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IN THE BLACK SEA ECONOMIC COOPERATION REGION SMEs AND SMALL FARMS IN AGRIBUSINESS SMEs AND SMALL FARMS IN AGRIBUSINESS IN THE BLACK SEA ECONOMIC COOPERATION REGION ISBN: 978-605-4679-11-9 www.kas.de/tuerkei FINAL WORKSHOP REPORT on “SMEs AND SMALL FARMS IN AGRIBUSINESS IN THE BLACK SEA ECONOMIC COOPERATION REGION” organized by ORGANIZATION OF THE BLACK SEA ECONOMIC COOPERATION (BSEC) and KONRAD-ADENAUER-STIFTUNG (KAS) 15 – 18 April 2015 Chişinău, Moldova SMEs AND SMALL FARMS IN AGRIBUSINESS IN THE BSEC REGION Edited by Dr. Antal Szabó 15 – 18 April 2015 Chişinău, Moldova Published by Konrad-Adenauer-Stiftung Konrad-Adenauer-Stiftung e.V. All rights reserved. No part of this publication may be reproduced in any form or by any means without the permission of Konrad – Adenauer – Stiftung Ahmet Rasim Sokak No: 27 06550 Çankaya-Ankara/TÜRKİYE Telephone : +90 312 440 40 80 Faks : +90 312 440 32 48 E-mail : [email protected] www.kas.de/tuerkei ISBN : 978-605-4679-11-9 Designed & Printed by : OFSET FOTOMAT +90 312 395 37 38 Ankara, 2015 7 | ABBREVIATIONS 11 | PREFACE by Meltem Güney by Dr. Tudor Copaci 19 | 1. THE EU'S COMMON AGRICULTURAL POLICY by Dr. Antal Szabó 33 | 2. LESSONS LEARNED: HOW FAMILY BUSINESS RESEARCH CAN SUPPORT SMEs AND SMALL FARMS IN AGRIBUSINESS by Dr. Steffen Grossmann 45 | 3. NATIONAL COUNTRY STUDIES IN THE BSEC REGION 45 | 3.1 Albania by Assoc. Prof. Ledia Thoma, Assoc. Prof. Anila Boshnjaku, and Assoc. Prof. Etleva Muca 59 | 3.2 Armenia by Rshtun Martirosyan 73 | 3.3 Azerbaijan by Dr. Sabit Bagirov 87 | 3.4 Bulgaria by Vesselin Halachev 101 | 3.5 Georgia by Dr. Kakha Nadiradze 130 | 3.6 Greece by Ioulia Drossinou and Lina Ioannou 149 | 3.7 Moldova by Prof. Alexandru Stratan 174 | 3.8 Romania by Prof. Zsuzsanna Katalin Szabó,PhD and Katalin Dalma Szabó 204 | 3.9 Russian Federation by Olga Generalova-Kutuzova 218 | 3.10 Serbia by Dr. Dejan Erić, Dr. Sonja Đuričin and Olivera Pantić 238 | 3.11 Turkey by Ertuğrul Nazlı by Cem Ali Birder 268 | 3.12 Ukraine by Anna Kuznetsova and Vladimir Yefimov 287 | 4. BEST PRACTICE IN MICROFINANCE IN MOLDOVA 287 | 4.1 MOLDOVAN ANNUAL AGRICULTURAL SUBSIDY PROGRAMME by Petru Maleru 297 | 4.2 SUCCESS STORY OF THE SANDIC GROUP – “FAGURAS DE AUR” LTD by Stefan Sandic 302 | 4.3 MOLDOVA’S ASSISTANCE TO THE HIGH VALUE AGRICULTURAL SECTOR: ACED PROJECT by James G. Herne 308 | 5. FINAL DISCUSSIONS AND RECOMMENDATIONS OF THE BSEC WORKHOP ON SMEs AND SMALL FARMS IN AGRIBUSINESS 308 | 5.1 CONCLUSIONS 310 | 5.2 RECOMMENDATIONS 312 | INDEX OF AUTHORS ABBREVIATIONS ACED Agricultural Competitiveness and Enterprise Development Project AIDA Albanian Investment Development Agency ALL Albanian lek AMD Armenian dram ANFES Azerbaijan National Fund for Entrepreneurship Support AZN Azerbaijani manat sh.a Shoqëri Aksionare, or anonymous company in Albanian ASC Union Albanian Savings and Credit Union AZHBR Agricultural and Rural Development Agency in Albania BDSS business development support service BGN Bulgarian lev bn billion BSEC Organization of the Black Sea Economic Cooperation BSTDB Black Sea Trade and Development Bank CC credit cooperatives CEDA Center for Entrepreneurial Education and Business Support in Moldova CEE Central and Eastern European countries 8 CIP Competitiveness and Innovation Framework Programme CIS Commonwealth of Independent States CNIPMMR National Council of Small and Medium Sized Private Enterprises in Romania COSME EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises CU credit union DCFTA Deep and Comprehensive Free Trade Area EAFRD European Agricultural Fund for Rural Development EAGGF European Agricultural Guidance and Guarantee Fund EBRD European Bank for Reconstruction and Development EC European Commission EFSE European Fund for Southeast Europe ENPARD European Neighbourhood Programme for Agriculture and Rural Development EPRS European Parliament Research Service ERENET Entrepreneurship Research and Education Network of Central Eastern European Universities ETEAN National Fund for Entrepreneurship and Development in Greece EU European Union EUR, € euro, official currency of the eurozone FAF-DC First Albanian Financial Development Company FB family business FDI foreign direct investment FGCR Rural Credit Guarantee Fund in Romania FOB free on board FREDA Fund for Rural Economic Development in Armenia FRC Romanian Counter-Guarantee Fund FX foreign currency exchange GDP gross domestic product GEL Georgian lari GNI gross national income GNP gross national product GUF German-Ukrainian Fund GVA gross value added ha hectare HACCP Hazard Analysis and Critical Control Points HDI Human Development Index 9 ILO International Labour Organization INSTAT Albanian Institute of Statistics JASMINE Joint Action to Support Microfinance Institutions in Europe