Ministry of Agriculture of Georgia From China to Europe: Agribusiness as emerging driver for export America-Georgia Business Council`s 19th Annual Conference USA 2016 Levan Davitashvili Minister of Agriculture of Georgia

Country at Glance Fast growing Corruption free Western oriented Above 5% average growth during the last 10 years Above 5% expected growth over the next years Corruption free Tangible improvement in Corruption Perception Index over the 10 years – up by 82 places since 2005 (Transparency International) “Globally, Georgia improved the most in the areas measured by Doing Business over the past 12 years” – DB 2016 Western oriented Association Agreement (AA), including Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU since 2014 Visa Liberalization with the EU Ongoing reforms Good Governance Improved governance and rule of law

Sovereign Ratings – Georgia Government's debt burden remains modest and fiscal performance under control; Long Term Growth potential remains strong; Banking system well capitalized and liquid; Regional competitiveness. Major Rating Strengths Strong support from the international community; Strong commitment to economic and structural reforms; AA with EU, DCFTA- easier access to EU market, which will boost Georgia's attractiveness as an investment location over the medium to long term; Georgia's business environment very favorable with rating peers (ease of doing business indicators); Prudent fiscal policy, sustainable debt level. Regional logistics hub and transport corridor between Europe and Asia; Very strong banking sector (Banking sector risk -Low); High institutional strength relative to peers, reflected in strong government indicators. (Georgia has progress beyond its Soviet roots, and has arguably advanced further towards Western-style, independent institutions than any other country in the post -Soviet space.); High Worldwide Governance indicator (WGI) scores and outperforms its peers; Institutional capacity- and pro business operating environment, government's relative strong balance sheet and moderate debt burden.

Transit Hub 01 02 03 04 Roads Rail Maritime Air Plan to finish all spinal projects by 2020 – Europe Caucasus-Asia & South-North Corridor 02 Rail Baku-Tbilisi-Kars new railroad line Railway modernization project 03 Maritime Anaklia deep water black sea port Capable of accommodating Panamax size cargo vessels High capacity – up to 100 mln. tons turnover annually Georgia – Participating Country in large investment projects within “New Silk Road Economic Belt” Georgia – located on the crossroads of Europe and Asia, with new opportunities for various countries’ businesses – establishment of industrial infrastructure in Georgia and export to European countries without tariff barriers Georgia – Hub of trade, logistics and transportation 04 Air Tbilisi International Airport 2nd runaway to be constructed International Cargo terminal Expansion of the South Caucasus Pipeline through Azerbaijan and Georgia Additional USD 2 bln FDI in Georgia 16 billion cubic meters of new natural gas to Europe and Turkey.

Reforms Agenda Promoting Open Governance Economic Reforms 4 Infrastructure Development Education Reform 4

United Agroproject Plant The Future Preferential Agro Credit Project Co-financing of Agro Processing Enterprises and storage facilities Georgian Tea Rehabilitation Program Agro Insurance Small Farmers Support Program Seasonal Projects AMMAR

Current Results of Ongoing Projects Up to 700 re-equipped Enterprises More than 5,000 ha of established intensive orchards 1.16 bln. preferential agro credits disbursed, outstanding portfolio amounts 455 mln. Gel Insured limits Cultivation of more than 200,000 Ha agricultural land area annually Established 154 new enterprises 2014 -2015 – 193 mln. Gel 2016 – 126 mln. Gel

Trade Policy Outcomes DCFTA with EU Global Economic Integration FTA with CIS countries FTA with Turkey, China EFTA - Iceland, Norway, Switzerland, Liechtenstein GSP with - USA, Canada, Japan Global Economic Integration Economic growth Export Expansion Competitiveness Foreign Investment New Jobs

FTA with CHINA 02 03 01 04 05 06 Free trade negotiations with China successfully completed – Historical Deal for Georgia in terms of finalization of talks in a remarkably short time Opportunities for increased business and trade turnover through the Free Trade Deal Exports of Georgian products (i.e. wine, mineral and non alcoholic beverages, fruit, vegetables) to China with zero tariffs and without any transition period Exports of Georgian products to the 1.4-billion-customers Chinese market without additional customs fees Georgia – First country in the region with this type of deal with China With China-Georgia Free Trade Agreement partnership of Georgian and Chinese businessmen for long term cooperation encouraged, general business environment definitely improved

Georgian Wine in Chinese Market 02 03 01 China - already the second export destination for Georgian wine First Georgian Wine Promotion Center established in Beijing (July 2015) with the aim of assisting Georgian Wine Companies to establish new business contacts with Chinese partners Already 40 Georgian Wine Houses established in China

DCFTA –EU The Deep and Comprehensive Free Trade Agreement (DCFTA) implies trade liberalization of goods and services

Future Objectives 02 03 01 04 05 06 Increase sustainable development of competitive Agribusiness Increase effectiveness of export potential in Georgian Agribusiness Strengthen Agriculture Extension Stimulate development of efficient supply chain Promote high value agricultural production Identify new markets

THANK YOU FOR YOUR ATTENTION! Ministry of Agriculture of Georgia Levan Davitashvili Minister of Agriculture of Georgia