Different forms of subsidies given to small agricultural enterprises

Kocsisné Andrásik, Ágota – Tenk, Antal – Molnár, Barna

Systems of guaranties cannot be examined alone without the knowledge of the actual political objectives as well as of the credit system established hitherto. The majority of governments in advanced market economies developed their own programmes of guaranties performed by a well-established system of institutions. The Hungarian institutions offering credit are mostly founded around the early 90-ies. Their form of trading, logics and structures of ownership are different, but their common aim is to assist small and medium-size enterprises in their development as far as they do not dispose funds sufficient to take a loan.

The financial problems of agricultural production ought to be reconsidered in the process of integration to the European Union. It is especially true for the poorly funded small and medium-size enterprises. Animal husbandry was – by objective reasons – always at a disadvantage, moreover, their chances will even worsen under the circumstances of the system of subsidies in the EU. Most of the small enterprises are unable to perform larger projects, therefore, they cannot fulfil the conditions of tenders (own funds, employment, size of plots, etc.).

The most important task of the future will be the creation conditions, which could favour the competitiveness of small farms by state intervention. One of the useful actions would be to help with national subsidies the enterprises to apply for EU tenders invited for resources to structural and rural development. During the initial period, they will not be able to do that, therefore, it has been suggested to train experts to advise the farmers in optimising their investments.

Full article