10/2017
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17 M o l d ova Agriculture Bulletin Moldova requests increased tariff quotas for EU exports EIB and EIF loan guarantee agreements to support SMEs Moldovan fruits to appear in Romanian supermarkets Plums and grapes export west; apples export east
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Contents State Initiatives ........................................................................................................... 2 1) 2) 3) 4)
AIPA signs cooperation agreement to help it modernize ............................................................... 2 Moldova requests increased tariff quotas for EU exports .............................................................. 2 Training for youth to open businesses in rural areas ...................................................................... 2 Agricultural land can now be used for rural tourism ...................................................................... 3
Foreign Aid ................................................................................................................. 3 5) 6) 7) 8)
APM identifies regulatory shortcomings in value chains ................................................................ 3 EIB and EIF loan guarantee agreements to support SMEs .............................................................. 4 Farmer trainings on benefits of cooperatives ................................................................................. 4 FAO project to promote agro-ecological practices ......................................................................... 4
Private Sector.............................................................................................................. 5 9) 10) 11) 12) 13)
Rural poverty hurting Moldovan agriculture ................................................................................... 5 Moldovan fruits to appear in Romanian supermarkets .................................................................. 5 January-September agricultural production ................................................................................... 5 Cross-border agricultural forum to be held in Chisinau .................................................................. 6 Plums and grapes export west; apples export east......................................................................... 6
Note: The Agriculture Bulletin presents a monthly roundup of headlines and news stories related to Moldova’s agricultural sector. This bulletin is prepared by Business & Finance Consulting—a Swiss-based development finance consulting company with a long history of working in Eastern Europe, Central, South and South East Asia and North Africa. Read more »
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BFC Agriculture Bulletin
State Initiatives 1)
AIPA signs cooperation agreement to help it modernize
October 24th, 2017, http://agrobiznes.md/afacerile-agricole-de-tip-start-up-vor-putea-obtine-subventii-in-avans.html
The ‘Best Practices of the European Payment Agencies’ conference was held in Chisinau under the framework of the ‘Strengthening the Agency for Intervention and Payments for Agriculture's (AIPA) Capacities and Competences to Administer Support Measures in the Field of Agriculture and Rural Development In Line with EU Norms and Standards’ twinning project. The purpose of the event was to raise awareness among policy makers, the business community and the society at large about the role of payment agencies in managing funds for the development of the agro-industrial sector. At the conference, a cooperation agreement was signed with counterpart agencies from Poland, the Czech Republic and Slovenia. The purpose of the agreement is to help AIPA modernize its institutional framework based on the best practices of these countries. Starting next year, AIPA plans to launch two new activities. The first will give upfront grants and/or subsidies for start-up projects that have a limited capacity to finance projects. The second is an online email service for agricultural producers that will help streamline AIPA processes.
2)
Moldova requests increased tariff quotas for EU exports
October 24th, 2017, http://www.ziarulnational.md/r-moldova-solicita-ue-majorarea-cotelor-de-export-pentru-struguri-prunegrau-orz-porumb-si-zahar/
The Republic of Moldova has requested that the European Union (EU) consider increasing export quotas for grapes, plums, cherries, wheat, barley, maize, sugar and ethyl alcohol. The request was made at a meeting of the Moldova-EU Association Committee that took place in mid-October in Chisinau. The request was motivated by the fact that, due to the support given by the EU and the structural evolutions that have taken place in the agricultural field in recent years, Moldova's export potential for certain goods has increased considerably. European representatives replied that all requests would be examined and could be resolved in favor of national producers. Specifically, Moldova has requested that tariff quotes increase as follows: fresh grapes to 25,000 tons, fresh plums to 20,000 tons, cherries to 2,000 tons, wheat to 250,000 tons, barley to 100,000 tons, corn to 250,000 tons, sugar to 50,000 tons and processed cereals to 15,000 tons. In the first eight months of this year, Moldova exported goods worth about USD 915 million to the EU, which represents 64.13% of total exports. The Ministry of Economy believes that this could be increased 15-20% in the coming years. In the first three years since signing the Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU, Moldova has exported approximately USD 3.8 billion in goods to the EU.
3)
Training for youth to open businesses in rural areas
October 24th, 2017, http://www.basarabia.md/determinati-sa-si-deschida-propria-afacere-in-localitatile-rurale-300-de-tineriau-beneficiat-pe-parcursul-anului-de-instruire-in-cadrul-pnaet/
About 300 young people from the Cimislia, Comrat, Donduseni, Ocnita, Straseni, Ungheni and Vulcanesti regions have benefitted from entrepreneurial skills training this year. The training was offered as part of the government’s National Youth Empowerment Program (NYEP), which aims to increase the role of Page 2
BFC Agriculture Bulletin
young people in the social and economic life of the country by setting up new businesses in rural areas as well as developing existing businesses. Of those that participated in the program, only 6% already had a business, with the remaining 94% wanting to open a new business. Around 69% of the trainees were unemployed. After completing the training courses, half of the beneficiaries were determined to start their own business in the next 6-12 months, with the rest deciding that a 24-month period was necessary to open their new businesses. Between January and September of this year, 159 businesses have been funded with MDL 18 million in grants and MDL 45 million in preferential loans. It is expected that, by the end of the year, about 170 businesses will have been helped by MDL 20 million in grants and MDL 50 in preferential loans. The government has also decided to extend the program but has changed the age limit for potential program beneficiaries to 30-35 years of age.
