A comparative analysis of regional agricultural enterprises in Romania and Germany as a basis for developing possibilities of an effective EU subsidy policy on a regional level

Abstract

The aim of this thesis was to provide a thorough insight into the European funding policy and the Common Agricultural Policy (CAP) in particular. In addition, it should be examined to what extent the CAP ensures effective funding at the regional level based on the needs of the local farmers there and to what extent adjustments would be necessary to ensure the implementation of a common and sustainable European agricultural policy, as well as to enable small and medium-sized farms in particular to facilitate potential for development in the current process of concentration. The thesis offers a comprehensible insight into the current European funding policy with its goals, challenges and processes. The structure and development of agricultural subsidies, the current financial instruments and the characteristics of the application, award and control processes are explained and summarized. Furthermore, major undesirable developments in CAP and their associated effects on the agricultural market and European society are emphasized in detail. Especially, the effects on the labour market, the animal welfare, the development of land prices, the biodiversity, the health, climate, soil and water protection, the world trade and the market exit of small and medium-sized farms are highlighted. Case studies and the evaluation of statistical data describe the comparative situation of the German and Romanian agriculture in just as much detail as the system comparison of the CAP with the comparable conditions of the US agriculture. The effects of subsidies or changes of subsidies and their characteristics on farms and the associated procurement and sales markets are examined in detail and the respective developments are reviewed. The evaluation of two surveys with the same content in the regions of Westmünsterland and in the Banat near the city of Timisoara provide a detailed basic assessment of the current CAP and enable conclusions to be drawn about necessary adjustments. It was examined whether and to what extent the predatory competition takes place at the expense of small and medium-sized farms. It was crucial to answer the question of whether and to what extent the displacement of small and medium-sized farms is caused by subsidies for large companies. Furthermore, an in-depth, comparative analysis of the two survey regions was carried out and the influence of subsidy payments on key success and competitive factors in agriculture was examined, as well as a discussion of possible alternatives to subsidy payments for strengthening these factors. The current degree of digitisation in agriculture in comparison to industrial digitisation as a whole was presented and the importance of an advancing digitisation for the future survival on the market was examined. The results of both surveys and of the analysis concerning the current state of digitisation in agriculture finally offer predefined starting points for future research. Five thought models were briefly outlined and qualitatively assessed concerning to their feasibility.