Serbia Newsflash Week 44

The food industry in decline, new regulations on public land, mass arrests for subsidy embezzlement, digitalization in public service, updates for the new EU financial cycle and Serbian grants - The week in Serbian agriculture

Man working in a field.
©Jed Owen
In the EU's new financial cycle between 2021 and 2027, will receive €288 million in grants. 40% of these grants will be intended to increase the share of renewable energy sources and green agriculture in the agro business sectors.

Serbia’s food industry production in decline since January

The Macroeconomic Analyses and Trends  (MAT) newsletter reports that Serbia’s food industry production has been dropping by an average of 0.6% per month since January this year, adding that another drop of 2.7% was recorded in September this year compared to the same month of 2020. The report informs about the fact that the decline in all branches of the food industry is concerning, especially in the case of the dairy, meat and bakery industries.

The increase in production of the processing industry in 2021 will amount to 4-5%, depending on whether the stagnation in September is temporary or permanent. Exports in September 2021 were worth €1.96 billion and were 24% higher compared to the same month last year, and the imports, worth €2.47 billion, increased by 21% year on year.

The current account deficit in the period from January to August 2021 amounted to slightly more than €1 billion and was €454 million or 29% lower compared to the same period last year, the authors of the MAT stated. Inflation rose to 5.7% year-on-year in September as all basic consumer goods increased in price.

Substantial revenue from lease state agriculture land

Serbia has an annual revenue of over €42.5 million from the lease of state-owned agricultural land, out of which 40% goes to the national budget while 60% is the income of local municipal administrations where the land is located, stated the Director of the Agriculture Land Agency, Mr Branko Lakic.

The Director specified that there is about half a million hectares of state-owned land. Out of this, the state manages 410 thousand hectares through the ministry, while 90 thousand hectares under pastures are managed by villages. Representatives of the Ministry of Agriculture pointed out that the Land Agency is  working on the preparation of new laws and regulations for the lease of state land.

A new set of regulations is now being considered based on the lessons learned from disputes the Ministry has had upon leasing parts of this land in previous years.  

Arrests due to the misuse of agriculture subsidies

The director of the Directorate for Agrarian Payments at the Ministry of Agriculture of Serbia, Ms. Biljana Petrovic, stated that a working group dealing with the misconduct of agriculture subsidies was established in March this year, and that 180 people had been arrested thus far.

At a roundtable discussion at the conference “How budget money is spent in agriculture,” organized by the Independent Association of Journalists of Serbia, Ms. Petrovic said that the Payment Agency had received information that the rights to subsidies in primary plant production were being misused. “Based on the documentation from the Directorate, suspicions were raised regarding the accuracy and correctness of applications. The authority conducted an investigation and 180 people were arrested”, explained the Director. She pointed out that the users submitted requests with false documentation, which means that they did not have the correct accounts, guarantees and bank statements.

Ms. Petrovic added that the state administration managed to prevent misconduct by some applicants because it performed the checks before the payment of incentives were done. Mr. Igor Grabez, media advisor to the Minister of Agriculture, Forestry and Water Management, said that according to some data, about 300 people attempted to embezzle, not only individual farmers, but also some companies.

Potato field basks in the golden light as the night fog dissolves in the morning sunshine
©Henry Gartley
Serbia has around half a million hectares of land owned by the state, out of which 410 thousand hectares are managed by the Ministry of Agriculture, while 90 thousand hectares are used as pasture by rural communities. The state has an annual revenue of €42.5 million from the lease of public lands.

Introduction of a new software solution for the Directorate for Agrarian Payments

The Serbian government adopted a bill on changes and amendments to the Law on Agriculture
and Rural Development, which harmonises this field with the EU acquis and, among other things, introduces e-Agrar. A new software solution by the Payment Agency, E-Agrar will enable a
more efficient management of the Farms Register and of incentive payments in agriculture and rural development.

As specified, farmers will be able to submit electronic requests for entry in the Register of Agricultural Holdings; change personal farm-data; renew registration and delete from the Register. E-Agrar will also
link the system with all relevant public records and automatically download the necessary data.

Slovenian meat industry strengthening its market position in Serbia with EU financial support

Slovenia has received financial support from the European Union within the project “Original EU Quality – Promotion of Pork Meat Products in Serbia,” which aims to increase the competitiveness and strengthen the position of its meat products in Serbia. For the Slovenian meat industry, as its representatives told the journalists from Serbia who visited Slovenia, Serbia is an important exporting destination, which is why the association GIZ Mesne Industrije Slovenije has been present in the Serbian market for ten years now through EU promotional projects.

Promotion of agricultural and food products is an integral part of the EU promotional policy and entails financial support with the aim of increasing the recognizability and competitiveness of the products of EU origin, creating new market opportunities for the agricultural  and food industries, strengthening their position in the world market.

New EU grants for Serbian farmers

Minister for the EU Integration Jadranka Joksimovic and Minister of Agriculture Branislav Nedimovic, together with the Head of the EU Delegation to Serbia Emanuele Giaufret, visited the cold store for production and trade in fresh and frozen fruits ABD Prom Company  in the village of Jevremovac and got acquainted with the solar power plant project which is part of the IPARD investment.

They announced new grants for farmers. "What follows is a new seven-year period for 2021-2027. Serbia will have €288 million in grants available for projects in the field of agriculture, of which about 40% will be intended for increasing the share of renewable energy sources, green agriculture and agribusiness," said the Minister Joksimovic. She emphasized that the company from Jevremovac is an example for other producers, adding that with the new IPARD 3 tranche, special attention will be paid to projects that support gender equality and women's participation in projects.

“Today we have approximately 23% of women who applied for the projects so far, and we will now pay special attention to that, as well as to projects involving young people. Every 14th person who has applied for agricultural production projects is less than 40 years old. The average age of the owners of farms who have applied so far is 61 years," the Minister explained