The European Union has approved EUR 4 million disbursement to the Georgian state budget, which is the first tranche of the budget support component in frames of the EU-funded EUR 40 million three-year program aimed at agriculture sector development.

In 2013 EU launched the European Neighbourhood Program for Agriculture and Rural Development (ENPARD) with Georgia, designed to boost the production of food and reduce rural poverty in the country where rural population is 46.8% and agriculture’s contribution to GDP is below 10%.
 
“After assessing the situation, the EU has concluded that Georgia is satisfactory progressing in the implementation of the agriculture sector policy and that the conditions set out for the payment of this first tranche are met,” EU delegation to Georgia said on June 24.

EU ambassador to Georgia, Philip Dimitrov, said that this progress was demonstrated in establishment of agriculture service centres in provinces to provide advice to the farmers and the submission of new legislation to promote farmers ' cooperatives.

“All these developments are aligned with the priorities and directions agreed between the EU and the Georgian Government in the ENPARD programme,” he said.

“The fact that the EU is assessing positively the implementation of the sector strategy gives as reassurances that we are in the good path towards modernizing the sector and improving the conditions of our small farmers,” Georgian Agriculture Minister, Shalva Pipia, said.

A recent EU-funded report, assessing Georgia’s agriculture sector, says that country’s capacity of agriculture and rural economy stakeholders is weak and output “extremely low.”

“The failure of Georgian agriculture to modernize is one of the root causes for the persistence of high poverty levels in the country. The total area planted has been reduced by 43% and average production per hectare has diminished. Agriculture remains an important, albeit declining sector in terms of GDP contribution… Of those classified as employed in the sector 95% are 'small farmers', typically with around 1.2 hectares and 2 cows per family, classified as subsistence or semi-subsistence,” according to the report.