Small Farmers’ Aid Shadowed by Corruption
09 May, 2013
Small Farmers’ Aid Shadowed by Corruption
The scandalous money embezzlement worth of GEL 2.5 million in frames of the agriculture development project initiated by the state a couple of months ago, puts the entire project under a shadow.
10 entrepreneurs and several of the Ministry of Agriculture of Georgia (MOA) were detained by the Investigation Service of the Ministry of Finances of Georgia on May 1, 2013; they were charged with money embezzlement through swindle connected with the agriculture vouchers delivered to small farmers in frames
of Small Farmers Spring Works Assistance Program. Agriculture Development Fund [earmarking GEL 700 million on agriculture sector this year] allocated GEL 184 million to this Program to subsidize spring land cultivation works for 640 thousand small landowners owning arable and gardening lands within the range of 0.25-5 hectares. The notes provided financial assistance within GEL 100-640 apiece [depending on the land size] to acquire necessary inventory. To make the financial assistance transparent beneficiaries were obliged to buy necessary goods envisaged in notes only at 810 special shops shortlisted and accredited by MOA. Selling of the agriculture-notes was forbidden.
Nevertheless, according to Investigation Service, some authorized shop-owners contrived to swindle with the notes to get extra benefits as following: they purchased notes from beneficiaries for under-price, falsified data in notes as if the said note-beneficiaries purchased the goods indicated in the notes, the faked notes were submitted to banks and the cheaters got the full sum indicated in the notes.
Davit Kirvalidze, Agriculture Minister, stepped down until investigation will be through. He believes the detained MOA officials [including his buddies] are innocent. Georgian economic and agriculture analysts find Kirvalidze to be a part of the guilt for the project included loopholes for corruption deals at the very outset and was administered very poorly: the spring works subsidizing notes delivery started in February and is to last to August that deprives the program off its sense inasmuch as spring works end in April and nobody needs them in May and July.
Many farmers complain that May has started and agriculture-notes are still not completely delivered. Besides some of the accredited shops that generally are in charge of several villages, work only one day per week that hinders farmers to make due procurements. Besides, prices at the authorized shops are by around 30% higher than in non-accredited shops trading similar goods. The monitoring service of MOA itself fined 6 shops for fixing unreasonable prices.
“I had been predicting cheating schemes would take place in the program as soon as it was launched and my apprehensions came true unfortunately,” Demur Giorkhelidze, an economic analyst, told Georgian Journal. “It was obvious from the very outset, for the program lacked competent calculations and backgrounds. When you plan to provide spring works subsidizing notes in July the cheating risk is clear: when one cannot use the notes for targeted purpose he/she tries to use it for other means.” He doubts that the program has been deliberately drawn back to undermine local production and boost import inasmuch as some importers still enjoy lobby.
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