Ministry of Agriculture has made changes to the preferential agro- crediting scheme as well as to a project of co-financing of processing enterprises.According to the Ministry, as a result of the project optimization, from January 2015 instead of the current 8 components there will be a preferential agro-credit of two components :
- preferential agro-credit for current assets
- preferential agro-credit for fixed assets
- preferential agro-leasing
- state program “Produce in Georgia”
Upper limit rate to the interest rate on a loan was set under the preferential agro-credit project. In theframework of the optimization, annual interest rates on bank loans have reduced and the upper limits are defined as follows:
For current assets:
- GEL 20 000 to GEL 10 000 000 loans (depending on the loan amount) annual interest rate was set at 10% -15%
For fixed assets:
• USD 12 000 – USD 600 000 (depending on the loan amount) annual interest rate was set at 12%- 15%
Simultaneously with a decline in interest rates, the Agency reduced annual interest rates on co- financing and defined as follows:
- the current assets component – 8%;
- the fixed assets component – 11%
annual interest rates on co-financing remained unchanged for preferential agro-leasing and the government program “Produce in Georgia
- preferential agro-leasing – 12%;
- “Produce in Georgia” – 10%.
To interest and attract large business groups, changes were introduced to the project of co-financing of processing enterprises.
These changes will provide incentives for investment in the regions, which will eventually promote important projects. New enterprises will be created and the locals will be employed.
The government launched a preferential agro-credit program on March 27, 2013. According to theMinistry of Agriculture, 22 thousand people have benefited from the preferential agro-credit until October 13 and loans worth GEL 566 million 493 thousand 582 have been issued.