1. Subsidies in Agriculture and Rural Development in 2016 Unit for Analytics and Statistics Sector for Agricultural Policy

2. Legal basis The Law on Subsidies in Agriculture and Rural Development OG RS No 10/13, 142/14, 103/15 Defines the types of subsidies in agriculture and rural development, eligibility requirements, beneficiaries, use of subsidies and minimum amounts per subsidy. The Regulation on the Allocation of Subsidies in Agriculture and Rural Development in 2016 OG RS No 8/16 Defines the amount of the funds, the types of subsidies and maximum amounts per subsidy for 2016. Based on the Law on Subsidies in Agriculture and Rural Development and the Law on the Budget of the Republic of Serbia in 2016.

3. Subsidies in 2016 DIRECT PAYMENTS RURAL DEVELOPMENT MEASURES CREDIT SUPPORT SPECIFIC SUBSIDIES Basic subsidies for plant production Investments in agriculture for competitiveness improvement and quality standards achieving Subsidizing a part of interest rate Subsidies for implementation of breeding programs, in order to achieve the objectives in livestock production Input subsidy on fertilizers Subsidies for sustainable rural development Subsidies for implementation of scientific research, developmental and innovative projects in agriculture Milk premium Subsidies for rural economy improvement Subsidies for production of planting material, certification and clone selection Subsidies for quality breeding animals Subsidies for support of advisory activities in agriculture Subsidies for cattle, lambs, kids and pig fattening Participation in the financing of IPARD measures Subsidies for suckler cows Subsidies for beehives Subsidies for consumable fish Recourse for storage costs in public warehouses

4. Funds for subsidies in 2016 Budget of the MAEP in 2016: 40,5 bill. RSD Net funds for subsides: 19,6 bill. RSD  about half of the MAEP’s budget Significant reduction of subsidies in 2015: for 33%; Insignificant increasing in 2016: for 0,4%

5. Allocation of funds for subsidies in 2016 DIRECT PAYMENTS17,0 bill. RSD RURAL DEVELOPMENT MEASURES1,8 bill. RSD SPECIFIC SUBSIDIES233 mill. RSD CREDIT SUPPORT600 mill. RSD TOTAL19,6 bill. RSD  Changing in subsidies classification in 2016 due to harmonization with the CAP schemes.

6. Allocation of funds for subsidies in 2013-2016

7. Direct payments

8. Basic subsidies for plant production Aimed on yields increasing through improvement of agro technical measures. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. Right on subsidies are related with area covered by certain crops and declared in the Farm Register. The amount per unit: 2.000 RSD/ha Input subsidy on fertilizers Designed to help reducing the production cost by decreasing variable costs. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. Right on input subsidy on fertilizers is related with the same area for which can be used right to the basic subsidies for plant production. The amount per unit: 2.000 RSD/ha

9. Milk premium Aimed on increasing milk production and trade redirecting into "legal" distribution channels, as well as creating conditions for stable supply. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered agricultural holding. Milk premium is paid for delivered (to dairies) cow, sheep and goat raw milk. At least 3.000 liters of cow milk shall be delivered quarterly, or rather at least 1.500 liters in area with difficult working conditions in agriculture. The amount per unit: 7 RSD/l Subsidies on suckler cows Has a purpose of increasing the number of cows, developing cow-calf system and meat production improvement. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. Subsidies shall be granted per cow for pure breed fattening cattle that belongs to a herd intended for calf breeding for meat production. Beneficiaries cannot deliver milk from their holding for further processing for a period of 12 months. The amount per unit: 20.000 RSD/head

10. Subsidies on quality breeding animals Aimed to improve livestock production through improving quality of breeding heard. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. Animals shall be registered on the agricultural holding and to be under the supervision of breeding organizations. The amount per unit: –Quality breeding dairy cows: 25.000 RSD/head –Quality breeding fattening cows: 25.000 RSD/head –Quality breeding sheep and goats: 7.000 RSD/head –Quality breeding sows: 7.000 RSD/head –Parental heavy type hens: 60 RSD/head –Parental light type hens: 100 RSD/head –Parental turkeys: 300 RSD/head –Quality breeding nuts of carp: 500 RSD/head –Quality breeding nuts fish trout: 300 RSD/head

11. Subsidies for cattle, lambs, kids and pig fattening Designed to increase production of beef, lambs, kids and pork and to stabilize the sector. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. Animals shall be intended for meat production and delivered to a slaughterhouse or exported. The amount per unit: –Cattle fattening: 10.000 RSD/head –Lambs fattening: 2.000 RSD/head –Kids fattening: 2.000 RSD/head –Pigs fattening: 1.000 RSD/head Subsidies for consumable fish Aimed to improve consumable fish production. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. The amount per unit: 10 RSD/kg of delivered fish

12. Recourse for storage costs in public warehouses Designed to stimulate producers to store their products in public warehouses and place goods on market later on higher price. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. The amount: 40% of storage costs Subsidies for beehives Aimed to improve production in apiculture. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. Beehives shall be marked and registered in the Central Database. The amount per unit: 600 RSD/beehive

