The Future of Small Scale Farming in Romania

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By Meryl Carr, SNH

Visiting Alba and neighbouring counties in Transylvania, Romania was the highlight of my working year. I applied to go on this ERASMUS funded Arch destination as I thought it would be an interesting in-sight into how other European countries manage the funding opportunities provided by the European Common Agricultural Policy, particularly to benefit the small scale farmer and small rural communities. My main area of work during the year is assessing Agri-Environment and Climate Change grant applications. In Scottish Natural Heritage we assess any applications which involve land management on designated sites or deer management. As Romania is one the new member states to enter the European fold, lies in Eastern Europe where in the past agriculture has had many challenges, I was interested to see and hear their story and find out if and how the European Union’s Common Agricultural Policy was benefitting agriculture and the environment in Romania. I live and work in the North West Highlands of Scotland, one of the Crofting Counties where small scale agriculture dominates. Romania is a country where small, semi subsistence/subsistence farming is of great importance. Is there a future for this type of farming in the European Union?

The course was hosted by Monica Oprean, whose family have farmed self-sufficiently on their small farm in the foothills of the Apuseni mountains in the farming village of Girbovita for generations. Monica is chair of the Associatia Satul Verde who’s aims are empowering rural communities, halting rural migration and developing new markets for local and sustainable products. Our other host was Martin Clark of Grampus Heritage and training. Both Monica and Martin were wonderful hosts giving us the opportunity to get a good insight into rural life in Transylvania.

On our first day, under clear blue skies and hot temperatures we headed from Ciumbrud village near Aiud town towards the foothills of the Apuseni Mountains. Romania was in the grip of a drought so the country side was a baked blond, but trees of the woodlands and forests appeared to continue to thrive indicating good ground water. The Mures river flows through undulating countryside where more large scale farms produce maize, terraces of vines, orchards of peaches, plums and apples, sunflowers and strips of roses and other flowers for the cut flower and horticultural markets.

Alba County, Transylvania

The road to Girbovita village is untarred, this will change quite soon when services and tarmac will come through the village to the head of the valley. The village is contained, with houses sitting next door to one another, linear to the road . Each has ground enough to keep poultry, pigs, rabbits, a byre for cattle to come home to at night, barns for storing hay andvegetable plots. Each plot has strong, high fencing or walling surrounding it’s perimeter, this is to keep the wildlife out; pole cats, wild boar, fox, bear, wolf. Dogs guard each steading and the animals that are kept within it. Wildlife co-exists with the small farming communities, instead of getting rid of wildlife that threatens farming activities, farmers make the extra effort required to protect their stock and farms. This is done by shepherding and

Hay stacks on a mountain farm in Rimet Market day in Aiud

herding, bringing stock in at night to the protection of barns or the fenced land around the core of their farm.

Out-with the steadings are apple and plum orchards, vines are produced and walnut trees are tended. These orchards, meadows and vineyards are cut out of clearings in the indigenous forest where oak and beech dominate. In this area there is little fencing, each farmer knowing exactly where their orchards and meadows begin and end. Each orchard is also a meadow where hay is cut and stacked for the coming winter. The village has a common grazing which is leased by the village from the local council. The cattle and sheep are taken out to the grazing every morning and brought in in the evenings.

For centuries each village has been self-sufficient using resources efficiently.

While we were helping to gather and stack hay that had just recently been cut Monica highlighted the problems facing this way of life. Youngsters were leaving in search of a modern, “easier” lifestyle. The older generations getting to the stage health-wise, where all the hard work of running a self-sufficient life style was no longer possible and without younger folk to take over it was becoming harder to sustain. Depopulation of the rural areas is becoming a problem, this will in turn lead to the landscape, managed and shaped by small farming over centuries, quickly returning to forest.

Monica was not all that impressed by the EU agricultural support system and it appeared that very few of small holders in this area were taking or indeed able to take advantage of the opportunities offered by this funding. The main reason appeared to be the obstacles of the bureaucratic system, for example, lots of difficult forms to fill in, unhelpful attitudes of the civil servants and lack of knowledge of what support was available to small holders.

Because Monica seemed disillusioned with the Agricultural subsidy system and while my co-group members comment on other aspects of our Romanian study trip I thought I would attempt to explore the agricultural grant funding situation in Romania. Is it helping the small farmer and if not why? What is the future for small farms in Romania?

Prior to 1990, agriculture was considered the poor relation of the Romanian economy, with the communist regime focusing on industrialisation, transition to a market economy has enhanced the role played by the agricultural sector1.

