Serbia is facing a continuous decline in the agricultural sector. Experts point to drought, lack of investment and low level of agricultural technology as the main causes
Although the real growth of gross domestic product in the third quarter of this year was positive - 3,1 percent, agriculture records a negative trend – path in all three quarters of almost eight percent in each - for which the profession points the finger at climate change and low investments, writes New economy.
Observed by activities, the most significant real growth of gross added value was recorded in the industry and water supply and waste water management sector, 3,6 percent and the information and communication sector, 7,8 percent.
On the other hand, a real drop in gross added value was recorded in the agriculture, forestry and fishing sector, 8,6 percent.
The share of agriculture in the gross domestic product of Serbia has been declining for a number of years, and looking only at the period from 2022, that share decreased from 5,3 percent to 3,8 percent in 2023. Data so far for this year indicate that in 2024 this value will be slightly over three percent.
During all three quarters of this year, the agricultural sector recorded a decline in gross added value, namely 7,6 percent in the first, 8,6 percent in the second, and XNUMX percent in the third.
"This decline, especially this year, can be attributed to the droughts that significantly threatened crop production, not only in Serbia, but also in Europe," says Milan Prostran, agroeconomist, for New Economy and adds that "in order to turned this decline into a plus, it is necessary to initiate larger investments, as well as to regulate the market".
The trend is getting worse.
On the other hand, he explains that another important reason is the still present low level of agricultural technology - "due to the high prices of investment costs in agricultural production, people resort to less use of mineral fertilizers, plant protection agents, as well as the use of undeclared seeds, in order to reduce their expenses considering the modest financial capital they have - which indirectly or directly affected the yields and physical volume of agricultural production".
Prostran particularly pointed out the bad situation in livestock production, the trend of which is getting worse - which he points out as one of the most alarming issues in the agricultural sector.
"In terms of value, livestock production accounts for 70 percent of the agricultural sector in the European Union, while in Serbia it is only about XNUMX percent - which clearly indicates the systemic problem we have in agriculture," Prostran believes.
Speaking of climate change, since the beginning of the 21st century, Serbia has faced severe episodes of drought and extreme rainfall that have caused large economic losses - estimated to exceed six billion euros, and more than 70 percent of those losses are related to drought and high temperatures , which is over four billion euros.
Without an adequate response from the state
Following the major floods of 2014, there have been positive developments in natural disaster management, ranging from improving the legal framework to developing recovery programs and implementing mitigation and preparedness measures.
"Many of these moves were primarily focused on floods - while, as a result, Serbia still does not have a national strategic document dedicated to drought, although the economic losses associated with droughts in some years are approximately the same as the losses from floods in 2014," says the professor Vladimir Đurđević of the Faculty of Physics of the University of Belgrade for the New Economy.
On the other hand, Serbia already has some elements to respond to drought, but often these elements are not fully developed, they are fragmented and are not able to function together, to which Professor Đurđević adds that "the current response to drought in the country is mostly reactive , focusing on actions after the start or end of the drought".
New economy has already written about how Serbia risks losing up to 74 million euros from the EU's IPARD program because it did not use those funds in a timely manner - and the "hidden" loss is precisely the farmers - who recently protested because, as they say, the Government does not respects the agreements reached and does not deny the allegations that their subsidies will be reduced.
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