Georgia : Reform in the Food and Agriculture Sector Book

Today Georgia is largely an agriculture-based economy. It has quite favorable conditions for the production of a wide variety of annual and perennial crops including grapes, fruits, tea, citrus, tobacco as well as some aromatic and medicinal plants. Yet, its agricultural and food production system has experienced a sharp decline in output from the peak levels of 1987. The ongoing reforms in food and agriculture in Georgia suggest that the government is committed to continuing reforms in the economy of the country, and more specifically in food and agriculture, to complete the transition to a market system based on private ownership. This study presents a status report on the reform of the food and agriculture sector in the Republic of Georgia. In addition to giving an account of the current situation in primary agriculture and agro-processing, this study also recommends a set of actions to facilitate recovery in the sector and provide guidelines for replacing the present spontaneous and unstructured sectoral reform with a consistent program for transition to a market based agriculture. The first part of the report emphasizes the necessary actions for continuing sectoral reforms and the critical first steps in their implementation, while the second part provides subsectoral analyses and recommendations for improving production efficiency and investment. Part I is organized as follows: 1) background; 2) agenda for agricultural reforms including: (a) supportive policy environment for agriculture; (b) privatization of primary agriculture; (c) competitive market for agricultural products and services; (d) financial services; and (e) institutional framework for privatized food andagriculture; and 3) proposed short-term and medium-term assistance program. Finally, part II is divided as follows: 1) annual crop and horticultural production; 2) irrigation, input supply and mechanization; 3) livestock production; 4) agro-processing; and 5) forestry and environment.