Target population: “The program target beneficiaries are farmers registered as individual entrepreneurs, cooperatives, SMEs, rural entrepreneurs, or municipalities who have the intention and financial capability to make investments related to agriculture.
Eligible investments: The program makes a difference between capital expenditures (also called fixed assets) and operating expenditures (also called working capital). The program looks to support capital expenditures only, and excludes operating expenditures, and used equipment, construction costs, and live animals.
Capital expenditures1: Only certain capital expenditures are considered as eligible investments for matching grants calculation within the program.
Below are some types of capital expenditures that are however not eligible for the matching grant calculations, but may be included in the matching contribution part of the application:
- Construction costs (except for Type 6 investments, “municipal investments”). Construction work shall be conducted by a registered construction company.
- Purchase of live animals (limited to reproducing mothers, in line with the commercial activity, and only from authorized legal resellers)
Below is a list of capital expenditures that are not eligible in the matching grant calculation nor in the matching contribution part of the application:
- Alcohol production equipment, with the exception of wine making.
- Transportation vehicle which are not specifically designed for a professional usage (including adapted pick-ups).
Operating expenditures2: Operating expenditures are not eligible for the matching grant calculation, nor for the matching contribution part of the application.
The following expenditures are also considered ineligible activities under this program:
- Procurement of equipment not related to project activity;
- Previous obligations and/or bad debts;
- Fines and/or penalties;
- Any expenditures that would present an environmental or social risk
- Any expenditure that would not comply with FAO and/or EU environmental standards
- Procure of genetically modified organisms;
- Purchase of invasive
The eligibility review of investments will be performed on a case-by-case basis by the implementing partner with the overall technical review from FAO. Before signing the contract, the documentation will be checked. During the prior check, in case of discrepancy (for example unrealistic costs or other unaccepted costs), the applicant will be asked to modify the budget and FAO’s financial contribution will be reduced accordingly. Consequently, the applicant has to be focused on the realistic and rentable budget provision.
1 Capital expenditures: An investment made to buy fixed assets. It is considered a capital expenditure when the asset is newly purchased or when the money is used towards extending the useful life of an existing asset, such as repairing the roof.
2 An operating expense is an expense a business incurs through its normal business operations.