Romania Structural funds for agriculture
Keywords: agriculture in Romania, structural funds, structural instruments, food processing Romania
The contribution of the primary sector (agriculture, forestry, fish farming) to the gross value added was, between 1998-2003 of 16.2% in 1998 and 13.0% in 2003 (OECD -1998/2003 NUTS III). The decrease came from the vegetable sector, dropping from 54.7% in 1998 to 42.5% in 2002 (11,8% in the considered period) in terms of contribution to the GVA of the primary sector (agriculture, forestry and fish farming), followed by the animal sector, dropping from 39.8% in 1998 to 24,4% in 2003 (14,6%). This creates opportunities for investors in Romania.
During 1998-2003, the production of food units had various developments, depending on the group of products. In 2003 as against 1998, we can see a strong decrease of the meat processing by 40%, canned fish by 33%, milk by 40%, cheese by 30%, wheat and rye flour (wheat equivalent) by 17%, margarine by 27%. There are other products with significant increase: sweets and pastry by 16%, fermentation alcohol by 21%, wine by 26%, beer by 25%, tobacco products by 10%. The number of companies from food industry had an insignificant increase, from 10,237, in 1998 to 10,688 in 2003 (NIS/MAFRD 1998/2003 country level). The industry distribution shows that most companies are bakeries, mills and producers or processors of meat and meat products. This creates opportunities for investors in Romania because a lot of these companies do not comply with EU regulations.
Agri tourism is considered to be a potential alternative activity that will continue to grow in rural areas, due to beautiful landscapes, a high share of semi natural lands, hospitality of rural people and preservation of rural traditions. The Romanian rural area is also reach on natural and historical amenities. However, the development of rural tourism is dependent on the presence of the necessary basic infrastructure and institutions to support tourism which in many places in Romania is still hampered by a lack of capital. Today there are about 4,000 rural boarding houses offering tourist services (bed and breakfast) of which 1965 unit are included in organized rural tourism network such as National Agency for Eco-Cultural Tourism. Only 1267 of this units are certified while the remaining units require some modernization in order to get the necessarily classification by the official certification organisms. This creates opportunities for investors in Romania..
Romania introduced the following structural instruments (not structural funds) for agriculture in Romania and food processing in Romania. There are also programmes give non refundable funds for agri tourism, support of the local agriculture, etc
Axis 1 Improving the competitiveness of agricultural and forestry sector
Measures in Axis 1 aim to improve the efficiency of agricultural and forestry sectors in order to allow them to adapt to the open trade environment conditions.
Expected results:
A better trained labor force, with an improved age structure (111 - Vocational training, information actions and diffusion of knowledge, 112 - Setting up of young farmers) A better lands structure and a competitive agriculture (121 - Modernisation of agricultural holdings, 122 - Improving of the economic value of forests, 125 - Improving and developing infrastructure related to the development and adaptation of agriculture and forestry, 141 - Supporting semi-subsistence agricultural holdings, 142 - Setting up of producer groups ) An increase in the added value of products (123 - Adding value to agricultural and forestry products).
Axis 2 Improving the environment and the countryside
Support through Axis 2 is intended to improve the environment and the sustainable management of agricultural and forestry land.
Expected results:
Continuing the use of agricultural land in less favoured areas and promoting sustainable farming (211 - Support for mountain areas and 212 - Support for Less Favoured Areas other than mountain areas), Preserving and improving the status of natural resources and habitats (214 - Agri-environment payments) Promote sustainable management of forests (221 - First afforestation of agricultural lands).
Axis 3 The quality of life in rural areas and the diversification of the rural economy and Axis 4 LEADER
The support granted through Axis 3 aims to encourage the diversification of the rural economy and to improve the quality of life in the rural area.
Expected results:
Village development through the maintenance and development of economic activities (322 - Village renewal and development, improvement of basic services for the economy and rural population, conservation and upgrading the rural heritage) Increasing the attractiveness of rural areas (312 - Support for the creation and development of micro-enterprises, 313 - Encouragement of tourism activities) Fostering alternative employment opportunities for the population in rural area (312 - Support for the creation and development of micro-enterprises, 313 - Encouragement of tourism activities)
Measures within Axis 4 aim to assist rural development by improving local governance and fostering endogenous potential.
Expected results:
LEADER approach will lead to carrying out the objectives of Axis 1, 2 and 3 within integrated local development strategies and innovative actions.
The intensity of aid for agricultural projects Period 2007-2009
Maximum eligible value smaller then 2,000,000 Euro, share of the non-refundable support-50%.
The non-refundable support may increase with:
5% for investments done by young farmers; 10% for the investments done by farmers from LFA, Natura 2000 and payments linked to the Directive 2000/60/EC; 25% for investments aiming the implementation of Council Directive 91/676/EEC
Period 2010-2013:
Maximum eligible value/project smaller then 2,000,000 Euro, the share of non-refundable support- 40%
The non-refundable support may increase with:
10% for investments done by young farmers 10% for the investments done by farmers from LFA and Natura 2000 and payments linked to the Directive 2000/60/EC 25% only for 2010 for the investments attaining to implement the Council Directive 91/676/EEC
For projects also including investments for production and use of renewable energy, the maximum eligible amount 3,000,000 Euro, share of the non-refundable support - 50% for 2007-2009 and respectively 40% for 2010-2013.
For projects belonging to an associative form and serve its members, the maximum eligible amount- 4,000,000 Euro, share of the non-refundable support-50% for 2007-2009 and respectively 40% for 2010-2013.
Aid intensity for the processing of agricultural projects
Micro-enterprises and SME
up to 50% of the eligible value of investments and a maximum ceiling of the non-refundable public aid of 2,000,000 Euro/project up to 50% of the eligible value of investments and a maximum ceiling of the non-refundable public aid of 3,000,000 Euro/project for the investments belonging to an associative form and serving its members
The support intensity for the region no. 8 Bucharest-Ilfov is smaller then 40% of the eligible value.
For other types of enterprises
up to 25% of the eligible value of investments and a maximum ceiling of the non-refundable public aid of 2,000,000 Euro/project
The support intensity for the region no. 8 Bucharest-Ilfov is smaller then 20% of the eligible value.
(c) Copyright 2009 Romania Structural Instruments for agriculture