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Release of EU agriculture funds opens gate to future money

SLOVAKIA has been given access to European Union aid funds for agriculture in a move the EU hopes will prepare domestic bureaucrats for the job of distributing Union aid when the country joins the 15-member bloc.
After more than two years of haggling, in which money from the union's Special Accession Programme for Agriculture and Rural Development (Sapard) fund was available but withheld, EU agriculture commissioner Franz Fischler in mid-April signed a deal to distribute 18.6 million euros in annual development funds through a local Slovak agency.
Among the 12 EU-candidate countries, Slovakia now joins the three Baltic republics, the Czech Republic and Bulgaria in receiving management of EU pre-accession agricultural funds.


SLOVAKIA'S struggling farmers can start receiving EU agriculture funds, but not as much as they want.
photo: TASR

SLOVAKIA has been given access to European Union aid funds for agriculture in a move the EU hopes will prepare domestic bureaucrats for the job of distributing Union aid when the country joins the 15-member bloc.

After more than two years of haggling, in which money from the union's Special Accession Programme for Agriculture and Rural Development (Sapard) fund was available but withheld, EU agriculture commissioner Franz Fischler in mid-April signed a deal to distribute 18.6 million euros in annual development funds through a local Slovak agency.

Among the 12 EU-candidate countries, Slovakia now joins the three Baltic republics, the Czech Republic and Bulgaria in receiving management of EU pre-accession agricultural funds.

"This means that Slovakia is ready to receive, administer and control Sapard programme funds and will be able to begin implementing concrete projects," said Agriculture Ministry spokeswoman Anna Majkutová.

Sapard was set up in 1999 to speed legislative reform in candidate countries and bring their agricultural policies into line with those of the EU, as well as to address key issues in agriculture and rural development identified by candidate countries.

According to Onno Simons, the counsellor for the European Commission's Slovakia delegation, the money will go towards "restructuring farms to be more competitive, working on rural infrastructure, a little bit on forestry - those are some of the Slovak priorities."

While Sapard Slovakia has not received any projects since their April 16 accreditation, they say they are prepared for new ideas. The funding rules have been posted on the Agriculture Ministry's web site, and the agency promises to decide on individual projects within two months of receiving them.

A source close to the programme said while the amount of money might not be so significant, the fact that Slovaks would be given EU-scrutinised control would eliminate arbitrary funding decisions by the Agriculture Ministry, whose insistence on independent control had held up the funds in the previous two years.

The source also said the new office would help prepare Slovakia to receive massive EU agriculture funding after entry.

Disagreements on the level of that funding remain, however, despite the release of Sapard money. Under the EU's plans, new member states will be eligible for direct payment of agricultural funds at only 25 per cent of the level offered to member states, and will be eligible for full funding only after a 10-year transition period.

Agriculture Minister Pavol Končos said: "We think that the transition period in direct payments will make it more difficult for Slovakia to adjust to the [EU's] Common Agricultural Policy and to create a competitive agriculture sector in Slovakia."

Ľubomír Miček from the Agriculture Ministry's European Section added: "We see it as discriminatory if an Austrian farmer gets 100 percent in the future while a Slovak farmer gets just 25 percent."

The EU, however, worries that immediate granting of full subsidies could create market imbalances in the largely unreformed agricultural sectors of candidate countries, and artificially increase agricultural profitability, thus reducing the incentive to restructure.

"If direct aids are introduced too quickly in the candidate countries, their short-term positive effects on farm income would be outweighed by their negative impact on restructuring. There is a significant risk that necessary restructuring would be slowed or even stopped, creating a durable vicious circle of low productivity, low standards and high hidden unemployment," the EU said in a prepared statement.

The EU's Simons said he felt there was still room for compromise. "[The lower subsidy levels] are between what member states are willing to give and what accession states are asking for. It remains a subject to be agreed on in negotiations which will take place shortly."

The Slovak agriculture sector has stagnated since independence. Foreign trade in farm and food commodities this year already showed a deficit of Sk4.3 billion by April 9, according to the Slovak Customs Directorate. While this figure is Sk1.3 billion less than during the same period the previous year, the agriculture sector, which employs nearly 82,000 on 7,189 farms, remains a drag on the balance of trade, which recorded a record deficit of Sk103 billion in 2001.

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