ECONOMY

Agricultural restructuring is the last chance for the sector to emerge from its long crisis

The government has announced a broad restructuring of farming cultivations that can restore vibrant life to the provinces and reinstate the productive role of a forgotten minority of the population. Unfortunately, with the domestic market flooded by foreign agricultural products, it is natural that the younger generations in particular wonder what the economy gains from those old people who appear on television protesting their abandonment by every government. «Stop going on about our agriculture when we import potatoes from France, onions from Poland, garlic from Argentina and mandarins from Turkey,» a young economist told me. You can’t blame him, as, according to the latest figures available covering 2003, Greece’s agricultural exports were worth 2,509 million euros, while imports rose to 4,339.6 million euros, making the agricultural balance negative. This situation is not irrelevant to the long-term crisis that dogs Greek agriculture and is expressed in a fall in production and the shrinking of producers’ incomes. In the last annual report of the Bank of Greece (p.109), it is stated that «based on temporary assessments, the gross added value of the primary sector was down in 2003 for the fourth year in a row. The fall came to about 5 percent in 2003, after a 1.1 percent fall in 2002, 3.8 percent in 2001 and 3.7 percent in 2000.» An entire four-year term wasted at a time when the then government was priding itself on the «strong economy.» What is most tragic for the Greek economy, and most decisive about every Greek government’s policy, is that the decadence of agriculture began with the country’s entry to the then European Economic Community, now the EU, in 1980. Opportunity missed The golden opportunity provided to Greek agriculture, with its free access to a large market hungry for Mediterranean products and more importantly the huge influx of resources to Greece in the form of community grants, not only failed to set off its development but actually signaled the start of its decline. The last year that the agricultural balance of the country was positive (by $438.5 million) was in 1980, with the decline beginning after that, so that in 2000 the deficit stood at $941.8 million. How can this madness be explained? Simply by the fact that, for decades, Greek agriculture has been left to its own devices, without any guidance from the governments, no prospect for the future or its competitiveness. Consequently, farmers believed that they could forever receive Common Agricultural Policy (CAP) funds, cultivate peaches and oranges which were then buried because they could not be exported, or resort to cultivating products that harm the soil, such as cotton. Pocketing EU funds became a goal in itself, instead of becoming an incentive for turning to better and more efficient crops. However, with the application of a new CAP from January 2006, Greek farmers are facing the threat of a steady fall in their incomes unless they turn to new forms of cultivation that are compatible with the country’s climate and guarantee the production of internationally competitive products. This is why we believe that the agricultural reform that Prime Minister Costas Karamanlis recently announced is the last opportunity for our country.