Resource information
Economic progress in Macedonia has been
variable and slow during the last 10 years. This slow
progress is attributable to the succession of political and
economic shocks, and the failure to complete economic
reform. Agriculture is an important sector in the Macedonia
economy, with production and processing contributing around
18% of GDP. As a small economy with a structural deficit in
most food commodities, agricultural trade is essential for
Macedonia. Current agricultural trade policy, however,
constrains agricultural trade. Most Macedonian imports are
covered by free trade agreements under the Stabilization and
Association Agreement and with regional trading partners.
Direct support for agriculture derives from the budget of
the Ministry of Agriculture, Forestry and Water Economy, and
the activities of the State Office for Commodity Reserves
(SOCR). Budget support is minimal due to the severe current
fiscal restrictions. Most support comes from SOCR, through
its purchases of wheat and tobacco to maintain official
floor prices. Macedonia has 1.28 million ha of agricultural
land, about half cultivable and half pastures. All socially
owned land was nationalized in 1993. Existing irrigation
schemes have been reduced from 40% to 13%. The state of the
country's irrigation system is poor and crop damage
during the variable summer dry period is prevalent. Produce
quality suffers from lack of needed infrastructure
supporting post-harvest treatment and packing. The priority
areas for agriculture, the expansion of production, and
increase in productivity, require that resources be
available to efficient private producers, including
efficient small ones, and a processing and marketing chain,
so that they can expand in areas where they are competitive.
This will require a comprehensive restructuring of
government policies and support.
