Planting the Seeds for Growth

GIG: The food and agricultural sector in Greece has traditionally been one of the main pillars of its economy and one of the major export sectors of the country. In fact, it is believed to be one of the few sectors of the Greek economy that showed positive signs of growth during the crisis. What are your key goals at the ministry? What weaknesses in Greece’s agricultural policy would you like to tackle first?

Voridis: Our strategic vision for the agri-food sector in Greece is to create the appropriate conditions for its balanced development in terms of economic, social, and environmental sustainability. This means that we need to respond successfully to today’s and tomorrow’s challenges – complex and multidimensional challenges that are part of a wider, globalised environment – as we all have realised during the consultations with our EU partners about the new Common Agricultural Policy (CAP) budget.

This is an environment that, through the new CAP 2021-2027, sets the financial and operational framework of the new programming period and at the same time, through the international market, sets the rules of competition and forms new trends in the demand for agricultural products, consumer habits, and insights as well.

For these reasons, at the heart of our strategic plan for the agri-food sector is:

• Developing further Greek agriculture in terms of improving competitiveness;
• Increasing the added value and the sustainable production of healthy and safe food;
• Upgrading the Greek countryside and rural areas in terms of increasing job opportunities and reducing economic, social, and territorial disparities.

In order to meet these goals, we are focusing on the following main challenges related to both the primary sector and the rural areas of the country, particularly:

• The enhancement of the comparative advantages of the agri-food sector regarding the diversity of climatic and geomorphological conditions for the production of differentiated and quality products, and the promotion of the Mediterranean diet and gastronomy.
• Upgrading human resources and infrastructure. Despite the generally low level of education/training (which has been improved over time), a significant part of the human capital is characterised by dynamism and a tendency towards innovation. The recession has been conducive to an increase in the employment of highly educated human resources in the agricultural sector that are both more receptive to the introduction of innovations and new technologies and, at the same time, have considerable experience in management and marketing.
• Ensuring an appropriate investment environment, which encourages and boost investments in the primary sector. Lack of liquidity and limited lending to agricultural businesses in the current circumstances are inhibiting the development of entrepreneurship and, therefore, alternatives should be sought through the activation of financial instruments in cooperation with EU Structural Funds, the European Investment Bank, etc.
• Proceeding with necessary structural changes to overcome both the problems of the economic crisis of previous years and the structural problems of agriculture and livestock sectors. These include:
  • Low productivity and high cost of production, mainly in energy and animal feed;
  • Unfair commercial practices and a weak negotiating position of producers compared with all other links in the agri-food chain, due to a low degree of organisation of producers in collective schemes;
  • The need for the rational management of natural resources by investing in Renewable Energy Sources (RES);
  • Precision farming and environmentally friendly farming practices;
  • The aging of the rural population;
  • The small size of agricultural holdings;
  • The lack of effective education-training structures and advisory support services to producers;
  • The lack of mechanisms to support the adoption of innovation and new technologies by encouraging partnerships and networking among agri-food stakeholders, as well as by providing incentives for appropriate investments.
• Strengthening territorial cohesion of the regions and rural areas. Entrepreneurship in the primary sector is inextricably linked to the level of development of rural areas and therefore it is directly affected by the problems they face, particularly the islands, mountainous, and less favourable areas, which are even more vulnerable to abandonment and aging of the population, the risk of poverty, the lack of accessibility, etc.
• Investing in basic public and private structures in rural areas, which will make both entrepreneurship and social inclusion easier. In this direction, our strategy focus is on developing basic infrastructure which a) promotes research and innovation, education, cooperation, and advisory support services to the primary sector, and b) ensures accessibility by maintaining and protecting natural resources of the rural areas, upgrading and regenerating rural settlements in order to become more productive, but also attractive for further touristic, environmental, and/or any other kind of development.

GIG: The CAP is a key pillar of Europe’s measures geared towards rural development and food safety. How important is this instrument for Greece? What are your priorities for the post-2020 CAP?

