Improving farming and knowledge systems in CEE by CEESA

Stjepan Tanic
Farming Systems Development Officer, SEUM, Budapest

Are farming systems in the EU and CEE changing towards the same target?
Why do we need CEESA?
References

Starting points and chosen ways of transition in CEECs differ from country to country. The same applies to the progress in achieving objectives toward market based agriculture and farming. There has been little difference between one country and another in terms of what needs to be done. However, there are quite big differences when it comes to the pace of realization and the manner of implementation. At the beginning of the transition process, the most visible effect of the initiated reforms in agriculture was a sharp decline of agricultural output. Besides the deteriorating effect caused by the loss of previous markets and an inability to infiltrate new ones, another major reason for this decline was an inherited low level of productivity, which was further emphasized by a so called "spontaneous extensification"¹.
Since the beginning of the transition process in CEECs a set of reforms was prepared and implemented to create incentives for the agricultural sector to improve its efficiency and sustainability. One of the major issues facing policy makers concerns the promotion of efficient farm units. In some countries, like Poland and Slovenia, structural changes that occur are geared towards the enlargement of small family farms, whilst in a number of others the trends and objectives of agricultural policies are aimed at a decrease in the average farm sizes. Both processes have the objective of increasing economic efficiency by finding appropriate farm size in order to achieve the effects of economies of scale. Several of the initial tasks of transforming the inherited structure into market - and private ownership - based systems have not been fully resolved in some countries, such as land privatization, completion of land titling and registration and the restructuring and consolidation of the new farming units, etc.

Are farming systems in the EU and CEE changing towards the same target?

During the last few decades, the development of EU agriculture has been inter alia characterized by greater intensification, specialization and the enlargement of farm units. The increase in inputs and yields has been accompanied by greater specialization, with a huge reduction in mixed farming, and in particular a loss of traditional rotations. This previous farming and traditional rotations brought environmental benefits greater than those of the systems which have now replaced them. Such trends produce negative environmental effects, which need to be controlled to ensure the sustainability of agriculture.
Public concern about those negative effects has led to an increased demand for environmentally beneficial agricultural production methods, such as integrated production, traditional low-input farming and organic farming. Increased environmental awareness, combined with product surpluses and a low competitiveness on the world markets, have resulted in the introduction of appropriate policy measures and the promotion of a decrease in the intensity of production. With regard to the economic impact of decreasing the intensity of production, the following main aspects were noted:

in crop production, less intensive techniques affected yields and the resulting income loss was generally not compensated by a better price for a more healthy product of better quality;
farm management became more sophisticated and more costly due to the compulsory introduction of additional tasks (carrying a nutritive balance, setting up a manure balance, preparation of a farm environmental management plan, etc.);
the economic impact extensification measures entail has been immediate, while positive environmental effects are expected to appear in the long run; this has made state support inevitable, with the resulting need for budgeting funds for direct payments and price-independent subsidization.

European agriculture is now facing economic, environmental, political and social pressures which are forcing a fundamental reappraisal of agricultural production systems. Today farmers in Europe, particular in Central and Eastern Europe, are faced more and more not only with constraints originating from their micro and neighbouring environments, but with constraints that are generated on the macro level too. Among these, of particular importance are constraints related to the:

changes in the economic system and policies and pressures designed to increase competitiveness and profitability on domestic and global markets;
the need to assure the long term viability and preservation of existing natural resources in order to comply with new emerging requirements concerning access to international markets and by doing so, sustaining household food security.

