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agriculture and food economy in poland

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AGRICULTURAL POLICY<br />

- real estate tax exemptions<br />

- subsidies to afforestation of agricultural l<strong>and</strong> of grade 5 <strong>and</strong> 6<br />

- subsidies to buy<strong>in</strong>g <strong>in</strong> prices of extra grade milk<br />

- subsidies to buy<strong>in</strong>g <strong>in</strong> prices of cereals for human consumption (wheat <strong>and</strong> rye<br />

of appropriate quality parameters)<br />

- subsidies to buy<strong>in</strong>g <strong>in</strong> prices of <strong>in</strong>dustrial tobacco<br />

- subsidies to starch <strong>and</strong> potato starch producers<br />

- f<strong>in</strong>anc<strong>in</strong>g <strong>in</strong>tervention buy<strong>in</strong>g <strong>in</strong> of major agricultural products (cereals, milk<br />

powder, butter, pig half-carcasses, etc.)<br />

- f<strong>in</strong>ancial aid for producer groups<br />

- subsidies to exports of certa<strong>in</strong> agricultural products (pork, milk powder).<br />

F<strong>in</strong>anc<strong>in</strong>g of <strong>agriculture</strong> from the national budget<br />

Every year allocations from the national budget are made for support of<br />

<strong>agriculture</strong>, agricultural markets <strong>and</strong> rural areas development as well as for social<br />

<strong>in</strong>surance.<br />

Table 24. National budget funds allocated for support of <strong>agriculture</strong>, agricultural markets <strong>and</strong> rural areas<br />

development (PLN million, nom<strong>in</strong>al amounts) <strong>in</strong> 2001-2003<br />

Specification 2001 2002 2003<br />

Funds for support of <strong>agriculture</strong>, agricultural markets <strong>and</strong> rural areas development 4005 3886 4321<br />

Funds for subsidies to Farmers’ Social Security Fund (KRUS) 15822 15390 15690<br />

Total 19827 19276 20011<br />

As translated <strong>in</strong>to Euro (at the mid exchange rate announced by the National<br />

Bank of Pol<strong>and</strong>; PLN 366.85 for Euro 100 <strong>in</strong> 2001; PLN 385.57 <strong>and</strong> PLN 439.78 for<br />

Euro 100 <strong>in</strong> 2002 <strong>and</strong> 2003 respectively), aid decreased from Euro 5 405 million to<br />

Euro 4 550 million <strong>in</strong> 2003. The share of expenditure on <strong>agriculture</strong> <strong>in</strong>clud<strong>in</strong>g<br />

KRUS <strong>in</strong> GDP is by 0.47 percentage po<strong>in</strong>ts lower than the <strong>agriculture</strong> contribution<br />

(2.6%) to GDP. In 2003 the share of expenditure on <strong>agriculture</strong> <strong>in</strong> total national<br />

budget expenditures was 2.22% <strong>and</strong> 10.29% <strong>in</strong>clud<strong>in</strong>g KRUS.<br />

Membership of the EU <strong>and</strong> application of the Common Agricultural Policy rules<br />

implies a complete change of scale <strong>and</strong> system of <strong>agriculture</strong> f<strong>in</strong>anc<strong>in</strong>g. The<br />

programmes <strong>and</strong> subsidies f<strong>in</strong>anced hitherto from the national budget will become<br />

of secondary importance or will be ab<strong>and</strong>oned.<br />

Rural Development Programme (RDP)<br />

To implement the Rural Development Programme, the Polish government<br />

contracted a loan from the World Bank totall<strong>in</strong>g Euro 118.8 million. The<br />

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