Voridis: To give an idea of CAP funds’ contribution to Greek agriculture, this represents for the current programming period total resources of about €20 billion, almost the equivalent amount of resources directed to the Greek economy through all other EU structural and investment funds. In other words, Greek agriculture ‘absorbs’ – in real terms – more than 50% of EU resources in relation to all other sectors of the Greek economy. This fact, as well as the EU’s overall policy for the primary sector over time, demonstrates its importance for economic development as well as for the environmental and social cohesion of rural areas of the EU as a whole and, of course, the need for further support.

This multidimensional importance of the primary sector is also highlighted through the effort we make in the framework of EU consultations to ensure that for the next programming period for CAP, resources will not be reduced.

Key strategic priorities for CAP post-2020, which holistically approach the development and social cohesion of rural areas and will be served by specific policy measures and actions are:

• Enhancing the competitiveness and productivity of the primary sector with policy measures that support collective forms of organising production, contributing to the modernisation of farms/agricultural holdings and the reduction of production costs, the construction of public infrastructure, and providing support advisory services to transfer knowledge and innovation.
• Enhancing the value chain of domestic agricultural products, with policy measures that increase their added value and certify their quality, safety, and openness while promoting innovative culture and high added value entrepreneurship. Indicative measures are to encourage investment in the processing and marketing of agricultural products, promotion of exports and certification of cultivation practices/quality of agricultural products.
• Upgrading human resources and enhancing entrepreneurship, with policy measures that support the installation and start-up of young farmers and newcomers in rural areas, as well as their education and training.
• Protecting the environment and natural resources and tackling and/or adapting to climate change with targeted agri-environment and forestry measures, which also contribute to the quality and added value of the products.
• Strengthening the social fabric in rural areas through local development strategies that promote public and private investments aimed at the diversification of the income of rural households, and access to digital infrastructure.

GIG: According to the National Bank of Greece, the food sector could generate an additional €12.2 billion per year as well as 200,000 jobs if steps were taken to modernise the sector. What is your view, and what actions are you planning in relation to the modernisation of Greece’s food sector?

Voridis: Firstly, we need to take into account consumers’ needs and insights and to plan our next steps according to them. For example, we need to consider the shift in demand into agri-food products, the growing demand for high-quality and identity products, certified and safe – as well as organic – Protected Designation of Origin (PDO) and Protected Geographical Indication (PGI) agricultural products. Moreover, our strategy should focus on addressing the structural problems and the high degree of concentration of exports (in olive oil, fruits, vegetables, and cotton) and imports (in milk and meat). Therefore, it is important to enhance the comparative advantages and quality of more agricultural products and their extroversion through certification and promotion on domestic and foreign markets.

At the same time, we need to promote the adoption of innovation and new technologies by encouraging partnerships and networking among agri-food stakeholders and by providing incentives for appropriate investments. In this direction, we are taking advantage of the financing opportunities of EU co-financed programmes, such as the Rural Development Programme 2014-2020, funding investments in processing of about €1 billion.

GIG: Greek farmers have been responding to the digital age, but a lot more of work is needed here. What will the ministry do to achieve this goal?

Voridis: The current National Rural Development Programme includes a significant number of measures that introduce farmers into the new digital age, but this needs to further expand in the next programming period, 2021-2027, taking advantage of new CAP provisions for even more ambitious projects.

In line with these provisions, our priority is to invest in actions that will substantially contribute to the structural transformation of our primary sector and especially to the establishment of a new agricultural entrepreneurship culture that will be based on, and promote, agricultural advisory services, training and education, cooperation and networking, encourage innovation, farmers’ access to reliable knowledge, broadband infrastructure, cooperation, and more collective organisation and management.

GIG: Greece’s farming sector is highly fragmented, consisting of small and very small farms. What challenges/benefits does this pose?

Voridis: The small size of our agricultural holdings combined with the low degree of organisation of producers in collective schemes causes serious problems. These include unfair commercial practices and a weak negotiating position of producers compared with all other links of the agri-food chain. These problems could be overcome with incentives to participate in healthy cooperatives, producer groups and organisations, and incentives for collective investments, thus ensuring growth in terms of economic and critical mass production, economies of scale and reduced production costs, strong bargaining position of producers, and investment opportunities through the vertical integration of their production to increase added value and improve farmers’ income.

