The i mpact of the application of the National [603458]

The i mpact of the application of the National
Program of Rural Development on agricultural
holdings in Romania
Restructuring measures for agricultural holdings through NRDP 2007 -2013

Adrian Turek Rahoveanu
University of Agronomic Sciences and Veterinary Medicine
of Bucharest , UASVM, Bucharest , Romania
[anonimizat]

Abstract : After joining the European Union, Ro mania benefited
from over € 8 billion in funding for 2007 -2013, plus national co –
financing, funds that had to be directed to rural areas and
agriculture to solve the multiple problems with which they are
facing. To this end, in the present paper I proposed to analyze the
impact of the implementation of measures under the National
Rural Development Program on agricultural holdings in Romania
during the programming period 2007 -2013.
I analyzed the situation of agriculture: the rural population and
human resou rce, the number and size of farms and the average size
of farms, then briefly presented the measures 141 and 142 for the
restructuring of agricultural holdings through the National Rural
Development Program 2007 -2013 and finally we highlighted the
impact o f Measures 141 and 142 at the end of the 2007 -2013
programming period as well as the extent to which the objectives of
these measures were met .
Keywords: agrarian structures, measures 141 and 142 ,
sustainable growth, competitiveness
I. INTRODUCTION
The terr itory of Romania, as it appears, illustrates the
harmony of the geographic structure and the agrarian potential
– starting with the relief forms; hydrographic network, soil,
vegetation, land use, landscaping and ending with
communication routes, the networ k of localities and economic
activities, reflecting its natural -economic valences integrated
into a continuous process of development, exploitation,
harmonious restructuring, arrangement and organization.
With a total area of 238 thousand km2 and a populat ion of
over 22 million inhabitants (55% is urban and 45% rural),
Romania accounts for 6% of the total European Union area
and 4% of its population. Investments and competitiveness in
Romania are elements that need to be improved in order to
accelerate econ omic growth and ensure the convergence of
revenues with those in the EU.
Against this background, Romanian agriculture has
been and remains in the general attention of the potential of
land resources, occupied population and achievable production
that mak e food security and the welfare of farmers
conditional. The current state of Romanian agriculture is determined by
the agrarian structure of Romania – an economic and social
issue of utmost importance and topicality for Romania.
(Zahiu, Dachin, Turek Rahov eanu, A., 2007).
Romania's agriculture is inhomogeneous in terms of
exploitation structures and its dual character is accentuated by
the vast majority of the Member States of the European Union.
Although some progress has been made, an excessively large
number of individual, small and very low -performing farms,
as well as a small number of large and very large units whose
activity has not been restructured to become compatible with
market requirements unique. There is a lack of a medium –
sized sector, which characterizes the "European agricultural
model" that has long been formed under the impact of the
Common Agricultural Policy. (Popescu, 2004; Zahiu, Toma,
Dachin, Alexandri, 2010).
The existence in our country, predominantly, of
subsistence households, lea ds to such productive behavior.
Such a situation, given that the area owned by each household
is reduced, leads to its fragmentation, which does not favor the
rational development of agricultural works and the efficient
use of different resources, such as technical means. In
addition, it is difficult to practice a performing farm in such a
state of affairs. In developed agriculture such households are
endangered or have ceased to exist.
In Romania, the agricultural land fund is heavily affected
by the proc ess of fragmentation in small plots, which in many
cases leads to the impossibility of applying modern
agricultural agro technology technologies leading
scientifically to the cultivation of cultivated lands stable
productions both in terms of quantity and quality. Agricultural
production is mostly supported by small farms and therefore
the performance of the agricultural sector in Romania is
affected by the excessive fragmentation of property. (Turek
Rahoveanu, A., 2007).
II. RESULTS AND DISCUSSIONS
In Romania, as a result of land restitution, most individual
farms are characterized by a reduced economic power and
consumption -oriented consumption of their own production,

