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.

Publicat la data de 31.12.2016 .

Lasa un comentariu


SIMILAR ARTICLES

Marin Pana

Adapting Romanian production to increasing incomes – rapid development and trade balancing are at stake

Romania is increasingly specializing in the extremes of the demand range High-quality products for the foreign markets or parts incorporated at low prices in quality products marketed as final products in other countries Along with products at a modest level of quality and moderate price for the domestic solvent market In other words, we exploit small gaps identified among the already ...
Read more »

Cristian Grosu

Cristian Grosu / Why Romania is doomed to improvise: Unproductive Romania and delirium of decision makers

  It is not that, after a fashion, we have something to cook every evening – us, employees, entrepreneurs, decision makers, plits (politicians for life, irrespective of their skills) or just spectators: but that is (INCREASINGLY!) difficult for Romania to become a productive country in the strict sense, because the context of our economic game requires a visionary conceptualization ...
Read more »

Mariana Bechir

DESI 2017, Romania: Best Internet speed, but ranking last in EU in terms of using it

The European Commission has published the Digital Economy and Society Index (DESI), 2017 edition, which shows that the only thing that Romania prides itself, namely the Internet speed, is not enough for our country to move from the traditional last position in the EU ranking Romania ranks 28th in DESI 2017 The report says: "Romanians benefit from coverage of fast broadband connections in urban ...
Read more »

Mariana Bechir

State, as employer in capitalist Romania: a different analyisis of private economy

Who keeps alive the economy, administrative systems, budgets of all kinds - from the investment to pension budget - and ultimately the whole society The answer to this question - that should be simple: private economy - looks more like a patchwork than it should There are entire areas of the economy where the state is the employer without which nothing moves And "the private ...
Read more »

Marin Pana

Warning (detailed) for lucid ones: 4.8% – highest growth in Europe – NOT based on something tangible: Industry contributed 0.4%, construction 0.1% and agriculture nothing

The National Institute of Statistics (INS) confirmed the last year's economic growth at 48%, the first preliminary version published after the initial forecast announced as a signal (We remind that the second preliminary version is to be announced after about a month and the semi-final version after one year, while the data will remain "set in stone" only after two years, in their final ...
Read more »


NEWS

IMF mission concluded consultations in Bucharest – Government’s options

The IMF mission concluded Thursday a 7-day visit in Romania in the annual process of consultation under Article 4, after a small delegation came to ... Read more

Romanian leu depreciated to reach 4.5654 lei/euro, record level of last four and a half years

The reference exchange rate announced Friday by BNR was 4.5654 lei/euro, 0.3% more than the level reached in the previous session and a maximum level ... Read more

Liviu Voinea (BNR): 7,000 notifications on debt to equity swap, by February; loans amounting to 2 billion lei

The number of notifications registered under the Law on debt to equity swap reached to 7,000 at the end of February, representing total loans amounting ... Read more

Siegfried Muresan: Romania should make joining Schengen a condition to accept two-speed Europe

Member of the European Parliament Siegfried Muresan (photo) said in Strasbourg that the idea of a multispeed Europe is not wrong altogether, and Romania should ... Read more

Valentin Lazea: Absorption of EU funds could lead to a 4.5% increase of potential GDP

The International Monetary Fund (IMF) told the officials of the National Bank of Romania (BNR) that a 95% absorption of the European funds would lead ... Read more

Investigation on record high prices on energy market: 440 million lei in losses generated by seven to eight traders. Guilty ones lose their licenses

Seven or eight energy traders generated total losses of 440 million lei to the suppliers of last resort and the network operators, losses that will ... Read more

ANAF announces a campaign to control compliance of tax declarations

ANAF announced Thursday that will launch inspections starting in April that will include institutions from the financial and banking sector, with the aim of checking ... Read more

Romanians pay among the highest utility costs in Europe, by reference to their income

Romania ranks second in the ranking of families from the European Union who spend more than 40% of their income on home utilities (electricity, gas, ... Read more

Hourly labour cost increased by over 12% in Q4 2016 compared to 2015. Higher earnings in healthcare and education

The hourly labour cost in adjusted terms (by the number of working days) registered an increase of 12.33% in the fourth quarter of 2016 compared ... Read more

Emergency measures to control deficit: Minister of Finance blocked recruitment for budget institutions and halted promotions

Minister Viorel Stefan (foto) urged to keep the deficit under control. In the midst of the discussion about the increased salaries, government officials turn off the ... Read more

Ministry of Finance, investigations on misleading and comparative advertising

The Ministry of Finance announced Wednesday that it has started an information and verification campaign on a sample of 447 firms that sell food, beverages, ... Read more

Budget implementation of January 2017 - 5.7% lower revenue and 3.5% higher expenditure compared to January 2016

The Ministry of Public Finance published Monday the report on the implementation of the consolidated general budget for January 2017. According to the official announcement, ... Read more

Romania, Hungary and Slovakia are competing for an EUR 200 million Mitsubishi investment 

After Renault, Ford and Daimler, another big car manufacturer intends to establish an engine factory in Romania: the company is Mitsubishi, announces ProTV. According to ... Read more

2017 started with a decreasing confidence in economy and leu, according to CFA Romania Index

The index of macroeconomic confidence has declined for the second consecutive month, down to 54.9 points in January 201, of 100 points in total. “The ... Read more

One of 102 taxes eliminated is back: Daniel Constantin announces new version of car pollution tax

Daniel Constantin probably has not read the program of the PSD government The Minister of Environment Daniel Constantin (foto) announced on Tuesday that, probably next ... Read more

Competition Council investigates why fuel prices in Romania exceeds the EU average

The Competition Council has launched a sectoral investigation on the fuel market, to analyse why the prices in Romania are above the EU average, said ... Read more

2017 European Semester, analysis on Romania: growth above potential, worrying deficit estimates

Despite Romania’s progress in implementing the recommendations of the European Commission (EC), “the structural challenges may dampen the medium-term outlook,” mentions the report on Romania. ... Read more

2017 trends : Bucharest Stock Exchange indices hit new 5-year highs. BET exceeded psychological threshold of 8,000 points

The most important indices of the Bucharest Stock Exchange (BSE) registered new 5-year high Wednesday at noon and continued the favourable trend of the last ... Read more

World Bank, interested to support founding of Sovereign Investment Fund

Alexandru Petrescu, Minister of Economy The World Bank is interested in the announcement that Romania plans to establish a Sovereign Fund for Development and Investment ... Read more

Memorandum: Sovereign Fund to be financed from selling shares of state companies and bonds

To obtain financing, the Sovereign Fund for Development and Investment (FSDI) planned by the Government will sell shares in the state companies received in its ... Read more