IPARD - EU assistance to Serbia's agriculture industry
IPARD II was completed in 2021 - Goals were achieved, lessons were learned, and stakeholders are now waiting for the approval of IPARD III.
The EU support going into Serbia’s agriculture industry is most apparent in the utilization of IPARD funds: the Instruments for Pre-Accession for Rural Development.
IPARD is the only EU financial assistance intended for individual farmers or SMEs engaged in the primary agricultural production and/or food processing industries in the dairy, meat, fruit and vegetable sectors. Beneficiaries whose businesses reached a certain level and intended to upgrade their operations were very satisfied with the opportunity provided through IPARD funds. They could count on reimbursement of allegeable costs of up to 50% for the processing activities and 60% of the total cost investments for primary production, with financial limits of €1 million for processing and €0.7 million for primary production per project. Such investments resulted in the introduction of new technologies, improved production and the implementation of the EU production standards in respective fields of production/processing. In this way, farmers and agro operators raised their competitiveness and prepared themselves for challenges at the global market.
It took some time for the Serbian administration and applicants to adjust to the newly introduced application standards. The biggest issue in the first years of implementation was lagging in project processing and approval procedures. The period from submitting applications to obtaining approval took up to two years, after which some of the applicants no longer had the funds for the implementation of project activities, which meant that projects never took off after having received green light by the Serbian Paying Agency. Yet, subsidies were allocated to the project and were effectively blocked from being spent on other projects that could have been realized instead.
After the first IPARD implementation period (2015-2020), one can say that IPARD has proven to be the best suited financial support instrument for companies that have ongoing operations and have clear multiannual investment plans whose implementation does not interfere with the company’s current operations.
If the utilization of IPARD funds in Serbia is compared with the implementation and absorption of similar funds in other countries in the region during their pre-accession period (e.g. SAPARD in Hungary, Romania, Bulgaria etc.) , it can be stated that Serbia was successful in the implementation of the IPARD program. The approval procedures were revised and improved on an annual basis to the benefit of clients. Remarks from clients and obstacles in administrative procedures were “lessons learned” and were used to upgrade the approval process.
Given that the last calls for the IPARD II program was completed by the end of 2021, farmers and agro businesses in Serbia are eagerly awaiting the new IPARD III program 2021-2027, for which €288 million will be available in grants. It is currently being discussed in Brussels and is expected to be approved later this year.
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