The Context

Formerly part of the Soviet Union, Georgia lies to the south of Russia, between the Black Sea and Azerbaijan. By 2012 it was ranked a lower middle income country, and in 2016 Gross Domestic Product per head was US$3,833.

Since 2014 lower oil and commodity prices, weaker exports and falling remittances and capital inflows have slowed growth.

With a population of 3.71 million in 2015, Georgia has around 550,000 rural households. Nationwide, poverty declined from 20.9 per cent in 2010 to 14.8 per cent in 2012, but the rural poverty rate, at 18.8 per cent, remained far higher.

In rural areas, farming accounts for 45 per cent of household income, while social payments provide a further 28 per cent and salaried work just 27 per cent.

Farming is likely to remain the mainstay of rural communities in the foreseeable future, but its development is held back by inadequate infrastructure, especially irrigation, and gaps in value chains. This combines with limited off-farm opportunities to spur rural-urban migration, especially by young people, leaving behind increasingly aging and diminished communities.

The Strategy

In Georgia, IFAD loans work to reduce rural poverty and improve rural people's living conditions and livelihoods.

IFAD’s country strategy programme (COSOP) is fully aligned with the strategies of the Government of Georgia.

Key activities include:

• promoting investments by smallholder farmers and agribusiness to foster competitive climate-smart value chains;
• improving access for farmers and agribusinesses to key markets (particularly through better access to credit, savings, leasing and insurance); and
• promoting financially and environmentally sustainable rural economic infrastructure to improve productivity, post-harvest management and the resilience of smallholder producers.

Results-based country strategic opportunities programme (COSOP):
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