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ARMENIA-UNITED STATES AGRICULTURAL PROGRAMS, FY 1999

Agricultural Marketing Assistance Program ($5.7 million)

USDA Support for Agricultural Education Reform

U.S. Information Agency (USIA) Exchanges - Community Connections Program

U.S. Department of Agriculture (USDA) – Cochran Fellowship Program

USAID Economic Restructuring and Reform Programs - Land Registration and Titling Programs

U.S. Department of Agriculture (USDA) – Government-to-Government Food Aid

USDA PVO Food Aid Programs

Seed Delivery Program

Support for WFP Food-For-Work Program

Preview Of FY 2000 Programs

Agricultural Marketing Assistance Program ($5.7 million): This U.S. Department of Agriculture (USDA) program was initiated in 1996. In FY 1999, USDA expanded the program, adding a particular emphasis on assisting private sector growth in Agriculture and Agribusiness. In FY 1999, MAP played a key role, both technically and financially, in a highly successful collaborative effort involving the World Bank, the Lincy Foundation and the Andre Group of Switzerland. Under this program, 7,000 metric tons of tomato paste were produced and exported, with an export value of $4.5 million. In addition, $2.5 million worth of tomato paste was produced and packaged for domestic sale. In addition, MAP loans were used to purchase Agricultural production from 6,000 Armenian farmers and to provide aseptic production and packaging equipment to four major canneries to meet world-quality standards. MAP also provided a $550,000 credit for the purchase of 2.3 million glass jars and the establishment of Armenia’s first leasing company. More than 1,000 seasonal jobs were created at the cannery level and an estimated 5,000 jobs were created at the farm level. Counting farmers, cannery workers, harvest workers and their dependents, more than 50,000 people benefited from the tomato paste project. Also in cooperation with the World Bank, MAP played a key role in the opening of Armenia’s only domestic fruit juice processing plant, by providing a loan for 63 percent of the required funding. The company, New Wave, Limited, began operations by selling 3,500 liters of juice per week in the Yerevan market and secured a contract for exporting their production. The plant, which uses modern aseptic packaging, processes apricot, peach, apple, and rose hip juice, and has created 40 new jobs and 60 seasonal jobs, and has purchased fruit from 20,000 farmers. In addition, MAP provided financial and technical assistance to Armenia’s cheese industry and to packaging firms that support the industry. Armenia’s production of European style cheeses was increased by 300 percent, resulting in substantial import substitution. In FY 1999, MAP also provided over $1.52 million in loans to 215 Agribusinesses and individual farmers, milk processors, and livestock producers to expand the sale of cheese, dried fruit, milk products, meat, wine, tomato paste, and fresh and processed fruit.

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USDA Support for Agricultural Education Reform: USDA’s Marketing Assistance Program (MAP) is helping the Armenian Agricultural Academy (AAA) revise its curriculum and integrate the Armenian Agricultural Extension Service and several national research institutes into the AAA. MAP is also helping the AAA design an undergraduate degree program in Agribusiness management to be implemented in the 2000 fall semester, which will be taught entirely in English and will feature guest speakers from several American universities. MAP is also providing limited opportunities for exceptional AAA students to continue their studies and receive advanced degrees from prominent U.S. universities. All of these students have contracts to return to Armenia to teach undergraduate courses. In addition, USDA facilitated the creation of the Foundation for Applied Research and Agribusiness, whose membership consists of more than forty AAA professors and students and whose goal is to use applied research to improve income at the farm level. One successful Foundation project tested U.S. tomato varieties and found varieties that increased tomato production by 60 percent in comparison with Armenian varieties.

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U.S. Information Agency (USIA) Exchanges - Community Connections Program: These programs aim at exposing future Armenian leaders to Western concepts of democracy and market economics, received a significant increase in emphasis in FY 1999. Under the Community Connections Program - a total of 60 Armenians were selected for four to five week community-based internships in the US in a number of fields, including dairy production.

