01/2017
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8 M o l d ova Agriculture Bulletin New quality standards for fruits and vegetables Moldova is better prepared to combat animal diseases 2017 Agricultural Subsidy Fund will be MDL 900 million New vineyards and stone fruit orchards planted in 2016
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Contents State Initiatives ........................................................................................................... 2 1) 2) 3) 4) 5)
2016 agricultural subsidy results announced .................................................................................. 2 Minister Grama attends agricultural forum in Berlin ...................................................................... 2 New rural development program to launch .................................................................................... 2 Prime Minister calls for patience with promised aid ...................................................................... 3 New quality standards for fruits and vegetables ............................................................................ 3
Foreign Aid ................................................................................................................. 4 6) 7) 8)
Moldova is better prepared to combat animal diseases................................................................. 4 Sweden allocates EUR 2 million for food safety program ............................................................... 4 2017 Agricultural Subsidy Fund will be MDL 900 million ................................................................ 4
Private Sector.............................................................................................................. 5 9) 10) 11) 12) 13) 14)
New vineyards and stone fruit orchards planted in 2016 ............................................................... 5 Gross agricultural output increases 18.6% ...................................................................................... 5 Moldovan exports to the EU on the rise ......................................................................................... 5 Fruit farmers demand promised aid, threaten protests ................................................................. 6 Mobiasbanca participating in Polish credit program ...................................................................... 6 Moldovan exports increase in 2016 ................................................................................................ 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)
2016 agricultural subsidy results announced
February 3rd, 2017, http://www.maia.gov.md/ro/comunicate-de-presa/rezultatele-subventionarii-pentru-anul-2016
The Ministry of Agriculture and the Agency for Payments and Intervention for Agriculture (APIA) announced the results of the 2016 agricultural subsidy program. 4,549 grant applications were received between August 5 and October 31, 2016, requesting MDL 641 million, marking an increase of 500 applications and MDL 100 million as compared to 2015. Most grant application (1,143) were submitted under the sub-measure for ‘Investment Incentives for Agricultural Equipment and Technologies’, representing MDL 115.6 million. The most applications (297) came from Cahul, while Comrat requested the highest total amount of subsidies (MDL 46.15 million). In 2016, young farmers filed 286 applications for subsidies as did 186 women farmers. Young farmers and women farmers receive an addition 15% to their subsidies to encourage the growth of these segments in agriculture. In total, 148 applications representing MDL 27.7 million were rejected as ineligible, leaving 4,401 applications worth MDL 613.3 million for the final total for the 2016 agricultural subsidies.
2)
Minister Grama attends agricultural forum in Berlin
January 25th, 2017, http://www.maia.gov.md/ro/comunicate-de-presa/maia-sustine-gestionarea-responsabila-apei-agricultura
Agriculture Minister Eduard Grama attended the 9th ‘Agriculture and Water – Key to Feeding the World’ forum for agriculture ministers in Berlin in January 2017. The forum was held for ministers of agriculture to come together and discuss issues related to agriculture and food security. This year, the forum focused on a key challenge for the 21st century, lack of water. As a major consumer of water, agriculture has a responsibility to ensure proper and efficient use of this vital resource; agriculture also has enormous potential to help lead the way in addressing this challenge internationally. During his time in Berlin, Minister Grama also held a series of meetings. He met with Grationo Da Silva and Vladimir Rakmanin of the Food and Agriculture Organization (FAO) to discuss climate change effects on agriculture as well as current and upcoming FAO projects in Moldova. The Minister also met with Michael Harms and Anja Quiring of Germany’s Regional Committee on Economic Relations with Eastern Europe to discuss Moldova’s agricultural relationship with Europe and to confirm their support in helping Moldova modernize its agri-food sector. Minister Grama also visited the Green Week international exhibition where he met with his counterparts from Romania, Georgia, Belarus, Lithuania, Latvia and Armenia for discussions on strengthening bilateral relations. The Minister also held a separate meeting with Illar Lemet of Estonia to discuss how Moldova and Estonia could strengthen their relationship within the agricultural sector.
