#73 Serbia Agriculture Bulletin, BFC

10/2021

#

73 S e r b i a Agriculture Bulletin New Digital System to Facilitate Faster Farmer Access to Funding New Law to Help Farmers Access IPARD Funds

EC Assessment of Serbia’s Progress Toward EU Integration

Sowing of Winter Wheat Delayed

All materials are published “as is” and are the property of their respective owners.

Agriculture Finance Bulletin Edition #73, October 2021

Contents State Initiatives ........................................................................................................... 2 1) 2) 3)

New Digital System to Facilitate Faster Farmer Access to Funding ................................................ 2 Conference Held on the Usage of Funds from State-Owned Agricultural Land .............................. 2 eAgrar Software Solution to Help Improve Recordkeeping and Payment Management ............... 2

Foreign Aid ................................................................................................................. 2 4) 5) 6) 7) 8) 9)

New Law to Help Farmers Access IPARD Funds .............................................................................. 2 EC Assessment of Serbia’s Progress Toward EU Integration ........................................................... 3 Serbian Agriculture Vulnerable to Climate Change ......................................................................... 3 Ministry of Agriculture Opens Tender for Digitalization Expert ...................................................... 3 Berry Business Forum Held in Belgrade ........................................................................................... 3 IPARD 3 Funds Likely to Be Delayed ................................................................................................ 3

Private Sector.............................................................................................................. 4 10) 11) 12) 13) 14)

Sowing of Winter Wheat Delayed ................................................................................................... 4 MK Group Invests in Trainings Related to the Digitalization of Agriculture.................................... 4 Beef Prices in Serbia Now Equal to Those in Sweden ..................................................................... 4 Agricultural Producer Prices Up 24.0%............................................................................................ 4 Berry Production and Exports on the Rise ...................................................................................... 4

Note: The Agriculture Bulletin presents a monthly roundup of headlines and news stories related to Serbia’s agricultural sector.

This bulletin is prepared by Business & Finance Consulting—a Swiss-based development finance consulting company. Currently, BFC is implementing “Development of Financial System in Rural Areas in Serbia” programme for KfW. Read more »

BFC Max-Högger-Strasse 6 CH-8048 Zurich, Switzerland

Phone: +41 44 784 22 22 Fax: +41 44 784 23 23

info@bfconsulting.com www.bfconsulting.com

BFC. Agriculture Finance Bulletin.

State Initiatives 1)

New Digital System to Facilitate Faster Farmer Access to Funding

October 31st, 2021, https://www.dnevnik.rs/ekonomija/poljoprivreda/nedimovic

Amendments to the Law on Agriculture will allow for the introduction of a new electronic system that will facilitate the faster processing of applications for IPARD and other state funding support. This, in turn, will also lead to the faster disbursement of approved funds. In addition to the implementation of the new system, trainings will be provided on how to submit applications electronically. The system is expected to be operational within one year.

2)

Conference Held on the Usage of Funds from State-Owned Agricultural Land

October 29th, 2021, https://www.politika.rs/scc/clanak/490878/Drzava-od-arende-zaradi-pet-milijardi

A conference was held regarding how funds collected from the leasing of state-owned agricultural land are used. Past funds have been used to ensure the proper protection and administration of a state-owned agricultural land (including the creation of the Geoportal) as well as for agricultural subsidies. At the conference, participants discussed investing funds into mechanization and digitalization measures, incentives for developing irrigation and anti-hail systems and which agricultural subsectors should receive support.

Each year, Serbia collects more than RSD 5 billion in income from the leasing of state agricultural land, with 40% of this directed to the national budget and 60% directed to local governments.

3)

eAgrar Software Solution to Help Improve Recordkeeping and Payment Management

October 27th, 2021, https://rs.n1info.com/biznis/drzava-uvodi-eagrar-za-poljoprivredna-gazdinstva-i-isplatu-subvencija/

Amendments to the Law on Agriculture will introduce eAgrar, a new software solution that will enable more efficient recordkeeping and payment management for the Directorate for Agrarian Payments. eAgrar is an electronic portal through which farmers can access data on their farms and submit electronic requests for entry in the Register of Agricultural Holdings. They will also be able to change data, renew registrations and download necessary data. To develop and implement the solution, the government has allocated RSD 573 million.

Foreign Aid 4)

New Law to Help Farmers Access IPARD Funds

October 29th, 2021, http://www.agronews.rs/sta-predvida-predlog-zakona-o-ipard-fondovima/

A new law, once adopted, will make IPARD rules more favorable for farmers. In particular, the new law will allow advanced payments of IPARD funds to be made to farmers in an amount of up to 50% of the total proposed investment. This is an important development as Serbia looks to increase the usage of existing IPARD funds. So far, only 30% of the EUR 175 million in IPARD 2 funds have been utilized.

Page 2

BFC. Agriculture Finance Bulletin.

5)

EC Assessment of Serbia’s Progress Toward EU Integration

October 26th, 2021, http://www.agronews.rs/izvestaj-eupotrosnja-sredstava-iz-ipard-a-prioritet/

The European Commission (EC), as part of an assessment of progress made by countries in the Western Balkans and Turkey on their paths toward the European Union (EU), has found that Serbia has made some progress in terms of its agriculture and rural development as well as its food safety, veterinary and phytosanitary policies. Going forward, the EC has tasked Serbia with: (1) speeding up the processing of IPARD 2 applications, (2) submitting, in due time, a request to commence IPARD 3 and (3) making further progress in the implementation of the action plan for harmonizing its agricultural and rural development measures.

