| Project ID: 1325
Executive Board document:
EB-2005-84-R-25-REV-2
Rural Development Project
Who are the beneficiaries? The project will initially target around 300 community groups of small
farmers and rural poor people in eastern, central and western Georgia. The target group will include:
(i) small farmers (men and women) with limited or no access to rural finance and extension support;
and (ii) landless men and women with insecure income and little or no access to rural finance and
market information for agricultural production activities. The project will adopt a two-level, inclusive
approach targeting: (i) areas with articulated demand from rural people, especially with respect to the
provision of financial services; and (ii) selected areas where opportunities are arising for commercial
agriculture and related businesses in the agricultural supply chain.
Why are they poor? The incidence of poverty in rural areas of Georgia is high with almost the entire
rural population (44% of the country’s total population) being poor. Although 52% of the employed
national workforce is engaged in agriculture, the sector only produces 20.6% of GDP, indicating the
low productivity, underemployment, unemployment and low incomes deriving from the sector. About
83% of the rural population depend entirely on their own farms for subsistence, with a typical
household consuming 73% of what it produces. Poverty is largely due to limited access to essential
inputs and technologies, barriers to land consolidation, poor access to markets, scarcity of rural credit
and limited off-farm opportunities.
How will the target group benefit? To address the above livelihood constraints, the project will seek
to: (i) build farmer communities’ capacities to develop equitable and profitable commercial
relationships with commodity supply chains; (ii) promote pro-poor, medium- and long-term financing
for farmers by encouraging a savings culture and appropriate rural savings facilities; (iii) bring about
institutional modernization through legal reforms benefiting the rural poor (e.g. land, microcredit).
Loan and grant amount:
Loan: SDR 6.05 million (equivalent to approximately
USD 9.2 million)
Grant: SDR 550 000 (equivalent to approximately
USD 800 000)
Total project cost: USD 34.70 million
Project ID: 1147
Executive Board document: EB-2000-70-R-17-Rev-1
Rural Development Programme for Mountainous and Highland Areas The overall goal of the seven-year IFAD-initiated programme is
to help populations in the target areas improve the quality of their
lives in a sustainable manner by increasing incomes and protecting
the natural resource base and environment. More specifically, the
programme seeks to:
(i) strengthen the organizational capacity of the beneficiaries
so they may participate more fully in the market economy and better
manage the natural resources upon which their livelihoods depend;
(ii) restore economic livelihoods through improved management of
the resource base and better access to financial, technical and
commercial services; and
(iii) strengthen public capacity to identify and respond to the
needs of the mountain areas by setting up appropriate institutional
mechanisms.
The target group, which comprises small private farmers operating
individually or in voluntary associations, will consist of approximately
2.4 million persons (1.2 million from Azerbaijan, or about 33% of
the rural population, and 1.2 million from Georgia, or about 60%
of the rural population). A significant proportion of the target
group will be women who, due to the absence of men family members,
now carry the entire burden of farm and family work. Other target
groups will include families facing resource constraints in terms
of land and livestock. Approximately 18 800 households will benefit
directly from programme activities.
Innovative features:
This joint programme for Azerbaijan and Georgia is unique in that
it is the first project for IFAD that covers two countries. By developing
a common strategy for both countries, IFAD seeks to alleviate the
shared disadvantages and constraints faced by mountain-area communities
during the transition from a centrally planned to a market-based
economy. Key innovative features include:
- establishment of the Mountain Areas Development Agency as an
autonomous, service-oriented institution. This agency will provide
a clear focal point for mountain-area communities and link the target
group with a range of services;
- development of farmer-led extension services and community-owned
and managed credit delivery systems;
- establishment of a collaborative framework to facilitate networking
between the programmes in Azerbaijan and Georgia, both at the level
of programme implementers and policymakers and through grass-roots
organizations.
Loan amount:
SDR 6.9 million (approximately USD 9.0 million) for Azerbaijan.
SDR 6.1 million (approximately USD 8.0 million) for Georgia. Both
loans are on highly concessional terms.
Total programme costs:
Estimated at USD 19.2 million (USD 10.0 million for Azerbaijan
and USD 9.2 million for Georgia), of which USD 406 000 and USD 659
000 will be provided by the Governments of Azerbaijan and Georgia
respectively and USD 481 000, USD 500 000 by the beneficiaries of
each country and USD 100 000 for Azerbaijan and USD 73 700 for Georgia
by cofinanciers to be determined.
Cooperating institution:
UNOPS.
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