3)
New rural development program to launch
January 20th, 2017, http://agrobiznes.md/in-curand-va-fi-lansata-o-campanie-de-dezvoltare-a-afacerilor-in-sectorul-rural.html
The Ministry of Economy will be partnering with the Organization for the Development of Small and Medium Enterprises to launch a program of business development in the rural areas of Moldova. The program will consist of several concrete actions aimed at supporting entrepreneurs in these areas. To Page 2
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achieve the program’s objectives, the Ministry will focus on organizing events which engage development partners and government authorities at all levels directly with rural community members and has committed to organizing a series of events throughout 2017 in order to promote this atmosphere of cooperation. Business development in rural areas not only ensures the development of those particular areas but also supports the development of the national economy as a whole. In this context, the Ministry of Economy is ready to support existing business incubators and help create new ones. Vasile Bitca, Minster of Regional Development and Construction, stressed that his Ministry will also contribute to rural business development with a three-year, MDL 121 million fund which will be aimed at developing the competitiveness of rural businesses through projects such as regional markets and a center for the transfer of innovations and technologies.
4)
Prime Minister calls for patience with promised aid
January 19th, 2017, http://www.basarabia.md/premierul-in-2016-am-achitat-nu-doar-subventiile-dar-si-restantele-din-aniitrecuti-vom-intreprinde-in-continuare-eforturi-pentru-a-sprijini-agricultorii/
Prime Minister Pavel Filip gave assurances that the government will fulfill its responsibilities regarding financial support to farmers who suffered from natural disasters in 2016. The Prime Minister reiterated that the government is doing everything it can to get the needed aid to farmers as quickly as possible and chided those calling for protests. The Prime Minister called for increased dialogue, saying that he and the Ministry of Agriculture are always open for discussions to resolve any existing problem in the country, reminding farmers of the constructive relationship and discussions the government maintains with farmers through farmer associations.
5)
New quality standards for fruits and vegetables
January 12th, 2017, http://replika.md/index.php/ru/moldova/moldova-ekonomika/2194-v-moldove-ovoshchi-i-frukty-budutvyrashchivatsya-v-sootvetstvie-s-evropejskimi-normami
The Cabinet of Ministers approved a number of changes and additions to requirements on the quality and marketing of fresh fruits and vegetables. The changes are part of Moldova’s Association Agreement with the European Union (EU), which requires Moldova to move towards adjusting national standards to be in-line with European and international fruit and vegetable standards. The changes will also help achieve higher quality products and protect the rights and interests of international and domestic consumers. The changes define specific requirements for the classification, grading, packing and marking of products and will help increase access to European markets. Going forward, fruits and vegetables will be divided into categories depending on their quality, variety, appearance and form.
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Foreign Aid 6)
Moldova is better prepared to combat animal diseases
January 25th, 2017, http://agrobiznes.md/moldova-este-protejata-mai-bine-impotriva-bolilor-transfrontaliere-la-animale.html
Moldovan authorities are better prepared to prevent and control swine flu and other diseases as a result of a project implemented by the Food and Agriculture Organization (FAO) of the United Nations. FAO has supported the development of a national strategy to improve legislation and emergency plans, install a system for operational decisions and hold a series of workshops. The last of the workshops, held in January 2017, brought together veterinarians and control agency employees from different regions in Moldova to learn and exchange views on methods to combat cross-border infections of animal diseases. Participants also took part in an exercise simulating the outbreak of African swine flu. Preventing and controlling animal diseases is essential to protect the national economy and Moldovan citizens, and FAO has helped Moldova to significantly improve its readiness to respond to pathogenic animal diseases. FAO’s effort is part of a coordinated strategy between countries to improve legislation and government responses to transboundary animal diseases. Transboundary animal diseases are highly contagious and can spread extremely quickly, irrespective of national borders. They cause high rates of death and disease in animals, which causes series harm national economies and, sometimes, cause public health risks.