The enhancement of the competitiveness and productivity of the agricultural sector is a core priority of our strategic plan, especially through our actions a) to increase the economic and physical size of small agricultural holdings by supporting collective forms of organising production; b) to introduce land reforms in conjunction with comprehensive consideration of tax law in this direction; c) to fund entrepreneurial plans contributing to the modernisation of farms and the reduction of production costs; and d) to enact the construction of public infrastructure and the provision of support advisory services, transferring knowledge and innovation at a regular basis.

The need to increase productivity on the basis not of labour intensity but rather of transferring research results and introducing new technologies and innovation in agricultural practices is also illustrated by the fact that in the EU proposal the new CAP includes the increase of funds for agricultural research through Horizon Europe (by and additional €10 billion) and the extension of the ERASMUS programme to the agriculture sector by doubling resources. At the same time, the EU proposal demonstrated its priorities on agricultural advisory services, training, digital transformation, and cooperation to promote innovation through Agricultural Knowledge & Innovation Systems (AKIS) and the European Innovation Partnership on Productivity and Sustainability of Agriculture (EIP – AGRI).

GIG: The Greek farming and agri-business sector could benefit from greater foreign investment, especially taking into account that there are several examples of companies (namely in the food sector) that have achieved significant market shares abroad. What, in your opinion, are the benefits of investing in the Greek agribusiness sector, and what type of investments would you like to see?

Voridis: Our strategy for the agri-food sector is a holistic and integrated approach that aims in creating sustainable and multifunctional links; building cross-sector ties between the primary sector and tourism, culture, and natural environment; and setting up new structures, mechanisms, and development standards that take advantage of the following things.

• An increased demand, especially abroad, for Greek traditional high-nutritional products and the need to establish processing and standardisation units to meet the requirements for their sale abroad;
• The possibility of exploiting the country’s renewable energy sources;
• The development prospect and extroversion of the Greek economy;
• The highly educated young people;
• The upward trend of tourism while integrating Greek products into the eating habits of tourists.

Tourism, culture, tradition, climatic conditions, variety and quality of agricultural products, gastronomy, the natural environment, landscape and biodiversity, rural heritage, and human capital are the comparative advantages of the country and its regions that can boost development and support policies that will serve the challenges of the post-2020 period.

In order to attract investments, we are also planning significant improvements at a governance, administrative, and coordination level, in the following directions:

• Simplifying procedures and the institutional framework (implementation of simplified cost methods, avoiding overlapped responsibilities between public services and institutions, rationalisation of procedures and audit framework, automatic public document searches, improvements to the funding process by central government, etc.);
• Planning the appropriate financial instruments to support investments in the primary sector and processing. These specific tools provided by the EU will facilitate investors’ access to financial sources, such as micro credits, guaranteed loans, co-investment, etc.;
• Adopting electronic and online e-applications for the submission, evaluation, approval, monitoring, and payment of projects, as well as interconnection with other supporting public e-services, leading to substantial time-saving for beneficiaries and management bodies in implementing co-financed programs;
• Developing synergies with other agencies, ministries, and organisations, and cooperating to promote the adoption of best practices, new technologies, and innovation.

The aim of the above initiatives is to create an attractive investment framework that promotes the effective coordination of policies at all levels, along with strategy, policy, planning, implementation, and control through a properly organised staffing and control function of the Ministry of Rural Development and Food, supported by services from decentralised agencies and authorities as well as from the private sector.

GIG: What are the latest trends emerging in farming, in terms of production techniques and products produced? The medical cannabis industry is taking off thanks to a bolder, more innovative approach to farming. How do you see this evolving? Can we expect any other reforms like this that can help move the sector forward?

Voridis: Of particular interest are production techniques and products that respond to the needs and requirements of consumers, to the modern trends and desires for healthy, safe, certified, quality, innovative, and environmentally friendly products. Also of interest are production techniques and products that are produced not only for food and diet, but also for cosmetics, medical care, or other uses.

Cannabis is an example where we expect significant investments.

Investments of relevant interest could be made in areas such as renewable energy, greenhouses, high-tech nutrition, the bioeconomy, the circular economy, and cultivations/production techniques adapted to climate change, etc.