein agriculture

The declineThe declineof Georgian agricultureof Georgian agriculture

Rural poverty

Why? Agriculture remains the forgotten sector of the economy

– Lack of public policies. No strategyNo strategy– Modest investment by either the public or private sectors– No provision of veterinarian and extension services

Farms are too small, so farmers cannot…– secure credit– purchase inputs and equipment competitively– acquire critical production information– market their products competitively

Negative background on farmers' co-operation No legal support to farmers’ coops/associations

Policies: – Policy favours importing ( low import costs)– Lack of non-trade barriers (no SPS in place)

The potentialThe potential

LaborLabor Comparatively well-educated farmersComparatively well-educated farmers

LandLand Fertile soilsFertile soils High biodiversity/ecosystemsHigh biodiversity/ecosystems Lots of unused agricultural lands (stated-owned)Lots of unused agricultural lands (stated-owned)

MarketsMarkets Internal market (imports’ substitution): Consumers prefer local productsInternal market (imports’ substitution): Consumers prefer local products External markets: Georgia, good ‘brand’ in former URSS republicsExternal markets: Georgia, good ‘brand’ in former URSS republics Europe; DCFTA (?)Europe; DCFTA (?)

……and the proven successand the proven success Georgia had very efficient agriculture system during URSS and beforeGeorgia had very efficient agriculture system during URSS and before (10% of URSS production) Many small-scale projects have proven that it is not that difficult to increase productivity and Many small-scale projects have proven that it is not that difficult to increase productivity and

farmers’ income farmers’ income THE MANY COLORS IN THIS MAP INDICATES THE VARIETY THE MANY COLORS IN THIS MAP INDICATES THE VARIETY

OF GEORGIAN LANDSCAPES AND TYPES OF SOILS…OF GEORGIAN LANDSCAPES AND TYPES OF SOILS…

THE MORE COLORFUL A COUNTRY IS IN A MAP LIKE THIS, THE THE MORE COLORFUL A COUNTRY IS IN A MAP LIKE THIS, THE MORE FERTIL IT IS. GEORGIA IS EXTREMLY FERTIL!MORE FERTIL IT IS. GEORGIA IS EXTREMLY FERTIL!

Geographical Geographical diversity/diversity/

specializationspecialization

donor co-ordination set-up in place

40 individuals from 30 organizations attending regularly– IOs, bilateral donors, NGOs, etc. – MoA is part, but not chairs yet

FAO chairs, EUD sis secretariat Sub-groups along the lines of the strategy priorities Presentations and discussions on technical topics Blog to collect technical documents More resources by donors

New trends:From Cinderella to princess

Strong political commitment

Strategy and Action Plan

New programmes by Government

Dramatic increase in the budget

More resources by donors

Government StrategyMain directions… •Competiveness improvement trough private sector development

Including Straightening farmers' groups

•Capacity improvement of the institutions and stakeholders (MoA local extention offices, training, extension, VET…)

•Development of food production chains

•Rural infrastructure •Irrigation…

•Food security

•Environment, agri biodiversity

ENPARD GEORGIAENPARD GEORGIA

Evaluate successful Evaluate successful experiencesexperiences

Produce a Produce a Strategy Strategy for the sectorfor the sector

Undertake Undertake policy/legislative

reforms Budget fundsBudget funds

Undertake consultation with stakeholders

EU fundsEU funds

ENPARDENPARD


Preparation of the draft strategy

Preparation of the draft strategy

ConsultationConsultation

PreparationOf the Action

Plan

PreparationOf the Action

Plan

ApprovalApproval

Initial 'guidance' provided by external expert

Assessments of farmers' organizations

Assessments on information needs (food security)

Lessons learned from EU+MS projects

EU/FAO programme on Linking information and decision-making to improve food security

Review of EU-assisted development aid in agriculture

Farmers survey (GEOSTAT)

TAIEX

TA to assist in the preparation of the Action Plan

EU FWC

TA to assist in the preparation of the Action Plan

OTHER DONORS?

Workshop on agricultureStrategies on EU MSThe process

Successful experiences evaluated


Overall objective:Overall objective: it aims at increasing food it aims at increasing food production in Georgia and reducing rural production in Georgia and reducing rural poverty.poverty.

The specific objectiveThe specific objective is to improve the is to improve the agriculture sector by supporting the agriculture sector by supporting the implementation of the implementation of the Agriculture Sector Agriculture Sector strategystrategy and strengthening small farmers‘ and strengthening small farmers‘ organizations. organizations.


Strengthened co-operation amongst small farmersAdoption of legislation to promote business-oriented small farmers' groupsPromotion of small farmers' co-operation Establishment of business-oriented small farmers' groups Capacity building to farmers' groupsComplementary limited investment support to the farmers' groups

Access to capacity building by small farmers improved Organization of the extension system, district level

Improved efficiency of institutions involved in agriculture Capacity building/support to the MoA of Georgia Capacity building/support to the MoA of AdjaraCapacity building to agriculture-related education and research institutionsImprovement of agriculture-related information systems and statistics

Geographical Indications regulated and developed


EUR 40 M EU contributionEUR 40 M EU contribution

EUR 18 M Budget SupportEUR 18 M Budget SupportEUR 15 M grantsEUR 15 M grantsEUR 2 M TA to MoA via FAOEUR 2 M TA to MoA via FAOEUR 3 M suport to Adjara (UNDP)EUR 3 M suport to Adjara (UNDP)EUR 1 M academic instiutionsEUR 1 M academic instiutionsEUT 1 M otherEUT 1 M other

5 years (BS 3 years)5 years (BS 3 years)


A cooperative is a business organization owned and operated by a group of individuals for their mutual benefit.

It has nothing to do at all with a kolkhoz!

Cooperatives…– supply their members with inputs for agricultural

production (seeds, fertilizers, machinery, TA) – And/or undertake transformation, packaging,

distribution, and marketing of farm products

Cooperatives are the dominant form for agricultural production in Europe (i.e. over 50% of agri-food industry ) and elsewhere in the world where there are small farmers (including many areas of USA)

Why Cooperatives?

Thanks!!!!

EU co-operation in the agriculture sector Georgia: ENPARD Juan Echanove February, 2013.

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