tailieunhanh - Stimulating Economic Productivity in Georgia

In addition to the market chain development that is the focus of the AgVANTAGE program, current staff expertise in international finance and business could be accessed to further assist the development of targeted subsectors (like those mentioned above). AgVANTAGE staff is providing strategic development (capacity building) to support the types of import substitution activities and market chain investments that these subsectors require in order to grow. However, with the projects experience to date, this area is in greater need than the current capacity of the project. Project activity could be further expanded to identify, research, market,. | AgVANTAGE Maximizing Georgia s Agricultural Exports Stimulating Economic Productivity in Georgia December 10 2004 Discussion Paper Prepared by Roger Bird AgVANTAGE Page 1 of 17 Stimulating Economic Productivity in Georgia Introduction This paper presents some of the options available to improve Georgia s economic productivity particularly in the financial agricultural and industrial sectors. Potential activities target USAID Caucasus s strategic objective SO Accelerated Development and Growth of Private Enterprises to Create Jobs and intermediate results IR Increased Access to Financial Services . The data presented is offered as an overview of Georgia s current economic landscape and in particular of the financial sector but is not intended as a comprehensive study or analysis. Numerous reports assessments and studies commissioned by USAID and others over the last eight years have noted that accessing credit in Georgia is a major constraint for the development of small and medium sized enterprises and the agricultural sector see Annex A for a complete list of reference material . The lack of access to credit is limiting Georgia s ability to acquire modern equipment and technology in all sectors and subsequently constrains productivity and economic growth. Georgia s economy suffered a serious blow with the breakup of the Soviet Union. Export markets were lost infrastructure deteriorated and civil conflicts worsened the situation. In the mid-1990s a series of structural reforms were implemented including legal tax and regulatory reform price and trade liberalization and freeing the exchange rate. These programs had a stabilizing and positive result but Georgia s recovery continues to trail behind other CIS countries. The lack of access to credit particularly long-term financing 3-5 years has further contributed to Georgia s mediocre economic recovery. In the agricultural sector for example since its independence Georgia has seen a large decline of .