Agriculture Sector Reform in the Baltic Republics

This paper looks at the agriculture sector in the three Baltic republics, i.e., Estonia, Latvia and Lithuania. It highlights current problems, the emerging private family farmers, the restructuring and reform process in agricultural production, issues in environmental protection, marketing of agricultural products, education and training of farmers, the development of extension services, employment effect of agriculture, etc.

The primary objective of this study is to, firstly, present an overview to the present state of the agricultural sector in all three Baltic republics and highlight areas that are of primary importance and need urgent attention, and, secondly, to point out areas that need to be studied more thoroughly.

Successful reform in the Baltic agricultural sector needs active government participation. Agriculture is quite unlikely to be sustainable in the Baltic states, nor in any European country for that matter, without proactive government agricultural policy. The relatively low price and cost structure in the Baltic states, which is very likely to be temporary nature, gives false expectations about the international competitiveness of the sector. The newly emerging and reforming agriculture sector needs protection from foreign imports. Governments should also support the agriculture sector with other policies. Which subsidies to use and when it is appropriate to use them depends on what the key agricultural policy goals are.

Farmers’ Union should take a more active role. So far the Union’s program have unfortunately, been incomplete and rather ambiguous. Interest groups should speak out their demands and give clear suggestions for policy programs.