Agricultural production in Armenia will rise by over 10 percent this year following a sharp fall registered in 2010, Agriculture Minister Sergo Karapetian said on Friday.
Citing official statistics, Karapetian said output in the agricultural sector was up by 14 percent in January-November 2011.
With agriculture accounting for roughly one-fifth of the country’s Gross Domestic Product, the sharp increase bodes well for a 4.6 percent rate of economic growth forecast by the Armenian government for 2011.
Armenian agricultural output contracted by more than 13 percent last year mainly because of highly unfavorable weather conditions. The drop significantly slowed economic growth in Armenia.
Karapetian said the sector’s better performance this year resulted from not only more favorable weather but what he described as unprecedented government support for farmers. The minister singled out a government program to subsidize agricultural loans provided by commercial banks.
According to Karapetian, the scheme has enabled 23,000 farmers across the country to receive a total of 15 billion drams ($40 million) carrying interest rates of 8-10 percent per annum. Market-based interest rates for such loans typically exceed 20 percent.
“This is a continuous process. More such loans will be extended next year,” Karapetian told a news conference.
The scheme has so far benefited only a small minority of Armenia’s mostly low-income farmers. Many of them continue to complain about government neglect, a lack of irrigation and the high cost of fuel and fertilizers.
Karapetian said the government will also continue to promote in 2012 consolidation of modest land holdings through the establishment of agricultural cooperatives.
Prime Minister Tigran Sarkisian said in October that at least 55 cooperatives will be set up by the end of 2012. He said agricultural output in those communities will grow by 30 percent each year as a result.
According to the Ministry of Agriculture, Armenia has approximately 403,000 hectares of arable land owned by as many as 340,000 physical and legal entities. The vast majority of them are village families eking out a modest living.
Citing official statistics, Karapetian said output in the agricultural sector was up by 14 percent in January-November 2011.
With agriculture accounting for roughly one-fifth of the country’s Gross Domestic Product, the sharp increase bodes well for a 4.6 percent rate of economic growth forecast by the Armenian government for 2011.
Armenian agricultural output contracted by more than 13 percent last year mainly because of highly unfavorable weather conditions. The drop significantly slowed economic growth in Armenia.
Karapetian said the sector’s better performance this year resulted from not only more favorable weather but what he described as unprecedented government support for farmers. The minister singled out a government program to subsidize agricultural loans provided by commercial banks.
According to Karapetian, the scheme has enabled 23,000 farmers across the country to receive a total of 15 billion drams ($40 million) carrying interest rates of 8-10 percent per annum. Market-based interest rates for such loans typically exceed 20 percent.
“This is a continuous process. More such loans will be extended next year,” Karapetian told a news conference.
The scheme has so far benefited only a small minority of Armenia’s mostly low-income farmers. Many of them continue to complain about government neglect, a lack of irrigation and the high cost of fuel and fertilizers.
Karapetian said the government will also continue to promote in 2012 consolidation of modest land holdings through the establishment of agricultural cooperatives.
Prime Minister Tigran Sarkisian said in October that at least 55 cooperatives will be set up by the end of 2012. He said agricultural output in those communities will grow by 30 percent each year as a result.
According to the Ministry of Agriculture, Armenia has approximately 403,000 hectares of arable land owned by as many as 340,000 physical and legal entities. The vast majority of them are village families eking out a modest living.