SIMILAR ARTICLES

Financing Romania: How we got apart from Hungary and Poland in terms of loan costs

September 2016: The market yield of 10-year Romanian government bonds was 2.97%. Very good situation: yield was lower by two-hundredths percent (2 basis points, bps)… Mai mult

Dan Badin / Most ambitious reform of taxing profits in EU with impact on companies and national budgets, under preparations

The buoyant fiscal changes in Romania left almost unnoticed the European debates on profit taxation that are very important for both companies and the public… Mai mult

Fiscal Council – Analysis in a regional context: How pro-cyclical tax policies compromise long-term economic growth

Romania is captive of tax and wage policies that are hostile to long-term sustainable development. One of the most striking arguments is the very large… Mai mult

Conflict between Presidency and PSD-ALDE government on transferring Romanian Embassy in Israel. Liviu Dragnea’s stake

President Klaus Iohannis was not previously informed or consulted on the topic regarding the transfer of Romanian Embassy in Israel to Jerusalem, a press release… Mai mult

What Romania exported and imported in 2017. Some observations

According to INS data, last year, the automotive industry was the driver of Romanian exports, with about EUR 9.6 billion, of a total of EUR… Mai mult

A table: Distressing image of Romanian agriculture. Few and poor farms: a comparison with Europe

de Marin Pana 31.12.2016

 

agricultura-tractor-300x203The ratio between the standard income obtained by a farm from the Netherlands and a farm from Romania is 92 to 1, according to the Eurostat data. They would have an average of 303,760 euros, while we would have only 3,303 euros.

To keep in mind, this average level also includes large farms, in which case the ratio drops to less than 4 to 1, with 4,101,551 euros for the Dutch and 1,104,177 euros for us.

The explanation is simple and devastating for the gap that we should recover. In their case, the fifth of the agricultural production from the poorest farms is at an average of 87,451 euros per year, while in our case it is a tiny amount of 856 euros because production is primarily intended for self-consumption and not for the market.

Below, a report about the relationship between large and small farms, valid for 2015:

tabel

*

Revenues (euros/ year)

Country           Average          Poor farms      Large farms    Number of poor/large farms

*

Property fragmentation has played the key role. Romania holds slightly more than a third of the number of farms from the EU (33.5%), followed at a big distance by Poland (13.2%).

This is the situation although we rank the sixth, with only 7.5% representing the utilised agricultural land, after France (15.9%), Spain (13.3%), the UK (9.9%), Germany (9.6 %) and, again, Poland (8.3%).

Classification of farms according to Eurostat:

Classification of farms into five categories by the economic volume (value of annual production, in euros):

  • Very small farms under 2,000 euros
  • Small farms 2000-7999 euro
  • Medium farms 8000-24999 euro
  • Large farms 25000-99999 euro
  • Very large farms at least 100,000 euros

Classification into small and large farms by the total revenue obtained.

The small ones are those of smallest sizes that obtained 20% of total production. The largest are those that have the highest achieved all sizes and 20% of total production. Note: according to this criterion, definitions differ from country to country but the sizes of small and large farms at the national level are relevant.

Classification of farms into four categories by the size (area in hectares):

  • Very small farms under 2 hectares
  • Small farms at least 2, but less than 20 hectares
  • Farms average at least 20, but less than 100 hectares
  • Large farms over 100 hectares

Poor structure of farms by surface

Small and very small farms (under 20 hectares) represent over 95% in five EU member states. Along with us (it was expected to fall in this category), in the same category we find Slovenia, Malta, Greece and Cyprus, but when they make a more detailed analysis, Eurostat records that more than half of the very small farms (less than 2 hectares) are in Romania, 54.4% respectively.

Obviously, at the other end, we are among the seven EU member states (along with the same above mentioned countries, plus Croatia and Poland) where the number of large farms is less than 1% of the total. To get the picture of the distance that separates us from the developed West, we mention that this number exceeds 20% of the total in four states (the UK, Luxembourg, France and Denmark).

Moreover, farms with areas larger than 100 hectares cumulated, in 2013, 52.1% of the EU utilised agricultural land, following a quite clear process of concentration (they represented only 45.2% in 2005). This matter also concerns the former socialist countries, including the Czech Republic that became the leader in terms of average size of the farm in the EU, with 133 hectares, surpassing the UK (only 93.6 hectares).

Here we find the key to the effective shift from feudalism, with the society characterized by the majority of self-consumption, without extensive relationships of the employed and taxed workforce, and capitalism, in which what matters is production for the market with the work of employees like those from industrial enterprises.

And here we find the model to follow for Romania. The countries that have changed the fastest their structure of agricultural production, took the model of industrial exploitation and headed toward the practice from the developed West are the Czech Republic and Slovakia, the only EU countries that have more than two-thirds of the agricultural workforce employed on the large farms.