JEREMIE Joint European Resources for Micro to Medium Enterprises KAS Konrad-Adenauer-Stiftung KEPA Business and Cultural Development Centre in Greece KfW Kreditanstalt für Wiederaufbau (German government-owned Development Bank) LED local economic development in Armenia LLC Limited Liability Company LSEs large-scale enterprises m million MAP Multiannual Programme in the EU MDL Moldovan leu MARDWA Ministry of Agriculture, Rural Development and Water Resources in Albania MSME micro, small and medium-sized enterprise na not available NAAS National Agricultural Advisory System in Bulgaria NBFI Non-Bank Financial Institution NBG National Bank of Georgia NBR National Bank of Romania NLC National Licensing Center in Albania NLGFSME National Loan Guarantee Fund for SMEs NPL non-performing loans in Romania NRC National Registration Center of Albania PABSEC Parliamentary Assembly of the Black Sea Economic Cooperation PERMIS BSEC Permanent International Secretariat of BSEC PDO Protected Designation of Origin PGI Protected Geographic Indication PRD Programme for Rural Development in Bulgaria RAEF Romanian-American Enterprise Fund RMCF Romanian Micro Credit Facility RON new Romanian leu RSD Serbian dinar RUB Russian rouble SBA Small Business Act for Europe SCA Savings and Credit Associations 10 SLA Savings and Loans Associations in Moldova SMAE Small and medium-sized agri-processing enterprise SME small and medium-sized enterprise SME DNC SME National Development Center in Armenia SPM Social Performance Management SRO self-regulatory organization TIN tax identification number in Azerbaijan TRY Turkish lira TTIP Transatlantic Trade and Investment Partnership UAA utilized agricultural area UAH Ukrainian hryvnia UCO Universal credit organizations in Armenia UNECE United Nations Economic Commission for Europe USD United States dollar WIFU Witten Institute for Family Business WTO World Trade Organization PREFACE Meltem Güney Executive Manager, Permanent International Secretariat (PERMIS) of the Orga- nization of the Black Sea Economic Cooperation (BSEC) Your Excellency, Dr. Tudor Copaci, honourable Deputy Minis- ter of Economy of the Republic of Moldova, Dr. Colin Dürkop, esteemed Representative of KAS in Turkey, Mr. Sven-Joachim Irmer, distinguished Representative of KAS in Romania and Moldova, Dr. Antal Szabó, esteemed Scientific Director of ERENET, Distinguished participants, It is a privilege to welcome you, on behalf of the Permanent International Secretariat of the Organization of the Black Sea Economic Cooperation, to the BSEC-KAS Joint Work- shop on SMEs and Small Farms in Agribusiness. I would like to begin by expressing our appreciation to the Konrad-Adenauer-Stiftung for the longstanding support to our Organization. Thanks to their continual support, we have been able to jointly organize over 45 workshops and seminars promoting and encouraging the development of SMEs in our region since 1997. 12 I would like to also express our gratitude to Dr. Szabó, the Scientific Direc- tor of ERENET, who has participated in a great number of these workshops and shared his vast knowledge on the ways and means of supporting the SME sector in the BSEC Member States with the participants. Today’s workshop will focus on a specific topic, namely, SMEs and Small Farms in Agribusiness, which is one of the key economic sectors in our 12 Member States. I am confident that through the presentations we will hear and the fol- lowing discussions, our workshop will help participants explore new and innovative ways in which SMEs and small farms in the agricultural sector can be better assisted to contribute to the overall economy. Distinguished participants, SMEs play a significant role in the economic, social and political develop- ment of the BSEC Member States. They are essential for the economic growth of our countries. They constitute the backbone of our economies. BSEC endeavours to develop effective policies and concrete measures to support the sustainable development of the SME sector in our region. In- deed, that is one of the goals outlined in the BSEC Economic Agenda and endorsed by our Heads of State and Government in 2012. Through its Working Group on SMEs, BSEC has been focusing on high technology, innovation, entrepreneurship and sustainable development, as well as technology parks and incubators. The key objective is to encourage innovative ideas, products, services and processes to help SMEs improve their performance qualities. Our Organization also strives to bring together businesses, scientific insti- tutions, business incubators as well as private and state institutions from our Member States with the purpose of developing a culture of cooperation through networking. We also support the collaboration of SMEs
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