4)
Agricultural land can now be used for rural tourism
October 6th, 2017, http://infomarket.md/ru/businesslaw/v_moldove_razreshat_ispolzovanie_zemel_selhoznaznacheniya_v_deyatelnosti_po_selsk omu_turizmu_dlya_razmescheniya_agroturisticheskih_pansionatov
Parliament has adopted amendments to the land code which will allow agricultural land to be used for rural tourism activities. Under the newly adopted measures, owners of agricultural lands who have been engaged in agricultural activities for at least 5 years will be able to place agro-touristic boarding houses. The amendments are aimed at facilitating the creation and development of agro-tourism services in rural areas, which is one of the goals of the Action Plan for the implementation of the National Strategy for the Development of Agriculture and Rural Areas for 2014-2020. The introduction of the new measures will promote the development of agro-tourism, create new jobs, increase the attractiveness of rural areas and preserve and promote cultural and traditional values.
Foreign Aid 5)
APM identifies regulatory shortcomings in value chains
October 30th, 2017, http://agrobiznes.md/proiectul-apm-constata-un-sir-de-lacune-ale-cadrului-regulator-pentru-o-serie-delanturi-valorice.html
The ‘Agricultural Producer in Moldova’ (APM) project of the United States Agency for International Development (USAID) has completed an analysis of the time, cost, action and accompanying documentation required in a range of agricultural value chains, including apples, table grapes, stone fruits, open-field vegetables and greenhouses. The analysis found that, although the regulatory framework is rather permissive and tends to ease administrative efforts, there are still areas and processes that are not sufficiently regulated, thereby creating obstacles for farmers. For example, testing and registration procedures for plant varieties are considered complicated, even when already registered in the European Union (EU) Common Catalog of Plant Varieties. Additionally, there is a lack of effective control over seedlings producers, leading to the emergence and marketing of bad quality seedlings. The APM project aims to help agricultural producers increase the competitiveness of domestic highvalue agricultural products as well as increase sales in domestic and international markets.
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6)
EIB and EIF loan guarantee agreements to support SMEs
October 26th, 2017, http://www.eib.org/infocentre/press/releases/all/2017/2017-287-the-eib-group-signs-the-first-guaranteeagreements-in-georgia-moldova-and-ukraine-under-the-eu4business-initiative.htm
The European Investment Bank (EIB) and European Investment Fund (EIF) signed the first guarantee agreements to provide EUR 100 million in loans to support small- and medium-sized enterprises (SMEs) in Moldova, Georgia and Ukraine. These are the first guarantee agreements that EIB and EIF are jointly supporting in the three countries. The agreements, signed with the ProCredit Bank Group under the EU4Business initiative, will facilitate access to finance for local SMEs by providing a 70% guarantee on each loan and offer financing at favorable conditions, including reduced collateral requirements. The three guarantee transactions are expected to unlock additional financing for SMEs and ultimately create and maintain jobs and new business opportunities in Moldova, Georgia and Ukraine. These guarantees are funded by the European Union through the Neighborhood Investment Facility, within the context of the EU4Business initiative.
7)
Farmer trainings on benefits of cooperatives
October 16th, 2017, http://agrobiznes.md/fnfm-invita-fermierii-mici-si-mijlocii-sa-afle-despre-beneficiile-asociatiiloragricole.html
A series of seminars are being held in several regions throughout Moldova this October and November that will train approximately 350 farmers on the role and importance of agricultural associations and cooperatives as well as how to access agricultural lending opportunities. The overall objective of the seminars is to help Moldovan farmers improve their performance and increase their profits. This initiative is being organized by the National Federation of Farmers in Moldova (NFFM), the Ministry of Agriculture and the European Neighborhood Program for Agriculture and Rural Development (ENPARD). Seminars are open and free to all farmers.
8)
FAO project to promote agro-ecological practices
October 6th, 2017, http://www.madrm.gov.md/ro/content/fao-este-gata-s%C4%83-sus%C8%9Bin%C4%83-agroecologia%C3%AEn-moldova
The Food and Agriculture Organization of the United Nations (FAO) and state authorities have launched a pilot project to promote agro-ecological practices in Moldova. The project is a continuation of joint efforts to ensure a sustainable and resistant food system in Moldova and involves revising policies and national agro-ecological strategies as well as formulating recommendations for improving and updating documents. Another important component of the project includes conducting field studies to identify the best cultivation systems for the adoption and promotion of conservative agriculture and integrated plant protection. Based on this, there will be 10 national farmer schools established to promote conservative farming and innovative methods of integrated plant protection. Within these schools, over 40 training sessions involving more than 600 farmers are planned to be organized. In order to promote and raise awareness of the need for an agro-ecological approach in agriculture, a set of materials will be developed to inform farmers about new techniques and initiatives. The National Federation of Farmers of Moldova (NFFM) will implement the project, which will end in June 2018 and has a budget of USD 125,000.