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U.S. Department of Agriculture (USDA) – Cochran Fellowship Program: In FY 1999, USDA’s Cochran Program continued to support Agricultural reform in Armenia, organizing FREEDOM Support Act funded short-term exchange programs for a total of six participants.

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USAID Economic Restructuring and Reform Programs - Land Registration and Titling Programs: In FY 1999, USAID assistance continued to build on previous years' progress in this area. To date, more than 75 percent of Agricultural land has been transferred to private ownership, and by law the remaining 25 percent must also be transferred. In coordination with the World Bank and TACIS (the European Union’s technical assistance program for the NIS), a streamlined methodology is being used to survey, register and title urban and rural land throughout the country. Largely as a result of these efforts, 100,000 land parcels have been surveyed to date. USAID also provided assistance in drafting laws that will ensure the development of land markets in Armenia.

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U.S. Department of Agriculture (USDA) – Government-to-Government Food Aid: In FY 1999, the Government of Armenia decided not to accept a $10 million concessional loan for the procurement and delivery of U.S. wheat to Armenia under USDA’s P.L. 480, Title I Program, basing its decision on the premise that accepting the loan would have exacerbated the country’s 1999 budget deficit and would therefore have seriously jeopardized the planned release of segments of Armenia’s IMF and World Bank loans. The Armenian Government subsequently requested a USDA Section 416(b) grant wheat program for FY 2000, the provision of which will be dependent on commodity availability and funding authority.

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USDA PVO Food Aid Programs: In FY 1999, USDA allocated $9.15 million for the provision of approximately 6,200 metric tons (MT) of food commodities to Armenia, drawing from USDA resources under the Food for Progress and Section 416(b) Programs. USDA’s Food for Progress Program donated 5,700 MT of commodities through two U.S. private voluntary organizations (PVOs) working in Armenia: the Fund for Armenian Relief (FAR) and the United Methodist Committee on Relief (UMCOR). UMCOR monetized 2,500 MT of these commodities and used the proceeds to carry out several programs to assist health care providers and to improve Agricultural facilities. FAR used 1,900 MT of donated commodities for the direct feeding of 60,000 beneficiaries. In addition, FAR used the proceeds from the monetization of 1,300 MT of commodities to help revitalize the country’s dairy industry. In addition to the Food for Progress commodity donation, USDA also donated 500 MT of dry milk to support United Nations World Food Program (WFP) initiatives in Armenia.

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Seed Delivery Program: In FY 1999, the State Department’s Operation Provide Hope funded the cost (approximately $107,000) of transporting 1,528 metric tons of spring barley seed purchased by the Armenian Government. This program was undertaken to help Armenian farmers recover from the 1998-99 drought by providing them with an essential Agricultural input for the spring 1999 planting season.

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Support for WFP Food-For-Work Program: Since 1996, the United Nations World Food Program (WFP) has been transitioning from humanitarian distributions to development assistance through its food-for-work program in Armenia. With funding from multiple donors, the program has employed more than 75,000 vulnerable Armenians, while at the same time creating the infrastructure necessary for income generation. Through this program, WFP employs more people than any other nongovernmental employer in Armenia. In lieu of wages, workers receive food packages of vegetable oil, flour and sugar. The U.S. Government has been enthusiastically supporting this program since its inception. In FY 1999, two U.S. Government agencies made significant contributions to the execution of this successful and necessary program. In response to an appeal to donors, USAID contributed $571,000 to the program, and through its FY 1999 Section 416(b) Program, USDA provided 500 metric tons of flour with a total commodity and transportation value of over $240,000. It is likely that without U.S. Government support, this important WFP program could not have attained such a high degree of success.

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Preview Of FY 2000 Programs: In FY 2000, U.S. Government funded assistance programs for Armenia will focus on increasing the demonstrable and tangible benefit of U.S. Government assistance to the average Armenian citizen and to his/her standard of living. The U.S. Government will seek to accomplish this by designing assistance programs that will, among others, continue to decrease humanitarian assistance in favor of a more targeted development approach, with a particular emphasis on job creation, education and Agriculture.

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