But the influences of the communist era on agriculture have continued and still continue to favour the large farms that were set up in the communist era which, when they became privatised, the people who came to own them were connected to the communist system with

Juicy colourful peppers at Aiud Market A visit to a rose and vine nursery on the Mures

River

still strong links to the bureaucrats in the Agricultural sector3. These large scale farmers benefited from direct government support and subsidies, the justification being that it is the large scale farms that provide the country with the food security required for it’s population3.

The official opening of the negotiations for EU accession in May 2000 represented a crucial step in reshaping Romanian agricultural policy. Following EU accession, the European Agricultural Common Policy (CAP) extended to the Agricultural community of Romania. The aim of CAP is to ensure there is a decent standard of living for 22 million farmers and agricultural workers across Europe and ensure a stable, varied and safe food supply for Europe’s 500 million citizens2.

Romania with it’s rich agricultural heritage and people deeply connected to the land face many challenges. Coming out of the crumbling communist system in the 1990s, people returned to their traditional small scale, self-sufficient agriculture which sustained them for so many generations. But now Romania as part of the European Union has become an open country and part of the world market. It must find it’s place in Europe and deal with the opportunities and challenges that arise from this3. The biggest challenge being: what is the place of small scale, traditional farming in the European Union? Is it valued and if it is how does Europe ensure it’s future. This is a conundrum for all small scale farmers across the EU but a particular issue for Romania where 45% of the population live in predominantly rural areas, 30% involved directly in Agriculture. 92.2% of the agricultural holdings are less than 5ha3.

What are the challenges faced by the European Union with it’s new Central and Eastern European member states?

Within the EU, Romania is the most heavily reliant on agriculture and represents the largest number of farmers3. The European Union’s agricultural policies have been built on the experience of agriculture in Western Europe. For the future it has to take into account the agricultural development and heritage of it’s Eastern European members. Future policy will have to benefit the farmers of their new member states as well3.

Size matters, the average Western European family farm is much larger than Romania’s family farm which on average is 2.2ha. Most Western European small farms were expected to be economic units capable of trade whereas most of Romanian small farms are built around self-sufficiency and local trade3.

Another question which must face the policy makers is productivity for economic growth is it the only game in town (or countryside)? Sustainable farming practice that provides produce

Orthodox church murals Rimet Traditional House at ethnographic museum Rimet

locally, benefits rural economies/populations, biodiversity and landscapes are now coming up high on the agenda of environmentalists.

In Romania there is the problem of two agricultural systems 1) small subsistence/semi subsistence farming and industrial class farming. Small farms under 1 hectare account for only 5% of utilized agricultural land (UAA) but account for 45% of farmers in comparison to farms over 100ha cover 38% of the UAA but only account for 0.2% of farmers. The remaining UAA is small to middle sized farms3.

The benefits of agricultural support and subsidies/funding opportunities favour the large industrial farmer and it appears that the Romanian government and the EU have a policy of getting rid of small farms or being totally indifferent to their future3. Surely with the state of the environment and climate change the EU and it’s member states should be basing agricultural policies on a sustainable agricultural future.

Poverty in the rural areas is another issue that could result in the collapse of the small farm sector in Romania. Since Romania’s entry into the EU the average income in all economic sectors in Romania increased by 54% but incomes in rural areas only increased by 10% and this was with agriculture starting at a much lower level4 In 2007 the average income from agriculture in Romania was seven times smaller than that of the average employee and one half of Romanian farmers were living under the poverty threshold5.

The real state of poverty in rural areas of Romania is hidden behind the fact that subsistence farmers can and do produce for self-consumption. Due to land seizure during the communist era and the destruction of land ownership records many small farms are not yet registered, this is compounded by bureaucratic inefficiency. This means that many small farms are not legal entities and therefore are unable to apply for EU funding.

The Romanian Government needs to make it easier for the small farmer to register themselves and needs to develop programmes that allow the small farmer to sell locally and diversify.

There is the issue of the ageing population of the countryside in many EU countries but particularly so in Romania. Between 2002 and 2008 people aged between 15 – 24 years

Farm in the Apuseni Mountains

living in rural Romania dropped from 52.5% to 41.4% of the rural population while people aged between 55 – 64 increased from 60.1% to 62.9%6. The elderly in rural Romania cannot afford to retire and live off a pension. They continue to work into their old age while their urban cousins enjoy retirement. In 2006 23.4% of people over 65 who live in rural Romania were still working while in urban Romania only 2.2% of this age group worked.

Under Pillar 2 of CAP young people are encouraged through funding and training incentives to go into farming. But in Romania this policy is not promoted and due to bureaucratic inefficiency do not trust that funds will be forthcoming.

Rural Development is high on the agenda for the European Union. In Romania the infrastructure that would lead to a strong rural economy is in need of modernisation and development. The EU Special accession program for agriculture and rural development (SAPARD) and Pillar two CAP funds are targeting improving this situation. However for small farming communities and local authorities to take advantage of these funds they have to be able to co-finance projects they want to achieve. In areas of poverty it is difficult to achieve this and also difficult to find lenders willing to provide loans that would allow co-funding to take place.