7)
Sweden allocates EUR 2 million for food safety program
January 23rd, 2017, http://radiochisinau.md/experti-suedezi-vor-ajuta-la-modernizarea-ansa---44608.html
Sweden is allocating EUR 2 million for technical assistance to the Moldovan National Food Safety Agency. The funds will be used within a project aiming to enhance Moldova’s food safety. The project will last three years and will contribute to Moldova fulfilling its obligation to bring its legislation into compliance with European directives, as was agreed as part of the Deep and Comprehensive Free Trade Agreement (DCFTA). In the next two years, Moldova will need to adopt around 200 European Union (EU) directives by amending its domestic legislation. This will increase the confidence of European consumers in foods from Moldova and, thus, spur exports to the EU. The government hopes to approve a new food safety strategy which was developed with the support of Moldova’s development partners. With national programs to control all food safety facets having already been drafted, Moldova’s next objective will be to enlarge the network of food control laboratories and have them certified. There is currently a network of labs in Moldova that tests the quality of products of animal origin, with a central office in Chisinau and regional offices in Donduseni, Drochia and Cahul. The same network will be enhanced and utilized for testing the quality of products of plant origin. Moldova will also need to work to ensure the quality of foods being imported into the country. To this end, three special customs checkpoints have been arranged and one more checkpoint, on the border with Romania, will be opening this June.
8)
2017 Agricultural Subsidy Fund will be MDL 900 million
January 16th, 2017, http://infomarket.md/en/agriculture/The_2017_Agricultural
A draft resolution on the 2017 Agricultural Subsidy Fund was offered for public hearings in January 2017. The MDL 900 million fund aims to provide support for restructuring and adapting farms to European Union (EU) standards, upgrading agri-food processing facilities, adopting green technologies, improving agricultural infrastructure, advisory/training services and encouraging agri-tourism. Subsidies will not Page 4
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exceed 50% of the investment made but will be greater for young farmers and women (+15%), farmers which grow organic foods (+20%) and farmers fitting the subsidizing criteria who buy domestic goods (+10%). MDL 231 million of the funds will be provided as a grant from the European Commission.
Private Sector 9)
New vineyards and stone fruit orchards planted in 2016
February 2nd, 2017, http://radiochisinau.md/soiurile-autohtone-de-struguri-prevaleaza-pe-plantatiile-noi---45190.html
Approximately 3,200 orchards were set up in Moldova last year. However, farmers have chosen to move away from traditional apple orchards due to the Russian embargo and the vulnerability of apples to late frosts, instead concentrating their efforts on grapes and other stone fruits. In addition, manufacturers are investing more and more in strawberry, gooseberry and blackberry plantations, with the amount of subsidies requested for such plantations last year exceeding MDL 4 million and covering an area of 100 hectares. Moldovan farmers also planted more than 570 hectares of vineyards last year, 55% of which were of table grape varieties. The most popular grape variety planted was the local ‘Moldova’ variety, although technical varieties such as ‘Festeasca’ and ‘Rara Neagra’ were also planted. In total, more than MDL 10 million in subsidies was issued for the planting of these new vineyards in Moldova last year.
10) Gross agricultural output increases 18.6% January 27th, 2017, http://infomarket.md/en/agriculture/Moldovas_gross_agricultural
According to the National Bureau of Statistics, Moldova’s gross agricultural output increased 18.6% yearon-year in 2016. The growth in the agricultural output is a result of a higher than average capacity of plant products which resulted in 26% higher volumes. In particular, the harvest of cereals and grain legumes increased 34.6% to 2.98 million tons; the bulk yield of wheat grew 39.9% to 1.29 million tons; and the bulk yield of corn increased 28.8% to 1.38 million tons. There was also a 3.1% growth in the production of livestock output, led by 4.8% growth in cattle and poultry breeding and 7% growth in egg production. The share of plant products in the gross output was 72% in 2016, against 68% in 2015, while the share of the livestock products was 28% in 2016, against 32% in 2015. 42% of the total agricultural output was produced at agricultural enterprises, 19% at farms and 39% at households.