Farmers in CEECs are now faced with a new political and economic environment, one which results in structural changes and a transfer of responsibilities and decision making to the farm level. The speed of this transfer depends not only on the implementation of national structural policies, but also on the development of support institutions as well as farmers' willingness and ability to manage new responsibilities. This is to say that not only will they enjoy the freedom, for instance, to decide what to produce and how to produce it (which they did not have before), but that farmers will also have to take responsibility for and bare the risk of, making those decisions (Table 1). To assure the sustainability of their farms, they will also need to adopt new, and in most cases, environmentally friendly technologies and practices.
Since the technical efficiency of natural resource use in CEECs is lower than in the EU in the short run, an attractive approach for both farmers and policy makers might be to boost production by increasing the volume of output per unit by applying conventional production technologies. Even if there was a market for increased production such an orientation would potentially lead to increased subsidization, not to mention the negative impact on the environment. A alternative approach would be to increase technical and economic efficiency at either the existing, or just slightly higher, level with regards to the use of production factors (inputs, labour, capital). Both approaches require a knowledge of existing and alternative farming systems and farm management principles and skills.

Table 1. Types of farm management decisions and responsibilities taken by governments and farmers in the transition to market economy farming*

	Before transition	Transition	Market economy
Government level decisions	producer prices structure of production quantity of production size of business marketing of products way of production (input mix) risk and responsibility bearing	macroeconomic, legislative and institutional support producer prices structure of production size of business marketing of products risk and responsibility bearing	macroeconomic, legislative and institutional support
Farm level decisions	way of production (input mix) risk and responsibility bearing	structure of production size of business marketing of products risk and responsibility bearing quantity of production way of production (input mix) adoption of new technologies	structure of production size of business marketing of products risk and responsibility bearing quantity of production way of production (input mix) adoption of new technologies

* Italics denote types of decisions that are made on both levels on a case to basis.

Even before the beginning of the transition process, environmental pollution problems caused by agriculture were waiting for a solution. They were caused by inappropriate and environment-damaging practices, and in some cases, a very high level of industrial input use. The resulting ecological damage was not mitigated by spontaneous extensification during the first stage of the transition period.
To ensure the effective transition to market-oriented agriculture, and also improved income opportunities and food security for the rural population, farming systems in CEECs will need to become more intensive but at the same time sustainable and diversified. These farming systems have to provide that:

farm productivity is sustained or enhanced over the long-term;
adverse impacts on the natural resource base of agriculture and associated ecosystems are minimized or ameliorated;
residues resulting from the use of chemicals in agriculture are minimized;
the net social benefit derived from agriculture is maximized;

Such farming systems could improve the well-being of individual farming families by increasing the overall productivity in the context of both private and social goals. They also need to be sufficiently flexible to manage risks associated with the variability of climate, markets and legislative and policy measures. To be able to design and to develop such farming systems, it is of paramount importance to have the appropriate knowledge about the environment (natural, social, economic, political) in which farmers operate in order to assist them in the adoption of appropriate production and management practices.

Why do we need CEESA?

The complexity of relationships within the individual farming systems, and the imminent interactions of those systems with their physical and social environment, require complex approaches to the identification of, and research into the causality of both their internal operation and their behaviour in the systems' surroundings as well. As the result of the conflict between short-term individual interests and the long-term objectives of societies in attaining sustainability, in most cases those relationships are not in harmony. In these instances, adequate solutions can only be identified in an interactive setting. Hence, networking emerges as a tool that can provide the necessary flexibility to address the dynamic changes of systems and their surroundings.
In the context of the globalization of research, production and trade, regional networks are becoming an effective tool for developing the capacity to deliver adequate knowledge to farmers and policy makers alike. Networking is becoming increasingly popular among researchers and professionals not only in developed, but also in developing countries. Governments and development agencies such as the FAO, together with members of the donor community, have been instrumental in promoting this form of regional cooperation. Several examples of regional networks related to agricultural research and development are presented in textbox 1.
Regional networking can also serve as the vehicle for information exchange. It is a cost effective way of collaboration between experts and practitioners, particularly for smaller countries, which may not have the necessary "critical mass" of human and financial resources needed to resolve the complex emerging issues they are faced with. Collaboration between experts from countries with different levels of development not only provides an opportunity for access to "state of the art" knowledge, but also contributes to the building of human capacity in less developed countries.
New initiatives and developments in Central and Eastern Europe (EU accession, globalization of environmental concerns, etc.) create the need to facilitate and strengthen collaboration between experts and institutions who are both interested and engaged in the issues of sustainable agricultural development. There are several reasons for this. First of all, there is a rapidly increasing demand for expertise in economic and institutional issues surrounding the evaluation of the environmental effects of agricultural systems and also in the design of schemes aimed to reduce their negative impacts. Because of the lack of an appropriate forum coupled with poor information flows, there have been limited activities in the sharing of information between countries. There is also the need to analyse the impacts of structural adjustment on farm incomes, the quality of the environment, rural development, trade and the functioning of world markets.

