Georgian Hazelnut Improvement Project (G-HIP) Quarterly Progress Report

The project aims to improve the productivity and competitiveness of the hazelnut sector in Georgia by capacitating the Georgian Hazelnut Growers Association (GHGA) and the Hazelnut Exporters and Processors Association (HEPA). G-HIP's 5-year vision for the hazelnut sector includes developing and maintaining sustainable business models, strengthening the hazelnut value chain, and representing the sector before the Government of Georgia and in international markets. During the second quarter of Project Year 3, G-HIP continued to focus on sustainable capacity development for GHGA and HEPA. The project assisted GHGA in finalizing its business and action plans and collaborated with HEPA on initiatives to promote Georgian hazelnuts globally. G-HIP also worked closely with the Ministry of Agriculture, the Agricultural Projects' Management Agency, and commercial banks to obtain approval for concessional commercial credit and grant for Husking, Drying, and Storage (HDS) facilities. Construction of the facility began during the reporting period and is projected to be operational for the 2018 hazelnut harvest. G-HIP contributed significantly to the response to the potentially devastating Brown Marmorated Stink Bug (BMSB) infestation. The project worked closely with AgriGeorgia/Ferrero, the National Food Agency, USAID, and international BMSB specialists to hire a consultant to help write a detailed action plan for combating BMSB in the 2018 season. The plan includes action items and responsible parties, potential constraints, and solutions. G-HIP's key accomplishments during the second quarter include submitting a quarterly report to USAID and AgriGeorgia/Ferrero, hosting a visit from USAID Assistant Administrator Brock Bierman, hiring new staff, and submitting and approving the G-HIP Grants Manual. The project also assisted GHGA in recruiting a Regional Coordinator and training new Producer Group Advisors, supported GHGA in securing contracts with a Co-Investment Fund, Kakheti Traditional Winery, and Private Investors for the creation of new hazelnut orchards, and supported GHGA's financial capacity development through the configuration and usage of financial accounting software. G-HIP also coordinated and supported the strategy for combating the BMSB infestation, supported GHGA in providing soil-testing services for producers participating in the input financing program and for other members/potential members utilizing fertilizers, and provided strategic support to GHGA to implement the student-training program. The project supported LLC "Megruli Tkhili's" application to APMA for a special financing package for HDS facilities for hazelnuts, supported HEPA to design and lead the creation of a promotional video for Georgian hazelnuts, and supported HEPA to develop an organizational website and attend an international trade conference. The project's progress is aligned with its 5-year vision for the hazelnut sector in Georgia, which includes capacitating GHGA and HEPA to develop and maintain sustainable business models, strengthening the hazelnut value chain, and representing the sector before the Government of Georgia and in international markets. G-HIP anticipates that GHGA will achieve financial sustainability by 2020 through strategic investments in activities designed to significantly expand membership and a tiered, income-generating membership structure. By the end of the program, G-HIP expects that HEPA will have established strong linkages with high-value markets, particularly in the European Union, and will assist in establishing Georgian hazelnuts in the global marketplace.