with more subsistence and semi -subsistence. Their opening to
the market is relatively small, both in terms of inputs and
outputs.
1. Population and human resource at rural level
The rural population is not evenly distributed throughout the
country. Thus, the rural population has a high share in some
regions (South Muntenia – 58.6%, North East – 56.8% and
South -West Oltenia – 51.9%), the highest density except the
Bucharest -Ilfov region, (63.24 places / km2), while in the
western part of the country the rural area is less populated
(26.51 places / km2 in the West region). These disparities are
reflected in the socio -economic development of the area and
the quality of life of the rural population.
Within the EU, Romania is the country most dependent on
agriculture and the country with the largest number of farmers.
Not only do they have the highest p ercentage of farmers in the
EU but they account for 20% of the entire EU labor force
mobilized by agriculture. (Alboiu, 2009).
Labor force in agriculture remains much oversized compared
to other EU countries. The employment rate in agricultural,
forestry a nd fisheries activities remains at a high level (28.0%)
compared to the European average (4.7%), and its evolution
over the past few years has not seen spectacular developments.
The labor force in agriculture is aging, with a low level of
education, social ly vulnerable. In addition, there is a decrease
in the level of training of the employed rural population: the
younger (under 35) labor force has a lower level of training
than the mature population (35 -45 years old), which, is
appreciated, limits the poss ibilities of implementing advanced
business -based business initiatives. (Done, Chivu, Andrei,
Matei, 2012).

2. Number and size of agricultural holdings
The increase in domestic agricultural production is the main
factor by which agricultural policies infl uence the food
security of the country. Farm structure adjustment measures
are instruments that have the potential to bring about lasting
solutions to the supply of agricultural products, including by
supporting the increase in the physical and economic si ze of
holdings, in line with developments in agricultural production
technologies. Comparing the economic performance of farms
of different sizes between Romania and those of the EU
member states shows that Romania is only at the beginning of
the road to a performing agriculture.
With an agricultural area of 13.3 million hectares
(representing 55.8% of Romania's territory), Romania has
important agricultural resources. Although there are areas of
used agricultural area classified as disadvantaged, pedologic al
conditions are particularly favorable to agricultural production
activities in the southern and western regions of the country.
Most of the utilized agricultural area is arable (8.3 million ha),
followed by pastures and meadows (4.5 million ha),
permane nt crops (0.3 million ha) and familiar gardens (0.2
million ha).
Considered globally, EU agriculture is characterized by a
continuing decline in the number of holdings maintained since
the 1970s (the EU -5.8 million EU -9 since 1975 decreased to 2.6 million EU-15 in 2007), then with the EU -27 expansion,
the number of holdings increased substantially to 12.24
million in 2010 at EU -28 level.
According to Eurostat statistical data, there are 12248
thousand farms in the EU -28. These farms use an area of
174.1 mi llion hectares, the average area of a farm being 14.2
ha. (Table 1 , Table 2 ).

TABEL I. NUMBER OF FARMS ACCORDING TO THEIR SIZE IN EU –
28 vs. ROMANIA
< 2 ha 2-5 ha 5-10 ha 10-20 ha
UE-28 6018390 2474030 1337660 916570
49.1% 20.2% 10.9% 7.5%
RO 28664 40 727390 182440 43610
74.3% 18.8% 4.7% 1.1%
20-30 ha 30-50 ha 50-100 ha > 100 ha
UE-28 382560 399160 393890 325820
3.1% 3.3% 3.2% 2.7%
RO 9730 8210 7480 13730
0.3% 0.2% 0.2% 0.4%
Source: Eurostat

TABEL II. USABLE AGRICULTURAL AREA (UAA), DEPE NDING ON
THE SIZE OF THE FARMS IN EU -28 vs. ROMANIA
< 2 ha 2-5 ha 5-10 ha 10-20 ha
UE-28 4301640 7810520 9368890 12851610
2.5% 4.5% 5.4% 7.4%
RO 1718360 2229930 1210510 571390
12.9% 16.8% 9.1% 4.3%
20-30 ha 30-50 ha 50-100 ha > 100 ha
UE-28 93236 00 15429640 27605440 87424210
5.4% 8.9% 15.9% 50.2%
RO 233850 315400 518300 6508390
1.7% 2.4% 3.9% 48.9%
Source: Eurostat

