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Abstract
Agriculture occupies an important place in the national economy of Azerbaijan. In 1999 the share of agriculture in the national economy was 28.69%. The population of Azerbaijan in 1999 was a little over eight million people of which 51 % were urban and 49% rural; 42.3% of the population depends on agriculture. Since its independence in 1991, Azerbaijan has carried out profound reforms in almost all segments of its economy, including the agricultural sector. State farms have been abolished and the land and livestock distributed among 800 thousand people; nearly 40 thousand enterprises, comprising small farmers, private property based producers' cooperatives and other agribusinesses have been created. Price controls on inputs and outputs were eliminated, as well as the administrative-command system, state-owned enterprises for marketing and agro-processing. The agricultural sector has undergone profound changes and, at present, consists of private farmers, leasers, producer cooperatives, agro-processing units, service organizations and other private enterprises. Despite these changes in the agricultural economy, the national agriculture research system, its management and infrastructure have remained unchanged. Research institutions face enormous financial difficulties and as a result many highly qualified scientists have abandoned research. The old system of priority setting and control does not correlate with the current economic realities, but continues to function as in the past. Given the current economic realities of the agricultural sector in Azerbaijan, there is an urgent need to find mechanisms to improve the cost effectiveness and efficiency of the agricultural research and extension system. A comprehensive strategy to reform the agricultural knowledge system is a long term undertaking. The Competitive Grant System (CGS) is a mechanism to jump starts the reform process by providing mechanisms to identify and implement projects in areas of research, extension and training that would have immediate impact on the resource poor farmer's ability to enhance productivity and profitability. The Agriculture Development and Credit Project of the Agency for the Support of the Development of the Agricultural Private Sector in Azerbaijan seeks to reform and reinvigorate the national agricultural research system in support of the modernization of the country's agriculture and the development of private farming. This entails the reorientation of agricultural research towards meeting high priorities of the sector, the building of a capacity for on-farm technology assessment and the development of a national strategy for reforming agricultural research and the agricultural knowledge system in general. CGS is envisaged as a first step in achieving this goal. During the first phase of this project, the emphasis will be on initiating result-oriented research and research and extension projects in order to jump start the productivity and profitability of resource poor farmers. These efforts are to be executed through a CGS by awarding complementary financial support to selected priorities making use of the current research and extension system. As the CGS moves forward, new mechanisms will be developed to identify longer term goals in research, extension and training. A comprehensive strategy to reform agricultural research, extension and training will be the final aim, so that the research and extension system is sustainable and relevant to new economic realities and social needs. To accomplish the above goal, the Agency for Support to the Development of the Agricultural Private Sector (ASDAP, hereinafter called the "the Client") and the International Maize and Wheat Improvement Center (CIMMYT, hereinafter called "the Consultant") entered into a contract on 15/11/2000, whereby the Consultant agreed to provide the aforementioned services to the Client. This report by the Consultant, at the end of the contract period, is a comprehensive account concerning the state of affairs of the CGS in Azerbaijan. The report is organized in eight chapters. The Introduction provides background information that led to the initiation ofCGS and the contact with CIMMYT. The second chapter Expected Outputs describes the expected outcome of the contract with CIMMYT and what has been achieved. The third chapter Consultation Missions is a factual statement concerning the number of missions undertaken by the consultants in accomplishing the goals of the CGS. The fourth chapter Problem Analysis and Priority Setting presents the general agricultural scene in Azerbaijan and gives an in-depth description of various aspects of priority setting undertaken in achieving the goals of CGS. Chapter five provides an indepth Sector by Sector Analysis of sectors where CGS is operational. The Current Status of CGS is described in chapter six. For a project to be successful there must be proper Evaluation and Monitoring, explained in chapter seven. In our opinion the CGS is a very successful project. However, there is always room for improvement, and chapter eight provides some Suggestions for the Future aimed at making the CGS even better.