The Sustainable Agriculture Network (SAN)
http://www.sare.org/san/
"SAN is the communications and outreach arm of the Sustainable Agriculture Research and Education (SARE) programme. SARE is a U.S. Department of Agriculture-funded initiative that sponsors competitive grants for sustainable agriculture research and education in a regional process nationwide. SAN is dedicated to the exchange of scientific and practical information on sustainable agriculture systems using a variety of printed and electronic communications tools."

Farm-level Applied Research Methods for East and Southern Africa (FARMESA)
http://www.farmesa.co.zw/
"FARMESA is a regional collaborative initiative of Kenya, Tanzania, Uganda, Zambia and Zimbabwe, with Bostwana, Malawi, Mozambique and South Africa being Associate Countries. It is financed by the Swedish International Development Cooperation Agency (Sida) and executed FAO. The goal of this initiative is the improvement of food security, incomes and resource management of farming families, emphasizing innovative systems and participatory methods for identifying, testing and adapting small holder technologies. The concept of FARMESA is to develop methodologies and tools which allow field workers, researchers and policy makers to work with farmers and improve their standard of living."

The European System of Cooperative Research Networks in Agriculture (ESCORENA)
http://www.fao.org/regional/europe/activ-e.htm
"ESCORENA promotes cooperation in research, exchange of information and transfer of know-how and methodology advances, with clear sustainable development and socio-economic implications. These objectives are implemented through activities which include: a) collaborative research projects, b) network consultations, c) meetings and workshops of working groups and sub-networks, and d) documentation, proceedings and publication of network bulletins."

Textbox 1. Examples of regional networking for agricultural development

Taking into account all these concerns, the 21^st FAO Regional Conference for Europe confirmed that sustainable agricultural development remains a cornerstone of food security in the region, and that questions about the sustainability of agricultural systems in Central and Eastern Europe have been identified as one of the FAO’s priorities in Central and Eastern Europe.
Networking is also becoming another major model for providing answers and solutions to complex issues such as sustainability. Building on past FAO initiatives and experiences, by fostering cooperation between both researchers and those professionals from the EU and CEECs interested in sustainable agricultural development, it has been recognized that collaboration in the Central and Eastern European Sustainable Agriculture Network (CEESA)² has the potential to:

provide forum to stimulate collaboration and information exchanges between institutions and individuals interested in issues related to sustainable agricultural development within the agreed framework.
facilitate the design of recommendations and options for the building of country-specific approaches to the development of sustainable agricultural systems.
foster better integration with researchers and practitioners from Western and Central and Eastern Europe and help to plan and co-ordinate collaborative research projects.
enable higher visibility of research results in an international/global context and prestigious recognition of research activities.

