11/2017
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18 M o l d ova Agriculture Bulletin USD 400 million in agricultural development in 10 years EBRD approves new strategy for Moldova EUR 120 million to be invested in horticulture project Honey exports on the rise
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Contents State Initiatives ........................................................................................................... 2 1) 2) 3) 4) 5)
USD 400 million in agricultural development in 10 years ............................................................... 2 Agricultural credit guarantee fund proposed .................................................................................. 2 ODIMM provides financing to 25 more entrepreneurs .................................................................. 2 New measures to facilitate poultry/egg exports to the EU ............................................................. 2 Ministry of Agriculture stops black currant subsidies ..................................................................... 3
Foreign Aid ................................................................................................................. 3 6) 7) 8) 9) 10) 11)
EBRD approves new strategy for Moldova ...................................................................................... 3 Czech business development grants in Northern Moldova ............................................................ 3 Two new FAO projects announced for Moldova ............................................................................. 3 Only 1% of direct foreign investment goes to agriculture .............................................................. 4 EUR 120 million to be invested in horticulture project ................................................................... 4 IFAD VII project launches in Moldova ............................................................................................. 4
Private Sector.............................................................................................................. 5 12) 13) 14) 15)
Honey exports on the rise ............................................................................................................... 5 2016-2017 agricultural year fruitful ................................................................................................ 5 Moldovan fruit available at large Romanian retail chain ................................................................ 5 Moldovan honey collection down this year .................................................................................... 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)
USD 400 million in agricultural development in 10 years
November 29th, 2017, http://www.trm.md/en/economic/peste-400-de-milioane-de-dolari
The financial support of development partners for investment projects in agriculture has amounted to over USD 400 million in the past ten years. This includes the ‘2 KR’ project, which has helped 5,000 agricultural producers receive modern agricultural equipment. Currently, the Ministry of Agriculture manages or is a partner in 39 investment and technical assistance projects in the agricultural field.
2)
Agricultural credit guarantee fund proposed
November 26th, 2017, http://www.trm.md/en/economic/in-moldova-va-fi-creat-un-fond-de-garantare-a-creditelor-agricole/
The Ministry of Economy has proposed amendments to the ‘Strategy for the Development of Small- and Medium-sized Enterprises’ that will set up an agricultural credit guarantee fund in Moldova. The proposal would allocate MDL 25 million annually to the fund as well as grant MDL 200 million in financial guarantees for small- and medium-sized enterprises (SMEs) in 2018. At present, SMEs represent 98.7% of the total number of enterprises in the country and employ over 60% of the total workforce in the country.
3)
ODIMM provides financing to 25 more entrepreneurs
November 26th, 2017, http://www.trm.md/en/economic/alti-25-de-antreprenori-vor-beneficia-de-finantare/
The ‘PARE 1+1’ program on attracting remittances into the economy will provide another MDL 5.85 million for the implementation of the projects of 25 entrepreneurs. According to the Organization for Small and Medium Enterprise Sector Development of Moldova (ODIMM), beneficiaries' own contribution will account for MDL 16 million. Most of grant beneficiaries plan to invest in agriculture, the processing industry or the agro-food sector. In total, the projects are expected to create 74 jobs.
4)
New measures to facilitate poultry/egg exports to the EU
November 21st, 2017, http://agrobiznes.md/masuri-noi-pentru-facilitarea-exportului
The Cabinet of Ministers has approved amendments to the measures on the monitoring and control of bird flu in order to bring them into line with European directives. The proposed amendments and additions are intended to limit the risk of the transmission of bird flu to poultry and other captive live birds. In particular, they are expected to strengthen the early detection and surveillance system of the National Food Safety Agency in order to prevent the outbreak of disease. This is expected to allow Moldova to export poultry meat and eggs into the European Union (EU). Although Moldova has had export quotas to the EU for animal products for several years, Moldova cannot currently deliver production into European markets due to Moldova not meeting the stricter requirements of the EU when it comes to these products.