11) Moldovan exports to the EU on the rise January 22nd, 2017, http://www.trm.md/en/economic/tot-mai-multi-producatori-isi-exporta-marfa-in-ue/
According to Minister of Economy Octavian Calmac, the amount of goods exported by Moldovan producers to European markets has increased since the implementation of the Association Agreement with the European Union (EU). In 2016, 65% of Moldovan exports went towards European markets. The export of goods to Commonwealth of Independent States (CIS) member countries has reduced from 38% in 2013 to 20% in 2016. Moldovan exporters are also actively working to further open up new markets, especially in Turkey and China.
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12) Fruit farmers demand promised aid, threaten protests January 16th, 2017, http://infomarket.md/en/agriculture/The_gardeners_of_Moldova
Representatives of UniAgroProtect, the MoldovaFruct Association and the National Farmers' Federation are threatening to organize protests if the government does not follow through and approve the aid promised to farmers whose orchards were affected by frost in April 2016. Alexandru Slusar, chairman of UniAgroProtect, said that farmers have been waiting a difficult 9 months for the government to follow through and deliver the promised aid and have even kept all their obligations to the state, including paying all required taxes, despite the difficulties for them. Late April frosts affected between 30% and 100% of the fruit harvest in the Briceni, Donduseni, Drochia, Glodeni, Ocnita, Soroca and Riscani regions. Calculations from the Ministry of Agriculture assess the total damage at MDL 207.9 million. In October 2016, a draft was developed to allocate MDL 45 million from a reserve fund to help support farmers affected by the frost. To date, the government has yet to approve the draft.
13) Mobiasbanca participating in Polish credit program January 13th, 2017, http://radiochisinau.md/creditul-polonez-destinat-fermierilor-este-disponibil-prin-intermediulmobiasbanca---44088.html
Mobiasbanca has announced that customers can receive financing with favorable terms for the development of companies engaged in food and industry. Clients seeking to develop their businesses can now access loans of EUR 500,000 to EUR 5,000,000, with a repayment term of up to 12 years. In addition, companies that receive the financing will also benefit from affordable lending conditions, other equipment and financial services provided by Poland, a VAT and zero-duty imports into Poland. To be eligible for the loan program, companies must utilize the funds for: setting up/modernizing agribusinesses, investing in new harvesting or processing technologies, and investing in modern innovations and technologies in order to comply with European Union (EU) food quality and safety requirements. The funds for the loans are the result of Mobiasbanca joining the Loan Assistance Grant Program of the government of Poland. By joining the program, Mobiasbanca is expanding its range of financing from external financial sources, offering its customers advantages for business development and contributing to Moldova’s economic growth. The program provides EUR 100 million in credit to Moldova, although Poland has requested that amount be halved to EUR 50 million. So far, the Ministry of Finance of Moldova has submitted six cases for funding, amounting to approximately EUR 10 million.
14) Moldovan exports increase in 2016 January 11th, 2017, http://moldpres.md/en/news/2017/01/11/17000202
Moldova recorded a 2.7% year-on-year increase in the export of goods in the first 11 months of 2016, with re-exports increasing by 4.4% and the export of local goods increasing by 1.8%. This exceeded official expectations of an overall 5% decline in Moldovan deliveries to foreign markets. November 2016 saw an 8.5% increase over October 2016 and a 30.3% increase as compared to November 2015. The European Union (EU) holds a 64.8% share of Moldovan exports, up 7.2% year-on-year. The import of goods decreased 0.1% in the first 11 months of 2016 and 5.7% in the month of November. Experts had projected a decrease of 6% in imports for 2016. Moldova exported goods amounting to USD 1.85 billion in the first 11 months of 2016; imports amounted to USD 3.63 billion. Page 6
Prepared by Business & Finance Consulting (BFC) www.bfconsulting.com In this bulletin, BFC provides extracts from articles that have been published by others and as a result cannot be held responsible for such content. The articles do not necessarily reflect the opinions of BFC, its staff, its associates or its partners. Copyright of articles is retained by their authors.