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Agriculture and Food Processing


Georgia is traditionally an agricultural country, which has 22 micro-climates varying from cool and dry to warm and humid. These diversified micro-climates allow for a longer than normal harvesting season and a wide range of growing conditions. Soils are of volcanic origin located in the river valleys. They tend to be quite fertile and reasonably easy to cultivate.

Agriculture and agribusiness account for 9.2% of the GDP and 17.5% of trade volume.

Georgia as an agrarian-oriented country has a significant rural population. The country was renowned as a quality food supplier during the Soviet times and the Georgian food & beverage products are still well-recognized as healthy and supreme quality brands in CIS region. 

 

Trade of Primary and Secondary Agricultural Products, USD Millions
 
 

Why Invest in Agriculture and Food Processing

 

Environment

Georgia’s natural resources and various micro-climatic zones are perfect for producing a wide range of grains, vegetables, fruits, etc. 
Rich and pesticide-free soil is ideal for organic production. 

Low costs

The employees in agricultural sector receive 30%-40 % less wage than the national average. As Georgia has big amount of water resourches, the access on water is easy and cheap. Other utility prices such as energy and gas is low also.

Market size

On the one hand, the investors can benefit from the rising consumption on the local market, which is on the other complemented by the Duty-free access to ~ 900 million markets under Free Trade Agreement with Turkey, Ukraine and CIS countries an DCFTA (Deep and Comprehensive Free Trade Agreement) with EU. 

Incentives for processing plants

The projects of building new agricultural products processing plants can get grant from the government with a total vaue of up to 250 000 USD (maximum 40% of the value of project). Additionally investor can buy state owned immovable nonagricultural property for 1 GEL (symbolic price) if the investment made on processing plant is 4 times more than its market value. 

 

Investment Opportunities

 

Aquaculture
Greenhouses
Food Processing
  • Fish Farming.pdf - 0.82mb

    In Georgia the aquaculture sector is growing rapidly, but currently only small amount of it's potential is utilized and investors can develop vast amount of feasible projects. Easy and cheap access to clean mountainous water opens an opportunity to run profitable freshwater fish farming business with high quality output. The Georgian Black Sea shore is ideal for mussel and saltwater fish farming. 

  • Average farm size in Georgia is 1.55 ha and most of local farmers produce products on open-fields, which causes seasonality supply. Most agriculture products are cheap during harvesting season and quite expensive during non-harvesting season. During non-harvesting season Georgia imports some main products from neighboring countries (mainly from Turkey), such as tomatoes, cucumbers, onions, garlics, potatoes, egg-plants, belly peppers etc. Additionally, demand for different greens and berries (blueberries, raspberries etc.), which aren’t quite traditional and Georgia produces only small quantities, is increasing yearly.
    Most local producers are plagued by prevalent inefficiencies in their production, caused by lack of know-how, adequate technology and capital. Apart from growing internal market, Georgia has an opportunity to export fresh vegetables/fruits to Middle East and Europe.
    Therefore there is a clear need for new modern greenhouses, which reduce dependence on seasonality and provide products during the whole year.

  • Government has acknowledged the food processing field as one of its top priority and nowadays it subsidizes that field, through Agricultural Projects Management Agency (APMA). With the increase of production, which is expected to grow due to currently undergoing new projects, this field will become more important.  Nuts, citruses, apple, stone fruits and greens have the best processing potential nowadays.  

Whine and Spirits
Fresh and Mineral Water
Meat and Poultry
  • The diverse natural conditions of Georgia create the best environment for the development of high quality viticulture-winemaking. Georgia has a history of 8,000 years of continuous wine making tradition, evidence is found by numerous archaeological discoveries. In addition to 525 indigenous grape varieties there are many foreign ones, which showed high results in production and wine quality. Wine produced in Georgia is distinct with its unique and diverse flavors, rich buckets. Wine export was 22% of agricultural export in 2014 with a total value of 183 Million USD.
    In parallel with winemaking, the production of spirits is also advanced in Georgia. The main products are brandy and vodka. In 2014 the export of spirits reached 95 Million USD.

  • Georgian water is respected for its high quality and good taste. The export of fresh and mineral water reached 137 million USD, which is 17% of total agricultural export of Georgia. Brands like Borjomi, Sairme, Nabeghlavi are well known in different parts of the world, especially in post-Soviet countries. There are many mid and large scale springs whose licenses can be obtained from the Ministry of Environment and Natural Resources Protection of Georgia. 

  • There are many small farms in Georgia, which are managed by individual households. Because of the lack of modern and efficient approaches in breeding, species selection, resource management and in other factors, many of them just remain small household with small scale production.
    The demand on meat consumption in country has an increasing trend. Around 25% of beef, 50% of pork and 80% of poultry consumed in Georgia is an imported product. There is a need and capacity to build modern farms, to supply local market in the first stage and to distribute through the region as a next step. Farming in Georgia has many advantages, e.g. ecological clean environment, cheap land and labor, easy access to different resources and so on.

ACCESS TO FINANCE

 

Agriculture Projects Management Agency (APMA)

Government started two new projects which support agriculture development in Georgia: Cheap agro-credit program and Grants for agro processing companies.

JSC Partnership Fund

JSC Partnership Fund (PF) is a largest state-owned investment fund, PF’s main objective is to promote investment in Georgia by providing co-financing (equity, mezzanine, etc.) in projects at their initial stage of development.

Produce in Georgia

The program aims to encourage manufacturing industries in Georgia. “Produce in Georgia” offers two main incentives: financial resources and infrastructure (land, building, etc.)

 

 

SUCCESS STORIES

 

Biubiu

HeidelbergCement has been carrying out its activities in Georgia since 2006 and up to date has made more than 200 million Euro investments that were mainly oriented on existing cement plants modernization and expansion in the concrete business line.

Blauenstein Georgia

The company Blauenstein Georgia was established in 2008 by Mr. Max Blauenstein from Switzerland and his local partner Mr. Irakli Kervalishvili. The aim was to create a modern, Swiss quality farm in Georgian Mountainous Region Racha.

NERGETA

Nergeta started its operations in 2009, and is a company dedicated to developing premium agricultural products in Western Georgia. Nergeta is exporting kiwifruit to Europe and which is sold through the supermarket chain Lidl.

 

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