Italy to boost aid to agriculture - Brief Article

Eurofood, Sept 27, 2001

The Italian government plans to pump in a massive Lit1 000bn (516m [European Dollar]) in a move to give a new boost to its agricultural sector. Tax cuts and other incentives will be used to increase production at a time when farms are disappearing at a fast rate.

Agriculture minister Giovanni Alemanno announced that financial assistance would be extended in a variety of areas, including irrigation projects, fighting forest fires, repairing flood damage, and improving the quality of products.

The aid will be incorporated in next year's budget.

"We are also studying changes in fiscal issues and VAT on some products," the minister noted. "What the sector needs above all is political guidance, a national point of reference. With weakness, one suffers within the EU and other international forums."

His comments came along with reports from the Institute of Agrarian Economy that the south of Italy, which is mainly agricultural, is facing a serious drought. Output of some products (tomatoes, for instance) could slump by as much as 40-50%.

In addition, farmers are shying away from products needing irrigation.

Meanwhile, the national food association, Federalimentare, reports that growth in the food sector was a mere 1.1% from May 2000 to May 2001, marked by declines in dairy products (2.1%), fish (4.4%) and the key fruit and vegetable processing sector (2.6%). The drinks industry went up by 7%.

Italy is being forced to produce more, better quality food in a competitive global market, from fewer farms. The National Statistics Institute put the number of agriculture units at 2 611 580 at the end of 2000, a loss of 411 764 farms.