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BFC Agriculture Bulletin
Private Sector 9)
Rural poverty hurting Moldovan agriculture
October 30th, 2017, http://poliexpert.md/noutatipublicatii/saracia-rurala-inghite-agricultura-republicii-moldova.html
In Moldovan villages, the living standard is rather low, and road and service infrastructure is poor at best and often not developed. Additionally, those living in rural poverty often lack regular access to urban centers. This makes it more difficult for the agricultural sector, which often offers poorly-paid jobs to rural inhabitants. This, in turn, has caused an exodus of the active labor market out of the countryside, leaving large vacancies in the rural area. Despite the difficult situation, there are solutions to resolve these issues and help both rural areas and the agricultural sector. The most important step is to modernize localities; this, however, is difficult as the ability to attract modern technologies is low in these areas, as is the level of academic knowledge. If Moldovan villages are to thrive once again, measures need to be taken now to reverse these trends. Additionally, the development of consultancy services in the country needs to be boosted along with effective ways to reach farmers with up-to-date information on legislation, market trends and legal services.
10) Moldovan fruits to appear in Romanian supermarkets October 29th, 2017, http://en.publika.md/moldovan-fruits-won-contracts-to-appear-in-romanian-supermarkets_2641511.html
Moldovan fruits are set to conquer the Romanian market this year as representatives of a Romanian supermarket chain have signed contracts with ten domestic producers that participated in INDAGRA, the largest agricultural fair in Romania. Delivery of apples, plums, pears and grapes will come via the Association of Moldovan Fruits Producers and Exporters Between January and August of this year, Moldova exported produce worth nearly USD 1.5 billion, with Romania accounting for approximately 25% of that total.
11) January-September agricultural production October 27th, 2017, http://www.agravista.md/article/view/77451
Total agricultural production from all categories (agricultural enterprises, peasant farms and households) in January-September 2017 amounted to MDL 22.51 billion, a 3.7% year-on-year increase in terms of prices. The increase of agricultural production was due to an increase of 6.3% in vegetable production and an increase of 1.5% in livestock production. The overall harvest of grain and cereal crops (excluding corn) was 1.56 million tons, or 2.5% less than in 2016. From this, the wheat harvest was 1.24 million tons, 4.4% less than last year; the barley harvest was 246,000 tons, 3.9% less than last year; and the harvest of leguminous grains was 70,000 tons, 1.8 times more than last year. The highest indices of grain and cereal crops were registered in the north, which harvested 4% more per hectare (38.8 quintals) than the country average. In January-September 2017, egg production increased 5% year-on-year, led by a 6.6% increase from agricultural enterprises and a 3.6% increase from household production. Livestock and poultry production (in live weight) decreased by 2.4%, and milk production dropped 3.4%. In total, the largest share of livestock production was recorded in households, which produced 94.8% of milk, 62.8% (in live weight) of poultry and 51% of eggs. Page 5
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12) Cross-border agricultural forum to be held in Chisinau October 24th, 2017, http://infomarket.md/en/agriculture/The_crossborder_agricultural_forum_Partnership_for_Sustainable_Rural_Development_in_Romania_and_Moldova_will_be_held_in_Chis inau_on_10_November
The Association of Businessmen of Moldova Abroad, the National Federation of Pro Agro (Romania) and the National Federation of Farmers of Moldova (NFFM) have organized the ‘Partnership for Sustainable Rural Development in Romania and Moldova’ agricultural forum. The event will be held in Chisinau on November 10 and will promote the cross-border cooperation of farmers in Moldova and Romania to expand investment opportunities in agriculture. The forum is expected to involve 150 farmers from both countries, representatives of science and agro-industry as well as officials from Moldova and Romania.
13) Plums and grapes export west; apples export east October 6th, 2017, http://www.trm.md/en/economic/prunele-si-strugurii-sunt-preferati-de-tarile-vecine-merele-de-tarile-dincsi/
Moldovan plums and grapes have larger export volumes to neighboring countries such as Romania, Poland, the Czech Republic, Slovakia and other countries in Western Europe, whereas apples are mainly exported to Commonwealth of Independent States (CIS) countries. The export market of apples being oriented to CIS countries is largely due to the European Union (EU) being a main player in apple trade. The diversification of sales markets has been a challenge for Moldovan producers because it involves the capitalization, adjustment and orientation of fruit export to several destinations. Extreme weather phenomena and labor shortages are also challenges faced by Moldovan producers and exporters of fruit. However, if Moldovan producers and exporters can overcome fears of potential risks, trade with other distant countries will bring internationalization and migration of the fruit trade from a disorganized form to a more beneficial one.
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