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Survival of the Fittest in Georgian Agriculture

From the ISET Economist news (http://www.iset.ge/news/?s=survival&lang=en)
By Nino Mosiashvili

The conclusion of the Association Agreement (AA) with the European Union was euphorically acclaimed by Georgian media as well as political and economic decision makers. Part of the AA is the Deep and Comprehensive Free Trade Agreement (DCFTA). The DCFTA is intended to liberalize trade between Georgia and the EU by lowering tariffs and reducing non-tariff barriers. For agriculture, the most relevant changes relate to food safety (bacterial contaminants, pesticides, inspection, and labeling) as well as animal and plant health (phytosanitation). For the manufacturing sector, the removal of so-called “technical barriers to trade” is similarly important, with the goal being to prevent the usage of technical standards as a means to protect domestic markets from foreign competition. “If regulations are set arbitrarily, they could be used as an excuse for protectionism”, states the World Trade Organization on its homepage.

             

It is clear that all these agreements require unilateral adjustment of Georgian regulations to European standards. Georgia is economically too small to impose its preferences on Europe. This is stated quite frankly in the AA, when it says that it aims to “support the efforts of Georgia to develop its economic potential via international cooperation, also through the approximation of its legislation to that of the European Union”.

Whether these unilateral adjustments are beneficial for Georgia is not generally clear. European regulations do not necessarily reflect “best international practice”. In democracies, laws and regulations come about through the lobbying efforts of political interest groups much more than through rational planning. In the future, internal political decisions made in the European Union will be relevant for Georgia much more than they were previously, and it will be more difficult to pursue policies tailored to the specific situation of Georgia.

Yet Georgia hopes that the convergence to European standards will make it easier for Georgian firms to access the European market. Most critical in this respect is Georgian agriculture, as it is the sector employing the bulk of the Georgian labor force, while it is at the same time dramatically lagging behind European productivity levels. In 2013, Georgia’s agriculture accounted for only 9.3% of the Georgian gross domestic product but employed about half of the labor force. Thus, one of the benchmarks for evaluating the usefulness of the DCFTA will be its impact on Georgian agriculture.

THROWN INTO THE WATER – WILL IT SWIM?

The impacts of the DCFTA for Georgia were assessed in a report with the lengthy title Trade Sustainability Impact Assessment in support of negotiations of a DCFTA between the EU and Georgia and the Republic of Moldova. It was written by a consortium consisting of the Dutch consulting company Ecorys and the The Center for Social and Economic Research (CASE)a Warsaw-based think tank. On a broad level, the report estimates that due to trade liberalization with the EU the national income of Georgia will increase by 291.9 million euro in the long run, corresponding to a GDP growth of 4.3%. This goes along with an increase in Georgian exports and imports by 12% and 7.5%, respectively, leading to an improvement of the Georgian trade balance. But what about agriculture?

According to the study, the DCFTA will have different effects on different agricultural products, and the overall picture is very ambivalent. The output of some product categories will increase, namely vegetable oils and fats (+6.7%), vegetables, fruits, nuts, and oilseeds(+3.4%), and animal products (+3.1%), while for many other products, the output is expected to shrink, e.g. livestock and meat products (-14.8%), other processed foods (-8.8%),beverages and tobacco (-4.0%), sugar (-2.4%), and other crops (-2.0%). The report attributes the increases to reductions of EU tariffs on Georgian exports and the decreases to the reduction of Georgian tariffs on goods imported from the EU. These numbers, if they say something about the true developments, suggest that parts of Georgia’s agricultural sector will get under severe pressure due to increased competition with European producers.

ECONOMIC DARWINISM

What are the implications for Georgian agricultural policy? Some of the producers will benefit from the integration into the European market, as they can stand the pressure and even expand in this highly competitive environment. Other producers are likely to run into essentially insoluble problems. One particularly beneficial category in this respect is vegetables, fruits, nuts, and oilseeds, because some of the products in that category (e.g. hazelnuts) are labor intensive and serve niche markets. This implies that more people can be employed in the production of these goods, making the transformation to a modern, efficient agriculture less painful, and it means that competition is lower and margins are higher. If policy recognizes these advantages, producers in that category might become “national champions”.