13. Rural development measures

14. Investments in agriculture to improve the competitiveness and achieve quality standards Aimed in improving the competitiveness of agricultural primary production and processing. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. Subsidies are intended for: 1.Investments in agricultural production: –Support for establishment of new permanent crops plantations of fruits, grapevines and hops –Support for primary agricultural production improvement 2.Investments for processing of agricultural products and marketing: –Support for vine and brandy quality improvement –Control stamps for agricultural and food products and wine –Purchasing of equipment in meat, milk, fruit, vegetables and grape sectors 3.Recourse for insurance premium for crops, permanent crops, nurseries and animals Level of support: –Investments in agricultural production and Investments for processing of agricultural products and marketing: 40% of measure value (55% in areas with difficult working conditions); 50% of measure value for users of PGI and PDO and certified organic producers (65% in areas with difficult working conditions) –Recourse for insurance premium for crops, permanent crops, nurseries and animals: 40% of insurance premium (45% in areas with difficult working conditions)

15. Subsidies for sustainable rural development The goal is to ensure sustainable rural development through improvement of organic production and preservation of plant and animal genetic resources. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding. Subsidies are intended for: 1.Organic production 2.Subsidies for conservation of plant and animal genetic resources Level of support: 40% of measure value (55% in areas with difficult working conditions) Subsidies for organic production are related with milk premium, basic subsidies for plant production, subsidies for livestock production and input subsides for fuel/fertilizer/seeds, increased for 40% (55%).

16. Subsidies for rural economy improvement Aimed to improve the quality of life in rural areas. Beneficiaries: any legal person, entrepreneur and natural person – a holder of registered commercial agricultural holding and local self-government unit and association. Subsidies are intended for: 1.Subsidies for improvement of economic activities in villages though non-agricultural activities support 2.Subsidies for economic activities in terms of adding value to agricultural products, as well as introduction and certification of food safety and food quality systems, organic products and products with geographical indications 3.Subsidies for improvement of trainings in area of rural development Level of support: 40% of measure value (55% in areas with difficult working conditions), except for Subsidies for improvement of trainings in area of rural development (100% of measure value).

17. Subsidies for support of advisory activities in agriculture Designed to support advisory and extension services in agriculture. Beneficiaries: any legal person, entrepreneur or organization, that meet the requirements prescribed by the law governing the provision of agricultural advisory and extension services. Obligations of advisers of AES: to provide advice, recommendations, services and assistance to producers applying individual and group methods through the mass media and press releases, to do data collection and dissemination as well as to implement other activities. Level of support: 100% of measure value. Participation in the financing of IPARD measures Based on obligation of the Republic of Serbia to ensure funds for co-financing IPARD funds (25%). Defined by the Sectorial Agreement between the Government of the Republic of Serbia and the European Commission

18. Credit support

19. Subsidizing a part of interest rate Aimed to provide access to credit funds for financing agriculture under more favorable conditions by subsidizing a part of interest rate. Beneficiaries: any natural person – a holder of commercial agricultural holding, entrepreneur and legal person (association with at least 10 members; classified as micro or small legal person). Purposes of credits: 1.development of livestock production 2.development of crop, fruit, grape, vegetable and flower production 3.investments in agricultural machinery and equipment Level of support: interest rate, which is equivalent to the reference interest rate of the NBS, shall increase for: –2 percentage points and decrease for 6 percentage points for credits with repayment period from1 to 3 years; –2 percentage points and decrease for 4 percentage points for credits for development of livestock production with repayment period from1 to 3 years; –3 percentage points and decrease for 6 percentage points for credits with repayment period up to 1 year; –3 percentage points and decrease for 4 percentage points for credits for development of livestock production with repayment period up to 1 year.

20. Specific subsidies

21. Subsidies for implementation of breeding programs, in order to achieve the objectives in livestock production Aimed to improve livestock production and genetic quality through the enforcement of breeding programs. Beneficiaries: breeding organizations engaged in livestock production and organizations with special authorization for performing activities in livestock production in accordance with the law governing livestock production. Purposes of the subsidy: –control of productivity of breeding and quality breeding farm animals; –selection and production of breeding and quality breeding farm animals; –selection and use of quality male and female breeding farm animals for production; –research of characteristics transfer from quality breeding farm animals to progeny; –controlled reproduction of farm animals; –keeping the main record of farm animals; –production and introduction of other breeds and newly-formed breeds and hybrids of farm animals into production; –other breeding and zoo-technical measures.

22. Subsidies for implementation of scientific research, developmental and innovative projects in agriculture Designed to improve scientific research in area of agriculture and rural development as well as promotion of agriculture. Beneficiaries: natural persons – holder of commercial agricultural holding and entrepreneurs, as well as scientific and research institutions and legal persons that meet the requirements prescribed by the law governing the provision of agricultural advisory and extension services. Purposes of the subsidy: 1.Measures and actions in agriculture: promotion of the scientific achievements, organization of scientific conferences, business events, agricultural fairs and events in the field of cultural heritage, improvement of the working conditions of agricultural producers, promotion of domestic products, agricultural producers and area of production, as well as organization of seminars, workshops, materials, etc. 2.Improvement of professional knowledge and permanent education of human resources Special programs are focused on farm management, sales improvement, rural development, strategic planning and programming at the local community level and upgrading small farms.

23. Subsidies for production of planting material, certification and clone selection Payments for raising mother plantations of fruit plants, grapevine and other crops, as well as procurement of equipment, technical means, planting material, maintenance of collections with an aim to certify planting material and clonal selection of varieties of fruit plants, grapevine and other crops. Beneficiaries: legal persons and entrepreneurs that meet the requirements in accordance with special regulations governing the production of planting material.

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