Georgia, with a total area of 69 700 sq.km can be divided into three geographical regions: mountains, covering about 54% of the total area, highlands about 33% and valleys some 13%. Agricultural lands total 3 million ha, which consists of 44% of the total territory, among which 24% is arable land, 10% - land under perennial crops and 66% - pastures and meadows. As a typical mountainous country, Georgia is divided into vertical soil-climatic zones, and there are many different climatic conditions on its territory. Ecosystems and landscapes change over small distances from high mountains with glaciers and eternal snow (up to 5,068 m above sea level, peak Shkhara) to subtropical landscapes at the Black Sea and steppes and semi-deserts in the Southeast. The natural-climatic conditions determine the main directions of agricultural production and their distribution on the territory of Georgia. Cropping is possible through the country up to 2 000 m. At higher elevations, only pastures are reported. The main agricultural specialities are viticulture and the growing of tea and fruit, especially citrus and nuts. Recently grain has been more prominent, along with sunflowers and vegetables, including potatoes. In order to get good yields of agricultural crops, it is necessary to carry out activities connected with irrigation (Eastern Georgia), draining (Western Georgia) and soil protection (against erosion). The agricultural sector, including the food industry, is of extreme importance to the economy of Georgia. Therefore, improvement in this sector has a direct effect on the lives of the majority of common Georgian people. In recent years, agriculture accounted for 34% of total GDP, and more than 50% of total employment. Agricultural products still form a major part of Georgian exports. In particular in 1999, nuts accounted for 6,5% of exports, grape wine 6,0% and tea 4,8% (total export - USD 240.7 m). However Georgia had a negative trade balance of agricultural products. In the same year, the largest share in agricultural imports belonged to cigarettes (5,7%), wheat and meal (4,8%), sugar (2,6%) (total import - USD 622,6 m). National independence in 1991, a subsequent civil war and ethnic conflicts, extreme inflation and problems due to the socio-economic adaptation as a consequence of the disintegration of Soviet production and distribution systems forced the Georgian rural population to introduce subsistent agricultural production systems, which are still at work. The agroindustrial sector of Georgia underwent a deep crisis in recent years. Compared with 1989-91 the total cost of agricultural production was reduced by 72,5% in 1996-98. Many food enterprises have stopped or are working at a low capacity. The main reasons for this are:- · Uncompetitive cost of raw materials, · lack of financial and energy resources, · uncertainty about demand, and · increased competition from foreign products. This is because under the Soviet system, Georgian agricultural production concentrated on high value agricultural exports such as tea, citrus, wine and other alcoholic beverages, fresh and processed fruits and vegetable, essential oils and spices. One of the factors in the concentration on high value crops in Georgia was the high level of labour required. Therefore, production of basic cereal crops, meat, milk, sugar and oil seed crops was neglected and these were supplied from other Soviet Republics where they could be produced more cheaply in other areas that were not suited to the production of high value export crops. As a result, the production infrastructure totally collapsed; irrigation systems, perennial crops, livestock farms were seriously damaged, and activities connected with soil protection, veterinary services, selection and breeding were abandoned. Additionally, production in the sector of food industry was considerably reduced; e.g. production of wine was 4 times reduced: of vegetable and fruit cans - 27 times: of tea - 90 times: of meat and meat products - 45 times: of milk and dairy products - 29 times. The stocks of wines, brandy spirit and other reserves were not created any more. As a result positions on the domestic markets and traditional export markets were fully lost. Furthermore, farmers have had no access to start-up capital, and attraction of loans at favourable terms is difficult. There is a drastic disparity in cost between manufactured goods and farm products. Farm buildings and homesteads were neglected and the rural infrastructure and technical equipment for agricultural production and processing enterprises were destroyed. As a result Georgia has faced the problem of hunger. The country, which had succeeded in becoming one of agricultural net-export, changed into country of net-import. Only with the assistance of international and humanitarian aid organisations did it become possible to provide the poorest sections of the population with minimum number of food products. |
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 Project Supported by TACIS |
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