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BFC Agriculture Bulletin
5)
Ministry of Agriculture stops black currant subsidies
November 19th, 2017, http://agrobiznes.md/ministerul-agriculturii-a-stopat-subventionarea-plantatiilor-de-coacaz-negru.html
The Ministry of Agriculture has stopped the temporary subsidization of black currants due to the mass drying of several black currant plantations in different areas of the country. In order to understand the problem, a special commission is being formed and will be composed of representatives of several Moldovan scientific institutions as well as Ministry officials. The Ministry hopes to find a solution soon for black currant producers.
Foreign Aid 6)
EBRD approves new strategy for Moldova
November 29th, 2017, http://www.ebrd.com/news/2017/ebrd-approves-new-strategy-for-moldova.html
The European Bank for Reconstruction and Development (EBRD) has approved a new strategy to guide the Bank’s investments and policy work in Moldova. Specifically, the new 2017-2022 strategy outlines the following priorities: restructuring the banking sector, enhancing energy security, supporting private firms, promoting the commercialization of public utilities and improving infrastructure. The new strategy gives a fresh impetus for the Bank’s engagement in Moldova. EBRD is the leading investor in Moldova. To date, the Bank has invested over EUR 1 billion in various sectors, including infrastructure, energy, banking, industry, commerce and agriculture.
7)
Czech business development grants in Northern Moldova
November 28th, 2017, http://www.trm.md/en/economic/granturi-pentru-dezvoltarea-afacerilor
The Czech government will provide EUR 40,000 in grants for business development in the Northern region of Moldova, with individual grants being provided between EUR 2,000 and EUR 5,000. Grants will be given for purchasing equipment and machines, marketing and promotion, technical staff training, improving logistics and implementing innovations. In order to be eligible for a grant, applicants must be a small- or medium-sized enterprise (SME) registered in the northern region of Moldova for at least one year and not have state debts.
8)
Two new FAO projects announced for Moldova
November 15th, 2017, http://en.publika.md/two-new-fao-projects-to-be-implemented-in-moldova-by-2019_2642124.html
The Food and Agriculture Organization of the United Nations (FAO) has announced two new projects will be implemented in Moldova. One project will help build the capacities of policy makers and local officials involved in preparing and implementing community agriculture and rural development plans in three pilot communities (the communities will be chosen soon). The other project will work to strengthen the capacity of smallholders in berry production via demonstration fields, value chain development and increasing berry farmers’ access to markets and processors. The projects have a combined budget of USD 800,000 and are expected to be completed by 2019.
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BFC Agriculture Bulletin
9)
Only 1% of direct foreign investment goes to agriculture
November 15th, 2017, http://www.trm.md/en/economic/doar-1-din-totalul-investi-tiilor-straine-directe-merg-in-agricultura/
According to an analysis by the German Economic Team to Moldova, agriculture is one of the most unattractive for foreign investors, with only 1% of total direct foreign investment being made into the sector. One of the reasons for foreign investors’ reluctance to invest in agriculture is higher costs, with the cost of pesticides, seeds and planting material being especially high in Moldova. Additionally, large custom duties on importing planting material are prohibitive. The other main factor holding back direct foreign investments into agriculture is the impossibility of the foreign investors to buy land in Moldova.
10) EUR 120 million to be invested in horticulture project November 14th, 2017, http://www.madrm.gov.md/ro/content/investi%C8%9Bii-de-120-milioane-euro
The government of Moldova is investing nearly EUR 120 million into the ‘Livada Moldovei’ (Orchard of Moldova) project, which is designed to rehabilitate Moldova’s horticultural sector. The funding, made available to enterprises via investment loans allocated by four commercial banks, will be invested in the technology and mechanization of primary production processes in horticulture, the installation of irrigation and anti-hail systems, the modernization of processing works and the diversification of Moldovan fruit market. The commercial bank loans are available in amounts of EUR 5,000-5,000,000 and have terms of up to ten years, including a grace period of up to four years, at a rate of 5-6% per annum. The project also provides tax incentives and a VAT zero rate on the import of equipment and services. The funding is made available via a loan from the European Investment Bank (EIB). The ‘Livada Moldovei’ project is being implemented by Moldova’s Ministry of Agriculture and will last until 2022.