However, there are strong contrasts in the structure of
agriculture at European level: on the one hand there is a very
large nu mber (6018 thousand farms) of very small farms (less
than 2 hectares), which use a small percentage (2.5%) of the
area total land (4.3 million hectares) and on the other hand
there are small farms (2.7% of total farms) of very large farms
(over 100 ha), wh ich use 87424 thousand ha (50.2%) of the
total land area used at EU -28 level.
Also, the share of holdings ranging from 0 -2 ha is 47.6% of
the total number of holdings, which is the fragmentation
phenomenon of the Romanian agricultural holdings, with
negati ve effects on their economic and developmental
performances.

3. Average size of farms
According to Eurostat, the average size of a farm in the EU -28
was 14.2 ha and in Romania 3.45 ha (over 4 times lower),
which negatively influences the use of available agricultural
and rural resources, with direct effects on the rural economy
and, implicitly, farmers' incomes. There are, however, at EU
level a number of states where the average size exceeds
several times the European average: the Czech Republic 152.4
ha; United Kingdom 90.4 ha; Slovakia 77.5 ha; Denmark 62.9
ha; Luxembourg 59.6 ha; Germany 55.8 ha: France 53.9 ha;
Estonia 48.0 ha; Sweden 43.1 ha. (Table 3 ).

TABEL III. NUMBER OF HOLDINGS VS. THE AVERAGE SIZE OF
AGRICULTURAL HOLDINGS IN THE EU -28
Country Number of
holdings Average size
(ha) (mii) %
UE-28 12248 100,00 14,2
RO 3859,0 31,51 3,45
IT 1620,9 13,23 7,9
PL 1506,6 12,30 9,6
ES 989,8 8,08 24,0
EL 723,0 5,90 4,8
HU 576,8 4,71 8,1
FR 516,1 4,21 53,9
BG 370,5 3,02 12,1
PT 305,3 2,49 12,0
DE 299,1 2,44 55,8
HR 233,3 1,90 5,6
LT 199,9 1,63 13,7
UK 186,8 1,53 90,4
AT 150,2 1,23 19,2
IE 139,9 1,14 35,7
LV 83,4 0,68 21,5
SI 74,7 0,61 6,5
NL 72,3 0,59 25,9
SE 71,1 0,58 43,1
FI 63,9 0,52 35,9
BE 42,9 0,35 31,7
DK 42,1 0,34 62,9
CY 38,9 0,32 3,0
SK 24,5 0,20 77,5
CZ 22,9 0,19 152,4
EE 19,6 0,16 48,0
MT 12,5 0,10 0,9
LU 2,2 0,02 59,6
Source: Eurostat

As can be seen from Table 3, the agricultural farms in
Romania, Italy and Poland together account for 57% of the
total numbe r of farms at EU -28 at the level of 2010. Also, the
distribution of the used agricultural area is totally
inhomogeneous at the level EU -28. Thus, 49.1% of the total
number of farms ranges from 0 to 2 hectares and occupies
only 2.5% of the total utilized ag ricultural area. On the other
hand, 325820 farms at EU -28 (2.7% of the total) use an area
of at least 100 hectares (268.3 ha, on average) and total 50.2%
of the total area EU -28. (Dobre, Cîrstea, 2013).
In Romania there is a large and very large category o f farms
with areas over 100 ha, which represent 0.4% of the total
holdings (13730 holdings), but which use 48.9% of the
agricultural area used at the level national. The average size of
such a holding is 474 ha, compared with 268 ha as the EU -28
average. T he share of these holdings is 2.7% at EU -28,
21.00% in the UK, 19.19% in Denmark, 18.26% in France,
11.20% in Germany and 5.17% in Spain.
The phenomenon of structural duality of agricultural holdings
is maintained, a long -term process being necessary to pr oduce
restructuring effects at farm level.