Incidentally, in a manual of military geography from the third decade of the last century, Czechoslovakia was already presented as an industrial-agrarian economy and not the other way around. Along with Germany and Sweden, which shows that processes are slower at the historical level, but also settle. We went after 1989 all the way back where we were before, but apparently, that was not the best idea.

Therefore, it is no surprise that the countries from the Central Europe are more capitalist than us and have a higher work productivity at the national level. It might even appear the suspicion of what sets us apart from them and penalizes us both in terms of GDP / capita and revenues.

Accordingly, a relatively large number of people who are not integrated, but marginally into the market that subsists, not exists, economically speaking. If we calculate the national average of our “Czechs and Slovaks” from all the other economic sectors and the farmers lost in time on our homeland we might rapidly explain why we are at only three-quarters of the Czech-Slovak standard of living.

Hope comes from the dynamism that we can bring. Surprisingly, although it has one of the most aging workforces in agriculture, Romania has at the same time the highest proportion of managers under 35 working in large farms among the EU countries (57.3%, about six times more than the EU average!). It remains for the authorities to support the transformation of a major deficiency into a development opportunity.

Mergeți în homepage ›

Publicat la data de 31.12.2016

Lăsați un comentariu


NEWS

IMF revised upwards Romanian economic growth in 2018, from 4.4% to 5.1%

The International Monetary Fund (IMF) has revised upwards the Romanian economy growth forecast for this year, from 4.4% to 5.1%, according to the latest World… Mai mult

Company insolvency, set on an upward trend in 2018, caused losses of RON 9.6 billion in 2017: ONRC statistics

The number of companies and authorized natural persons (PFA) which have declared insolvency increased by 19.31% in the first quarter of 2018 compared to the… Mai mult

Romania officially started negotiations with Mafia on Thursday. Criminal Law based on which there would be no Colectiv, Hexi Pharma, TelDrum, abusive retrocessions files anymore

Proposals to amend the Criminal Code started to be debated on Thursday at the Special Committee on the Laws on the Judiciary headed by former… Mai mult

Prime Minister Netanyahu's personal doctor, appointed as honorary adviser of Viorica Dancila

Herman Berkovits received in May 2014 the Key to the City from Mayor Sorin Oprescu Herman Berkovits, the personal doctor of Israeli Prime Minister Benjamin… Mai mult

Industrial production, up 7% in first two months of 2018, compared to the same period of last year

Industrial production (gross series) was up 7% in the first two months of 2018 compared to the same period in 2017, following the growth in… Mai mult

Deloitte study: Romania vs. EU - Tax rules applied to losses from selling bad loans

Deloitte Romania, at the request of the Romanian Banking Association, conducted a study for analysing the tax treatment of the sale of receivables and the… Mai mult

Transgaz, favourite to take over Greek natural gas transport operator

The US and the EU support Transgaz-Reganosa (Spain) offer to take over the Greek natural gas transport operator DESFA, for geopolitical reasons, the Greek media… Mai mult

Workforce (i)mobility: Unemployed young Romanians are not willing to move to another locality for a job

Romania has one of the highest percentages of young unemployed people who would not leave their hometown to find a job (either in the country… Mai mult

Unions: State will pay detainees between EUR 370 -550 million

Total compensation that the state will pay to detainees who have been imprisoned in improper conditions will be between EUR 370 million (in the case… Mai mult

Schweighofer sells forest domains owned in Romania and only keeps processing activities

Schweighofer Group, one of the European leaders in wood processing, announced on Monday "a strategy change": it sells its subsidiary Cascade Empire S.R.L. (Cascade Empire)… Mai mult

Dancila government has established "Commission for Preparing Changeover to Euro". Another committee has been already doing the same thing for a year and a half

On Wednesday, the Government adopted an Ordinance aimed at establishing a commission for preparing the timetable for Romania's accession to the single European currency. Prime… Mai mult

Mangalia Shipyard: Agreement between Ministry of Economy and Damen. Dutch buy Daewoo shares, give state 2%

The state has reached an agreement with Damen Shipyards Group after blocking for several months the takeover by Dutch company of Daewoo's shares at Mangalia… Mai mult

CCR judges are no longer willing to participate in MCV assessments

The President of the Constitutional Court (CCR) has communicated to the European Commission (EC) delegation the fact that "the Court plenary expressed its wish not… Mai mult

Romania to host regional centre for endowment of Black Hawk helicopters for Central Europe

Romaero and American company Sikorsky, part of the Lockheed Martin group, have signed an industrial partnership agreement that will lead to the establishment of a… Mai mult

State-owned companies forced to participate in public tenders

The Government approved on Thursday a memorandum that includes a series of measures targeting publicly owned or controlled companies. Basically, the document forces the state-owned… Mai mult