The livestock sector plays a significant role in Georgian agriculture, accounting for more than half of total output. Although livestock farming is spread throughout the country, agriculture is dominated by livestock in the mountains, which cover over 50% of Georgian territory. The livestock sector contributed to around 4% of the country’s overall GDP in 2018, and dairy production remains one of the most traditional Georgian agricultural sub-sectors.

On October 17, the APRC’s Rati Kochlamazashvili presented the results of a study of Value Added Tax (VAT) Exemption Impact for Increasing the Competitiveness of the Georgian Dairy Sector to dairy sector stakeholders, including farmers, dairy processors, and associations, as well as representatives of government bodies and parliament.

Can VAT exemption on dairy products produced from domestic raw milk boost the competitiveness of Georgian dairy sector? The objective of the study was to estimate the potential impact of VAT exemption on dairy products on the competitiveness of the dairy sector in Georgia.

Land O'Lakes International Development is leading an innovative, demand-driven Safety and Quality Investment in Livestock (SQIL) project to improve food safety and quality within Georgia’s dairy and beef value chains. The project is funded by the U.S. Department of Agriculture (via Food for Progress) and aims to reduce losses, improve food safety and quality from farm to fork, and to boost competitiveness, productivity, and trade within the Georgian dairy and beef market systems.

In March 2019, the average cost of cooking one standard Imeretian khachapuri declined slightly to 3.51 GEL, which is 0.8% lower MoM (compared to February 2019), and 1.1% lower YoY (compared to March 2018).