US$ 16 million credit for Armenian villages

The World Bank Board of Executive Directors today approved a US$ 16 million credit for the Community Agricultural Resource Management and Competitiveness (CARMAC) Project for Armenia, WB press office reports.

This Project is designed to improve productivity and sustainability of pasture-based livestock farms in 55 mountainous communities by increasing milk production, improving pasture management, and enhancing farm sales of livestock products.

For the women and men living in Armenia’s mountainous communities, livestock production is the main source of cash income and livelihood. The CARMAC project will help address key constraints facing these activities, including unsustainable pasture management and underutilization, persistent diseases, processing and marketing constraints.

“Agriculture continues to be a key sector for the Armenian economy, and notwithstanding the numerous challenges of the recent years, it has to revitalize its role and contributions to the country’s economic growth and employment,” says Asad Alam, World Bank Regional Director for the South Caucasus Countries. “Project activities are clustered in the poorer mountainous areas of the country, where pasture resource degradation is acute. Overall, 55 villages in six regions with a total population of around 78,000 will benefit from the Project.”

The Project will introduce innovative community-based pasture/fodder-based livestock production practices. Villages will be selected based on their interest in improving their livestock production through sustainable use of pasture resources. The Project will also help improve pasture management, through investments in infrastructure, community level agri-business, and related support services. Most importantly, the investments will be channeled through pasture user associations – all-inclusive co-operatives created for the management of community pasture resources.

“Productivity increases will be the result of a more rational use of pastures and better feeding, and will boost overall efficiency, so that Armenian products will be in a better position to supply the domestic market and to compete regionally,” says Doina Petrescu, Task Team Leader of the World Bank Team that designed the Project. “The Project will support these changes and increase net income through a range of income-generating measures.”

“I would highlight the long-term environmental benefits,” says Jean-Michel Happi, the World Bank Country Manager for Armenia. “The Project will have environmental benefits through sustainable pasture management, improved waste management from animal farms and community veterinarians, as well as dissemination of good farming practices among rural communities. Development and implementation of pasture management plans are expected to capture degradation of target pastures, reverse productivity losses, and boost biodiversity conservation in the alpine zone of Armenia.”

The CARMAC Project builds on the World Bank experience and successes in agriculture, rural development, pasture and livestock management, and participatory community development in Armenia and other transition economies.

Total financing of the Project is US$ 21.33 million, of which the Government of Armenia will finance US$ 5.33 million. The IDA credit carries a maturity of 20 years including a grace period of 10 years.

Since joining the World Bank in 1992 and IDA in 1993, the total IDA and IBRD commitments to Armenia amount to US$ 1, 449 million.