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Tuesday 22.08.2017 | Name days: Rudīte, Everts

LOSP: more and more young people living in rural areas see development opportunities

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUYoung people in Latvia are beginning to see development opportunities in living in rural areas. Niche products provide Latvian farmers the opportunity to strengthen their positions. It is even further improved by the quality of Latvia’s soil in comparison with other EU member states, as it was told BNN by Chairman of Latvian Agricultural Organization Cooperation Council Edgars Treibergs.

What are the most important recent events in your industry?

Because LOST performs functions of a ‘roof organization’, because we represent the interests of 59 member organizations, the list of the most important events is rather long. This is because every single of our organizations has its own important events.

In a horizontal perspective, the most important events include the matters regarding grains and dairy farming. This also includes the situation with the damage that has been done to winter crops by this year’s black frost. The most important issue for dairy farms to tackle this year is the construction of manure silos that would comply with EU requirements.

Can you say economic conditions are improving and there is a lot of potential for economic growth in the market?

We do feel the improvement of the economic situation, but not in all areas. There are certain differences among farm segments based on their size. The situation depends not just on the abilities of farms, but also on the state policy and plans on the kinds of farms and agricultural structure we want to see in the country. If we look at it from a realistic perspective, our areas are as big as they are. We need to finally come to terms with the fact that Latvia will never be a world-class exporter. We are as big as we are. Our only trump card is the quality of our soil in comparison with other EM member states. With that, we can still improve our positions by means of production and niche products with higher added value.

How would you describe the government’s economy policy aimed at improving the economic situation in the country?

There are many matters that remain part of documentation. Everyone sees which industries make the most money and are able to develop successfully. Others remain ideas. Even though ideas are often good, they are often delayed in their early development stage. This is because economic regulations and economic policy often cannot provide for proposed development directions. There are often instances when regulations provide generous support mechanisms for sectors that do not require aid. This is why it is much more important to evaluate directions that require subsidies and whether or not it complies with the country’s development direction and goals, especially when residents are expected to fund the development of different industries.

How is the industry affected by Latvia’s policy? What changes to legislation would you like to see? What helps? What makes things more complicated?

Agriculture is a risky form of business. Any form of business has its risks. However, agriculture has additional risks that can impact business – yield and poor crop years. These risks are affected by factors outside of human ability – climate, temperature and other weather factors. Flaws in legislation also play a major role. One other important point that can impact the situation is VAT reduction on food products. It may be initially applied to products that have begun going bad. Other food product categories can be added later for other food products as well. This principle has been working in the EU for some time now.

How would you describe the industry’s position in the Baltic market? What about competition with Estonia and Lithuania?

I do not believe we are big players in the context of the EU market. In terms of the Baltic market, however, Latvian producers have rather stable positions. We have plenty of competitive companies and high-quality goods to offer. We cannot compete with big volumes. But we can offer niche products – this is where we are competitive the most.

What can you can your ‘trump card’? What is your ‘Achilles’ heel’?

The trump card of our industry is the quality of our soil. In the rest of Europe, where agriculture is very intensive all year round, it is a big problem. Secondly, the ability of our farmers to do more with lower than average EU subsidies and become more competitive in comparison with EU countries with high subsidies.

Lower direct payments remain our industry’s Achiless’ heel. This makes us less competitive and makes the situation unequal in regard to other EU states.

Can you say there is a lack of skilled workers in Latvia?

Speaking of lack of skilled workers, the situation is such that there is such a lack, and the industry suffers from it. It is possible that young people simply do not want to study agriculture-related subjects and work in the sector that is largely inherited from Latvia’s history. There is still a high degree of negativity in the thought of living and working in the countryside. However, more and more often we see how many young people understand how hard live in the countryside is, but nonetheless find their niche and development opportunities.

We need to consider sorting out our country’s education system, so that school programmes are sufficiently innovative and it is more interesting for young people to study and consider agricultural education.

What do you predict for the next five years? With the economic situation in the industry improve, worsen or stay the same?

Considering the aforementioned factors and conditions, it should be concluded that the situation may yet improve, because people will always need food. Another important factor is that everything in the world continues to develop; this includes technology and infrastructure, which notably affects the development of the countryside environment. Food products produced by domestic farmers continue to grow in popularity in Latvia and the rest of the world. And there is no reason for this trend to decline.


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