11) IFAD VII project launches in Moldova November 6th, 2017, http://www.madrm.gov.md/ro/content/agricultorii-din-republica-moldova
The Ministry of Agriculture and the International Fund for Agricultural Development (IFAD) have announced the launch of the rural resilience IFAD VII project. The project, which will begin to be implemented this year and last until 2023, aims to enhance economic development and strengthen resilience to climate change in agriculture as well as to provide Moldovan entrepreneurs with an affordable and long-term financing source for business development. Implementation of the IFAD VII project is expected to build 24 irrigation water supplies to cover 1,400 hectares, construct 12 road segments to facilitate access to production areas and rehabilitate 4-5 water capture basins. In total, these efforts are expected to create 700 new jobs, including 280 permanent ones. Additionally, approximately 420 agricultural producers will benefit from grants for measures to improve resilience to climate change, and more than 600 micro entrepreneurs, young entrepreneurs and small and medium-sized enterprises (SMEs) will benefit from preferential credits for the development of agro-businesses. The project will have a budget of USD 23.7 million, about 75% of which comes in the form of a 25-year loan to Moldova. The loan has a fixed interest rate of 1.25% and a five-year grace period.
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Private Sector 12) Honey exports on the rise December 3rd, 2017, http://www.trm.md/en/economic/exportul-de-miere-in-crestere/
According to official data, honey production in recent years amounts to about 5,000 tons annually, and exports of honey from Moldova have increased 14 times within the last 10 years, amounting to approximately 3,500 tons each year. The main importer of Moldovan honey is the European Union (EU), especially Romania, Italy, France, Germany and Spain. Moldovan authorities are actively promoting state support to beekeepers in order to help the sector develop.
13) 2016-2017 agricultural year fruitful November 20th, 2017, http://infomarket.md/en/agriculture/Agricultural_year_2016-2017
Despite natural disasters in April of this year and a drought in the early autumn of 2016, the 2016-2017 agricultural year has been a successful one. In particular, the average yield per hectare of wheat increased 0.77 tons, leading to a wheat harvest of 1.17 million tons. Moldova also harvested 248,000 tons of barley and is expecting a harvest of 1.1 million tons of corn. Pea harvest volumes remained at the same level as last year (51,000 tons) despite planting areas being reduced. Additionally, the harvest of soybeans was 57,000 tons, of sunflowers was 51,000 tons, of rapeseed was 74,000 tons and of tobacco was 3,900 tons. Moldova also had a good fruit harvest of 608,000 tons, 2.1% more than last year. Finally, it is expected that more than 100,000 tons of sugar will be produced from this year’s sugar beet harvest, enough to cover domestic demand and fill the export quota (35,000 tons) to the European Union (EU).
14) Moldovan fruit available at large Romanian retail chain November 8th, 2017, http://www.realitatea.md/producatorii-moldoveni-livreaza-primele-fructe
The first shipment of Moldovan fruit has been delivered to one of the largest retail chains in Romania, Auchan Retail Romania. This is the result of the efforts of the Moldova Fruct Association and the United Nations Development Program in Moldova (UNDP Moldova) to help Moldovan producers diversify export markets. This particular deal came about at the Indagra Food 2016 specialized exhibition held in Bucharest. Auchan Retail Romania currently operates 33 hypermarkets in Romania and has plans to open several hundred more. The company also plans to expand cooperation with Moldovan fruit producers in the near future.
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15) Moldovan honey collection down this year November 6th, 2017, http://tvrmoldova.md/economic/recolta-de-miere-a-scazut-dramatic-in-republica-moldova/
The amount of honey collected this year (so far approximately 5,000 tons) is down by almost 30% as compared to last year. It is estimated that about 80% of the losses are the direct result of beekeepers not properly making winter preparations. Additionally, there is concern that some Moldovan beekeepers have introduced unauthorized bees into the country. So far this year, more polyflora honey (70%) has been collected than acacia and lime honey (30%).
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Prepared by Business & Finance Consulting (BFC) www.bfconsulting.com Articles are taken directly from local sources without any fact-checking; they are provided as a convenience and for informational purposes only. Business & Finance Consulting (BFC)’s editing is limited to providing a short summary in English of the texts, highlighting the main points of the original articles. All rights reserved by the authors. BFC takes no responsibility and does not make any representation or warranty, express or implied, or assume any responsibility whatsoever for the content, accuracy, and reliability, or completeness of any of the articles.