4. Restructuring measures for agricultural holdings through
NRDP 2007 -2013
During the period 2007 -2013, the National Rural
Development Program (NRDP) included two measures with
direct effect on the consolidation of the farms, proposed by the European Regulation in order to speed up the structural
transformation of the agriculture of the new Member States
(adhered after 2004). These are the transitional measures 141
"Supporting semi -subsistence farms" and 142 "Sett ing up
producer groups", aimed at speeding up the market integration
of smaller farms.
Measure 141 – „Support for semi -subsistence farms”
The measure was included in Axis I – "Increasing the
competitiveness of the agricultural and forestry sectors" and
had as a general objective to increase the competitiveness of
the agricultural holdings undergoing restructuring in order to
facilitate the resolution of the transition problems, given that
the agricultural sector and the rural economy are exposed to
pressure competitive single market.
The specific objectives of the measure were: increasing the
volume of production to be marketed in order for semi –
subsistence farms to become economically viable;
diversification of production according to market requirements
and the introduction of new products.
The operational objectives were to ensure the necessary
income support during the restructuring of semi -subsistence
farms for a better use of human resources and production
factors through: stimulating entrepreneurship a nd
diversification of activities and revenues.
Measure 142 – „Establishment of producer groups”
General objectives: to increase the competitiveness of the
primary agricultural and forestry sectors by balancing the
relationship between producers and the pro cessing and
marketing sectors and adapting production qualitatively and
quantitatively to the requirements of consumers.
Specific objectives: Encourage the establishment of
agricultural and forestry producer groups in order to obtain
quality products that meet Community standards by applying
unit production technologies and supporting market access for
their own members.
Operational objectives: increase the number of supported
producer groups for the establishment and administrative
operation and increase r evenue by improving the technical and
management capacity of their members.

5. Impact of Measures 141 and 142 at the end of the 2007 –
2013 programming period
By measure 141, semi -subsistence farms could be supported to
restructure individually on the basis of a development plan
involving better market integration, while measure 142 was
aided for a collective integration activity on market through
the common marketing of products.
If measure 141 meant increasing production, through a vertical
form of produc tion coordination (selling on an organized
market or even integrating into a tiered firm), measure 142
encouraged the association to sell the production through a
horizontal coordination between farmers through the
establishment of producer groups, with a special contribution
to the structure of the agri -food chains in Romania.
The field of action of Measure 142 was to encourage the
establishment and the administrative functioning of the
producer groups recognized in accordance with the provisions

of the na tional legislation in force, which led to the adaptation
of production to the requirements and requirements of the
market; ensuring product sharing, including preparing for sale,
centralizing sales and distributing wholesale products;
increasing the added value of joint production and better
economic management of resources and results; establishing
common rules on production information, in particular on
quantity, quality and type of supply, paying particular
attention to products obtained in appropriate q uantities for the
processing industry and for the marketing network .
Results of Implementation of Measure 141
By the end of 2015, five sessions for the submission of
projects during which 88,846 projects with a public value of
666,345.00 thousand Euros wer e submitted. Of the 88,846
projects submitted, 63,544 projects were selected.
52,768 projects have been contracted (the number reflects the
financing decisions remaining in the system after funding
decisions that have ceased for various reasons excluded),
respectively 83,04% of the NRDP target of 63,544 projects
and a public value of 375,592 thousand Euros.
Of the total number of projects contracted in the amount of
52768 semi -subsistence holdings: 16599 farms were run by
women; 33892 holdings were run by young people under 40
years of age; 22181 farms were located in less -favored areas;
11844 farms have applied for agri -environment.
Until the end of 2015, payments of EUR 333,413 thousand
were made, the EAFRD contribution amounting to EUR
297,821.89 thousan d (the financial execution rate is 92.73%,
out of the allocation of 359,568 thousand Euros).
By the end of 2015, 8984 financing decisions had been
canceled, out of which 5923 at the request of the beneficiaries,
3058 due to non -compliance with the contrac tual clauses and 3
contracts terminated from other causes.
Results of Implementation of the Measure 142
By the end of 2015, 86 projects with a public value of 16,870
thousand Euro have been submitted. Of the 86 submitted
projects, 80 projects were declared eligible for funding, out of
which 58 projects (remaining in the system following the
operation of the terminators) and 35.15% of the target were
declared, the projects having a public value of 11,921
thousand Euros .
Cumulatively, by the end of 2015, paym ents of EUR 5,405
thousand were made, the EAFRD contribution amounting to
4,993 thousand Euros. Also, by the end of 2015, 18 funding
contracts were terminated, of which 8 at the request of the
beneficiaries and 10 due to the non -observance of the
contractu al clauses .

