diversification into non agricultural activities under the conditions of slovakia
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Diversification into non-agricultural activities under the conditions of Slovakia. Stanislav Buchta, Zuzana Federičová Miriama Cibulková. Basic terms and concepts.

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diversification into non agricultural activities under the conditions of slovakia

Diversificationintonon-agriculturalactivitiesundertheconditionsof Slovakia

Stanislav Buchta, Zuzana Federičová

Miriama Cibulková

basic terms and concepts
Basicterms and concepts
  • DiversificationIf country / company / a businessdiversifies , itincreasestherangeofgoods or servicesitproduces
  • BeneficiarySomeonewhogetsadvantagesfromanaction or change
  • Legal person
  • Natural person
slide3
Thediversificationofproductioni.e. cultivationofvariouscommoditiesatthesametime
  • Diversification by increasingtheshareofincomefromnon-agriculturalactivities in thetotalreceiptsoffarminghouseholds has become a more commonphenomenon.
  • Diversificationofagriculturalactivities has improvedtheeconomicopportunities and socialconditionsofruralinhabitants.
  • According to theRuralDevelopment in theEuropeanUnion, Statistical and EconomicInformationand Report 2006, almost 31% offarmershaveothergainfulactivitiesapartfromtheagriculturalones.
  • Thepercentage over 50% ishigher in manycountries and regions (Slovenia, Sweden, Cyprus, Malta , Germany)
aim and methodology
Aim and methodology
  • ThepaperanalyzesthediversificationactivitiescomingfromtheFarmStructureSurvey
  • And analyzesthediversificationimplementation in thesectoralprogrammedocumentsinthepre-intergation and post-integrationperiod
  • Theanalysescontainspersonalattitudes and opinionsofthemeasurebeneficiariescentred on thediversificationsupport in 2004-2006
analysis of diversification activities from the farm structure survey
AnalysisofdiversificationactivitiesfromtheFarmStructureSurvey
  • Thediversificationactivitiesincreasedfrom 34,2% (2003) to 35,2% in alllegalformsin 2007
  • Theactivitieswerespread more by legalpersons (52,8%) than by registerednaturalpersons (30,1%)
  • In 2007, everysecondlegal person and everythirdnatural person and everythirdfarm(35,2%) ofthetotal 8900 farms in agricultureshowedsomeothergainfulactivities.
slide7
Diversificationactivities in thelegalpersons’farmswere almost two times higher than in the farms of the registered natural persons
  • Theslightlyhighershareofdiversificationwasregistered in thelowproductionregionswhereitiseconomicallynecessary to addothergainfulactivitiestotheagriculturalproduction
  • In 2007, farmsoflegalpersonsapparentlypredominated over thefarmsofnaturalpersons in alldiversificationactivitiesexcepthandcriftwiththebalancedproportion.

The most predominatingdiversificationactivitiesoflegalpersonsweresaleofagriculturalproductsforenergyproduction (10,3 times more by legalpersonsthanbynaturalpersons), processingoffarmproducts (3,1 times more) and contractualwork (3 times more).

slide9
The most commondiversificationactivities are concentrated in theproductiveregionsasfollows:
  • Processingoffarmproducts
  • Contractualwork
  • Saleofagriculturalproductsforenergyproduction

And in thelessproductiveregions:

  • Agrotourism and ruraltourism
  • Woodprocessing
analysis of public expenditures into the diversification oriented projects
Analysisofpublicexpendituresintothediversification-orientedprojects
  • In thepre-integration and theshortenedbudgetaryperiod, thediversificationwasfinancedfromtheprogrammes SAPARD, theSectoralOperationalProgrammeAgriculture and RuralDevelopment (SOP ARD) 2004-2006 and theRuralDevelopmentPlan 2004-2006.
  • In lastthreeyears, theexpenditurefordiversificationacceleratedsignificantly and wereincreasingyear on year.
  • Thehighestamountwasdrawn in 2008 (275,5 million SK)
  • In the new programmeperiod 2007-2013 , 122,16 million € are planned to beallocatedintothediversificationof non- agriculturalactivities, thatis 4,8% ofthetotalpublicsupport set in theprogramme.
  • Publicexpenditureswithprivatefinancingofthebeneficiaries are supposed to be 244,32 million €
slide11
Annualdrawing in diversificationfromtheSapardprogramme, SOP ARD 2004-2006 and RuralDevelopmentPlan 2004-2006
slide12
Analysisofthe RDP 2007-2013 projects in theMeasure 3.1 “Diversification into non-agricultural activities”
  • There were 271 submitted projects
  • 271 projectswererequested by 260 enterprises, ofwhich 119 (46%) werebusinesscompanies, 100 (38%) privateindividualfarmers and 41 (16%) cooperativefarms
slide13
Applicantsfornon-repayablefinancialcontributionfrom RDP 2007-2013 which has alreadybenefitedfromthe SOP ARD
conclusion
Conclusion
  • Diversificationofruraleconomyformsthebasicaim in order to preserve and improvethebalancedjobopportunitiesandsocialconditionsofruralpopulation
  • In 2007, everythirdfarmofthetotal 8900 farms had othergainfulactivities
  • In thepre-intergration and theshortenedbudgetaryperiod, thediversificationareaabsorbed 947 billion SKK fromtheEuropeanfunds
slide15
Thegreatprojectpotentialofdiversification has appeared in the new programmeperiod , where 271 projectsfordiversificationhavebeensubmitted in theamountof 127,9 million €
  • Regardingthequestions (on thediversificationmeasure) howthediversification has influencedtheemployment, twothirdsoftherespondentsrepliedthatthecontribution had supportedformingof new jobs
  • Twothirdsofenterprisesco-financedtheinvestmentthrough bank credits and onethirdusedtheirownfinantialsourcesforco-financingthediversificationactivities
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