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Annual Agriculture and Rural Development Report

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Annual Agriculture and Rural Development Report 2007 ANNUAL AGRICULTURE AND RURAL DEVELOPMENT REPORT December 2008 PREFACE I am deeply honored and privileged to introduce you with the 2007 Annual Agricultural Report, in which The Ministry of Agriculture, Forestry and Water Economy presents the agro-food sector of the Republic of Macedonia and its achievements in 2007. The report is a result of several reports of individual sectors prepared by the Ministry. The report is organized in 9 chapters and includes information on the macroeconomic frame in which the agricultural production was realized and the significance of the agro-food sector in the Republic of Macedonia, capacities, achieved production results in individual subsectors, agricultural and alimentary products trade, the Ministry’s policies on the creation of an ambient for the sector, services, science, education development in the area of agriculture. Many sources have been used for the preparation of this report for the purpose of providing the highest data quality as possible. The main source of data is the State Statistical Office (mainly published data from publications), data from individual sectors and administrations of the Ministry, studies of educational and scientific institutions etc. Yet, the insufficiently harmonized statistics that causes inappropriate dynamics still exists as a problem and represents a limiting factor for this report to be complete in all its elements. Due to that, some parts of the analyses refer to a period up to 2006. I hope that the 2007 Annual Agricultural Report shall be an important document for everyone who shall use it, and especially for students of the agro-food sector, no matter in which segment they are found, as a means which shall contribute to acquiring information in order to intensify development of the entire sector. Sincerely yours, Minister of Agriculture, Forestry and Water Economy, Aco Spasenoski I. SOCIAL AND MAKROECONOMICAL SITUATION IN THE REPUBLIC OF MACEDONIA WITH FOCUS OF AGRO-FOOD SECTOR 1 1 The macroeconomic environment 1 2 Agricultural situation 2 3 Major sectors - trends of principal crop and livestock products 3 4 Main characteristics of the farm structure 5 5 Agricultural policies 5 6 Characterization of the rural environments 8 7 Forests and forest land 9 8 Water resources 9 9 Structure of the rural areas and rural economy 9 9.1 Rural demography and education 9 10 Rural population and employment 11 11 Social welfare infrastructure 12 II. AGRICULTURAL PRODUCTION, PROCESSING AND TRADE 13 1 Cereals 13 2 Industrial crop 17 3 Forage crop 20 4 Vegetable crops 21 5 Fruit and table grape 25 6 Fruit and Vegetable processing 28 7 Vine growing and wine industry 30 8 Farming and production 37 9 Bee-keeping 45 10 Snail farming 46 11 Milk and dairy products 46 12 Meat production 48 13 Organic production 50 14 Sector of Fishing 53 15. AGRICULTURAL MARKETS AND MARKETING WITH AGRO-FOOD PRODUCTS 57 15.1 Trade Policy 57 15.2 Total trade and trade with agro-food products 58 15.3 Trade exchange with 59 15.4 The most significant trade partners of the Republic of Macedonia with agro-food products in 2007 62 III. POLICIES FOR DEVELOPMENT OF AGRICULTURE AND RURAL REGIONS 66 1 Introduction 66 2 Rural Development Programme 67 3 AGRICULTURE AND RURAL DEVELOPMENT STRATEGY 69 3.1 National Strategic Objective. 69 3.2 Main Issues of the Strategic Policy 70 3.3 Agriculture Support Policies 80 3.4 Rural Development Support Policies (National + IPARD+ Rural Crediting Policy) 82 IV. FOOD SAFETY 84 1 VETERINARY MEDICINE 84 2 Animal Health Protection 85 3 Veterinary Public Health 86 4 System of veterinary-medical remedies 88 5 Animal Nutrition System 89 6 System of animal identification and registration 89 7 Legal Regulations 92 8 Veterinary Inspection Services 93 9 MEAT AND MEAT PRODUCTS EXPORT 97 10 FUTURE ACTIVITIES OF THE VETERINARY DIRECTORATE 98 11 PHYTOSANITARY DIRECTORATE IN 2007 100 12 PLANT PROTECTION 100 13 STATE PHYTOSANITARY LABORATORY 105 14 SEED AND PLANTING MATERIAL 106 14.1 Testing plant varieties 106 14.2. Testing and approval of new varieties of agricultural plants 106 14.3. Implementation of expert control (approbation) and production of certified seed and planting material in 2006/2007 106 14.4. Program for seed and planting material 107 14.5. The Policy of the Management of Seed and Planting Material for promotion of the Management and future development plans 107 14.6. Other activities from the area of Seed and Planting Material 107 V. SUSTAINABLE NATURAL RESOURSES MANAGEMENT – AGRICULTURAL LAND, FORESTRY AND WATER ECONOMY 108 1 Agricultural land 108 2 FORESTRY 109 2.1 General Characteristics of the Forestry Department 109 2.2.1 Strategy for maintaining the development of the forestry in the Republic of Macedonia 109 2.2.2 Realization of the Program for widened reproduction of the forests for the year 2007 110 2.2.3 Protection of the forests 111 2.3 Hunting 111 2.5 The State Inspectorate of Forestry and Hunting 112 3 WATER ECONOMY 113 3.1 GENERAL 113 3.2 STRUCTURAL REFORMS IN WATER ECONOMY ORGANIZATION ACCORDING TO THE WATER COMMUNITIES LAW AND WATER ECONOMY LAW 114 3.2.1 Factors for the Water Economy Law and Water Communities Law enforcement 114 3.2.2 Organizing the water economy activities according to the Water Communities Law and Water Economy Law 115 3.2. 