The other problem is that most information about the funding opportunities available is only available on-line and many parts of the rural population do not have access to on-line resources.

Romania’s Government and Civil Service is inefficient, sluggish and unreliable this leads to a lack of trust from farmers in their Government and it’s ability to deliver what is promised. The Romanian Government has continually failed to process EU funds. Failure to pay subsidies promised at the beginning of 2009 by May 2010 left many farmers distrusting and disillusioned. Many do not see that being part of the EU could help them in any way3.

It is easier for foreign companies to develop projects in Romania by accessing funding from banks in their home countries. This leaves Romanians at a disadvantage with their inability to access funds or loans3.

Despite being one of the richest endowed agricultural countries in Europe, the largest producer of raw agricultural products, the communist era and what followed has led Romania to becoming a net importer of agri-food products. The solution to this is to build an infrastructure that supports food processing facilities close to where food is produced, and allows Romanian agriculture to provide for Romanian people3.

Meadows in the Apuseni Mountains

In the areas of Romania where large, collectivized farms were created during the communist era, which have now become privatised, industrialised farms, there are environmental issues. These areas are affected by soil erosion, pollution attributed to pesticides, heavy metals, oil etc. Compaction of the soil and acidification are also a problem

However in the small farm sector pollution, soil erosion and compaction are not issues due to the sustainable agricultural practices carried out by farmers. This could be a great opportunity for organic farming to be a huge growth sector in Romanian agriculture.

The European Common Agricultural Policy (CAP)Today

CAP is divided into two pillars.

  • Pillar one is made up of direct payments to farmers and market interventions to stabilize the price of agricultural products. The Single Farm Payment is based on the amount of productive agricultural land a farmer has and how the land is used. It is a demanding scheme to administer.

In order to give the new member states (NMS) a chance to slowly adapt to the administrative demands of Pillar one a simplified version was put in place for NMS – Single Area Payment Scheme (SAPS). They were allowed to use this scheme for three years after joining, thereafter apply for an extension or take on the Single Farm Payment Scheme (SAF)

All the NMS should be at this time be administering the SAF.

  • Pillar two focuses on Rural Development measures. There are four separate “axes” for Pillar Two;
  1. Axis one – improving the competiveness of the agricultural and forestry sector.
  2. Axis two – improving environment and the countryside.
  3. Axis three – improving the quality of life in rural areas and encouraging diversification of the rural economy.
  4. Axis Four – LEADER program. Aim “improving the development potential of rural areas by drawing on local initiative and skills, promoting the acquisition of know-how on local integrated development, and disseminating this know-how to other rural areas.”

The management of the CAP is largely up to each member state to decide.

Temporary hay stack Girbovita Village

The Common Agricultural Policy: Romania 2014 – 2020

Pillar One

Member states are allowed to set a minimum level of land eligible for direct payments. The EU minimum allowable is 0.3ha. Romania opted for a minimum of 1ha. The reason for this being the administrative costs of paying subsidies on small bits of land.

But this means that 2.6million farming households (over half the farming population) are ineligible for direct payments. It appears that the aim is to encourage small farmers to work co-operatively in order to access funding.

Pillar Two Rural Development

Romania’s RDP aimed to fund action under all six Rural Development priorities for the 2014 – 2020 CAP period these are;

Knowledge transfer and innovation in agriculture, forestry and rural areas

Training for owners of small processing units. Training for delivering environmental and climate change benefits, Specific advisory services set up for farmers and owners of micro and small enterprises in Rural areas, setting up of co-operation projects.

Competitiveness of agri sector and sustainable forestry

The RDP will support investments in the modernisation of nearly 3 400 farms and cooperatives, the development of more than 30 000 small farms and the setting up of more than 9 400 young farmers. There is a particular emphasis on promoting association between small farmers in order to improve competitiveness of the many small farms. Some 15 000 small farmers will also be supported to permanently transfer their holdings, promoting consolidation of holdings. In forestry sector, there will be investments to expand the limited network of forest roads by over 900 km” 7 .

Food chain organisation, including processing and marketing of agricultural products, animal welfare and risk management in agriculture

aim to modernise and support the investments of nearly 300 food processing units, to set up 62 new producer groups, with the participation of 620 holdings, to support cooperation projects (e.g. in short supply chains. local markets) developed by nearly 750 farms and to

Can I take you home please?

cover new participation by 400 farmers and groups of farmers in quality schemes. Almost 3 000 farmers will take part in a mutual fund so that they can better mitigate the effects of adverse climate and other risks and 5 000 farmers will be supported for premium for insurance. Nearly 600 pig and poultry holdings will receive payments for the animal welfare commitments signed in both previous and current RDP.