Figure 1. The framework of CEESA

By providing a broad regional and professional framework together with a flexible structure, the concept of CEESA has the potential to respond to the complexity of themes related to the development of sustainable agricultural systems by enabling the interaction of its members on both a country and regional level (Figure 1.). As such, CEESA also has the potential to benefit other European countries and to have a multiplier effect through the generation of information relevant to policy formulation and technology development in member countries outside the region as well.
Given such a broad framework, there are a number of opportunities to address farming systems issues in the CEESA context. Unlike some existing but narrowly based networks, it could, for example, deal with on-farm and off-farm economic and environmental costs and benefits and not just crop output and ecosystem process matters. One possible approach would be to make studies concerning the needs and possibilities for the introduction of farm environmental accounting, which could be used to propose methodologies for the development of sustainability indicators and the introduction of farm-level environmental accounting.
The imperative need for improved farming efficiency in CEECs, combined with the requirement for the environmental neutrality of production systems, as well as household and country level food security, will most likely lead to the adoption and development of such farming systems which are at the same time intensive and sustainable. The process of the sustainable intensification of farming systems in CEECs is heavily dependent on the availability of multi-disciplinary expertise. In this context, CEESA can certainly have a catalytic role.
Technological changes along with the globalization of markets are transforming industrial countries into knowledge-driven economies. This shift away from resource-based toward knowledge-based economies is reflected in the promotion of contemporary approaches to farming systems development in industrialized countries too. The ability, skills and knowledge of the people who farm the land has been recognized as a major factor of efficiency. It is not enough that farmers have only the relevant information but also the knowledge of how to judge what is in their best interests. Therefore, to achieve adequate levels of agricultural productivity, quality, efficiency and profitability, farming systems in Central and Eastern European countries would need not only to be resource but knowledge intensive as well.

1.Spontaneous extensification refers to the decreased use of industrial inputs and investments in the beginning of the transition period that was not caused by deliberate and balanced extensification policies, but by unclear property relations, deteriorating terms of trade for agricultural enterprises, a lack of financing and insufficient management knowledge and also by a reduced domestic and export market demand for food (Budavari J. 1997).
2. A more elaborate concept of the "CEESA" project is provided in the paper by K. H. In the context of these proceedings, observations by the author may be considered as complementary to that paper.

References

Buckwell, A. & Kydd, J. 1998. Vision and Action for FAO Priorities for the European Region, Report prepared for the Europe Regional Representative for 21^st FAO Regional Conference for Europe.
Budavari, J. 1997. Economic and structural impact of changing (higher or lower) intensity in agriculture in pursuance of the goal of sustainable agriculture, Report of the Regional Workshop, Gödöllő, Hungary.
Csaki, C. & Nash, J. 1997. The Agrarian economies of Central and Eastern Europe and the Commonwealth of Independent States, Situation and Perspectives, World Bank Discussion Paper No. 387, The World Bank, Washington, D. C.
Commission of the European Communities. 1999. State of application of regulation (EEC) no. 2078/92: Evaluation of Agri-environmental Programmes, Commission working document - DG VI, http://europa.eu.int/comm/dg06/envir/programmes/evalrep/concl_en.htm.
Commission of the European Communities. 1999. Directions towards sustainable agriculture, Communication to the Commission to the Council: The European Parliament; the Economic and Social Committee and the Committee of the Regions, COM (1999) 22 final, Brussels, Belgium.
FAO. 1998. Report on FAO activities in the European region 1996-97, and actions taken on the recommendations of the Twentieth Regional Conference, 21^st FAO Regional Conference for Europe, Tallinn, Estonia, 25 - 29 May 1998.
http://www.fao.org/regional/europe/ERC/DEFAULT.HTM
FAO. 1999. Priorities for FAO activities in the European region, Draft proposal for 22^nd FAO Regional Conference for Europe, Rome.
Koutsouris, A. 1998. Networking for sustainable future: The case of developing agencies, Proceedings of third European syposium on rutal and farming systems analyses: Environmental perspectives, March 25 to 27, pp. 131-145, Stuttgart-Hohenheim, Germany.
Laroche, M., Merette, M. & Ruggeri, G.C. 1998. On the Concept and Dimensions of Human Capital in a Knowledge-Based Economy Context, Ministere des Finances du Canada; Division des Etudes Economiques et Analyse de Politiques, Ottawa Ontario Canada.

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