Georgia introduces subsidies on wheat flour


On 27 November 2020, the Government allocated a budget of GEL 10 million (about USD 3 million) to a programme to subsidize the sale of wheat flour, until 31 March 2021. The price of a 50 kg bag of wheat flour was set at GEL 53 (about USD 16) and the State subsidy will amount to a maximum GEL 10 per 50 kg bag. The decision was taken to avoid bread price increases, given that domestic prices of wheat flour have been increasing in recent months. Domestic wheat prices mostly reflect export price trends in the subregional market, as imports of wheat account for about 90 percent of the country’s domestic consumption and the Russian Federation is the main wheat supplier.

In April 2020, with the outbreak of the COVID‑19 pandemic and trade limitations implemented in the exporting countries of the subregion, the Government had launched a programme to subsidize imports of wheat. According to the programme, the beneficiary would receive a subsidy of USD 40 per tonne of imported wheat, with the condition to sell a 50 kg bag of flour at no more than GEL 51 (USD 16) (FPMA Food Policy).

Country: Georgia