Currently, vegetables, fruits and nuts are in Georgia primarily produced by small and medium sized farmers. Due to lack of greenhouses the production is seasonal. Yet farms can be consolidated and technical equipment can be upgraded. In the end, it will be relevant that Georgia has fundamental advantages in the production of goods in that category, namely clean soils, little usage of chemicals, a relatively large amount of available land for cultivation, and a long tradition in vegetable and fruit production.

Moreover, about half of Georgia’s current export of vegetables, fruits, and nuts already goes to the EU, which means that Georgian producers already have “a foot in the door”. Currently, the exports almost entirely consist of hazelnuts (there are no tariffs, as hazelnuts are already covered by the GSP+ regime, and hazelnuts easily satisfy sanitary and phyto-sanitary standards). Thus, while the DCFTA may not change Georgia’s hazelnuts export to the EU significantly, there may be other niche products in this category, like berries and other kinds of nuts, which may benefit from the DCFTA, for example through adjustments of Georgian regulations regarding product packaging.

It will be important that policy will subscribe to what one might call “Economic Darwinism” – do not try to keep those producers alive that are incapable of surviving, but instead create good circumstances for those that have a future in Georgia.

OTHER NEWS
04/05/2022
Georgian Milk Mark Dairies on Show

The Cheese and Tea Exhibition showcasing Georgian traditional, as well as foreign produce was held at Mtatsminda Park on May 1st, 2022. Ten dairies with the Georgian Milk Mark (GMM) - Milkeni, Tsintskaro +, Meskhuri Gemo, Bebo’s Kveli, Suamta, Leanka, Alpuri Javakheti, Dertseli’s Nobati, Naturaluri Rdzis Gemo, Tsezari presented their products at the event organized by Anna Mikadze-Chikvaidze, the Head of the Cheese Producers Guild. Visitors tasted cheese and got to know about the GMM. Butter with spices, a new product by Milkeni, was their favourite.

‘The GMM contributed a lot to make this event happen. I am thankful to them for giving me an opportunity to discover amazing products, like butter with spices. I am glad that the GMM promotes raw milk production’ - Event founder Anna Mikadze-Chikvaidze praised the development of the GMM in her Facebook posts.

Created in 2019, the GMM has twenty dairies currently using the mark. The GMM products are available in Madagoni, Spar, Tserti, Magniti, Smart, Ori Nabiji, Nikora, Zgapari, Fresco, Carrefour, Goodwill, Daily, Billion and Willmart supermarket chains.

A comprehensive online portal www.georgianmilk.ge provides a profile per enterprise allowing consumers to look up the products they are buying using a unique registration number printed on the label.

        

15/04/2022
Cooperation Solidifies Between Georgian and Armenian Women’s Rooms

For three days from 11-14 April, the Women’s Rooms Union of Georgia NGO hosted an Armenian delegation of the Mayors of Alaverdi, Tumanyan and Tashir municipalities of Armenia, their three Women’s Rooms managers, representatives of Lori Region Governor’s office and the Association of Lawyers Community NGO.  These three municipalities in Armenia have now all instituted Women’s Rooms and were in Georgia to learn more about their operation and potential and to strengthen links in the region.

They met the mayors and deputy mayors of Akhmeta and Telavi municipalities, and a representative of Kakheti Governor’s office and visited the rooms. The Women’s Room managers of both municipalities did presentations on their work.

‘It was a very interesting and useful visit. We have just established the Women’s Room service in our municipality and, as we’ve copied the Georgian model, it was necessary for us to see how this it works here,’ – Suren Tumanyan, the mayor of Tumanyan municipality said.

‘After this visit we clearly see how to use our Women’s Rooms and make sure that our women and girls are involved in local decision making through the Women’s Room as it was done in Georgia,’ – Edgar Arshakyan, the mayor of Tashir municipality said.

One of the main goals of the municipal Women’s Rooms in Georgia is to support women’s entrepreneurship by helping them write business proposals, connect with other women entrepreneurs and access the trainings and information. Participants visited social enterprise Skhivi, where women are making traditional enamel jewelry and accessories, the shop of entrepreneur Tamar Mikeladze, who is making handmade soaps and candles under the brand name Kumpa, and a local female beekeeper.