3 Implementation of the Water economy Law 116 3.3 IMPROVEMENTS’ SYSTEMS FOR IRRIGATION AND DRAINAGE 117 3.3.1 IMPROVEMENTS’ SYSTEMS FOR IRRIGATION 117 3.3.2 IMPROVEMENTS SYSTEMS FOR DRAINAGE 118 3.3.3 CONDITION OF THE IMPROVEMENTS SYSTEMS 118 3.5 WATER ECONOMY INVESTMENTS 123 4 HYDRO-METEOROLOGICAL DIRECTORATE 127 4.1. AGROMETEOROLOGICAL ANALYSIS OF WEATHER CONDITIONS IN THE REPUBLIC OF MACEDONIA DURING THE PERIOD BETWEEN JANUARY AND DECEMBER 2007 129 VI. HORIZONTAL ISSUES AND ADMINISTRATIVE-CONTROL SYSTEMS OF THE AGRICULTURAL POLICY 131 1 Institutional strengthening (of MAFWE) 131 2 Administrative Control Systems (AFSRD, Inspection services, IACS, URAH, LPIS) 131 3 Association within the agricultural-food sector (Commercial forms of association, Producers’ organizations, Cooperatives, Chambers of Commerce) 134 VII. INFORMATION-COMMUNICATIONS SYSTEMS AND KNOWLEDGE TRANSFER 135 1 Science and Research 135 2 Secondary and Higher Education in Agriculture 137 2.1 Agricultural Secondary Schools 137 2.2 Agricultural University Education 137 3 Advisory and Consulting Services 138 3.1. Public Institutions (faculties, institutes) 138 VIII. ADJUSTEMENT TOWARDS THE EU AND INTERNATIONAL POLICY 145 INTERNATIONAL COOPERATION 145 EU INTEGRATION 145 INTERNATIONAL COOPERATION 147 IX ANNEXES 151 I. SOCIAL AND MACROECONOMICAL SITUATION IN THE REPUBLIC OF MACEDONIA WITH FOCUS OF AGRO-FOOD SECTOR The Republic of Macedonia is situated in the southern part of the Balkan Peninsula. It has a total surface of 25,713 км² and a total population of about 2.04 million. The Republic of Macedonia declared its independence from the former SFRJ on 8th September 1991. It is a parliamentary democratic country, with established institutions of legislative (parliament), executive (government) and judicial authority (judicial system) and with a division of the authority between them. Head of the state there is the president who is elected every 5 years. 1 The macroeconomic environment The Republic of Macedonia is a small Western Balkan country which is still considered as a country in transition. In 2007 Gross Domestic Product (GDP) is about 5.4 billion US$ or 2.6 thousand US$ per capita. The intention of the Macedonian economy is integrate into the international market. In view of that, the Republic of Macedonia was officially accepted as a member of the World Trade Organization (WTO) in April 2003. In addition, the country has signed a number of free trade agreements with different countries from the region as a step towards strengthening the regional integration and cooperation. Macroeconomic indicators Indicator Units 2000 2001 2002 2003 2004 2005 2006 2007 Population '000 2026 2035 2022 2027 2032 2037 2042 2045 Economic growth (change in GDP) % 4.5 -4.5 0.9 2.8 4.1 4.0 1.6 5.9 Unemployment rate % 32.2 30.5 31.9 36.7 37.2 36.6 36.0 34.9 Inflation % 5.8 5.5 1.8 1.2 -0.4 0.5 2.2 2.3 Share of food, beverages and tobacco in % 50.9 51.5 47.4 47.0 45.4 43.8 43.4 42.5 total household's expenditures In 2001 the Republic of Macedonia signed a Stabilization and Association Agreement with the EU, which provided an opportunity for more intensive access to the EU market. Finally, in December 2005, Macedonia became a candidate country for EU membership. Unfortunately still without date for starting of the negotiations. There were radical political changes which took place on the territory of former Yugoslavia that affected the economy of the Republic of Macedonia in the last 17 years. Additionally, the Macedonian economy suffered from the UN sanctions to Serbia, and from the Greek economic embargo, related to the bilateral “name problem”. In this period (1991-1995), the GDP fell by more than 30%. In 1994, the government embarked a program for stabilization and structural adjustment, with 1 assistance from the IMF and the World Bank. The privatization process and the banking system reform were a valuable step in creating a free-market economy. In 2001 there was a conflict, which additionally influenced the economy that had a rapid economic growth decrease (table 1). The Political dialog and “the Ohrid agreement” set up political issues and there was an economic growth which started in 2003 and continued in 2007 (5.9%). However, the high rate of unemployment (34.9%) influenced a more progressive development. The inflation rate declined, and in 2007 it reached the value of 2.3%.
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