• 2004-05-13
Agriculture is, in a sense, a world unto itself, existing according to its own logic and laws. For Europe, agriculture is a perennial headache, devouring up to one-half of the EU budget. Try fiddling with farmers' subsidies, and you'll have trucks blocking the motorways and mounds of manure on the steps of parliament.

For the Baltics, agriculture represents sacrosanct traditions that penetrate the soul of the Baltic peoples. Yet at the same time it represents astonishing backwardness. And how it develops next in large part depends of government leadership.
The statistics tell the story. In Latvia, the agricultural sector accounted for 2.9 percent of gross domestic product in 2002, yet it employed 112,000 people, or 11.4 percent of the country's workforce. (Amazingly, just five years previous, in 1997, some 187,000 people worked in the agrarian sector.) Thus the resulting productivity factor - the relation between the sector's share in GDP and the share in overall employment - is 0.25. For comparison, the same factor was 0.4 in Lithuania, 0.77 in Estonia, while in the EU15 it averaged 0.5 in 2002.
Latvia, in short, has too many small farmers. As does Lithuania, and to some extent, Estonia. Lithuania is implementing a program to wind down elderly farmers' operations, and the application process is still underway. According to the Latvian Economy Ministry, the key strategic goal is "to transform agriculture into a sector able to fully satisfy domestic demand and integrate in the common European market and produce goods corresponding to world market requirements."
In other words, Latvia's agrarian sector needs larger farms and more specialization. True, these processes are already underway and will continue unhindered, but as the article "Life in the Union More Difficult for Some" points out, the "Eurocracy" farmers are now facing has them scratching their heads. If the new forms, applications and accountancy rules aren't intimidating enough, there are specific production requirements that will ultimately bury thousands of farmers. But these are the rules that Latvia, as well as Estonia and Lithuania, chose to live by once they joined the union, and now they must make the best of it.
Though far less temperamental than their French colleagues, the hundreds of thousands of Baltic farmers comprise a tremendous political force whose lives, perhaps more than all others, are destined to change dramatically now that are part of the European Union. Nevertheless, Lithuanian farmers showed they were capable of action when they blocked the borders last year while demanding increased subsidies. To prevent similar spillovers of provincial angst, the Baltic governments must work overtime to guide farmers through the maze of new rules and regulations. A lot of pain and hardship will be alleviated if they do. And that is the most honorable of goals.