‘We are impressed with the results of Georgian Women’s Rooms regarding women’s economic empowerment. The managers here had business plan writing and fundraising trainings to help local women to start their own businesses. We are looking forward to doing the same in Armenia,’ – Sasun Khechumyan, the mayor of Alaverdi said.

‘In Lori region there are five municipalities in total, out of which three municipalities have already opened the Women’s Rooms. We are ready to support the opening of this service in the other two municipalities as well,’ – Alik Sahakyan, the representative of Lori Governor’s office said.

This study tour has laid the foundation for future cooperation between Georgian and Armenian municipalities. Alaverdi and Akhmeta municipalities have decided to become twin towns and the Women’s Rooms Union is going to continue cooperation with these Armenia municipalities.

Background information: From 2011 to date the SDC and ADA funded Mercy Corps implemented Alliances Caucasus Programme has been facilitating the establishment and scaling up the municipal Women’s Rooms in Georgia and Armenia. 32 Women’s Rooms in Georgia and three Women’s Rooms in Armenia have been opened so far. The Women’s Rooms are owned by local governments and are used to facilitate access to public decision making, goods and economic opportunities. The Women’s Rooms Union was formed in 2021 to represent the rooms and facilitate their interests.

The information about the visit was posted on a Facebook pages of Telavi and Akhmeta City Halls.

Local TV Tanamgzavri made two news items about the visit. Please, follow the links below:

Meeting at Telavi City Hall  *  Visiting Local Women Entrepreneurs

Follow the link to watch The Women’s Rooms Promo Video

12/04/2022
New Jara Textbook Introduced for VET

Georgian Traditional Beekeeping: Jara Honey Production is a new textbook now available for VET colleges who include a Jara component in their beekeeping courses. It is part of making the Jara beekeeping course material an accredited component in its own right from September this year.

The author Aleko Papava, who is a competent, reliable and respected beekeeper teacher and Head of the Georgian Beekeepers Union, wrote the book together with education specialists on behalf of the Georgian Beekeepers Union and Jara Beekeepers Association.

The Scientific Research Centre of Agriculture of the Ministry of Environmental Protection and Agriculture reviewed and acknowledged the book positively.  

‘The book is written in a highly professional manner, materials meet the demand of the beekeeping sector in terms of bio honey production and provide comprehensive information about all the topics for studying Jara Honey Production’ – says the Centre in their letter sent to the GBU.

In June 2021, thirteen VET college representatives from seven regions of Georgia attended a Training of Trainers in Jara Honey Production and later received jara equipment. Now eight of them are integrating aspects of Jara beekeeping into different subjects of the beekeeping programmes to 106 students. Five more colleges will start soon. This textbook means that Jara Beekeeping will be taught as a separate accredited component of these courses. The newly established Vocational Skills Agency, National Center for Educational Quality Enhancement and sectoral skills organization Agro Duo are all supporting Jara teaching integration in the VET colleges.

Linked resources: Jara Honey Production Handbook; Bio Certification Guidelines for Beekeepers; www.honeyofgeorgia.com; Discover Georgia: The Land of the Oldest Honey.

03/02/2022
The ‘Secrets’ of Georgian Honey Revealed in the New Article

The Many Secrets of Georgian Honey, an article dedicated to the exceptional Georgian honey making, was published in the online journal Plantings by the World Sensorium Conservancy. The journal covers topics relevant to conservation and the intrinsic values of nature. The article was penned by Braden Bjella, an American culture journalist based in Eastern Europe, who takes readers to Georgian beekeeping journey with the help of the Georgian Beekeepers Union (GBU) and the Jara Beekeepers Association (JBA). As he says, “the question of Georgian honey quality is settled; now, it’s only up to the world to discover it". 

         

20/12/2021
The Georgian Beekeepers Union Celebrates Three Years Anniversary


On December 20th, the Georgian Beekeepers Union (GBU) hosted an event to celebrate its third anniversary inviting key honey sector stakeholders to Hualing Tbilisi Sea Plaza. 