6. The degree of achievement of the objectives of Measure
141 and 142
As regards the degree of achievement of the objectives of
Measure 141, namely the progress of the National Rural
Development Program 2007 -2013 in terms of reaching the set
targets, it is as follows:
– number of supported semi -subsistence farms – compared to
the proposed target of 63,544 holdings, support received through Measure 141 52,768 semi -subsistence farms, the
execution rate of NRDP being 83,04%.
– the financial execut ion rate (payments made) was 92.73%,
out of the allocation of 359,568 thousands Euro being used
333,413 thousands Euros.
– Measure 414 was multiannual (5 years), the first contracts
were signed in the second half of 2009, so that by December
2015 3,025 pro jects had been finalized. In addition to the
3,025 projects, 15,216 projects were added, which at the end
of 2015 had all five payment installments paid, and the
completion note was drawn up;
– By the end of 2014, only 371 semi -subsistence farms had
entere d the market due to their support. Regarding the
proposed NRDP target of 50,836 semi -subsistence holdings
entering the market as a result of the support obtained, the
target of 0.73% is reached; The actual achievement of the
target was 13.17%, as of the 37 1 projects declared finalized,
6,324 projects were added, which at the end of 2014 had all
five payment installments paid, and the completion note was
drawn up. Thus, all 6,695 holdings following the obtained
support entered the market, increasing their pr oduction for sale
by at least 20%, fulfilling the condition in the measure sheet.
– out of the 371 beneficiaries, who had projects completed by
the end of 2014, only 18% introduced a new product / new
farm technique as a result of their funding. Compared t o the
NRDP target of 25,419 holdings, the target reached only
0.26%.
Regarding the achievement of the objectives of Measure 142,
namely the progress of the National Rural Development
Program 2007 -2013 in terms of reaching the set targets, it is as
follows:
– The number of supported producer groups was 58,
representing 35.15% of the proposed target of 165. With
regard to sectoral breakdown, the proposed targets are 64.15%
for crops (34 groups targeted at 53), 15.22% for livestock
breeding (7 groups targeting 46), 30.77% for livestock
excluding milk (4 groups reported at target 13), 50% for
granivores (6 groups targeting 12), 33.33% for the mixed
sector (4 groups for the target 12) and 17.65% for other types
(3 groups for target 17).
– The turnover / year of t he supported groups is 103.96 million
euro / year, representing 39.38% of the target of 264 million
euro / year.
– "Total number of members in supported producer groups"
was 20.79%, respectively 2,194 members, against the target of
10,553
III. CONCLUSIONS
In se mi-subsistence farms, farmers carry out various
agricultural cultivation and animal husbandry activities based
on traditions specific to the Romanian village. These farms are
characterized by a very diversified production structure,
determined by the needs of the household, as well as by a
reduced and inadequate technical endowment, which prevents
the increase of productivity and the obtaining of a surplus of
products for sale. Guiding these farms to the market requires

