MINISTRY OF AGRICULTURE, FORESTRY AND
WATER MANAGEMENT
Republic of Serbia
Round table 4:
Integration of Western Balkans into the EU Markets
Annual meeting
Goran Zivkov
Berlin, May 2006
East Agri Annual meeting, Berlin, May 2006
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.
East Agri Annual meeting, Berlin, May 2006
“Economic Copenhagen criteria”
• Creation of a functioning market economy,
able to be integrated with the market-based
economies of the existing Member States;
What
is the main
direction
of the
• Ability
to withstand
competition
, so that
country’s
economies
wouldPolicy
not be destroyed
by
Serbian
Agrarian
to fulfill
a flood of imports once they joined the massive
free tradeCopenhagen
area of the EU; Criteria
• Adoption of the entire set of accumulated EU
rules and practices, known collectively as the
acquis communitaire.
East Agri Annual meeting, Berlin, May 2006
Main Strategy objectives
Objectiv
e 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
Social
Ensure 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
Social
Support the sustainable development of rural areas.
Rural
development
Earning &
Spending
Environm
ental
Safeguard the natural environment from detrimental
effects of agricultural production or restructuring
Environment
al protection
Spending
Political
Prepare Serbia's agricultural sector for accession to the
EU
EU accession
Complex
Political
Prepare Serbia's agricultural trade & support policies for
accession to the WTO
WTO
accession
Complex
East Agri Annual meeting, Berlin, May 2006
30000
6.00
25000
5.00
20000
4.00
15000
3.00
10000
2.00
5000
1.00
0
0.00
2000
2001
2002
2003
Agrarian budget
East Agri Annual meeting, Berlin, May 2006
2004
2005
2006
Percentage of total
%
'000 000 dinars
Agrarian budget 2000-2006 (billion dinars )
Budget goals
Modernization of the agriculture and
adjustment to the EU
2005 … +1…..______________n_______________….-1…..EU
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2000
2001
2002
2003
Market Intervention
Administartion
Rural Incentives
Area payment
East Agri Annual meeting, Berlin, May 2006
2004
2005
+1
+1
+1
-1
-1
-1
Structural support
Support for credit market development
Enviromental payment
EU
Support structure
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Budget 2003
Market support
Credit support
East Agri Annual meeting, Berlin, May 2006
Budget 2004
Budget 2005
Structural support
Institutional support
Budget 2006
Income support
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%)
East Agri Annual meeting, Berlin, May 2006
Milion EURO
Rural development & Investment support
35.00 €
Money allocation
6000
30.00 €
Total expenditure
25.00 €
Number of approved application
5000
Number of application
4000
20.00 €
3000
15.00 €
2000
10.00 €
5.00 €
1000
0.00 €
0
2004
2005
Year
East Agri Annual meeting, Berlin, May 2006
2006
Milion EURO
Rural development & Investment support
35.00 €
Money allocation
6000
30.00 €
Total expenditure
25.00 €
Number of approved application
5000
Number of application
4000
20.00 €
3000
15.00 €
2000
10.00 €
5.00 €
1000
0.00 €
0
2004
2005
Year
East Agri Annual meeting, Berlin, May 2006
2006
Rural development support
Focus on beneficiary
PROGRAMME
OTHER
LFA
30%
40 - 50%
2. Rural diversification
30-40%
40-60%
3. Rural Infrastructure
40%
50-60%
1. Improvement of production & marketing
Farms,
Mechanization,
Storage capacity…
Investment support
Focus on investment
1. Livestock farm establishment
30%
2. Milk quality improvement
30%
3. Storage capacity improvement
40%
4. Mechanization & equipment
30%
Irrigation equipment
Greenhouses,
Sowing, spraying & harvesting machinery…
OTHER. Standards establishment (HACCP, ISO…)
Setting up new orchards
Breeding support programme
Land Improvement programme etc.
East Agri Annual meeting, Berlin, May 2006
Priorities: Financing
System Development
MAIN OBJECTIVES:
DURRATION:
BUDGET:
i)
Development sustainable system for financing agricultural
sector from real sources
ii) Develop credit history
iii) Improving of production through ensuring access to capital
to farmers
5 – 7 years
700 millions to 1 billion EURO
Needed capital
State budget (MoA)
2004
2005
2006
East Agri Annual meeting, Berlin, May 2006
2007
2008
2009
2010 …
FARM REGISTER
Ministry projects for
adoption of acquis
Main Objective:
- Improve Payment
Avoid middleman
Farmers open bank account
- Develop payment
structure for future Paying
Agency
- Policy Planning
East Agri Annual meeting, Berlin, May 2006
141 offices of
Directorate for
Public Payment
Number of farmers
Average farm size total
Average farm size farmers
Average farm size companies
10.3
6.3
431
Adoption of acquis
300,000
1,400
250,000
1,200
1,000
200,000
800
150,000
600
100,000
400
50,000
200
0
0
4 4 5 5 5 5 5 5 5 5 5 5 5 5 6 6 6 6 6
4 4 4 4 4 4
-0 n-0 l- 0 g-0 p-0 t-0 v-0 c- 0 n-0 b-0 r-0 r-0 y-0 n-0 l- 0 g-0 p-0 t-0 v-0 c- 0 n-0 b-0 r-0 r-0 y-0
y
a u Ju Au Se Oc No De Ja Fe Ma Ap a Ju Ju Au Se Oc No De Ja Fe Ma Ap a
M J
M
M
Farmers
East Agri Annual meeting, Berlin, May 2006
Companies
Number of companies
FARM REGISTER
MINISTARSTVO POLJOPRIVREDE, ŠUMARSTVA I VODOPRIVREDE
Ministry of Agriculture
Direct payment & Price support
Structural payment
RD (Investment
payment)
Budgetary payment
BANK
BANK
BANK
BANK
BANK
BANK
BANK
BANK
BANK
Open account
CREDIT REGISTRY
FARM REGISTRY
Commercial
credit
Short term credit
Medium term credit
Cooperatives
SMEs
FARMERS
251.000 farmers open account in one of the bank
Bank started to be interested for farmers
East Agri Annual meeting, Berlin, May 2006
Preliminary
Results
East Agri Annual meeting, Berlin, May 2006
Trade of agricultural products
(mil USD)
1200
1000
800
600
400
200
0
-200
1996.
1997.
1998.
1999.
2000.
2001.
2002.
-400
Export
East Agri Annual meeting, Berlin, May 2006
Import
Trade balance
2003
2004
2005
(I/XI)
Agricultural Products Trade
with EU (mio USD)
600
500
400
300
200
100
0
2000
2001
2002
Export
Import
2003
Trade balance
2004
2005 (I-V)
Production Index 2000 –
2005 (previous year 100)
120
119.8
118.6
100
96.6
94.7
92
87.2
80
2000
*
2001
East Agri Annual meeting, Berlin, May 2006
2002
2003
2004
2005
Production Trends 2000 – 2005
120
110
100
90
80
70
60
2000
2001
Log. (Industrial crops)
Log. (Livestock )
East Agri Annual meeting, Berlin, May 2006
2002
Log. (Fruit )
Log. (Crops)
2003
2004
2005
Log. (Vegetable )
Log. (TOTAL)
HVALA
Thank you
East Agri Annual meeting, Berlin, May 2006