Since 2018, the honey sector has seen huge gains under the auspices of the GBU, which is leading efforts to remove pervasive constraints to growth such as the widespread use of prohibited antibiotics and performing the role of non-governmental national representative of the honey sector. The GBU’s three years of extensive work resulted in increased honey quality, more effective governmental advocacy, better vocational education in beekeeping, including, Jara teaching, available information and trainings for beekeepers, promotion and improved image of Georgian honey at the Apimondia Congress and London Honey Awards, all that paving way for an increase of honey export

 

‘There are some major developments in improving honey testing capacity, increasing awareness of Georgian honey, and opening of new export markets. The comprehensive laboratory analysis, before carried abroad, is now available in Georgia, which resulted in decreasing transaction costs.’ – Giorgi Khanishvili, the First Deputy Minister of the Environmental Protection and Agriculture of Georgia (MEPA). 

 

‘We were able to achieve significant improvements during these three years. We are continuing cooperation with the government and other honey stakeholders to ensure production of safe and quality honey.’ – Aleko Papava, the Executive Director of the GBU. 

Photo source: The MEPA

19/12/2021
Jara Enters the Qatar Market

Nena Jara honey, along with other types of Georgian honey, found its place on the Georgian honey corner opened at the SPAR supermarket branch in Tawar Mall, the largest shopping mall in Doha, Qatar. Georgian honey corner will be opened in every branch of the SPAR chain. The process is backed by the Embassy of Georgia to the State of Qatar. The ALCP facilitated the export of Jara honey.

Local influential media AI Raya dedicated a comprehensive article to Georgian honey with a special highlight on Georgian beekeeping characteristics and traditional Jara.  

The Qatar market seems promising. The Embassy’s previous facilitation for approval of a VET certificate, an essential requirement for honey export, has contributed to a 255% increase of Georgian honey export to Qatar in 2021 compared to 2020. The same figure saw a 350% boost in 2020. 

