St. Arachovitis: «We have the image of a perfect storm in the primary sector.»

In the plenary session of the House of Representatives for the discussion of the Ministry of Finance's bill entitled “Incentives for business development through partnerships and corporate transformations”, on Tuesday, May 24, the Minister of Rural Development and MP of Laconia of SYRIZA-PS St. Arachovitis.

By way of introduction, the MEP referred to the fact that Greek society is experiencing unprecedented economic pressure, which has two characteristics at the same time: accuracy, which has spread not only to energy but also to basic livelihoods and the total lack of liquidity both producers and small and medium-sized enterprises and households.

Mr.Arachovitis stressed that farmers, stockbreeders and fishermen have two qualities at the same time. On the one hand, they are consumers themselves and on the other hand they are producers. Therefore, they are doubly affected: by precision, where official inflation has reached 10% for April, a record high for the last 28 years, and by the increase in production costs.

«There are large increases in feed, in some cases exceeding 100% by category or region, particularly in remote islands and mountainous areas.  It is not the war in Ukraine that contributed to the increase in production costs. We have had increases in feed and energy for a year now. In fertilisers the increases are even worse, as some fertiliser categories, notably nitrogenous fertilisers, have passed 250%. If you factor in the increase in labour costs due to shortage of land workers, as we have repeatedly pointed out to you through parliamentary scrutiny, which is largely due to the Government's ideologies, we have the picture of the perfect storm in the primary sector, underlined among others the Minister.

Continuing, Mr.Arachovitis said that the reduction of VAT on animal feed from 13% to 6% without a corresponding reduction in sales, has finally turned into a noose for producers, while he also referred to the extraordinary support of the entire livestock sector with just 50 million euros, when in 2018, without this precision crisis, 44 million euros were given to support only sheep and goat farming, in the form of de minimis.

Elsewhere in his speech he pointed out the following: «A typical example of the situation that exists today in the livestock sector is the cry of anguish from the Naxos Agricultural Association. We have the emblematic product of Naxos Graviera, which is a P.O.P., and soon there will be no raw material for the creation and sale of this emblematic product. Despite the fact that this model cooperative venture has made many efforts, has provided equity loans to producers, has brought in livestock from abroad, yet at the moment it cannot find milk to produce the famous Naxos gruyere.

The same is the case in Laconia where the estimated livestock reduction has exceeded 20%. This is about reducing livestock, not reducing the quantity produced, because when animals are malnourished, production is even lower.».

The second major issue according to St. Arachovitis is that of liquidity. «The banking sector for the primary sector has turned off the taps. But already in 2019, we created a serious financial instrument, the Agricultural Guarantee Fund. It is still dormant. This fund has a capacity of €480 million. ΤLoan requests so far stand at €142 million and approvals are only €10 million. Out of a possibility of 480 million, only 10 million have been granted over the years, in unprecedented situations for our country, with a ready-made instrument. How can the Southwest government claim to love investment when Measure 4-2-1, which has included investment projects as early as 2019, has not yet paid off? The companies included in 4-2-1, the PAA measure, which have implemented the project and are waiting for their money, are at risk of bankruptcy.».

In conclusion, the Minister for Agriculture, Agriculture and Rural Development. Development of SYRIZA-PS referred to the Prime Minister's statements saying: «When Mr Mitsotakis talks about a holistic approach to life without regard to income, it is not by chance. He has done it before. It is a continuation of his previous statements that there are people who are dependent on their salary. So these statements come in a logic that devalues the productive forces of this country.

The stakes are twofold: firstly, the survival of producers and secondly, the continuation of production in our country. In this context, the organisation of producers into collective groups is purely a matter of survival. As a state, we have to provide strong incentives for producers to participate in collective organisations and at the same time strengthen the institutional framework in order to remove their fears and reservations.».