Restoring, preserving and enhancing ecosystems related to agriculture and forestry Sustainable land management, to protect its unique rural environment and ecosystems is of great importance to Romania and therefore nearly one third of all RDP financing will be devoted to this priority. More than 1.3 million hectares of agricultural land (almost 10% of all Romania’s agricultural land) and more than 800 000 hectares (12%) of forests will benefit from environmental and climate payments, or for forest conservation. Also more than 200 000 hectares of agricultural land will be supported to either maintain or convert to organic agriculture practices. A new delimitation of areas with ‘other significant natural constraints’ was introduced from 2015 in Romania, meaning the total area designated with natural constraints (ANC) will now cover nearly 50% of the Romanian agricultural area. Compensatory payments will be made to farmers on more than 70% of all the areas designated, representing 4.7 million hectares (more than one third of all the agricultural land) in order to prevent land abandonment and soil erosion (in areas affected by climatic and physical constraints such as the mountainous areas but also areas affected by soil erosion, dryness, etc.).

Resource efficiency and climate

The RDP puts particular emphasis on resource efficiency and particularly the challenge of climate change for agriculture. The RDP will support 435 projects for modernisation of existing irrigation infrastructure, targeting nearly 400 000 hectares of agricultural land on which the use of water will be more efficient and adapted to increased water scarcity. This will be complemented by training & advisory actions to help farmers adapt farming practice to increase their efficiency of water use. There will be 870 investments targeting the reduction of GHG and NH3 emissions (e.g. for manure storage). Support for afforestation will also play a key role to promote carbon sequestration.

Social inclusion and local development in rural areas

The RDP aims to promote diversification of the rural economy and creation of new job opportunities to help surplus labour from agricultural sector, and increase rural incomes. Nearly 3 000 projects will be supported for setting-up/developing non-agricultural businesses in rural areas and almost 27 000 jobs will be created, of which more than 2 000 will be created under LEADER. 120 LEADER Local Action Groups will implement local development strategies, covering 100% of the eligible rural territory. Almost 800 projects will be supported to improve small-scale rural infrastructure, improving living conditions for some 27% of the rural population. They will include investments in local roads, waste water/water supply facilities, crèches, kindergartens, after-schools, and agricultural high schools. Nearly 400 local cultural patrimony buildings will be restored and preserved. Access to credits for implementing private investments under the RDP will be facilitated by the use of financial instruments, starting with a Credit Fund. Romania has also chosen to implement a separate thematic sub-programme (with indicative financial allocation of € 320 million EAFRD funds) aimed to increase the competitiveness and enable restructuring of the fruit growing sector, a sector where Romania has climatic advantages and traditional strengths, but which has suffered from under-investment. Support is given for the setting-up of new orchards, reconversion of the old ones, fruit processing, cooperation projects, and the setting-up of producer groups within the sector. The four biggest RDP measures in budgetary terms (total public fund 7.

In Conclusion

I would say that the aims listed above are impressive. 2020 is next year and that is when the current CAP scheme comes to an end. I hope that the targets set will be achieved. When I started to research to find out more about how the Common Agricultural Policy was implemented by the Romanian Government I did not realize the complexities.

The biggest worry for the future is if the small semi self-sufficient farm, which is such an important feature of Romanian agriculture, cultural heritage and natural heritage will survive.

My main comfort and reason to be optimistic is that in my research there do seem to be many voices standing up for the small farmer and small farming in Romania, including Monica and Satul Verde.

I would like to thank all who made this study trip to Romania such a success.

References:

1. Studies in Agricultural Economics 116 (2014) 100-106

Carmen HUBBARD*, Lucian LUCA**, Mihaela LUCA*** and Cecilia ALEXANDRI** Romanian farm support: has European Union membership made a difference?

* Centre for Rural Economy, Newcastle University, Newcastle upon Tyne, NE1 7RU, UK. Corresponding author: carmen.hubbard@ncl.ac.uk ** Institute of Agricultural Economics, București, Romania *** General Secretariat of the Romanian Government, București, Romania

2.‘Cap-in-your country – Romania’ Information leaflet from the European Commission

3 Romania and the Common Agricultural Policy: The future of small scale Romanian farming in Europe Report by Douglas K. Knight For Eco Ruralis.

4.Alexandri and Luca “Romania and CAP Reform”

5. Luca,

6. Maria Vincze, Kinga Kerekes “Impact of CAPs Pillars on Romanian Rural Employment” 4th. Aspects and Visions of Applied Econonmics and Informatic (March 26 -27, 2009)

7. European Commission Fact sheet on 2014 -2020 Rural Development Programme for Romania

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