Photo source: The Embassy of Georgia to the State of Qatar

LATEST NEWS
Georgian Milk Mark Dairies on Show
04/05/2022
The Cheese and Tea Exhibition showcasing Georgian traditional, as well as foreign produce was held at Mtatsminda Park on May 1st, 2022. Ten dairies with the Georgian Milk Mark (GMM) - Milkeni, Tsintskaro +, Meskhuri Gemo, Bebo’s Kveli, Suamta, Leanka, Alpuri Javakheti, Dertseli’s Nobati, Naturaluri Rdzis Gemo, Tsezari presented their products at the event organized by Anna Mikadze-Chikvaidze, the Head of the Cheese Producers Guild. Visitors tasted cheese and got to know about the GMM. Butter with spices, a new product by Milkeni, was their favourite. ‘The GMM contributed a lot to make this event happen. I am thankful to them for giving me an opportunity to discover amazing products, like butter with spices. I am glad that the GMM promotes raw milk production’ - Event founder Anna Mikadze-Chikvaidze praised the development of the GMM in her Facebook posts. Created in 2019, the GMM has twenty dairies currently using the mark. The GMM products are available in Madagoni, Spar, Tserti, Magniti, Smart, Ori Nabiji, Nikora, Zgapari, Fresco, Carrefour, Goodwill, Daily, Billion and Willmart supermarket chains. A comprehensive online portal www.georgianmilk.ge provides a profile per enterprise allowing consumers to look up the products they are buying using a unique registration number printed on the label.         
Cooperation Solidifies Between Georgian and Armenian Women’s Rooms
15/04/2022
For three days from 11-14 April, the Women’s Rooms Union of Georgia NGO hosted an Armenian delegation of the Mayors of Alaverdi, Tumanyan and Tashir municipalities of Armenia, their three Women’s Rooms managers, representatives of Lori Region Governor’s office and the Association of Lawyers Community NGO.  These three municipalities in Armenia have now all instituted Women’s Rooms and were in Georgia to learn more about their operation and potential and to strengthen links in the region. They met the mayors and deputy mayors of Akhmeta and Telavi municipalities, and a representative of Kakheti Governor’s office and visited the rooms. The Women’s Room managers of both municipalities did presentations on their work. ‘It was a very interesting and useful visit. We have just established the Women’s Room service in our municipality and, as we’ve copied the Georgian model, it was necessary for us to see how this it works here,’ – Suren Tumanyan, the mayor of Tumanyan municipality said. ‘After this visit we clearly see how to use our Women’s Rooms and make sure that our women and girls are involved in local decision making through the Women’s Room as it was done in Georgia,’ – Edgar Arshakyan, the mayor of Tashir municipality said. One of the main goals of the municipal Women’s Rooms in Georgia is to support women’s entrepreneurship by helping them write business proposals, connect with other women entrepreneurs and access the trainings and information. Participants visited social enterprise Skhivi, where women are making traditional enamel jewelry and accessories, the shop of entrepreneur Tamar Mikeladze, who is making handmade soaps and candles under the brand name Kumpa, and a local female beekeeper. ‘We are impressed with the results of Georgian Women’s Rooms regarding women’s economic empowerment. The managers here had business plan writing and fundraising trainings to help local women to start their own businesses. We are looking forward to doing the same in Armenia,’ – Sasun Khechumyan, the mayor of Alaverdi said. ‘In Lori region there are five municipalities in total, out of which three municipalities have already opened the Women’s Rooms. We are ready to support the opening of this service in the other two municipalities as well,’ – Alik Sahakyan, the representative of Lori Governor’s office said. This study tour has laid the foundation for future cooperation between Georgian and Armenian municipalities. Alaverdi and Akhmeta municipalities have decided to become twin towns and the Women’s Rooms Union is going to continue cooperation with these Armenia municipalities. Background information: From 2011 to date the SDC and ADA funded Mercy Corps implemented Alliances Caucasus Programme has been facilitating the establishment and scaling up the municipal Women’s Rooms in Georgia and Armenia. 32 Women’s Rooms in Georgia and three Women’s Rooms in Armenia have been opened so far. The Women’s Rooms are owned by local governments and are used to facilitate access to public decision making, goods and economic opportunities. The Women’s Rooms Union was formed in 2021 to represent the rooms and facilitate their interests. The information about the visit was posted on a Facebook pages of Telavi and Akhmeta City Halls. Local TV Tanamgzavri made two news items about the visit. Please, follow the links below: Meeting at Telavi City Hall  *  Visiting Local Women Entrepreneurs Follow the link to watch The Women’s Rooms Promo Video
New Jara Textbook Introduced for VET
12/04/2022
Georgian Traditional Beekeeping: Jara Honey Production is a new textbook now available for VET colleges who include a Jara component in their beekeeping courses. It is part of making the Jara beekeeping course material an accredited component in its own right from September this year. The author Aleko Papava, who is a competent, reliable and respected beekeeper teacher and Head of the Georgian Beekeepers Union, wrote the book together with education specialists on behalf of the Georgian Beekeepers Union and Jara Beekeepers Association. The Scientific Research Centre of Agriculture of the Ministry of Environmental Protection and Agriculture reviewed and acknowledged the book positively.   ‘The book is written in a highly professional manner, materials meet the demand of the beekeeping sector in terms of bio honey production and provide comprehensive information about all the topics for studying Jara Honey Production’ – says the Centre in their letter sent to the GBU. In June 2021, thirteen VET college representatives from seven regions of Georgia attended a Training of Trainers in Jara Honey Production and later received jara equipment. Now eight of them are integrating aspects of Jara beekeeping into different subjects of the beekeeping programmes to 106 students. Five more colleges will start soon. This textbook means that Jara Beekeeping will be taught as a separate accredited component of these courses. The newly established Vocational Skills Agency, National Center for Educational Quality Enhancement and sectoral skills organization Agro Duo are all supporting Jara teaching integration in the VET colleges. Linked resources: Jara Honey Production Handbook; Bio Certification Guidelines for Beekeepers; www.honeyofgeorgia.com; Discover Georgia: The Land of the Oldest Honey.
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Georgian Traditional Beekeeping: Jara Honey Production GEO
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