Summarizing results in the agricultural sector with Iurie Fala, director of “Moldova Fruct” Association of Fruit Producers and Exporters, within IPN’s series “2020 in Review: Good and Bad Aspects”.
Iurie Fala said that during a pandemic year, the authorities didn’t do their best to support the sectors of the economy, in general, and the agricultural sector, in particular. The Republic of Moldova, being a small country, must have good relations with the development partners. The Government did not much to attract additional resources so as to overcome the crisis in agriculture, while the own resources it identified were insufficient. The way in which the Government treats the farmers in relation to other sections, such as teachers or pensioners, is unwise as the capacity of this sector determines the country’s capacity to attract investments and to manage crises.
The creation of artificial contradictions is not the best instrument of the Government. Resources could be found and it had to manage these things much more efficiently, to discuss with international organizations and other partners. Things weren’t managed correctly. Many famers will recover with difficulty after the difficult year. Currently, the agricultural sector is de-capitalized and the economic consequents after the first and second waves of the pandemic are unknown. In general, economic declines are expected in the neighboring states and in the EU too. No reserves were earmarked for the agricultural sector. The offered state support is insufficient and will not enable the sector to recover. We will feel this in the future. More things should be thus done. The reforms should be continued so as to create more favorable working conditions. The sector financing level will be affected as the state support comes with a signal for banks: if the state is open to support, the banks will lend to agricultural producers. The global production, according to statistics, in the agricultural sector will be much lower than the forecasts made by optimistic experts. Most of the enterprises are unable to repay loans. The state should have better managed this crisis.
For the agricultural sector, 2020 was without an analogy in the contemporary history. The protracted drought that started in 2019 led to the lack of precipitation in some of the districts during the vegetation period and most of the field crops all over the country were affected, primarily in southern and central districts. Specialists estimate the global production will decrease considerably. Agriculture, being one of the pillars of the GDP, will influence the GDP too. Primary agriculture in Moldova represents 12%, processing up to 25% of the GDP, while exports of products - 45%. The situation in agriculture will definitely affect other sectors as well.
Apart from drought, an important role in the growing and export of fruit this year was played by the late spring frost, of the start of April and then of May, in northern areas. The drought considerably affected the horticultural sector. Current estimates show the global apple production this year is of 430,000 tonnes, as opposed to 610,000 tonnes last year. Declines were reported in all the areas. The production of apricots, cherries and plumes decreased by 40-50%. The year was rather difficult for famers, who were affected by the pandemic too, even if to a smaller extent than other sectors.
A result in the export of fruit in 2020 was that the exports didn’t stop despite the travel restrictions. The supplies were used up swiftly as in quarantine the people prefer to consumer fresh fruit and vegetables and were even ready to pay the asked price as, during the pandemic, it turned out that the vitamins found in fruit are a good remedy against this scourge.
The fruit growers and exporters are solidary with the protesting famers and support all their demands. The state has limited internal possibilities and can solve the problem only partially. As the farmers in Moldova cannot efficiently use the available water resources and bank on precipitation rather than on special irrigation, the Government should have found resources, including from the development partners, to diminish the effects of the crisis. The agricultural sector affects the related sectors, such as haulage, delivery, import of diesel fuel that is used in agriculture. The current and previous Governments didn’t do much to grow the agriculture subsidization fund. The incoherent policies led to moves with different speeds in the implementation of reforms. In Moldova, many things related to the modernization of the agricultural sector are artificially delayed. It’s time for the policies in agriculture to be coherent and for this sector to be treated like a pillar of the country.
2020 was a troublesome agricultural year that will divide the world in the period before the pandemic and after it. The economy of Moldova, which is a developing country, was affected as were the economies of the neighboring states with which we have economic relations. All the economies will be actually affected. But towards the end of this year, we should think about good things and hope that farmers will also have more hopes for the coming year and will be more optimistic, stated Iurie Fala.
IPN