6)

Serbian Agriculture Vulnerable to Climate Change

October 21st, 2021, http://www.agronews.rs/sektor-poljoprivrede-i-vodni-resursi-medu-najugrozenijima/

The Food and Agriculture Organization of the United Nations (FAO), in cooperation with the European Bank for Reconstruction and Development (ERBD), held an online workshop on the impact of climate change on agriculture and water resources in Serbia. During the workshop, experts discussed historical trends as well as elaborated on projections for the next few decades. Experts predict that Serbia is likely to face increased temperatures and reduced precipitation (including an increase in the average number of dry days). As such, experts believe that it will be important for Serbia’s agricultural sector to start developing water collection and retention systems.

7)

Ministry of Agriculture Opens Tender for Digitalization Expert

October 20th, 2021, https://www.ekapija.com/en/news/3450776/ministry

Serbia’s Ministry of Agriculture has opened a tender for an expert consultant to implement its digital development strategy for the Serbia’s agricultural sector. This position is considered part of Serbia’s Competitive Agriculture Project, which is being financially supported by an International Bank for Reconstruction and Development (IBRD) loan of EUR 45.8 million.

8)

Berry Business Forum Held in Belgrade

October 6th, 2021, https://www.ekapija.com/en/news/3437170/first-international

Around 120 local and regional farmers, experts, distributors, equipment producers and other berry industry representatives gathered in Belgrade for the two-day Berry Business Forum. Forum participants discussed production capacities, world market trends, quality seed materials, climate change adaptation and financing needs and opportunities. The forum was organized with the support of the Ministry of Agriculture, the Embassy of the Kingdom of the Netherlands and the Competitive Economy Project of the United States Agency for International Development (USAID).

9)

IPARD 3 Funds Likely to Be Delayed

October 5th, 2021, http://www.agronews.rs/novi-milioni-evra-iz-eu-fondova-na-dugom-cekanju/

Millions of euros in assistance for Serbia’s agricultural sector from the European Union (EU) are now being prepared as part of the IPARD 3 program. However, these funds could be delayed in reaching their intended recipients as only 10% of the EUR 175 million in available funds under IPARD 2 have been delivered to farmers so far. The main reasons for the lack of fund usage to this point are complicated procedures related to strict European Union (EU) requirements and the insufficient number of employees at the Directorate for Agrarian Payments. Experts hope that the introduction of advanced payments

Page 3

BFC. Agriculture Finance Bulletin.

within the program will help facilitate the faster disbursal of program funds, although this requires legal changes to be adopted.

Private Sector 10) Sowing of Winter Wheat Delayed October 29th, 2021, https://beta.rs/ekonomija/ekonomija-srbija/154299

The sowing of winter wheat this fall is late, with only 10–15% of the planned areas have been sown. The delay in sowing is due to rains, the lack of mineral fertilizers available in the domestic market and the prices of both available fertilizers and fuel. This has left many farmers concerned over whether this year’s sowing of winter wheat will pay off or not. Many farmers expect that, even in the best case scenario, they will only break even. At the same time, farmers must continue planting to preserve their crop rotation, which is important for maintaining soil quality.

11) MK Group Invests in Trainings Related to the Digitalization of Agriculture October 27th, 2021, https://beta.rs/ekonomija/ekonomija-srbija/154211

MK Group is investing in its own staff to develop their abilities as related to the digitalization of agriculture.

Through a nine-month course in its Digital Academy, experts from MK Group have become more acquainted with the most modern agricultural technologies as well as important skills in project management, business processes, financial management and agricultural concepts. MK Group’s Digital Academy hopes to further develop talent and raise capacities in this regard. The next such training is scheduled for October 2022.

12) Beef Prices in Serbia Now Equal to Those in Sweden October 16th, 2021, https://www.021.rs/story/Info/Biznis-i-ekonomija/287439/Junetina

Beef has become significantly more expensive recently, rising in price by as much as 13% in a single month.

In fact, the price per kilogram is now on par with beef prices in Sweden (at approximately EUR 8 per kilogram). Market experts believe that the reasons for the increase in beef prices are drought and generally lower fodder yields. The prices of pork and chicken also recently underwent significant prices increases of approximately 15%, although their prices have since stabilized and even come down slightly.

13) Agricultural Producer Prices Up 24.0% October 12th, 2021, https://agrosmart.net/2021/10/12/cene-poljoprivrednih

Average producer prices for agricultural and fishery products in August 2021 have increased 24.0% yearon-year. The greatest price growths were recorded for the production of fruits (up 58.5%), industrial plants (up 42.9%), cereals (up 24.6%) and livestock and poultry (up 11.3%). Compared to July 2021, average producer prices rose 3.7%, with the greatest increases seen in the production of vegetables (up 33.8%), cereals (up 6.0%) and livestock and poultry (up 5.7%).

14) Berry Production and Exports on the Rise October 6th, 2021, https://www.021.rs/story/Info/Biznis-i-ekonomija/286676/Izvoz-bobicastog-voca-veci-za-trecinu.html

There has been a dramatic increase in berry production and export activity in the last ten years. This is evidenced by nearly 40,000 hectares of land in the country now being berry orchards, almost double the amount just ten years ago. The result has been a marked increase in berry exports. For example, 2020 Page 4

BFC. Agriculture Finance Bulletin.

berry exports were valued at EUR 338 million, 19.4% more year-on-year. Berry exports now account for 40% of total fruit exports.

Page 5

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.