The new agriculture minister Stelian Fuia said on Wednesday he would ask the Brussels authorities to extend the deadline for liberalization of the land market. The minister admitted though that such a measure would be possible through the modification of the EU accession treaty.
“The treaty has clauses that Romania committed to at the time of negotiations. In theory, we would have to modify certain provisions of the accession treaty, negotiations need to be resumed on this chapter. The idea is simple, at the moment in the EU there is talk of Greece, of ceding sovereignty, it would be a very bad timing for a move of this kind,” says political analyst Cristian Pirvulescu.
On the other hand, Vasile Puscas, former chief negotiator of Romania with the European Union, says “any legal document can be modified and this entails negotiation.”
Officials have two years left to find a solution to slow down farmland acquisitions made by foreign investors.
No.1 in Europe in terms of selling farmland to foreigners
Romania is no. 1 at present among European countries and no. 10 in the world in terms of the percentage of farmland controlled by foreign companies, according to a report of GRAIN, a multinational organization that fights for the rights of small farmers.
On the Romanian market, foreign investors hold 7% of the farmland, in the Czech Republic non-residents own 4% of the total, while in Ukraine, foreigners hold 3%.
Investors currently have to register companies in Romania in order to be able to buy land.
In absolute terms, the area owned by foreign investors amounts to 700,000 hectares, according to a statistic released by the agriculture ministry at the end of last year.
But what are the implications of foreign companies buying land in Romania?
“There are two opinions on the market at present, the nationalistic one, which says it is not good to sell land to foreigners, and the other, wider one, which says if we have decided to join the EU, we have to comply with the rules of the single market and liberalize it,” says Gabriel Popescu, professor at the Faculty of Agrifood Economy and Environment within the Academy of Economic Studies in Bucharest.
He adds that hindering farmland acquisition can hold back foreign investments in agriculture, specifying that a distinction needs to be made between investors. “Some come here and comply with market rules, but there are also those who buy land for speculative purposes and to get subsidies. The state cannot know or verify the intentions of an investor.”
In money terms, foreigners own farmland worth at least EUR1.5 billion, according to ZF calculations, which are based on an average price of EUR2,000 per hectare.
(English version by Daniela Stoican)