Subsidy Policies and the Efficiency of the Agricultural Subsidy Fund
Automatically translated summary. The full text is available in Romanian.
Independent Think Tank “Expert-Grup” analyses Moldova's agricultural subsidy policies and the efficiency of the subsidy fund. Agriculture accounts for 12%-13% of GDP and over 64% of exports, yet productivity remains low. The paper, produced under a project funded by Soros-Moldova, identifies key constraints and proposes reforms.
Small and subsistence farms dominate, with an average of 2.5 ha per holding against 20 ha in the EU. Gross value added grew only 11.9% in real terms in 2015 compared with 2008, and value added per person employed is falling. Exports increasingly consist of low value-added goods, which reached 35.3% in 2015, up over 13 percentage points from 2010, and about 80% of exports come from just 13-14 product groups.
The paper points to unstable funding, delayed payments, annual planning of subsidies and poorly targeted instruments. It warns that the planned Supervisory Board at the Agency for Intervention and Payments in Agriculture could bring interference and clientelism. Subsidies are distributed unevenly: districts differ five-fold per hectare and seven-fold per person. It recommends multi-annual programmes, product- and project-based payments, caution with direct payments from 2020, and support for livestock, horticulture and processing.
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