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Perspectives of the Moldavian Agricultural Sector by Using a Custom-Developed Analytical Framework

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  • Ștefan-Mihai PETREA

    (Faculty of Food Science and Engineering, Food Science, Food Engineering, Biotechnology and Aquaculture Department, “Dunarea de Jos” University of Galati, Domnească Street, no. 111, 800008 Galaţi, Romania)

  • Dragos Sebastian Cristea

    (Faculty of Economics and Business Administration, “Dunarea de Jos” University of Galati, Nicolae Bălcescu Street, 59-61, 800001 Galati, Romania)

  • Maria Magdalena Turek Rahoveanu

    (Faculty of Engineering and Agronomy in Brăila, “Dunarea de Jos” University of Galati, Călărașilor street, 29, 810017 Brăila, Romania)

  • Cristina Gabriela Zamfir

    (Faculty of Economics and Business Administration, “Dunarea de Jos” University of Galati, Nicolae Bălcescu Street, 59-61, 800001 Galati, Romania)

  • Adrian Turek Rahoveanu

    (Faculty of Management and Rural Development, University of Agronomic Sciences and Veterinary Medicine of Bucharest, 59 Marasti Blvd, 011464 Bucharest, Romania)

  • Gheorghe Adrian Zugravu

    (Cross-Border Faculty of Humanities, Economics and Engineering, “Dunarea de Jos” University of Galati, Domnească street 47, 800001 Galati, Romania)

  • Dumitru Nancu

    (Faculty of Economic Sciences, Ovidius University of Constanta, Ion Voda Street, no. 58, 900470 Constanta, Romania)

Abstract

Moldova possesses the largest area of farmland as a share of its total land surface, an advantage which should encourage economic development strategies oriented towards the agriculture sector. Government subsidies and agriculture loans have been used as tools for developing the Moldavian agriculture. However, considering the challenges generated by both climate change (the drought from year 2012 that affected 80% of farmland) and a difficult political situation (restrictions imposed by the Russian Federation on the Republic of Moldova’s agri-food imports and exports between 2013 and 2014), the country’s agricultural system ranks very low when it comes to agricultural production efficiency. The present paper analyses the performances of the agricultural sector and its impact on the Moldavian economy over a nine-year period (between 2008 and 2016), by using a custom-developed analytical framework based on a dataset containing 21 relevant indicators. The analytical framework generates various perspectives that can be used to elaborate an economic sustainable development strategy of the Moldavian agriculture sector. The development of the analytical framework is based on the dynamics of agriculture subsidies, agricultural loans, the agricultural sector’s gross domestic product (GDP) and gross value added (GVA), as well as the dynamics of agricultural production and production value, also considering the main crops belonging to the Moldavian agriculture sector. The results are presented as sets of mathematical regression models that quantify the relationships found between the relevant agricultural parameters and their impact on the economics of the agricultural sector. It has been identified that the agriculture sector has a considerable impact on the Moldavian economy, a fact revealed by the significant model between the agriculture GVA and total GVA and GDP. A significant, negative correlation model was identified between agriculture subsidies and agriculture loans, although a small percentage of Moldavian agriculture farms were subsidized. Strong correlation models were also identified between wheat and maize production and total agriculture production, emphasizing the importance of these two crops for the Moldavian agricultural economy. Grape and maize production values also generated a correlation model, emphasizing the market interconnection between these crops It can be concluded that the increase in value of governmental agriculture subsidies, as well as expanding their addressability in order to maximize the access possibility for a higher number of agriculture farms, are essential for the Moldavian agriculture sector’s future development, since considering the limiting value of and accessibility to subsidies, a direct correlation model was identified between governmental agriculture subsidies and agriculture GVA.

Suggested Citation

  • Ștefan-Mihai PETREA & Dragos Sebastian Cristea & Maria Magdalena Turek Rahoveanu & Cristina Gabriela Zamfir & Adrian Turek Rahoveanu & Gheorghe Adrian Zugravu & Dumitru Nancu, 2020. "Perspectives of the Moldavian Agricultural Sector by Using a Custom-Developed Analytical Framework," Sustainability, MDPI, vol. 12(11), pages 1-40, June.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:11:p:4671-:d:368659
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