One of Georgia’s most respected government executives is the 35-year-old Minister of Agriculture, David Kirvalidze. With a Ph.D in soil sciences and service as a Member of Parliament, the Minister demonstrated his knowledge and skill in a recent interview.

Barry Jagoda, The Washington Times: When did you become Minister?

Georgia’s plentiful agricultural products are sold in central markets. Plans are being developed to add value by processing food for export.

Georgian farmers send a wide variety of products to city markets such as this one in Tbilisi.

Agriculture Minister David Kirvalidze: I was named Minister on the 13th of June 2000. It was 13th but it was not Friday. Before that I had been a Member of Parliament.

TWT: Obviously a job like this has its political dimensions as well as policy, scientific and management functions. What is your principal mission?

Agriculture Minister: Our mission is to create a normal environment for farmers to work, and to help them earn additional money, to have savings, to have a better life. Our farmers must solve food security problems on their own and not be completely dependent on humanitarian aid. Our mission includes protecting the interests of both producers and consumers.

TWT: For how many years has this building been the Ministry of Agriculture?

Agriculture Minister: This building was erected in 1947 by German soldiers after World War II. And from the beginning, during Soviet times a big Georgian tea consortium was located here. After that it housed Agroprom, the HQ of everything related with all areas of agriculture.

TWT: Do you enjoy your work or are you too busy to enjoy?

Agriculture Minister: Well, from one hand it’s quite difficult, having very high-level responsibilities, but from the other hand it’s a big challenge, you really can do something. And there are a lot of things to do in this country in this field because this country is agrarian. The very name ‘Georgia’ in ancient Greek means ‘the country of farming’. This is an agricultural land, where farming has very strong roots and traditions. The conditions here--like climate and soil--are very suitable for a diverse approach to agriculture. One can grow tangerines, citrus, wheat, raise livestock, and produce early vegetables that are essential for the Russian market.

TWT: How much of the country is rural?

Agriculture Minister: From 20 to 30 percent of GDP is agriculture. And around 55 percent of total employment is in agriculture. That’s a very high figure of which we are definitely not proud. That means that if you live in the countryside there is nothing else to do but farm, a situation we do not welcome. One of the main tasks for our Ministry is to promote and encourage alternative job opportunities in rural areas. We don’t want to keep everyone in the rural areas as farmers. Most of them are subsistence farmers. And subsistence farmers aren’t commercially feasible for the long run. The problem is that farmers don’t have enough savings to be engaged in this business, and also they have very limited access to starting capital. Money in this country is still very expensive, averaging 18 to 24 percent per annum fixed in hard currency. Inflation is very tough on farmers. So one of our top targets is promotion of micro-financing provisions, to give farmers have a better access to start-up capital.

TWT: Are there opportunities for foreign investment in the rural portions of this country?

Agriculture Minister: Yes, opportunities exist, of course. The best sector today in all agro- business is the processing industry, which has a big chance of quick development. To compare the figures, Georgia used to be the wealthiest republic during the Soviet period and agricultural products had the main share of exports. Around 65-70 percent of all agricultural products produced in this country were processed. For the time being it amounts only up to 20 percent, and out of this 20 percent the main shares are wine and hazelnut. Traditionally Georgia used to produce different types of juices, canned products, vegetables, tea and export to all solid markets. But again I need to remind you about what happened in ‘90s, civil war, and the traditional market was lost. It is reality.

Our processed, or value added products, were sold all over the former Soviet Union. When that was lost, farmers turned more to subsistence, emphasizing wheat, corn and some essential products just to feed themselves.

Now, you asked about the advantages of investing in Georgian agriculture: With the situation improving we offer equal treatment for the foreign investor as for a Georgian investor, no limitation on profits leaving the country, no licensing for foreign investors and, most important, to the Russian, Ukrainian and Central Asian and other CIS markets. If a product comes from the United States or the West, it subject to taxation at the border, while if produced in Georgia it has a tax free access. This is very significant for foreign investors who have already come here, such as those in wine, tea and other agricultural industries.

TWT: Mr. Minister, let’s assume for just a moment that their work would be a safe and dependable transportation system to the North, would that solve the problem?

Agriculture Minister: Not the whole problem, but it’s the main constraint for the time being, particularly for perishable products. Most of our exports have been perishable products. Fresh vegetables, early vegetables and early potatoes are our main exports. Until July 15, Russia, and particularly Moscow—which can consume the entire Georgian harvest during one month--needs early potatoes from Georgia. The problem is the time of delivery because potatoes and early vegetables need water and if there is a delay they can perish. That is why were are just now working with the U.S. AID on a new program to develop alternative markets and approaches for potentially perishable products.

TWT: What is the time-line, how much money is involved and what is the general plan?

Agriculture Minister: It is four to five years, involving $20 million. We are beginning with certain success stories, looking at how those people without foreign aid have succeeded. The program is open, we are exploring a wide-variety of options, examples of value added enterprises that were successful. But a big part of this to develop marketing, a new concept for most in the post-Soviet space. Before it was not needed. Everything was planned. Now marketing is crucial, it’s the main driving force for these activities.

TWT: Well you know we’ve covered a lot of issues and you have emphasized that for today the main agricultural export products are wine and hazelnuts. Are there others?

Agriculture Minister: Yes. President Shevardnadze recently signed a completely new law on organic farming. This creates an opportunity for export of organic products. Georgian farmers had to be compulsory organic farmers over the last ten years because there was no money to buy chemicals.

TWT: How are you going to exploit this special market?

Agriculture Minister: It is a big challenge, but worldwide it is one exceptional niche where the demand is higher than supply. And it always brings a high price, and we also can rely on rich consumers in different countries. Starting from organic wine ending with organic baby food products.

TWT: How is the American-Georgia relationship coming along in agriculture?

Agriculture Minister: We have very good and intensive cooperation and my visit to Washington this summer has reinforced that. We have an exchange program when Georgian farmers and scientist go to the US for three weeks. In Georgia we have professional agronomists, plant protection specialists, land reclamation specialists, but we very badly need agricultural economists. That was my request in the US, to launch some educational program, to send 2-3 promising students from Agriculture University and educate them to Master’s Degree. And then they should come back.

TWT: Did they give you a good ear?

Agriculture Minister: We have very good cooperation with the American Embassy here, with US AID, they are my main partners.

TWT: Thank you, Mr. Minister.