goran zivkov round table 4: integration of western balkans into the eu markets ministry of...

Goran Zivkov

Round table 4: Integration of Western Balkans into the EU

Markets

MINISTRY OF AGRICULTURE, FORESTRY AND WATER MANAGEMENT

Republic of Serbia

Berlin, May 2006

Annual meeting

East Agri Annual meeting, Berlin, May 2006

Task Task Could you please give the most important messages on the situation of the agricultural food industry in your country, e.g. structure, capacities, main trade opportunities, and main problems regarding the accession to EU markets - EU standards etc. on 3-5 PPP slides max (max. 5-10 min). Since we have so many speakers in our RT 4, it seems to be reasonable to cut the presentations down to the most important messages and folow-up with discussions.


““Economic Copenhagen Economic Copenhagen criteria” criteria”

• Creation of a functioning market economy, able to be integrated with the market-based economies of the existing Member States;

• Ability to withstand competition, so that the country’s economies would not be destroyed by a flood of imports once they joined the massive free trade area of the EU;

• Adoption of the entire set of accumulated EU rules and practices, known collectively as the acquis communitaire.

What is the main direction of Serbian Agrarian Policy to

fulfill Copenhagen Criteria


Objective type

Overall objective Short title Economic effect

Economic

Increase the wealth of the nation through an efficient agricultural sector, producing products that are internationally competitive in terms of quality and price.

Wealth creation

Earning

SocialEnsure that the food provided to Serbian consumers meets acceptable standards of quality and safety

Food safety Spending

Social

Support the standard of living of people currently dependent on agriculture, where this is liable to seriously decline through economic reform

Income support

Spending

SocialSupport the sustainable development of rural areas.

Rural development

Earning &Spending

Environmental

Safeguard the natural environment from detrimental effects of agricultural production or restructuring

Environmental protection

Spending

PoliticalPrepare Serbia's agricultural sector for accession to the EU

EU accession

Complex

PoliticalPrepare Serbia's agricultural trade & support policies for accession to the WTO

WTO accession

Complex

Main Main Strategy Strategy objectivesobjectives


0

5000

10000

15000

20000

25000

30000

2000 2001 2002 2003 2004 2005 2006

'000

000

din

ars

0.00

1.00

2.00

3.00

4.00

5.00

6.00

%

Agrarian budget Percentage of total

Agrarian budget 2000-2006 (billion Agrarian budget 2000-2006 (billion dinars )dinars )


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2000 2001 2002 2003 2004 2005 +1 +1 +1 -1 -1 -1 EU

Market Intervention Structural support Administartion Support for credit market development Rural Incentives Enviromental payment Area payment

Modernization of the agriculture and adjustment to the EU

Budget goals

2005 … +1…..______________n_______________….-1…..EU


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Budget 2003 Budget 2004 Budget 2005 Budget 2006

Market support Structural support Income supportCredit support Institutional support

Support structureSupport structure


Main policy direction Main policy direction

• MARKET SUPPORT: Cancellation of the price support and area payment and replacement with input subsidy (decrease from 90.1% to 38%)

• STRUCTURAL SUPPORT: Establishment of rural development payment and investment support (25% of the total support)

• CREDIT SUPPORT: Establishment of Credit support (22%)

• INCOME SUPPORT: Establishment of significant income support (12%)


0.00 €

5.00 €

10.00 €

15.00 €

20.00 €

25.00 €

30.00 €

35.00 €

2004 2005 2006

Year

Milio

n E

URO

0

1000

2000

3000

4000

5000

6000Money allocation

Total expenditure

Number of application

Number of approved application

Rural development & Investment Rural development & Investment support support


Rural development supportFocus on beneficiary

PROGRAMME OTHER LFA

1. Improvement of production & marketing Farms, Mechanization, Storage capacity…

30% 40 - 50%

2. Rural diversification 30-40% 40-60%

3. Rural Infrastructure 40% 50-60%

Investment support Focus on investment

1. Livestock farm establishment 30%

2. Milk quality improvement 30%

3. Storage capacity improvement 40%

4. Mechanization & equipment Irrigation equipment Greenhouses, Sowing, spraying & harvesting machinery…

30%

OTHER. Standards establishment (HACCP, ISO…) Setting up new orchards Breeding support programme Land Improvement programme etc.


MAIN OBJECTIVES:

DURRATION: BUDGET:

i) Development sustainable system for financing agricultural sector from real sources

ii) Develop credit historyiii) Improving of production through ensuring access to

capital to farmers5 – 7 years700 millions to 1 billion EURO

2004 2005 2006 2007 2008 2009 2010 … Need

ed

cap

ital

Banks m

oney

State budget (MoA)

Priorities: Financing

System Development


Ministry projects Ministry projects for adoption of for adoption of

acquis acquis

Ministry projects Ministry projects for adoption of for adoption of

acquis acquis

FARM REGISTERFARM REGISTER

Main Objective:Main Objective:

- Improve Payment Avoid middleman Farmers open bank account - Develop payment structure for future Paying Agency- Policy Planning

141 offices of Directorate for

Public Payment


FARM REGISTERFARM REGISTERAdoption of acquis Adoption of acquis Adoption of acquis Adoption of acquis

0

50,000

100,000

150,000

200,000

250,000

300,000

Num

ber

of

farm

ers

0

200

400

600

800

1,000

1,200

1,400

Num

ber

of

com

pan

ies

Farmers Companies

Average farm size total 10.3Average farm size farmers 6.3Average farm size companies 431


FARM REGISTRY

FARMERS

Ministry of Agriculture

MINISTARSTVO POLJOPRIVREDE, ŠUMARSTVA I VODOPRIVREDE

Direct payment & Price support

RD (Investment payment)

Structural payment

BANKBANK

BANK

SMEsCooperatives

BANKBANK

BANK

BANKBANK

BANK

Open account

Budgetary payment

Commercial credit

Short term credit

Medium term credit

251.000 farmers open account in one of the bankBank started to be interested for farmers

CREDIT REGISTRY


Preliminary Preliminary Results Results


Trade of agricultural products (mil USD)

-400

-200

0

200

400

600

800

1000

1200

1996. 1997. 1998. 1999. 2000. 2001. 2002. 2003 2004 2005(I/XI)

Export Import Trade balance


0

100

200

300

400

500

600

2000 2001 2002 2003 2004 2005 (I-V)

Export Import Trade balance

Agricultural Products Agricultural Products Trade with EU (mTrade with EU (mio USD)

87.2

118.6

96.6

92

119.8

94.7

80

100

120

2000 2001 2002 2003 2004 2005*

Production Index 2000 – 2005 (previous year 100)

Trend line


60

70

80

90

100

110

120

2000 2001 2002 2003 2004 2005

Log. (Industrial crops) Log. (Fruit ) Log. (Vegetable )

Log. (Livestock ) Log. (Crops) Log. (TOTAL)

Production Trends 2000 – 2005


HVALAThank you


goran zivkov round table 4: integration of western balkans into the eu markets ministry of...

Documents

market support87534554698

eu markets eu standards

efficient agricultural

agricultural food industry

main trade opportunities

marketbased economies

main problems

functioning market economy