Election promises: Does Albania’s agriculture really need such high subsidies? – Analysis

Agriculture is one of the sectors that is being enriched more than ever in these election campaign days, with virtual money in the form of electoral promises.

The main political forces promise investments in this sector at hundreds of millions of euros, mainly in the form of direct support for farmers.

The Socialist Party promises $ 240 mln in four years, and that is the lowest bid.

The Democratic Party promises subsidies to around 1% of GDP per year, which is translated in absolute terms to more than 100 million euros each year.

The highest bid on such cashless auctions comes from the SMI, which promises an annual amount of $ 250 million to support agriculture every year.

Aside from the fact that no one says where they will find so much money or where they will remove such amount from, to bring it then to agriculture, there is another, even more important, problem.

Can Albanians absorb subsidies that amount to hundreds of millions of euros?

The answer is simple: according to experience and schemes that have been implemented so far, absolutely no.

In the last three years, the Agricultural and Rural Development Agency has disbursed an average of around 730 million or 5.4 million euros each year.

At best, the Albanian government has managed to provide nearly 10 million euros of subsidies per year, a figure recorded in 2009.

Here we are not mentioning the fact that not all of these subsidies go to farmers, because the total figures include support for agro-processing.

In order to create an idea of ​​the ability of the agricultural sector to absorb financing, we are adding the value of new loans to the sector from the financial system, which is not more than 5 million euros a year.

So, between government grants and loans, agriculture can absorb funding that hardly exceeds 13 million euros a year, while political parties pledge funding that goes 20 times higher.

Even if you have 250 million euros for farmers, you can give it them as charity, but not as funding that helps develop and increase the competitiveness of the sector.

This is enough to understand how frustrating and detached from reality are the promises heard during the election campaign.

Nobody promises to solve the real problems of agriculture, which are, in particular, low competitiveness due to parceling; lack of ownership documents; and lack of expertise.

Everyone promises money pouring in, but if even if they really offer them to farmers, basically this would not solve anything.

Ersuin Shehu – SCAN

*Material i përgatitur nga portali SCAN. Ripublikimi mund të bëhet vetëm kundrejt citimit të autorësisë dhe burimit origjinal.