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Improving life standards in rural areas and the diversification of the rural economy in Romania

Improving life standards in rural areas and the diversification of the rural economy in Romania. Dr. Cosmin SALASAN Banat’s University of Agriculture and Veterinary Medicine Timisoara & Romanian Academy – Research Centre for Sustainable Rural Development of Romania. Current situation.

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Improving life standards in rural areas and the diversification of the rural economy in Romania

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  1. Improving life standards in rural areas and the diversification of the rural economy in Romania Dr. Cosmin SALASAN Banat’s University of Agriculture and Veterinary Medicine Timisoara & Romanian Academy – Research Centre for Sustainable Rural Development of Romania

  2. Current situation • second largest new member state (6% of the EU territory) • GDP represents less than 1% of the total EU GDP • rural area represent 87,1% of the national territory (compared to 80% at EU level) • 45,1% of the population living in rural area • 32% of the active population is employed in agriculture and forestry • sector produces 12,1% of the GDP and 13,6% of the total GVA • productivity is very low (labour/land ration equals 63 AWU/100 ha) • agri-food trade balance is still negative and widening (1,3 billion euro in 2005)

  3. Current situation Farming in Romania has two main (and relatively opposite) dimensions: • few (agricultural) legal entities, mostly large commercial farms, (18,263 averaging 269 ha, accounting for 34.5% of UAA), • an impressive number of individual farms, mostly subsistence and semi-subsistence holdings (4,121,247, average size 2.15 ha, accounting for 65.5% of UAA) Around 3 million of the holdings covering approximately 30% of agricultural land are considered as subsistence only

  4. 4.121.247 farms 269 ha average size 65,5% UAA 18.263 farms 34,5% UAA 2,15 ha average size Graphical presentation of the farm number, average area and share of total UAA

  5. Current situation 30% of the national territory is represented by mountains Less Favored Areas represent 12% of the territory giving a total of 42% of LFA accounting 34,5% of UAA. Natural and semi-natural ecosystems cover around 47% of the national territory. Approximately 2.4 million ha of the country's semi-natural grassland is classified as of High Nature Value (HNV).

  6. CAP rural diversification opportunities Creation and the development of micro-enterprises in rural area aims to support by 2013 almost 10.000 enterprises, creating ~30.000 jobs Impacting in approximately 2% employment growth rate in secondary and tertiary sectors in rural area only by this type of support

  7. CAP rural diversification opportunities Encouragement of the tourism activities aims to add 2,52% employment growth rate by creating another ~40.000 jobs for more than 7,5 million tourist visits expected Projected tourism activities have a breakdown by type, including: • agro-tourism, • rural tourism and • leisure tourism

  8. Village renewal Over 5 million rural inhabitants from more than 1.000 communes are to benefit of the impact of actions and projects undertaken by this measure, accounting 50% of the target population In physical terms this means more than 3.000 km of roads, more than 6.000 km of pipelines for water supply and 5.000 km of sewage pipelines. It also estimates over 4.000 jobs created

  9. Recent developments The first projects’ call organized between the 3rd and the 28th of March gathered 918 projects amounting more than 700 million euro (728,71 million euro) for all the three opened measures: • 708 projects requesting 291,26 million euro for farm investments • 194 projects requesting 405,98 million euro for village renewal, and • 16 projects requesting 31,45 million euro for increasing the added value

  10. Number of projects submitted in March 2008 under NRDP in Romania

  11. Requested value of projects submitted in March 2008 under NRDP in Romania

  12. Recent developments The initial expectations regarding the monthly financial allocations, 194,31 million euro were from far over passed by the first round of projects submitted, 728,71 million euro, almost 4 times more (factor 3,75)

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