changing the production system and im plicitly additional
financial costs that farmers can not afford.
Consequently, support for the restructuring of semi –
subsistence farms was an instrument designed primarily to
improve management, accompanied by their transformation
into commercial family fa rms, capable of identifying new
opportunities for capitalizing on production.
The support provided by this measure was aimed at securing
the necessary income during the restructuring period and
transformation of semi -subsistence farms into market -oriented
holdings through the sustainable use of inputs, improved
management through diversification of agricultural
production, and the introduction of technologies performances
adapted to local conditions. As a result, the implementation of
the measure has led to an increase in the income of these
farms, together with lower production costs.
In order to qualitatively adapt production to market
requirements, semi -subsistence farmers through the NRDP
have been able to associate with producer groups and also be
able to access measures to improve professional training and
the use of consulting services.
The process of retrocession of agricultural land from state
ownership to private ownership has led to the establishment of
agricultural holdings of different sizes depe nding on their
type: semi -subsistence holdings, subsistence holdings and
commercial holdings The structure of holdings, mainly semi –
subsistence farms -subsistence, as well as insufficient
cooperation of agricultural producers, led to a poor
development of the agricultural sector in terms of its
competitiveness.
Increasing the competitiveness of this sector is conditioned by
the capitalization on the market of suitable agricultural
products in qualitative and quantitative terms. Adaptation of
production to m arket requirements can be accelerated
significantly by the association of agricultural producers,
which has the consequence of being aware of the importance
of applying unitary production technologies to the demands of
processors or wholesalers.
Also, the lack of financial support for the establishment and
operation of association forms has led to the maintenance of a
duality on the one hand from subsistence and semi -subsistence
holdings and on commercial holdings on the other.
To this was added the retice nce and the low interest of the
agricultural producers towards the associative forms due to:
– Awareness: lack of information and experience in such
activities, low awareness of farmers in terms of benefits
resulting from joint action; – Economic and legis lative aspects: insufficient sources of
financing for the start of an economic activity, lack of interest
of primary processing units in agriculture and forest sector to
conclude commercial contracts, continuous modification of
the legislation in the field ;
– The aspects of training, counseling and counseling: the
different degree of training of the persons involved in the
associative forms, as well as the different understanding of
their purposes and principles of functioning, the lack of
counseling and co unseling services and their concentration on
the quantitative and not the qualitative aspect and economic.
Following the analysis of the relationship between subsistence
and semi -subsistence holdings with the market, it is still
necessary to identify oppor tunities for better capitalization of
agricultural production. Considering that association in
producer groups was a lever in the process of transforming
semi -subsistence farms into commercial family farms, this
measure was extremely important .
References
[1] Alboiu Cornelia (2009) – Agricultura de Subzistență în România: un
modus vivendi? Seminar 111 EAAE -IAAE
[2] Dobre Ramona, Cîrstea A. C. (2013) – Land property structure – a
limiting factor in strengthening the agricultural holdings, Scientific
Papers Series Ma nagement , Economic Engineering in Agriculture and
Rural Development, Vol. 13, Issue 2
[3] Done I., Luminita Chivu, Andrei, J. V., Mirela Matei (2012), Using
labor force and green investments in valuing the Romanian agriculture
potential, Journal of Food, Agri culture & Environment Vol.10 (3&4 ):
737 – 741
[4] Popescu M. (2004) – Eficiența economică, socială și ecologică în
contextual dezvoltării durabile a agriculturii și integrării în Uniunea
Europeană,
[5] Turek Rahoveanu A., Stoian Elena, Turek Rahoveanu Magdalena (2013)
– Analysis of the exploitation structures and land management in
Romania vs. European Union; International Journal of Sustainable
Economies Management, Vol.2, Issues 4, pg. 47 -54, ISSN 2160 -9659
[6] Turek Rahoveanu A. (2007) – Evoluția formelor de proprietate funciară
în agricultura României, Editur a Cartea Universitară, ISBN 978 -973-
731-493-2
[7] Zahiu Letiția, Dachin Anca, Turek Rahoveanu A. (2007) – Factorii care
influențează performanța economică în fermele mari din România,
Dezvoltarea durabilă a spațiului rural”, ASE, Facultatea de Economie
Agroali mentară și a Mediului, București, 15 -16 iunie 2007, volum ISBN
978-606-505-025-9
[8] Zahiu Letiția, Toma Elena, Dachin Anca, Alexandri Cecilia, (2010) –
Agricultura în economia României : între așteptări si realități, Editura
Ceres, ISBN: 978 -973-40-0841 -4
[9] *** MADR, Direcția Generală de Dezvoltare Rurală AM PNDR,
Situația proiectelor depuse la data de 30.12.2015, PNDR 2007 -2013
[10] *** Ancheta Structurală în Agricultură 2013 – rezultate finale, INS 2014
[11] *** Eurostat – Agriculture, forestry and fishery statistics – 2013 edition
[12] *** Programul Național de Dezvoltare Rurală 2007 -2013