22th of June 2012: Why isn’t agricultural association attractive? EU funding for Agricultural Associations

Romanian Center for European Policies is launching the study Why isn’t agricultural association attractive? EU funding for agricultural associations.

Why have policies destined to encourage association have such limited effect? The overall conclusion of the report is that the disparity between the Romanian reality and the design of this policy (inspired by Western countries) was too big, especially in terms of inclusion of agriculture in the formalized economy. This calls for broader public policies, which stretch beyond the sphere of the Ministry of Agriculture. The biggest problem is that in order to receive these funds,farmers must be included in the formalized/taxed economy.

It proves to be difficult, as they must face disloyal competition from producers who do not register their production and, most importantly, from importers who avoid paying taxes. Thus, by allowing tax evasion and encouraging the  informal economy (e.g. through producer certificates), the Romanian state is dampening the NRDP’s association incentives.

This report was released during an event organized at the Romanian-American Foundation. The study is financed by the Romanian American Foundation in the preparation of the programme ”Rural Development through Entrepreneurship and Association’-a joint initiative of RAF, PACT,CIVITAS, FDSC, CMSC, CRPE and CEED.